HC Deb 04 May 1860 vol 158 cc714-36

said, be rose to move for leave to bring in a Bill to amend the law relating to the duty now chargeable on Fire Insurances. His reason for taking up the question, which he regarded as one of very considerable importance, was that Government required some pressure from without to stimulate their exertions for the removal of taxes of this description. He could not but express his regret at the deserted state of the House on a question of so much importance. Indeed, he had been informed that it was the intention to endeavour to count out the House. When the Motion was made that Government should take Thursdays instead of Fridays, it was said that that change would be made the medium of some such proceeding. He hoped, however, such a proposition was far from the intention of the right hon. Gentleman who conducted the business of the House. A question which affected every house in Great Britain was not a question which ought to be treated with such levity. There was a good deal of agitation in the country with reference to the fire insurance duty. A society had been organized for its total repeal. That society embraced some of the most illustrious Members of that House, and a long list of the most respectable commercial firms in the kingdom. Not only was their object the total repeal of the duty; they said, unless Parliament consented to some wholesome alteration of the present system, they would move that House and agitate the country for the reimposition of the tax which had been taken off farm stock and agricultural produce; but the object which be had in view was different. He did not seek a total repeal of the duty, but by a more gradual and temperate method so to reduce the duty as to popularize it if possible, and thus rather to increase than diminish the public revenue. He proposed so to alter the fire duty, that in all cases where the premiums charged on insurances against fire did not exceed 5s. per cent, the duty to be charged should be reduced from 3s. to 1s. The effect of that reduction he believed would be to increase the public revenue; and the alteration he proposed should take effect from the end of the present financial year. The income from fire insurance duty amounted to £1,300,000,—a large sum indeed, but not much more than the paper duty, which was treated so lightly not long ago, and which certainly did not affect the public interests so intimately as that they were now discussing. The effect of his proposal would be to deal with only one-third of the revenue under this head. Insurances, charged more than 5s. per cent were hazardous, and from that point they went up to 21s. and 42s. per cent, and in a case of extreme risk at Norwich, he bad known 26 guineas per cent paid. With that class of Insurances he did not propose to deal. The owner of a theatre or a cotton mill worth £50,000 who paid 21s. for insurance was not deterred from covering himself against risk, by having to pay 3s. per cent more as duty. The 3s. would still be charged on all insurances where the risk was represented by more than 5s. per cent, and thus one-half the present revenue would be retained. He proposed on other Insurances to reduce the duty from 3s. to 1s. per cent, which would cause a deficiency of £430,000 in the revenue, assuming it to be £1,300,000 a year. That sum of £430,000 was just the amount which stopped the whole progress of insurance in this country. The question was, could the revenue which he proposed to deal with be increased by the alteration? He maintained that there was more than a fair probability, nay, it amounted to almost a certainty, that before the end of the financial year they would more than make up any deficiency which might be caused. In 1815, when the duty was increased to 3s., there was a diminution of Insurances in the two succeeding years to the amount of £7,000,000. In 1835 farming stock was exempted, and the amount of farming stock insured, which was then £37,250,000, was, in 1855, £62,250,000. In 1846 the National property was estimated at £4,000,000,000, of which one-half was insurable. He took the increase of insurable property, in consequence of the gold discoveries and the vast increase of commercial operations, at £500,000,000. He added the value of ships and cargoes, estimated at £500,000,000, and the total insurable property was then £3,000,000,000. But the amount of property actually insured, according to the last accounts, was £900,000,000, and he contended that the £2,100,000,000 uninsured was just the property which ought to be insured, and would be insured if this stringent impost were relaxed. The man who had a hazardous mill, or gunpowder in his house, or who was manufacturing gutta percha, insured his property, but the man who lived in an expensive private house, usually said to himself, "So and so lived here before me; the house stood long enough; there is no chance of its being burned." The owners of such houses, however, were not so well acquainted with the doctrines of probabilities as actuaries were, one of whose canons was, "That whatever has happened may again happen." They naturally said; "If we insure our houses, we must pay 200 per cent for taking care of our own property." Indeed, the Government gave them a bonus for not insuring. The Government said to them in effect, "If you take care of your property we shall charge you 3s. per cent for doing so." In his own case he found, that while it would cost him £7 10s. to insure his property, the Government wanted to charge him £15 for the privilege of being allowed to do so. The result was that he had kept his money in his pocket for a long series of years; and on the whole he felt indebted to the Government for thus forcing him to be his own insurer. Many persons, however were not able to bear the loss which might at any time occur, and therefore it was the duty of the Legislature to encourage Insurance and remove the obstacles which at present existed to the proper exercise of prudent protection. Another point to which be wished to direct the attention of the House was the fact that the amount insured in this country had not increased in the same proportion as the national property, for while in 1835 £500,000,000 of value had been insured, in 1855, notwithstanding that the country had in the meantime made enormous progress in wealth, the amount insured was only £800,000,000. Comparing the position of France with that of England in relation to the subject, he might state that whereas in the latter, after 