HC Deb 07 August 1860 vol 160 cc885-93

Resolution 13 [6th March] (Malt Duty) further considered.

Motion made, and Question proposed, "That this House doth agree with the Committee in the said Resolution."


rose to move that the Resolution, with respect to the duty on the importation of Foreign Malt should be recommitted. The lion, and learned Gentleman said, that the main point then at issue was whether the duty on foreign malt should be 25s. or 26s. a quarter. He had to observe that that was not a question arising out of a treaty with France. This was a question in which France took no interest at all, for the French were not large manufacturers of malt. But whether it was a question arising upon the treaty, or a question of policy with Her Majesty's Government, the result of the Resolution passed by the House of Commons would be the same. The point to be decided was whether, consistently with the principle adopted last night with reference to paper, the Government should add 3s. per quarter only to the Excise duty now payable on malt, or whether, in justice to the English maltster, they should not add 4s. per quarter. lie would, however, first consider the relative positions of the English and the foreign producers. It was, he admitted, impossible to arrive at anything like certainty in a computation of the expenses of manufacture. [Hear!] He regretted to hear that cheer, because, if the questions were one of doubt—if it was impossible to arrive at any certainty with reference to what would be necessary to equalize the condition and satisfy the rights of both parties, surely upon this first experiment being made, taking into consideration the fact that it would affect so materially the price of beer—that single, solitary luxury of the poor mart—it would become the Government to resolve that doubt in favour of the trade and of the poor labouring classes, who were so deeply, though indirectly, interested in the question. Ho would take the price of malt at 42s. per quarter. Then came the first difficulty—what were the expenses of the manufacture of barley into malt? He had endeavoured with his utmost ability to arrive at this expense, and lie believed he could state it without exaggeration at 4s. per quarter; it ranged from 3s. to 4s. 6d., but the average was 4s. per quarter. The average cost of conveyance from the place of manufacture to the nearest market town—a charge which of course varied with the distance to be got over—he found to be 2s. 6d. per quarter. Adding these amounts—42s., 4s., and 2s. 6d.—together made 48s. 6d., and that, according to the best information he could obtain upon the subject, was the absolute cost of production to the English manufacturer irrespective of duty. Now how stood the case with respect to the cost of production to the foreigner? He could safely say he was understating the figures when he said that the price of barley in Belgium, Denmark, Sweden, and the North of Germany was from 2s. to 3s. per quarter less than in this country. The difference in the cost of malting were striking; the price of labour for that purpose being in those countries scarcely one-half of what it would be in England. In no case did it exceed 2½francs, or 2s. per quarter. The cost of conveyance to this country was extremely moderate, not exceeding Is. 6d. per quarter, and therefore, taking the primary cost of malt abroad at 40s., it could be imported into this country at 43s. 6d. per quarter. Quite independently of all duty, there was at least a difference of 5s. against the British manufacturer, so that the same article produced in England would cost at least 48s.6d. Surely such a prodigious difference as this alone would induce Her Majesty's Government to determine the question of the shilling in favour of the British manufacturer. He then came to the question of duty, which, to avoid fractions, he would take at 22s. He had understood the right hon. Gentleman the Chancellor of the Exchequer to state that he proposed an additional duty of 3s. per quarter on foreign malt, principally from the consideration that, whereas the foreign importer was permitted to keep his malt in bond without, paying duty, practically until he sold it, the English manufacturer had, in most cases, to pay the duty, even more than six months before he sold his malt, and therefore suffered a disadvantage to which the foreigner was not subjected. But beyond that there was this consideration, that whereas the foreign maltster had no Excise duty to pay at all, was liable to no restrictions or limitations in manufacture, might make large or small quantities at any time or in any season, might sell immediately or keep his malt in bond for six, nine, or even twelve months, and, in fact, might deal with it as he chose, export it at his pleasure without duty and free of expense; on the other hand the British manufacturer was exposed to a series of difficulties which, if not actually money, were money's worth, and really added to the value of the malt the entire amount—namely, Is., which he (Sir FitzRoy Kelly) hoped to induce the right hon. Gentleman to add to his present proposition. But the paramount consideration was that in this country the duty was paid long before the malt was sold, and it amounted to upwards of £2,000,000 per annum. He did not hesitate to call this a forced loan, under the law as it existed, by the maltster to the Government. It was a well known fact that it was during the winter months only, from November to April, that malt was permitted to be manufactured in England. Therefore, according to the short credit now given, the duty upon the whole would be paid, he would assume, on the 30th of June. But seven or eight months would frequently elapse before the maltster sold his malt. It was not simply the loss of interest, though that was something considerable, of which the maltster so much complained; but it was of the still greater loss caused by the want of capital which he could be employing in the extension of his trade, and the consequent reduction of annual profits. But there was this further point to which he desired to direct the attention of the right hon. Gentleman. Foreign barley actually paid the extra shilling per quarter. Why, then, should not foreign malt be similarly taxed? It seemed to be a most inconsistent variation, malt being only barley in another state. He was sure the Government could only desire to do what was just and fair. The question at issue was of no consequence whatever to foreign manufacturers of malt, but it was of the last importance, as he was informed, to the British producer. It should be recollected, moreover, that malt entered largely into the manufacture of beer, and as beer was the poor man's only luxury he hoped the Chancellor of the Exchequer would see that in the question of the duty upon foreign malt the labouring classes were almost as much interested as the British maltsters themselves.

