FIRE INSURANCE.—LEAVE.

HC Deb 08 March 1861 vol 161 cc1655-75

MR. H. B. SHERIDAN

said, he rose pursuant to notice to move for leave to bring in a Bill to reduce the duty on fire insurance. He would remind the House that he had submitted a Motion on this subject last Session, and having then gone fully into the question, he should not now attempt any detailed statement. Indeed, it was not necessary for him to trouble the House at the same length, for he thought the subject was never so well understood as at present. The right hon. Gentleman the Chancellor of the Exchequer had said the other night that he anticipated, if a certain tax were repealed, that other hon. Members would follow the example and come down to the House with propositions of an abstract kind. The proposition, however, which he (Mr. Sheridan) was about to move was no abstract Resolution. His proposal was precise and definite, and in favour of that proposal, authorities of worldwide reputation were arrayed. Moreover the appeal was not one made ad miseri-cordiam, but one, the effect of which he believed would ultimately benefit, instead of diminishing, the revenue. The country was getting quite tired of this tax. The public press had attacked it, and a powerful association had been established to bring about its abolition. His proposal was to reduce the duty on fire insurance from 3s. to Is., and by that means to satisfy the demands of the country, at the same time that he hoped the measure in its effect would be found to satisfy any deficiency in the revenue which might be anticipated from the reduction of the duty. How stood the case with reference to the duty? The income at present arising from the duty on fire insurance was £1,400,000, representing in round numbers a sum assured of £1,000,000,000. Bearing in mind that the duty charged in Ireland was 6d. less than in England, the duty would be reduced by about two-thirds. At present, speaking generally, the property insured which furnished this gross revenue was subjected to more than the ordinary risks, and insurance offices would describe it as affected by extreme hazards. On the other hand, the uninsured property came under the head of prudental insurance, consisting, for the most part, of household goods, houses, ships, their cargoes, and uninsured stocks-in-trade. Then again, it was well known that merchants and others now insured only a portion of their stocks. In all these cases there would be a great increase of insurance, and he believed that the deficiency in the revenue, which might be estimated at £800,000, would be soon made up by the inducement which a reduction would hold out to persons to insure. Last year the right hon. Gentleman argued against the proposed year's postponement of the reduction; but he believed that that would have been of the greatest value to the revenue, since it would have given time to the companies to communicate with their agents, and to procure a large additional amount of insurances. The Motion had now been submitted for some years past. Thousands of persons possessing insurable property held back from insuring, expecting the reduction of the duty, and if this reduction were made the deficiency of the revenue would, he believed, be almost immediately repaired. At all events, two years would not pass before three times the present amount of insurance would be effected. To show how these reductions of duty were replaced, he would refer to the post-office order system. In 1841 a considerable reduction took place in the amount charged for post- office orders. In the year previous, as he learned from an interesting pamphlet written by Mr. Sharman, the number of orders issued was 188,921, and their amount was £313,124. In 1842 the number was 1,562,845, and their amount was £3,127,507, while in 1859, 7,000,000 of orders were issued, the money value being £13,250,930. It might be asked whether, in the event of this reduction taking place, there was sufficient margin to allow of the deficiency being made up. That was a natural question, but his reply was that there was ample margin. In 1845 the personal property of the nation was estimated in Porter's Progress of the Nation, at £2,200,000,000, and allowing for an increase on the average of the preceding years it would amount to £3,800,000,000, inclusive of railway property. Reducing that by £800,000,000, as representing the National Debt, there would be £3,000,000,000 left as representing the personal property of the country. The real property of the country, according to Mr. Porter, could not be very accurately ascertained. But it was estimated from the assessment for the income tax that the value of the real property in 1842 was £2,382,000.000 exclusive of Ireland, and if they added for the eighteen years which had since elapsed £600,000,000, it would bring up the actual value of the real property of the country to £3,000,000,000. A little work called the Financial Register fully confirmed that view of the case, Then taking the personal property into consideration, he found that there was about £4,000,000,000 which might he fairly termed insurable property. The increase in the value of that property had been chiefly in the shape of buildings upon land; but, besides, there had been a great deal of additional property created by the reclamation of land. In Ireland alone, of late years, there had been an increase in the value of property from that source to the extent of £3,000,000, and a great deal of land had also been reclaimed in England. It would be idle for him to attempt to give anything like an accurate representation of the value of the national property