180 years of experience in the system of Fire Insurances, only £900,000,000, of property was insured, in the former after 33 years the amount reached £1,800,000,000 worth—a sum contrasted with which all the fire insurances of which we could boast sank into insignificance. But it was not by France only that we were surpassed in that respect. Russia, Germany, and Holland, were doing better than England in the same direction. The reason was obvious. We had so fettered the progress of Insurance that we rendered it difficult for any one to make up his mind to undergo the ordeal. France with a wiser spirit said, "We will not impose any restrictions on the prudence of our citizens, but will encourage them in every way to effect so excellent an object." The Government of Franco imposed only a small policy stamp on fire insurances, while we, in addition to a policy stamp, imposed a duty of 3s. per cent. He might, in order to show the different results which were produced as a consequence of the different systems adopted in both countries, state, on the authority of a pamphlet entitled The Progress of Fire Insurances, written by Mr. S. Browne, a Fellow of the Statistical Society—that while the total amount insured in the largest English office—the Sun, which had been established in 1701—exceeded, in 1855, £140,442,000, exclusive of foreign and re-insurances, the insurances in the National in France, which had been established only in 1820, amounted to upwards of £203,000,000. That fact served, in his opinion, conclusively to prove that these insurances, relieved from the trammels by which they were in this country surrounded, would rapidly increase. He might add that a custom prevailed in France of insuring, under the head of risque locatif, the property of one's neighbours, the damage done to which, cither by the fire or the water employed in extinguishing it, the person in whoso house the fire originated was liable to make good. The small-ness of the amount charged for the stamp, which was hardly appreciable, and the smallness of the duty, enabled persons to insure against contingencies of that kind, and the consequence was, that property was often insured three or four times over. Again, in France there was another system of insurance to meet the liability which railway companies incurred in cases of injury done to the goods of others within a certain distance of their respective lines. That, too, furnished a fruitful source of insurance. Even in this country, according to the common law, a man was responsible for the damage which might be occasioned to his neighbour's goods in consequence of a fire upon his premises. He was at a loss to understand why the Government did not turn their attention to this question. It was a well-known fact that persons were in the habit of insuring only a part of their property. A sad instance of that had recently occurred in connection with a valuable institution, known as the Sailors' Home at Liverpool, which was recently destroyed by fire. The amount for which the property was insured was £10,000, whereas the value was £30,000, the managers not daring to trust themselves to insure for the whole amount, in consequence of the heavy tax on their income which the Government duty imposed. The French were so satisfied of the mistake England had made in the matter of insurance that, desiring to take advantage of it, a French insurance office was established in London. It took risks at 1s. per cent, and would have been able to take them for less, had it continued. But the House of Commons putting an end to the enterprise by an Act of Parliament, showed the people of this country that they would neither encourage them to insure nor allow any one else to do so. He had assumed that hon. Members understood the system of fire insurance; but to illustrate the working of the tax he would suppose all the Members of the House of Commons formed into a "mutual" insurance company, in which each contributed to found a company for securing insurance to each to the amount of £1,000. Suppose a loss to occur, then the sum of £1,000 would be paid to the sufferer, and the Government would take £2,000. But this did not measure the extent of gain by the Government unless the amount of the profits of the insurance companies was considered. They were comparatively few in number, and the Government duty had contracted their operations. Many of the new companies, though they were making from £60,000 to £70,000 a year, failed, in consequence of the limited area of their operations. The losses of French companies were hardly 35 per cent; in England it was a rare case for an office to escape with less than 60 or 70 per cent loss. Russia, Spain, Germany, countries of which they were in the habit of speaking with something like contempt, all excelled England in the extent of their fire insurances. Such risks as those of Barcelona or Seville were among the best an English office could take. Before the establishment of the fire insurance system the loss of a house, manufactory, or stock in trade, was met by an appeal to the community at large—ad misericordiam. That was the old custom, and from custom it became law; and then compensation was demanded as a right. From 1690 to 1696 the first risks were taken at £4 per cent for brick dwellings, and £6 per cent if built of timber. At the present day he did not think they were much more enlightened on the subject than when the old Common Council had the first six policies of insurance stamped before it, with all sorts of solemn forms. So utterly neglectful had the Legislature been of the whole principle of insurance that there was some danger, as property increased, of there not being means enough to insure it. But, if they relaxed the duty, it would enable the English offices to reinsure their risks in foreign offices. But none would take risks to reinsure if they were clogged with a duty. In cases where insurances had not been effected and fires took place, persons were for the most part deprived of whatever property they possessed, and the result unquestionably was to add to the poor rates, and to increase emigration among the industrious classes, thereby violating the first principles of political economy. What were the grounds on which the Government, he understood, were to resist the proposal which he had ventured to make? If they rested their decision on the statements contained in the Report of Mr. Coode, a reference to the journals of the Statistical Society would show that the most important