Amendment proposed, to leave out from the word "That" to the end of the Question, in order to add the words "the said Resolution be re-committed."

Question proposed, "That the words proposed to be left out stand part of the Question."


said, there were one or two points he really did not understand in the hon. and learned Gentleman's speech; for, having made a pathetic appeal in the interest of the poor man as the principal consumer of beer, he (Sir FitzRoy Kelly) had strangely enough from that fact deduced an argument in favour of raising the duty payable on the material from which beer was manufactured. Then another observation to which he had failed to discover the key was, that this was a question totally unimportant to the maltsters, not only of France, but of every other country abroad, and yet was at the same time of vital importance to English maltsters. For he could not understand bow it was unimportant to those abroad unless their importations were few or none at all, which was really the fact; and, if so, it was impossible to show how it could affect the interests of the English maltsters. With respect to the French Treaty, the question lay in a very narrow compass. He apprehended that malt came distinctly within the treaty. At the same time it was open to the House of Commons to discuss the question raised by the hon. and learned Gentleman, provided they discussed it with reference exclusively to that addition which ought to be made to the import duty on account of Excise charges in this country. It was perfectly natural the hon. and learned Gentleman should feel an interest in a question like this, which was so important to his constituents; but he (the Chancellor of the Exchequer) believed that the maltsters of England were of opinion that they had nothing to dread from foreign competition. The trade was indigenous to this country; it was conducted on a large scale, with great skill and large capital; it was one thoroughly familiar to the habits of the people; and he did not believe that under any circumstances we should import any considerable quantity of malt from abroad. They had rather to satisfy the dictates of equity and justice in adjusting this duty, than to provide for any new considerations of trade. But he also believed that the maltsters were perfectly satisfied with the arrangement which the Government had made, and which the Committee had adopted. Of course he entertained the highest respect for the hon. and learned Gentleman, and admitted that he had large opportunities, considering the extent to which his constituents were interested in this trade, of obtaining information with respect to the various details involved in a discussion such as the present. But it should be borne in mind that Her Majesty's Government had still larger and more extensive opportunities of gaining such information. His hon. and learned Friend seemed to pride himself on an erroneous position when he took into his computation of the price at which the British maltster could bring his commodity to market as compared with the foreigner, and when he appeared to leave it to the House to draw the conclusion that the difference of 5s. a quarter was a difference which they were bound to make good in the way of a surtax. If that were what he intended, he need hardly point out that it would be a revival of the doctrine of protection in its purest form; and if it were not what be intended, he was at a loss to conceive in what way that part of the argument was at all relative to the question. They had nothing whatever to do with the price at which the foreigner could get his barley, with the cost of manufacture, or with the carriage; they had only to consider what proportion of the cost to the British producer was due to the imposition of the Excise duty. He must, however, criticise the figures of his hon. and learned Friend when he said that there was greater charge for manufacture and for cost of carriage to the British maltster; that the foreigner could bring his malt into the market in this country at Is. a quarter less than the Englishman who resided in this country. He (the Chancellor of the Exchequer) had thought that this country was celebrated at least for facility of carriage. The question, however, before the House did not admit of taking these elements into consideration, and, after having heard his hon. and learned Friend, he deprecated the further prosecution of this discussion in the interest of the British maltster, for he felt certain that if, under the influence, perhaps, of patriotic and creditable motives, the Government had committed an error, that error had been in asking Parliament to grant, under the name of surtax, a larger sum than the British maltster would be in strictness entitled to. If his hon. and learned Friend had been arguing the case against the British maltster, he should totally despair of convincing him that the British maltster had a claim to a surtax of anything like the amount that had been named. The elements to be taken into consideration were simple. There was the question how far the 1s. duty on foreign barley could be said to enhance the price of British barley. There was the question what advantage the British maltster was entitled to on account of the privilege of bonding possessed by the foreign importer; and the third and only other element on which they were justified in giving this surtax was, what was the positive cost to the maltster in England of the Excise regulations imposed for the necessary security of the revenue. He did not think that they could enter on the disadvantage to the maltster of making his malt in six months to he consumed in twelve months, for it was not a consequence of the Excise duty that it regulated the seasons of the year. As to allowance on account of bonding, if the average length of bonding were taken at six months, and 5 per cent were allowed upon the duty for that time, there would be got no more towards the surtax than 6d. a quarter. If he were to assume that the duty on foreign barley added 1s. a quarter of cost to the maltster—though this was undoubtedly beyond the truth—there would be altogether no more than 1s. 6d. towards the surtax. As to the Excise regulations, how did that matter stand? The surtax was nearly 3s. 4d. and 1s. 6d. having been accounted for there remained 1s. 10d. not accounted for. His hon. and learned Friend only stated the difference of manufacture between the Englishman and the foreigner at 2s. a quarter, and 1s. 10d. a quarter was allowed as surtax. His hon. and learned Friend, however, he was sure, would not think of saying that nearly the whole of this 2s. was due to the Excise duty. The truth was that in dealing with the French Government on the question of malt, they had done that which they could not have done in the case of spirits; they could not have sustained a surtax so considerable as that which they proposed. If the case of the British distiller were examined it would be seen how rigidly the Government had dealt with it on every point—how they had weighed in gold scales every statement the distiller made, how they had tested every item brought forward to make a surtax; and the maltster upon this examination would have very good reason to be satisfied with his position. The distiller paid the duty, and lay out of it for a very considerable time, so that the advantage to the maker of foreign brandy on this head was considerable, because he could bond. They had, as he had said, made the case more favourable to the British maltster than they could have done if they had an antagonist to satisfy upon the matter.