of this country, all that he could do was to give some approximation drawn from Mr. Porter's able work upon that subject. Perhaps, so far as regarded the increase in personal property, one criterion would be the vast increase in the exports and imports within the last few years. From the figures in a valuable little work upon that subject by Mr. Leone Levi, he found that the whole amount of exports in 1855 was £260,000,000, whereas in 1857 they were no less than £334,000,000, being an increase of no less thmi£74,000,000. The number of vessels which cleared out that year were no less than 97,500, with a tonnage of 22,300,000 tons; and if they estimated the value of the tonnage on the basis which Mr. M'Culloch had given, namely, £13, it would give a gross value of no less than £289.900,000, and he would add to that the £600,000,000 which he estimated was the increase in personal property. They must remember that that was almost all of it insurable property. The practice had hitherto been, with reference to ships, to insure them during the time they were loading and unloading, and to charge so much per month on the insurance. He was prepared to say that if the duty was reduced it would very materially increase the insurance of that particular class of property. At present a great many shipowners were their own insurers, including most of the shipping companies, and he attributed that fact almost entirely to the heavy duty now charged upon fire insurances. The amount of national wealth, which he had estimated at £6,000,000,000 was small, however, when compared with the national wealth of France. There existed in France 180 milliards of insurable property, amounting to £7,200,000,000 of English money. That was exclusive of real property. In this country a proportionate increase of insurance was by no means equal to that of Franco. In 1835 the amount insured in this country was £500,000,000. In 1855, it had increased to only £800,000,000. The revenue derived from fire insurance in 1845 was £1,062,000. In 1860 it was £1,400,000 or thereabouts. In England the habit of insuring had existed for 180 years. In Franco it had existed for only thirty-four or thirty-five years. But whilst we had only insured £1,000,000,000 out of 4,000,000,000 France had insured 2,200,000,000. That was a most unsatisfactory state of things, either as compared with the amount insured in France, or with the marvellous increase which had taken place in the value of our national property within the last few years; and it might be fairly assumed that it was caused mainly by the impolitic duty which was levied on fire insurances. Last Session the Chancellor of the Exchequer employed an argument based on the report of Mr. Coode to show that it was not probable any great increase in fire insurances would take place, as the result of the exemptions of agricultural produce had not been as favourable as was expected. But the opinion of an eminent actuary, Mr. Samuel Browne, was directly opposed to that conclusion, for he went into a calculation for the purpose of showing that in the two years which followed the granting of the exemption the insurance of farming stock was more than doubled; in the next ten years there was an increase of 80 per cent; in the next five, of 20 per cent; and it was only when the impulse given by the remission had been exhausted that the amount became stationary. To show the unjust character of the tax it was only necessary to suppose the case of an insurance society consisting of 1,000 members, who contributed a sufficient sum to insure each member for £1,000. In the event of a loss happening, before the society could hand over the £1,000 so insured it was requisite to pay £2,000 as a fine to the Government. That amounted to a bonus to those who did not insure, and was a penalty imposed on those who dared to take care of what they had earned by their labour. On what principle did the Government claim this 200 per cent? Had it taken any share in the risk, or had it superintended the transaction in any way? The principle would be the same if the Government in addition to the 1d. now charged for the postage of each letter were to demand 2d. for sending it. The profits of the fire insurance companies did not exceed 20 per cent on the returns; yet the demand made by the Government was at the rate of 1,000 per cent on their profits. If it were the desire of the Government to destroy the national property they were going the right way to work. The official Returns showed that insured property to the amount of £1,000,000 was annually destroyed by fire, while the total amount destroyed could not be less than £5,000,000, the balance remaining uninsured from what he must call the stupidity which actuated legislative proceedings on this subject. Were prudence and virtue matters so constantly to be met with that it was necessary to restrain them by taxation? Did not the House think it would be better to tax our vices and indulgences, than virtues such as forethought and economy? If the tax were to be regarded as a property tax he could understand its retention, though it ought to be fairly assessed. Why should a man who insured his property he liable to pay property tax, from which a man was exempt who had property sufficient to become his own insurer? Why, too, was it always thought necessary to fasten a property tax on trade, while agricultural products were allowed to go free? He could not help saying, that as a property tax it was dishonestly administered. In the leading newspapers articles had appeared in favour of the reduction of this impost, but he should content himself with quoting from