portion of his financial reflections were long since shown to be fallacies. That Gentleman did not put forward a single argument, but proceeded on the assumption that everybody ought to pay the tax, that tradesmen in particular were bound to do so, and that nobody had a right to grumble. If, on the other hand, it were alleged that the Bill which he introduced would disturb the financial arrangements of the year, and interfere with some of the details of that measure which had been drawn up with so much care, and brought before the House in so elaborate and masterly a manner, then he would have a complete answer to the position taken up by Government— namely, that the Bill was not intended to to pass into law until April, 1861, which would be at the end of the present financial year. Six months, at least, must be occupied in passing the Bill through both Houses, and a slight additional delay would make no perceptible difference where the injustice complained of was of such long standing. He had shown that this was not a proposition which need alarm the House on financial grounds. The amount with which he proposed to deal was £430,000, while there were £2,000,000,000 of insurable property to supply what the right hon. Gentleman the Chancellor of the Exchequer had called "the chasm;" and there was no doubt that if the impost were removed this deficit would be replaced with a rapidity which would be most remarkable if the House were not already familiar with such experiments. This was the true Peel policy—the reduction of duties which replaced themselves—a policy with which the Chancellor of the Exchequer was well acquainted, and the merits of which the House had enjoyed opportunities of appreciating. It was the same policy which had dictated, at first with great caution and timidity, the reduction of the postal duties, from which step such vast advantages had followed; and he ventured to say that if the House agreed to the reduction of the insurance duties from 3s. to 1s. an effect by no means dissimilar would be produced. But if the answer given to his Motion were that they could not promise to make the alteration in April, 1861, knowing in their hearts that they had no intention of making it at all, and hoping that something might happen which would prevent the question from being again brought forward, it would be well that the House and the country should understand one another. The House would then be detected in the appropriation of money belonging to another, and would be legislating from party motives, and not in accordance with general interests. Property by means of this duty had shifted its share of the burdens of the State on to the commercial and trading interests, and imposed a tax of 3s. per cent on insurable property, at the same time that one description of insurable property—namely, farming stock—had altogether escaped. So far back as 1836 hon. Members had availed themselves of their position as the governing class to relieve themselves and the farmers who looked up to them, from liability to the duty. ["No!"] Hon. Gentlemen said "No;" but this tax was either one on property or it was not. If it were not a tax on property it was one on prudence, forethought, and precaution; in fact, it was a tax on virtue. England was the first nation which had the presumption to inscribe on its fiscal banners—"Here we tax prudence, thoughtfulness, and virtue." If a tradesman went to an office to insure his stock in trade to the amount of £8,000, though that property had already paid property-tax, he would have to pay a shilling stamp on the policy, and 3s. per cent on the amount insured. If 200 workmen went to insure their tools by which they gained their living, and which might all be risked by the conflagration of one factory, as well as their furniture to the same amount of £8,000 — £40 each — the Government would charge them £10 in policy stamps, and the 3s. per cent. If a farmer went to insure the same amount he would pay the shilling stamp; but the influence of his friends in the House of Commons was powerful enough to get him excused the 3s. per cent. A rich man insuring his house and furniture for £8,000 —where the 200 working men paid £10 in stamps—would have to pay but 1s. and the same 3s. per cent. A great deal had been said during the present Session about legislating for the benefit of the working-man, particularly in regard to financial matters; but it was difficult to see how it had been carried out. The duties on tea and sugar, articles consumed by the working man, were loft untouched; but the duties on game certificates, silks, and wine had been reduced, and the paper duty abolished, though at present working men were so blind as not to see any particular advantage to them in these reductions. As to the stipulation with regard to coals in the Commercial Treaty, they looked on it with positive alarm, fearing that the increased demand from France might raise the price of fuel even higher than it bad stood during the late long winter. In fact, Parliament had, as yet, done nothing for the working classes, but if they would pass a Bill such as that he was now asking leave to introduce, which would allow the working classes to insure their tools and their furniture without being charged 400 per cent duties, they would then have done something of which they might be proud. Lest it should be thought that he was propounding a scheme the mere creation of his own fancy, he would state that the reduction of the duty by one-third, or even one-half, had been ably advocated by The Builder, and not very long ago The Times had given a magnificent article against the duty, which had attracted much attention. M'Culloch and other authorities also were in favour of the reduction of the duty, which was 900 per cent on the profits of insurance companies, to one-third of its present amount. Hon. Members who voted against this Bill would have to explain that vote to their constituents; and if the Bill were rejected there must then be a re-distribution of this tax in an equitable manner, and a universal tax at the rate of 1s. per cent on all insurable property. That would produce £2,000,000 a year. The Chancellor of the Exchequer had in his eloquent speech on the introduction of the Budget, stated that a deficiency in the revenue did not constitute a reason why there should be no no relaxation from oppressive taxation. He would conclude by moving for leave to bring in a Bill to amend the law relating to the duty now chargeable on fire insurances.