could assure the House that if the British maltsters were satisfied the British farmers were anything but satisfied with the existing arrangements. They considered that they should share more fully the advantages of free trade, for they considered that the present tax fettered them in their trade. It fettered them in supplying their labourers with a beverage which enabled them to compete in labour with the foreigner, and it fettered them in competing with the foreigner in fatting cattle. He believed that there were more than 400 petitions before the House complaining of the Treaty with France, and the way in which it had been carried out. They complained that in reducing the duty on wine no consideration was shown to the maltsters of this country. This question affected the great body of the people, who consumed beer, and he considered that he was pleading the cause of the man Who rising sees his work begun, And ends it with the setting sun. To such men beer was a necessary of life. The country generally felt that the days of the malt tax were numbered, and there were many who would take every opportunity to enforce the abolition of the tax.


felt that the House would hardly bear with the discussion of this subject at length, or it would not be difficult to show that the maltsters and brewers had received rather hard measure at the hands of the Chancellor of the Exchequer. He had reduced the duty on every article that could compete with malt, and at the same time increased the tax on malt. The contraction of the credit was itself a very great drawback to the trade, and made a difference against his trade alone of £1,800 a year. Nothing could be more obvious to the negotiator, when he was reducing the duty on wine, to consider what articles were likely to be affected by that, and to make the best bargain he could on their behalf. But it did not appear that Mr. Cobden ever named the subject of beer to the French Government, though it was notorious that they would have made concessions" on the subject in consideration of the competition that would be introduced by the admission of French wines. The Chancellor of the Exchequer underrated the difficulties with which the British maltster would have to contend in competition with the foreigner. The average price of barley during the last thirty-three years had been 33s. per quarter and the duty 21s. 8d. In many instances, including restrictions and the advantage taken by the Excise, the duty was brought up to 22s. 4d. per quarter. The Chancellor of the Exchequer had left this out of sight. The foreigner, who paid his own duty on his malt, could conduct his business with a capital of 33s., while the British maltster had to pay 22s. in addition, and the foreigner would thus he enabled to do as large a business with £33,000 of capital as the British maltster could with £55,000, and 1s. additional duty would make no adequate compensation for want of capital. It was said that we never imported foreign malt; but the fact was that we were daily importing barley from Hamburgh for malting, and he had that night sent a gentleman over there for the purpose. Malt-houses and labour could be got as cheap at Hamburgh as hero, and doubtless British maltsters would now be led to establish malt-houses abroad, 'where they could carry on their operations free from Excise restrictions, and so this country would be deprived of the advantage its manufacture gave to the employment of a great amount of labour. The Chancellor of the Exchequer made a comparison between the maltster and distiller. The latter paid his duty before he sold his spirit; but it was six weeks before the maltster could put his stock into consumption, and it must be considered that malt must be made at the end of March for consumption until far into December, so we paid our duties six months before our malts were consumed, while the foreigner kept his at home or in warehouse until it was required for consumption in England. The Chancellor of the Exchequer ought to allow maltsters to make their malt in bond, and so put them on a footing with the foreign maltster, and he had miscalculated if he thought the trade would not receive a great extension abroad. He had seen foreign malt within the last few weeks that would bear comparison with any English malt. Many maltsters were apprehensive of the measure, and were persuaded that malt would be made abroad for a large portion of the London trade. It could only affect his business by bringing the foreigners to compete with him for barley in their own markets.

Question put,

The House divided:—Ayes 86; Noes 49: Majority 37.

Main Question put, and agreed to.

Bill ordered to be brought in by Mr. MASSET, Mr. CHANCELLOR of the EXCHEQUER, and Mr. LAING.