The Times of the 6th of April 1860. The hon. Gentleman read as follows:— Let us now consider the character of the tax itself. Of course, in some sense, it is a direct tax, and also in some sense a tax upon property; but we venture to say that never yet was a property tax so levied. Mr. Bright proposed the other day to place a tax upon property. His scheme did not find much favour with the public, but its principles were at least more reasonable than those of the insurance duty. He would have taxed all property alike, without allowing imprudence to bring in a right of exemption; but he would not have treated a tradesman's stock as property, or levied his tax upon goods obtained merely for the purposes of sale. In the insurance duty no cognizance whatever is taken of property until its owner wishes to secure it against the risk of fire. A man with £5,000 worth of plate or furniture in his house is not called upon for a penny, provided he chooses to remain uninsured; whereas his neighbour, with a stock in trade worth £500, must pay 15s. yearly to the Government, besides 7s. 6d. to the insurance office, if he wishes to be guaranteed against ruinous loss. The tax, therefore, is levied, not upon property, but upon the act of securing it. If a man chooses to run the risk of being beggared Government will encourage him in his recklessness by exempting him from a tax; if he is too cautious to incur this peril, he must pay for his wisdom. It is in vain to argue that the duty does not really operate in this manner, and that the amount is too small to deter anybody from insuring his goods. The duty turns a payment of £1 into £3, and it would be preposterous to suppose that the latter obligation would be accepted as freely as the former. If a reduction of £200 per cent upon the cost of a thing will not bring it into more common use, what becomes of all the speculations on which Mr. Gladstone founds his Budget? What is the good of cheap silk or cheap claret unless cheapness means increased custom in the article? If there is truth, as assuredly there is, in the relations traced between price and consumption, it follows necessarily and directly that the heavy duty upon insurance discourages the practice of insuring, and that a premium is thus placed by legislative enactment upon culpable imprudence. Hon. Gentleman seemed to hear with impatience the quotation which he had read from so influential an organ of public opinion, but he begged to remind the House that these were arguments in favour of the amelioration of the condition of their fellow-countrymen. Comments had been made on the absence of petitions and remonstrances from insurance companies, but a petition had been presented that evening from the leading insurance companies of London protesting against this tax. The fire insurance companies were allowed a discount of 4 or 5 per cent for the collection of the duty. What was it that made those companies willing to give up that advantage and to ask for a repeal of the tax? The fact that they were in precisely the same position as the country at large with respect to this subject. He had heard a rumour of an intention to make an attempt to count out the House in order to get rid of this subject; but he could hardly believe that such treatment would be accorded to so important a matter, though so few Members were present. If it were a personal question affecting a Minister, the benches would be crowded, and the greatest interest be excited; but as it was merely a question of general policy, and affected more or less every household in the kingdom, of course it could hardly be expected that the representatives of the people would be in their places. It would be a very unusual thing if it were so. He had no doubt that the right hon. Gentleman, the Chancellor of the Exchequer, would object to the repeal of this duty on two grounds: first, that the Motion for its abolition was not brought forward by a member of the Government; and, secondly, that he had not the means of assenting to his proposal. He (Mr. Sheridan) was a very insignificant Member of the House; but his excuse for bringing the subject forward would be found in the fact that the Government had taken no step in that direction. A French company had proposed a scheme for insuring property in this country without duty. When the Government of the day discovered it they came down to that House, and the Act 19–20th of Victoria, preventing any company from stepping in to do that was the result of their appeal to hon. Members. That fact was sufficient to show that the repeal of the duty was not likely to be achieved by the spontaneous action of the Executive. As for the objection on the ground of want of means, the right hon. Gentleman himself, when bringing forward his proposal for the repeal of certain duties last year, laid down the doctrine that even a deficiency in the Exchequer did not afford a reason for continuing an unjust or impolitic tax, seeing that the consequence of a reduction of it might be to increase the revenue. What he proposed was to reduce the fire insurance duty from 3s. to 1s., and he believed that the sum actually obtained from the tax would, in the event of the change, not be less than at present. He I was convinced that no other tax had a; prior claim; and trusted that the Chancellor of the Exchequer would assent to the Motion, and thus increase the confidence which the public reposed in his wisdom, and in his desire to legislate in a just and worthy manner for the advantage of the entire community. The hon. Member concluded by moving for leave to bring in a Bill to reduce the duty on fire insurance.