seconded the Motion.


Sir, the Iron. Member who has moved for leave to bring in a Bill to reduce the duty upon fire insurances complained more than once in the course of his speech of empty benches, and threatened all absentees—some of whom, who now appear in their places, will be interested in knowing what was said at the time of their default—with the most serious consequences when they come to face their constituents at the next election. In fact, the hon. Gentleman sometimes appealing to lauded sympathies, sometimes to trading affections, sometimes seeking favour by attacks upon the Budget, sometimes glancing at the peril in which the farmer's exemption will be placed if this tax be not reduced, played most skilfully on all the prejudices and interests by which the human mind can be swayed. My case however is of a much simpler character, and when the hon. Gentleman talks of the indifference of the House upon what, in exaggerated terms, he calls this all-important subject, I must venture to remind him that it is the habit of the House to judge of questions, and the necessity of attending to them, not simply by their abstract magnitude and importance, but likewise and mainly by the circumstances under which they are submitted to its notice. That, in fact, so far as I am concerned, is the whole case which I have to submit. I do not intend to enter into the question whether a reduction or alteration of the duty upon fire insurances might or might not be a very proper subject for the House to entertain at a period when the state of the national finances presented you with a disposable surplus, or when you were prepared to say, "I think the evil of this tax is so great that I am prepared to repeal it and to provide in lieu of it a substitute, which I now point out." In either of those cases, I apprehend, it would he perfectly legitimate to approach the consideration of the reduction of the tax. But neither of these is the case before us. The hon. Gentleman does not say, "I propose a substitute for the tax I am going to take away." What he proposes is to introduce a change into the law, which, according to the account he gives of it, will have for its first effect to cause a loss of £430,000 a year to the public revenue. My answer is, that when we compare the Revenue of the country with the demands upon it, the House is not in a condition with propriety and with prudence to entertain the demand. Let him reserve it until he has a Revenue to give away, or until he has some tax wherewith to replace the duty he wishes us to reduce. But, of course, I do not mean to beg the question. The hon. Member has the courage to say that if we only repeal the duty the result will be an increase in the Revenue. But when will the increase manifest itself? If it is to be contemporaneous with the reduction of the duty, then undoubtedly the fact that it appears primâ facie to cause a loss forms no objection to the Motion of the hon. Gentleman. But that is the exact question at issue, and the instance he quoted with great triumph is by no means favourable to his case. Reduced duties, he says, are always followed by an increase of revenue. That has been undoubtedly true in many cases, but nothing can be more absurd than the indiscriminate application of the idea, as if it were a dogma fixed and unchangeable in its nature, instead of being a political proposition which, discreetly applied, has been of the utmost advantage to the country; but which, rashly and unwisely applied, will destroy public credit, and throw the public finances into confusion. What is the instance furnished by the hon. Member as a case in point? He reminds us of the effect of reduced postal duos. Now, I never can hear that reduction mentioned without recording my unhesitating testimony to the enormous advantage which it has bestowed upon the country. But we must not be told that the effect of the new postal duties upon the national revenue is to be the effect of the Motion of the hon. Gentleman. He has chosen it as his illustration, but what are the real facts? Why, that not one, but one-and-twenty years, have now elapsed since you reduced the charge for postage, and the net postal revenue, if it be fairly and strict- ly calculated, and if you deduct, as you ought to deduct, the marine postage, with which it has no business to be credited, does not amount to more than one-half the net revenue before the reduction. Do I say that that affords a reason against the new postage system? Certainly not; for the loss the revenue has sustained has been more than compensated by the advantage to the country. But the hon. Member's illustration was unfortunate in another point of view, for the House of Commons in that instance unhappily did the very thing which he is now inviting it to do; it adopted the change though it had not a revenue to give away, and consequently became involved in the series of deficiencies from year to year, which were the immediate causes of the income tax. Thus the illustration, while it entirely fails to sustain the argument of the hon. Member as to the immediate replacing of revenue once sacrificed, also furnishes to the House of Commons a warning, which is never otherwise than seasonable and advantageous, of the injurious consequence of proposing the reduction and remission of taxes, irrespective of the means at our disposal to meet the demands upon the public service. The hon. Gentleman says this is but £430,000; why make any difficulty about it? And now I am going to give hon. Gentlemen opposite the opportunity for a cheer—why make any difficulty about it, when you have been dealing lightly with the paper duty? [Opposition cheers and laughter.] I will not answer whether we have been dealing lightly with the paper duty; I will simply say what is sufficient for this occasion, and that is, that if we have lightly given away the paper duty, it is the greatest reason why we should not repeat the imprudence. If we have surrendered that duty, at any rate we have not done so without making provision of public revenue to supply its place. But the hon. Gentleman now proposes, after what he calls the light surrender of the paper duty, to take away £430,000 more, and makes no provision to supply its place, except, indeed, the provision which I will proceed to examine, and the promise of the hon. Gentleman that it will result in an immediate increase of the revenue. That promise is extremely alluring; but, unfortunately, he is wholly irresponsible for it; and, if I were to act upon that promise, if the House of Commons were to accede to it, and if, at the end of twelve months, we found that it had vanished into thinnest air, that we had lost our money, and left the Exchequer without the means for meeting the demands of the public service, could we challenge the hon. Gentleman with the failure of his prophecy? He would say, and truly say, "If the prophecy and the opinion I expressed were unsound, it was your fault to accept them." The promise of the hon. Gentleman would be no justification to the House for adopting the step he proposes. The hon. Gentleman, although his speech was copious, did not enter upon, but, on the contrary, most slightly touched, that part of the subject in which it was most material for him to be laborious and searching in his scrutiny, and most careful in his details. He told us that there is 2,000 millions of insurable property in this country which is at present uninsured. A statement more vague, more entirely in the nature of a simple individual assertion, never was submitted to the House. He has no data, no evidence for that statement. Undoubtedly, it is a matter of great difficulty to bring positive evidence to combat an assertion so vague and difficult to lay bold of, but I think we have some data for a decision upon this question. Although the hon. Member does not attach any authority to Mr. Coode, yet that gentleman is as able, bard-headed, searching an investigator as ever applied his mind to dry questions of economy. What does he tell us? He tells us that not 3,000 millions, but 1,000 millions, is the real amount of insurable property in the country. The schedules of the income tax, especially Schedule A, after examination, and due allowance being made for lands which are uninsurable, as compared with house property, do to some extent give us approximate evidence; and perhaps there is 1,000 millions or 1,200 millions, or 1,400 millions, of property in this country which can be insured; but the doctrine that 3,000 millions is the amount, is really the notion of dreamers and speculatists, rather than a serious assertion which should be submitted to a deliberative assembly. The hon. Member places at a loss of £430,000, the immediate effect of what he invites the House to do. That, again, is an opinion of