MR. CONINGHAM

seconded the Motion.

MR. NORRIS

said, it was usual, when hon. Gentlemen came forward in that House with a proposal for the reduction or abolition of a tax, to appear as the advocates and representatives of some distressed class of the community, who complained of the oppressiveness of a tax, or of the inequality of its incidence, But they had that night the novel exhibition of the hon. Member for Dudley asking the House to fetter its independence by pledging itself to the remission of a tax which was petitioned against by certain insurance offices alone. The whole scope and drift of the hon. Gentleman's speech was to embrace, not those who were oppressed with the weight of taxation, but those who paid no taxes whatever in respect of insurance. If night after night the House took up in this way one branch of revenue after another such a course would tend to unsettle their financial system and embarrass the Government. The tea and coffee duties had been continued for fifteen months with the express view that all the taxes bearing on the masses of the people should then be taken into consideration. It was forestalling the question to propose that a large source of income should be abolished now without taking in connection with it all the other sources of income. For these reasons he hoped the House would disregard the application that had been made for the removal of this tax, until they had before them the Estimate of the expenditure and income for the year. When they knew what these were to he they could, if the finances admitted of any reduction of taxation being made, decide in what direction that reduction should take place. None of the insurance companies had announced that they would give the public the advantage of any reduction of the duty that might be made. The question, indeed, was one in which the insurers, rather than the insured, were interested, and he had little hesitation in saying that if Government were to propose the establishment of an insurance department the profits of which should go to the State, every insurance company, notwithstanding the desire they professed to encourage habits of providence among the people, would he up in arms against it.

MR. ALDERMAN SIDNEY

said, he had often heard it laid down in that House that reduction of taxation did not impair the revenue. The proposition of the hon. Member for Dudley did not go to the destruction of the revenue, but simply asked for a reduction of a tax which probably would not at the same time bring about the reduction of the revenue. He believed if the fire duty were reduced from 3s. to 1s. per cent, the public would be benefited and the revenue not endangered; and although it might be said that this was not the year in which the alteration could be well made, yet he thought it would display a want of courtesy on the part of the Government on that ground not to allow the introduction of the Bill. The tax was a tax on the provident habits of the people, and he was surprised that the Government should oppose its abolition. Allusion had been made to France, and in stating that there personal property was insured to three times the extent it was in England, he believed the hon. Member for Dudley had not overstated his case. The measure was a wise and simple one, and he believed that, though the Government might successfully oppose its introduction, the sense of the country was in its favour.

THE CHANCELLOR OF THE EXCHEQUER

The hon. Gentleman who has just sat down has stated that he never knew a more simple proposition than this submitted to the House, and yet it seems impossible for its mover to bring it forward in speeches of less than one, two, or three hours in length. However that may be, I must apologize to the House, because I frankly own my opinion that, as far as argument goes, this is an exhausted subject. I do the hon. Member for Dudley this justice, that I think he has upon every occasion argued this question with the utmost ingenuity; but his ingenuity is totally at fault; he is compelled to resort to the most extraordinary expedients; he is obliged to read to us in full detail a leading article from a newspaper, and certainly if it had been possible to avert that necessity the hon. Member would have discovered the means of doing so. Far be it from me to deny that the sentiments of that leading article were admirably put; at the same time it appears to me that leading articles are written to be read in silence rather than aloud as part of a speech. After delivering his own speech the hon. Member went on to deliver mine. I shall make a comment on that by and by. I only notice it now as a proof of the straits to which the hon. Member found himself reduced; but I make this observation, that, having delivered my speech, he also delivered his own answer to it, and I take the liberty of noting that, as far at least as I am concerned, the hon. Gentleman has already exercised his right of reply, and will not be in a condition to claim it a second time. It appears to me that my hon. Friend the Member for Abingdon (Mr. Norris) has, in his reference to the mode, to the principles, and to the order in which financial subjects should be treated by this House, given reasons for the rejection of this Motion. Nevertheless, my respect for this subject, exhausted though it is, obliges me, as the hon. Member has thought fit to state in full detail the important but very familiar points on which the argument for the repeal of the tax turns, briefly to advert to them. The hon. Gentleman says that he proposes to reduce the fire insurance duty from 3s. to 1s., and as that primâ facie removes from the revenue about two-thirds of the amount received from that source—namely, £1,400,000, what he asks the House to do on the present occasion is to vote the condemnation of £900,000 of the public revenue. [Mr. SHEBIDAN: £800,000.] It appears to me that £900,000 is a fairer statement of two-thirds of £1,400,000 than £800,000. The hon. Member who last sat down appeared to think that it was a matter of courtesy to allow the introduction of the hon. Gentleman's Bill. I respectfully dissent from that proposition. If it were a matter of courtesy and nothing else, I am quite sure that I am speaking for my Colleagues as well as myself when I say that we should be most happy to accord to the hon. Gentleman that courtesy. But when the nature of a Bill does not in any degree turn upon its structure or form of expression, when the whole effect and purport of the measure is distinctly avowed in the title which appears upon the notice paper, and in the speech of the hon. Mem- ber who asks leave to introduce it, it is the ingenous and straightforward course for the Government to adopt to state at the earliest moment its opinion upon the mea sure. £900,000, then, is the sum which the hon. Gentleman asks us now, upon the 8th of March, to determine to deduct from the revenue of the coming year. He does not make this demand without holding out to us the most alluring prospect, for he assures us, upon his word, that he has a comfortable belief that in the course of two or three years the whole of this sum would be replaced. Nay, more, the hon. Gentleman goes the length of asserting that if we do but accede to his Motion the ultimate effect will be that the tax will realize three times its present amount. [Mr. SHERIDAN: I said it would produce three times the amount of the revenue reduced.] No doubt, the hon. Member intended to say that the whole revenue would be replaced. This astonishing position is one of those specious computations which one man is as free to make as another. It is difficult to apply a test to such computations. I heard, however, the hon. Member calculate the value of the shipping of the country. He said there were 22,000,000 tons of shipping in this country, and that its value might be placed at £13 a ton. That being so, I will give the House a specimen of the trustworthiness of the calculations on which the hon. Gentleman expects that this £900,000 a year will be replaced. The 22,000,000 tons of shipping exist nowhere but in his own imagination. That is not the amount of the shipping of this country, but the tonnage that passes in and out of the ports of this country. [Mr. SHERIDAN: I said so.] The same vessels may go in and out from five to fifty times in the course of the year. There are not 22,000,000 tons of shipping in this country, but 4,600,000 tons. Here is the book, and the hon. Gentleman may make his own calculation of the value of the shipping at £13 a ton. The difference, however, is astounding, and it is not a bad specimen of the computations or conjectures of the hon. Member. The hon. Member quotes the Post Office, and especially the Money Order Office. But this is no example, and has nothing to do with the present case. That was never a tax at all, but a charge for the transaction of business, and it is a gratuitous assumption that the reduction of that charge was the cause of the increase of the system. The money order system was a perfect novelty. It spread with wonderful rapidity, and it was a discovery almost equally honourable with the original system of penny postage. But that reduction of charge was only one of the improvements that produced this effect. But what is the case of the penny postage in relation to the public revenue? You made in 1839 an immense reduction in the postage of letters. The number of letters was stimulated by a variety of means, but you reduced the postage on letters far more in proportion than the hon. Gentleman proposes to reduce the duty on fire insurance. We have had that new postal system with its reductions in use for twenty-two years, and we have not yet made up the revenue we lost in 1839. The hon. Alderman has stated that he has heard it said in this House that the reduction of duties does not impair the revenue. But can there be a grosser mistake or more dangerous error than to assert as a universal proposition what is only true in particular cases? Make your selection with judgment, take the proper case, and then the reduction of a duty, nay, I will add the abolition of the duty, will not always reduce the revenue. Each case, however, must be judged on its own merits. I will take the hon. Member's own parallel of the Post Office, and I will say here was a clear proof that while the change was admirable, while the reduction was enormous, and while the new system was worked out by the very man who introduced it, we have not yet replaced the revenue that was taken away twenty-two years ago, although I admit that it was revenue well sacrificed, and that the benefit was ten times greater than the money lost. Still, we are now on fiscal grounds; and that is an issue that must not be changed or evaded. The hon. Member objects to the exemption of farming stock from the duty on fire insurance. The hon. Member, however, does not come down with an Address to the Crown, or a Resolution of this House, affirming that it is unjust to establish a distinction between farming and other stock not entitled to take advantage of that exemption. I recommend the hon. Gentleman to make the experiment and try to get that distinction abolished. But