the hon. Gentleman; and I only wish to say I do not intend to become responsible for it. I have no official means of knowing; the records are not framed in such a manner, owing to the mode in which the tax is levied, as would enable mo to tell the House what proportion of the total insurances are effected at premiums below 5s. The hon. Member says that one-half only of the risks are at premiums below 5s. I cannot say that it is at much more. But the question is as to this great promised increase of revenue. The first effect, assuming his proposition only to affect one-half of the revenue from fire insurances—that is, about £650,000 or £700,000—by reducing the present rate of duty to 1s., appears to be to reduce the revenue about £430,000. He says we shall have a revenue from the moiety of £220,000 or £230,000; and the question is, how is this £230,000 to replace the £430,000, which is given up; and then, when that is done, and then only, it will begin to fulfil the brilliant and cheering promise of the hon. Gentleman of an increase on the public revenue. According to that we shall have an increase of 300 per cent in insured property of the class affected by the Motion. To fulfil the promise, we must have a threefold increase in the first year. Surely, to give us the slightest shadow of hope or expectation of such a result, the hon. Gentleman ought to show, by returns or figures, how he calculates the astonishing increase which be prophecies. He has avoided that point, which is so essential upon the difference between us; for I am not arguing upon the merits of the duty, but of the necessity of having a revenue adequate to meet public charges. I say the proper time for the House to consider the removal of this duty is not the time when you have disposed of all that was at your disposal; but the proper time is when you are balancing estimates and revenue, and when you find that you have a surplus. There is, however, some evidence to which we can refer the hon. Member says he does not take away revenue, but that he will give us more. To give us the present revenue the insured property at risks below 5s. must be multiplied threefold, or the total quantity must be doubled within the year. Is it a fact, in the first place, that the quantity of property insured does not increase under the present duty? and, next, is it a fact that a rapid and enormous increase takes place when the duty is removed? We have the means from Mr. Coode's report of answering that question from public returns. I would call the attention of the House to a simple intelligible passage of the report. The hon. Gentleman has referred, in terms unnecessarily invidious, to the exemption which is enjoyed by farming property'. But that exemption has this advantage, at least, that it enables us to bring to a test the promise of the hon. Gentleman, and to in- form ourselves in some degree of what prospect there is of the rapid and astonishing increase which he holds out to us. I say there cannot be such an increase, because there does not exist the property to insure. Mr. Coode at page 41 of his report, says,— In the first year in which you have separate information of the value of farming stock insured —in the first year of the exemption—it was 37¼ millions. In 1856 it had risen to 62¼ millions, or an increase of 67 1–5th per cent in 22 years. That is a rise of nearly 3 per cent per annum, instead of 300 per cent per annum; and that is the breakdown of the declarations of the hon. Gentleman. These are the official figures as respects the progress of the quantity of property insured in cases where there was no duty at all. But you have besides the means of comparing, from official figures, the increase that takes place in those descriptions of insured property that were subject to the duty. In 1834 there remained of property subject to the duty £483,000,000, and in 1856 that property subject to the duty had increased from £483,000,000 to £802,000,000—that is to say, it had increased in 22 years by 65 per cent. The exact difference in the rate of increase between property that paid nothing at all and property that paid 3s. per cent, which the hon. Gentleman calls on the House to remove, is, that the exempt property increased in 22 years 67 1–5th per cent, and the no-exempt increased 65 5–6ths per cent, and the difference between them is 1 and 1–3rd per cent, and that not in one year but spread over a period of 22 years. Thus breaks down the case of the hon. Gentleman and ends in a total and ruinous collapse. The hon. Gentleman also referred to the case of France, and stated that, whereas in England we have only insured property to the amount of £9,000,000, in France they have property insured to the amount of £18,000,000, and he went on to infer from that, that if we only adopted the rule of abolishing duties we should have a vast increase and a larger quantity of property insured than there is in France. But the different mode pursued by insurance offices abroad to that pursued by insurance offices in England has almost the effect of compelling persons abroad to insure their property up to the real value. In England, on the contrary, we know that all property insured against fire is at least two-thirds, or, at all events, very considerably short of the full value of the property. The hon. Gentleman has also said that from the structure of the houses in France, the interests of one man were more bound up in regard to questions of fire with those of his neighbour than is the case in this country; and the expression used by the hon. Gentleman was, "in France the same property is insured three or four times over." If that be so, then, he cannot argue from the operation of the French law, because in England there is no such law, and if a fire arise in the house of A, and spreads to the house of B, the losses of B will not be charged upon A. I think I have now dealt with the statement of the hon. Gentleman, so far as any argument is included in it. There is one other point which it is material I should notice. The hon. Gentleman, in his generosity to the current year, which he knows is one of heavy burthen, proposes to postpone this change, and to fix its operation to commence on the first day of the financial year 1861–62. I do not hesitate to say, if there were no other objection to the proposal of the hon. Gentleman, having regard to the circumstances in which he makes it, that that is a conclusive reason why the House should not adopt it; for there is no shabbier course, or one more calculated to deteriorate the character of Parliament than to suffer itself to be tempted and seduced into the habit of attempting to gain popularity in one year at the expense of the financial operations of another. Occasionally, it is true, such a course is adopted, from the necessity of the case; you may have a great transition to make; you may have complicated arrangements that require time for their adjustment; and in those cases it has been the practice of the House from necessity to postpone and adjourn the effect of changes that it makes, but under no other circumstances can I recollect the House to have had recourse to such a step. This is one of those duties which, if it is to be dealt with at all, ought to be dealt with at the moment the proposal is made; and if the hon. Gentleman is right in saying that the proposed reduction will increase the insured property 300-fold in a year, though the official figures show that the increase will only be about 100th part as much; if he is right in the picture he draws of the almost millennial bliss which he expects to flow into every home throughout England from the adoption of this project; granting him the whole of this enormous demand, still there is one fatal objection to be made to his speecli— namely, that it is a speech made at ten o'clock at night on the 4th May, 1860; let him only reserve that speech and reproduce it bodily some day in February or March, 1861, and then the House of Commons will, I won't say be in a position to accede to this proposition, but, at any rate, it will be in the possession of the necessary information to enable it to judge whether or not it should accede to that proposition. The hon. Gentleman has threatened hon. Members with the vengeance of their constituents, a course of which I think they have some reason to complain if they think fit. I think it is hardly fair to put hon. Members in the position of either being obliged to vote with him in support of a proposition which is dangerous because it is ill-timed, or else appearing to record their votes against the removal of a tax the remission of which, when you have the means of making it, will be a perfectly fair question for the House to consider. For these reasons I trust the House will not accede to the Motion.