if the Legislature acted wrongly and rashly in giving away £200,000 by the exemption of farming stock from duty, is that any reason why we should give away £900,000 more? The hon. Member says there has been a greater increase in the property assured in France than in this country. Well, no wonder. The introduction of fire insurance into France is recent. Here it is 200 years old. As well might the hon. Member suppose that because 12,000 miles of railway were made in this country last year, the same extent will be made every year for the next twenty-five years. A grosser fallacy cannot be conceived. The state of the law relative to fire insurance is, however, very different in France. If a particular person has a house in a block of twelve, and if a firebreaks out in his house and extends to the other eleven, the losses of the other eleven are charged on the man in whose house the fire arises. In this country the risks are not so large, and the proportion between the amount of property and the insurance is entirely different in the two countries. The hon. Gentleman may, from the analogy of the Post Office, have fair ground for expecting that a gradual and moderate increase will take place in the event of the reduction of the duty, but he has no ground for expecting that we can avert a heavy fiscal loss that may indeed continue for a number of years. I do not quarrel with the hon. Member on the general question whether a reduction in this tax may not be desirable, but let it be considered on its own merits, and not on expectations not grounded on experience. I admit with him that in a certain state of our finances it might be just, wise, and expedient to afford a reduction in the duty on fire insurances. But that is not the question now before us. The hon. Member says I shall object to the interference of a private Member of Parliament in such a matter. No word has ever fallen from me approaching to such presumption. It is the duty of every Member of Parliament to propose the removal of any tax that he may consider burdensome to the people. But there is a mode and time of proposing such reductions, both for independent Members and the Government. If the hon. Member asks "when ought we to object?" I say let him make his objection when his claim can be put in competition with other claims, and not when he is in ignorance as he now is of the expenditure of the country for the year, and the means of meeting that expenditure. When the Government make their proposition to the House it will be seen whether, if there be a surplus, the mode of giving it away proposed by the hon. Member is wiser than that proposed by the Government. I know it is a popu- lar saying in the House, that if a remission of a tax is suggested before the Budget the Chancellor of the Exchequer says that it is too soon, and if after the Budget that it is too late. I do not know who ever said that—certainly I never did. I will cite a case which appears to me to have been perfectly legitimate and perfectly fair to all parties. In 1853 my right hon. Friend the Member for Ashton (Mr. Milner Gibson) moved the repeal of the advertisement duty; and after the Budget was produced we found that the prevailing feeling on the subject was such that, although it was only the proposition of a private Member, and although we ourselves had proposed entirely different plans, we gave way and adopted the abolition of the duty. Now this is the course which the hon. Gentleman should pursue. To demand £900,000 of annual revenue from the Finance Minister of the country, before we know anything about the probable balance of income and expenditure, is certainly, to use the hon. Gentleman's own words, a proposal of a "stern and unflinching character." It is really too much for my nerves; and I hope it will prove too much, also, for the nerves of the House. What right, in justice, reason, or policy, has the hon. Gentleman to take the reduction of this tax out of the category of other claims? Does he mean to say that it is a claim of such a nature that we ought to grant it whether we have a surplus or not? If so, I hope the House will beware of committing itself to a deficiency in the revenue. If the hon. Gentleman says we have the means to dispose of in this way, I tell him that he does not know. Till the close of the year, and till I know what the Estimates are to be, I myself cannot presume to lay before the House any statement which would warrant that allegation. But then the hon. Gentleman asserts that this claim is prior to all others. I shall be much surprised if the House proceeds, prematurely and in the dark, to affirm that proposition. I am glad to have got from the hon. Gentleman the meaning of his Motion. It is that neither the income tax, nor the paper duty, nor the duty on tea, nor the duty on sugar, which are the chief claimants on the public revenue when the time of revision comes, are to be put in competition with the duty on fire insurance. While I think it most objectionable, except under very extraordinary and peculiar circumstances, to accept any proposal for a financial reduction with- out knowing what claims there may be on our liberality and justice, I hold it to be especially objectionable in a case like the present. The real fact is that the demand for the reduction of this tax, though favoured by public opinion, is mainly supported by a powerful and well organized combination of wealthy bodies. The House should, therefore, observe especial caution in such a case. Let us contrast this claim with, for instance, that for the reduction of the duty on tea. That is a duty which interests every human being down to the lowest class of the community. There is not a single old woman, I mean old women of the species which nature produces, not that numerous class which on artificial but very substantial grounds receive that appellation; and I say that the real old woman is the just object of our consideration; there is not one of that class living on 2s. or 3s. a week doled out by the Board of Guardians who has not a direct and sensible interest in the reduction of the duty on tea; but there are no powerful companies, no great wealthy bodies of capitalists to besiege the doors of this House and the dwellings of its Members with a demand for the repeal of the duty on tea. That repeal will be urged on the ground of public interest alone. I do not wish you to pledge yourselves to any question of priority. I object to taking up one claim before the others. I object to your taking any step until you know the state of the probable income and expenditure. I object to your spending what you do not yet know that you have got. But above all I object to your selecting for special favour the claim for the reduction of a duty which already competes, at too great an advantage, with other claims of a similar nature, being supported by those organized means of agitation which wealth has always at command. I hope that the House will refuse the Motion of the hon. Gentleman. It is our obligation as a Government to bear in mind the condition of all the tax-payers of the kingdom, and to endeavour so to regulate the taxation of the country as to strike a fair balance between their interests and claims. But it would be impossible to accomplish that task if the House of Commons were, as I am thankful it is not their practice to do, to make a precipitate and premature decision at the bidding of a powerful interest in favour of a claim which is rather for the benefit of a class than of the public, to the disadvantage of other claims which are of more general interest and may be found to be of greater weight. To take such a course would involve a substantial betrayal of public duty, and would inflict a substantial injury on the people at large.