said, the right hon. Gentleman had made the best speech against his own Budget he had ever heard, and he congratulated the hon. Member for Dudley (Mr. Sheridan) that he had elicited so vehement a speech against the proposition he had made, for that was the best assurance he could have that he would succeed in attaining his object next year. The right hon. Gentleman had addressed the House in the same tone of earnestness that night against the repeal of this duty that only some short time ago he (Mr. Malins) heard him address to it against the repeal of the paper duty. The right hon. Gentleman then pointed out to them all the inconveniences which would result—


When was that?


He was not quite sure. It was last year or the year before.


It was neither.


If the right hon. Gentleman, who was as impatient of interruptions as any man he knew—


If the hon. Gentleman will allow me, I say I consider it only a matter of candour and fairness, when any hon. Gentleman is heard making a misstatement with regard to matter of fact, to assume that it is the result of pure error, and at once to set him right.


said, none would be more ready to make such an assumption than he himself; and he was about to say— but the right hon. Gentleman was so impatient—that time passed so rapidly, and as he had not armed himself from the pages of Hansard, he really was not able to say whether it was last year or the year before; but this at least hon. Members all knew—that this very Session the right hon. Gentleman had recanted everything he had previously said in respect to the paper duties. That being the case he (Mr. Malins) cared not whether it was one year or another that the right hon. Gentleman had used the argument, but he had used it in opposition to the repeal of the duties which he had this year proposed to repeal, although be had not repealed them yet. He (Mr. Malins) entertained a very distinct and decided opinion on the question before the House, and he could assure the right hon. Gentleman that his vote was not influenced by any fear of his constituents, who left him on that, as upon other subjects, to exercise his unbiassed judgment. In acceding to the Motion he begged to assure the right hon. Gentleman that he had no intention to embarrass him as Chancellor of the Exchequer, as he (Mr. Malins) did not deny the expediency of the proposition which the right hon. Gentleman had laid down, not to pass measures which would interfere, with the revenue of the country in future years. He had no expectation or wish that any progress would be made with the Bill which the hon. Member for Dudley desired to introduce— indeed, if he obtained leave to bring in the Bill he should advise him to proceed no further with it that Session—but he intended to make the present Motion an opportunity of recording his opinion that the duty on fire insurances ought to be reduced at the earliest convenient moment. That duty was one which pressed heavily upon the public; it was most inexpedient in its nature and most unjustifiable in its amount; and the result was that almost every proprietor was under-insured. Nevertheless, he was afraid that the hon. Member for Dudley would not effect his object until he got a seat in the Cabinet, for a duty was not now repealed or reduced because it oppressed the public and embarrassed trade, but because it was disliked by a Minister of the Crown. The paper duty had never embarrassed trade, nor was it felt by the people; but a colleague in the Cabinet had to be accommodated, and therefore an additional penny was put upon the income tax in order to repeal a duty which nobody felt. He would give this proposition his support on the principle of its being an instruction to the Chancellor of the Exchequer, should he still have the conduct of the public finances, that the tax should be taken into consideration at the earliest possible period. If the right hon. Gentleman could afford to take off the duty on wine and paper, he might fairly afford to take off the duty on fire insurance, and the result would probably be that every man would go and increase his fire duty.


said, the hon. and learned Gentleman who had just sat down, when he declared that the paper duty did not obstruct trade, appeared to have judged rather too much from his own profession. The meaning of the observation must have been that the paper duty did not make any great difference to the hon. and learned Gentleman, but that a penny income tax was a matter of some importance. But that did not make the allegation good that the paper duty was not a great obstruction to trade, and a tax upon knowledge. He (Mr. Crossley) was of opinion that the fire insurance duty was one of the worst taxes which was in existence. It was enormous in amount, and in its nature became actually a tax upon forethought and prudence. But he thought that the hon. Gentleman who asked leave to bring in the Bill was about to make the injustice far more unjust still. He proposed that a risk of 4s. 11d. should pay 1s., and a risk of 5s. should pay 3s. Bad as the present tax was, it contained no such injustice as that. Although he was strongly in favour of having something done in regard to the fire insurance duty, he certainly could not support such a Bill as the present. What he desired was that the Chancellor of the Exchequer, the very first time he had a surplus should take into consideration the reduction of the tax. In reducing the tax, too, all exceptions ought to be abolished. He (Mr. Crossley) did not know how it was that the farming interest came to be excepted, unless it was because of its being clogged with the corn law at the time. But now that it had got rid of that incumbrance, and