MR. MALINS

said, he agreed with the hon. Member for Dudley in thinking this was a bad tax, and he thought that the speech of the right hon. Gentleman was opposed in spirit to the speech in which he introduced the Budget last year. The right hon. Gentleman had told them that the duty on fire insurances was to be maintained in all its integrity. [The CHANCELLOR, of the EXCHEQUER: I never said that.] He should be sorry to misrepresent the right hon. Gentleman, but he certainly understood him to maintain that principle. However, it was perfectly clear that it was the opinion of the right hon. Gentleman that, for protecting his property against fire, which was a duty every man owed to himself and his neighbour, he ought to pay to the Government just twice as much as he paid to the insurance company, insuring at the ordinary risks. He bad no sympathy with the great insurance companies; but the right hon. Gentleman was not correct in considering this a mere question of insurance companies. On the contrary, it was because he believed it was a question which deeply affected the middle and poorer classes, who were most unjustly taxed in the matter, that he dissented entirely from the principle laid down by the right hon. Gentleman. The Chancellor of the Exchequer was the first to argue for the removal of the wine duty, which really did not press heavily on the classes to whom he referred, and he did so on the ground that if they reduced the duty to 6d., there would be a very great consumption, and their other revenues would not be less. Why did not the right hon. Gentleman apply the same principle to the reduction of duty on fire insurances as the wine duty? It was of much greater interest to the people that they should be allowed to insure their homes against fire without having to pay twice as much to the Government as to the insurance office, than that the rich man should get his bottle of wine a little cheaper. He quite admitted the force of the argument that they ought to wait and see by the Budget what the Government could afford to part with, for he admitted that there were considerations higher even than relieving the people from the burden of taxation, and be for one would consent to pay the insurance tax, or any other tax, for the purpose of promoting the greatness of the country. But was he, because he held that principle, to be told year after year that a tax could not be reduced, which outraged all principles of justice and transgressed all rules of taxation? After what the right hon. Gentleman had stated last year, was he now to tell them that that was a tax in which there was to be no modification.

THE CHANCELLOR OF THE EXCHEQUER

I hope the hon. Gentleman will not repeat a misrepresentation, which is very gross. I stated nothing of the kind. I stated that, in certain conditions of finance, such a reduction might have many claims; hut I asked the House to suspend its judgment.

MR. MALINS

said, he had stated that he was quite willing to wait until the financial statement had been made, and therefore he should, though voting for the introduction of the Bill, ask the hon. Member to postpone the second reading until after the Budget, and when the Chancellor of the Exchequer had explained the exact amount of surplus. And when they knew the amount of that surplus he was sure the voice of the country would urge on this reduction, rather than those which the right hon. Gentleman attempted to impose upon them last year. The fact was the tax was most oppressive. On an insurance of £100 it was 200 per cent. It was besides objectionable in principle, because it operated to prevent a man doing that which, as a matter of precaution and safety, he ought to do. The high amount of duty had induced him to run a great risk by insuring his property at much less than otherwise he would have done. There was no reason to suppose that if the tax was reduced fire insurances would not greatly increase, so that if the proposition of the hon. Member for Dudley were agreed to at once, and the duty reduced to one shilling, the Chancellor of the Exchequer would not lose, as he stated, £1,000,000, but a portion of the loss of revenue would be made up by the increased amount of property which would be immediately insured. If the right hon. Gentleman had only admitted that the time might come when it would be expedient to modify the tax there would be then something to hope for; but so far from that he did not say this was a tax which ought to be considered at all. The right hon. Gentleman said that, considering the finances of the country, he could not hold out any hope of the reduction of these taxes at all. [The CHANCELLOR of the EXCHEQUER: I did not say so.] At all events the Chancellor of the Exchequer did not hold out any hope.

THE CHANCELLOR OF THE EXCHEQUER

said, it would be very inconvenient if any misapprehension should go forth with respect to matters of finance. The hon. and learned Gentleman must know that he (the Chancellor of the Exchequer) could not and did not hold out any expectation whatever of the reduction of any duty whatever.

MR. MALINS

said, that there was no doubt about that; hut he thought that as the duty was not defensible in its nature, the right hon. Gentleman might have said that, having regard to the general finances of the country, he would consider it. On the contrary, they had the right hon. Gentleman saying it was a question of public companies. If he (Mr. Malins) entertained that view he would not urge the reduction of the duty one farthing; but considering, as he did, that the reduction of this duty would most materially benefit a very large class of the public he should vote for the introduction of the measure, on the understanding that it should not be proceeded with until after the financial statement of the Chancellor of the Exchequer.