that farmers had the advantage of selling their produce in the world's market for what it was worth and no more, be saw no reason whatever why they should not pay the same tax which all other classes of the community paid. Nothing could be more obvious and barefaced in its injustice than that corn and wool, and other agricultural produce, so long as they remained in the farmers' hands, should be insured without any tax, but that, when that very same corn and wool were taken from the farmyard to the manufacturers, the manufacturer must immediately pay 3s. per cent duty for their insurance. Such anomalies the Chancellor of the Exchequer really must abolish before long. The tax was one of the first which the Chancellor of the Exchequer ought to be called upon to reduce, but he (Mr. Crossley) could not support the present Bill, which began by creating differences and inequalities worse than those that already existed.


said, after the able and exhaustive speech of his hon. Friend the Member for Dudley, he did not wish to detain the House long, but be wished to make a few remarks after the speech of the Chancellor of the Exchequer. Every one must admire the unbounded skill and eloquence of that right hon. Gentleman, though they could not but be surprised at the arguments which he had that night brought forward. The right hon. Gentleman began by a most marked and signal condemnation of his own Budget and his own financial policy, and then he made copious quotations from a book that had been written at the suggestion of the right hon. Gentleman the Home Secretary when he was Chancellor of the Exchequer. The right hon. Gentleman, when he rebuked the hon. Member for Dudley for inviting them to reduce taxation on the ground that it was inopportune, asked the hon. Gentleman to repeat bodily his arguments in 1861. He in the same way would ask his right hon. Friend to repeat bodily his speech when the question of the paper duties came on for the final discussion on that subject. If it was sound policy and morality to reduce taxes on silks and light wines, which were mainly consumed by the richer classes, surely no Minister ought to refuse consideration to a proposal for reducing a tax that pressed heavily on the humbler tradesmen of the country! It would be found that in France and America artisans almost universally insured their tools and implements of trade, but in this country the power of doing so was denied them, and painful instances frequently occurred, as at the fire at Broadwood's manufactory, and Scott Russell and Co.'s works at Millwall, in which hundreds of poor workmen lost the whole of their implements of trade. The English artisan was not less provident than the American or the French, but he encountered discouragement, and, in consequence of the amount of taxation, was deterred from availing himself of the advantages of insurance. If the House then fairly represented the interests of the working classes they ought to make the proposed alteration. The English nation was constantly called a commercial nation, and was surely one in which sound principles of trade ought to exist; and yet we had a system of taxation that positively interfered in the most arbitrary manner in preventing men from exercising their natural instinct for prudence. The system was most unjust, impolitic and immoral. If the exigencies of a State required that there should be a tax upon all property, there was a sound, intelligible, and just principle. But the tax on insurances was arbitrarily levied on persons who received from the State not the slightest advantage in return for the tax they paid. For the State did not provide engines, escapes, or any of the appliances requisite in case of fires. The insurance companies sold the securities against fire at a certain price—they had all the liability, all the responsibility, all the intellectual labour of carrying the business on; they could afford to sell that security at the price of 1s. 6d., but the State, which did nothing, which afforded not the slightest consolation or advantage to the sufferer, stepped in and said, "For every 1s. 6d. for which you sell security, I ask 3s." Was anything more monstrous or iniquitous than that? In consequence the total amount of property insured was only £800,000,000, while twice that amount was uninsured. The Chancellor of the Exchequer alluded to a more "convenient season," but, like the convenient season recorded of old, he was afraid it would never come, and that it would even be like a dissolving view. He would give the House a slight idea of the kind of witness they had in Mr. Coode, who had written a book, by the desire, he believed, of the right hon. Gentleman, the Secretary of State for the Home Department, and whose instructions evidently were more or less, if it were possible, consistently with his own feelings of truth and justice, to discourage the cry against the tax. Mr. Coode said— Indeed, as a question of public policy, there is reason to doubt whether a greater amount of wealth has not been destroyed and other mischief produced solely by the operation of the facilities which the system of insurance affords to fraud, the whole of which fraud and mischief would be impossible but for the opportunities afforded by the insurance offices. After that extract he put it to the House to consider what sort of authority Mr. Coode was? His evidence, if worth anything, went to prove that the whole system of insurance was objectionable, and the fruitful source of fraud and mischief. The House could hardly be prepared to support such a paradox. He trusted that the principles proposed by the hon. Member for Dudley would receive the support of the House.


said, he rose to ask whether his hon. Friend would accede to the suggestion of the hon. and learned Member for Wallingford (Mr. Malins), if leave was given to bring in the Bill, not proceed further with it this Session. [Cries of "No, no."] He entirely agreed with the hon. Member for Dudley, but he saw great difficulty in proceeding now to legislate for 1861–62. His vote would be very much guided by the answer of his hon. Friend. He should, before sitting down, congratulate the House on the accession of the hon. Member for Wallingford to the cause of abolition, because that hon. and learned Member was one of those who voted against the introduction of the Bill last year in the month of March.


explained that he did not vote against the measure referred to, but only suggested that it should be withdrawn, because it was too late in the Session for the hon. Member to hope that he could pass a Bill containing 150 clauses.


said, he would recommend the hon. Member not to press his Motion, but at the same time he hoped the Government would give the House a pledge that they would take the subject into their serious consideration. There was a large class of persons in the Metropolis and in the country who might by a fire lose their all, but who were deterred from insuring when the sum which they had to pay was almost in the shape of a penalty. When they looked also to the effect which the loss of his tools might have on the artisan, they must be convinced what a serious matter this was to a very large class. The question could not possibly continue in its present position, especially when a large share of the property of the country — to the amount of £80,000,000—was exempt altogether from the tax. They must either revise the whole law on the subject, or repeal it. He would himself be quite satisfied if the duty on insurances to a limited amount, say £150, was reduced, for they would thus meet the class of cases to which he had referred. He was sure the poor would readily embrace the opportunity afforded by such a change. He trusted they would not meet to consider the financial condition of the country in another year without having this question dealt with in the manner in which it deserved. He hoped the hon. Member would not press his Motion.


said, that as one of the oldest supporters of the abolition, he trusted the hon. Member would be satisfied with the impression he had made, and not divide the House.


said, that he should have been glad to have acceded to the recommendations which had been addressed to him, if he had an opportunity of adopting them. A Resolution, pledging the Government to abolish this tax as soon as possible, had, however, been shown to the occupants of the Treasury Bench, and he understood that the right hon. Gentleman the Chancellor of the Exchequer objected to fetter himself by any such pledge. That appeared to him to be a distinct declaration that the Government was not at this moment prepared to consider the repeal of this tax at all; and therefore be had no alternative but to proceed to a division.


said, he could not vote for his hon. Friend if the Motion were pressed to a division. It would be impossible for him to vote for a measure which the hon. Gentlemen on the Opposition benches evidently wished to be converted into an attack upon the Budget. It was not true that the Paper Duties Bill was brought in by the Chancellor of the Exchequer merely out of deference to one of his colleagues in the Cabinet. It was brought in because the House had passed a Resolution condemnatory of the paper duty. Nor was it true that the public were not interested in, and would not be benefited by the repeal of the paper duty. The working classes especially would be materially benefited by that repeal, which was one of the principles that had reconciled the public to the Budget. The repeal of the paper duty was most popular out of doors, and would confer permanent and important benefits on the country at large.

Motion made, and Question put, "That leave be given to bring in a Bill to amend the Law relating to the Duty now chargeable on Fire Insurances."

The House divided:—Ayes 84, Noes 108: Majority 24.