MR. BLACK

said, he wished to explain the reason of an apparent inconsistency in the vote which he was about to give. He had the day before presented a petition from the merchants of Edinburgh against the tax, and on looking into the petition he found that he had signed it himself. It might appear inconsistent that he should pray for a particular measure and yet vote against its introduction. But when he considered the state of the finances, he thought there was good reason for opposing the Motion. At the same time he considered the tax not only a bad one, but one of the worst at present existing. The hon. and learned Gentleman opposite seemed to think that the Chancellor of the Exchequer had refused to take the tax into consideration at all; be (Mr. Black) did not so understand him, but only that he asked to wait until there should be a surplus, and he could gather from the tone of the right hon. Gentleman that he did not expect that at present. The hop growers came forward the other night with a very strong case, but he opposed them because he thought that the Chancellor of the Exchequer had made out a stronger case against remission; and, therefore, though he was himself greatly affected by this tax and would save a considerable sum by its repeal, he could not now vote for the introduction of the Bill, because it might, be said that he voted for the repeal of this tax because it affected himself, and supported the retention of another tax by which he was not affected. He trusted the right hon. Gentleman the Chancellor of the Exchequer would take into his consideration this duty on fire insurance, and that when he had a fair chance he would bring it forward as one of the first which called for repeal, or at all events for reduction. Under that expectation he should vote against the introduction of this Bill.

MR. SPOONER

observed, that the Chancellor of the Exchequer had said that the question before the House was an insurance companies' question. Granting that it was—and he would not say whether it was or was not—what then? The insurance companies alleged that if the duty were reduced their business must increase, and as their business increased so would the revenue be increased likewise. Admitting it to be a companies' case, granting them this concession, the reduction of the tax would lead to an increase of revenue. The Chancellor of the Exchequer said it was a fiscal question; hut it was also a social one. Great risks were run by those who neglected to insure at present, but who might be led to do so if the duty were repealed, and thus a great benefit would be bestowed on the country at large.

MR. BUCHANAN

said, it was with much reluctance that he had made up his mind to vote for the Motion, but when a great principle was brought forward, it was desirable that Members should express their opinions with regard to it. He had on former occasions voted for a similar Bill to the present one, but merely with the view of making a declaration of what he conceived to be right. While voting for the introduction of the Bill, he would, after the Budget was brought forward, determine the course he would take on the second reading, as the financial circumstances of the country might justify.

MR. GREGSON

intimated, that it was with reluctance that he found himself compelled to vote against the Motion of the hon. Member for Dudley, and stated that when the Chancellor of the Exchequer had brought forward his Budget he would take an early opportunity to state the case of those old women to whom the right hon. Gentleman had alluded.

MR. CONINGHAM

characterized the tax as perfectly indefensible in principle, and monstrous in amount, and expressed a hope that the decision of the House that night would have some influence upon the forthcoming Budget.

MR. HENLEY

remarked, that they seemed now to have come to this position—that one hon. Member after another found fault with some particular tax, which was one of the easiest things in the world to do; but if the principle of conceding one tax after another were carried out, there would soon be no taxes in the Exchequer, and he did not know in that case how the national credit could be maintained. The case of the hop duties was brought before them the other night, but with respect to that, as to other taxes, he would not consent to rob the Exchequer till he saw where the money necessary for keeping up the national establishments was to come from. He did not understand hon. Gentlemen saying they would vote for the first reading, but would leave it open to consider whether they should support the second reading. That was not business to his mind. If they wanted to knock a thing on the head they should do so at once.

VISCOUNT PALMERSTON

I hope the House will carefully consider the vote into which it is about to be hurried by the hon. Member for Dudley. I never heard anything more illogical than the argument which some hon. Gentlemen have used in support of this Motion. We are told that the country requires a revenue, that it is impossible to determine upon the repeal of any particular tax until my right hon. Friend, the Chancellor of the Exchequer, has stated his views of income and expenditure; that those who are going to vote for the introduction of this Bill do not mean to bring on the second reading until after the Chancellor of the Exchequer has stated whether he has any surplus to dispose of; and, if he has, how that surplus can best be applied. If there is any reason in that line of argument it leads directly to that result which we recommend to the House; namely, not to sanction the introduction of the Bill when we do not see our way to carrying it through all its stages. Every argument which was used by the hon. and learned Member for Wallingford (Mr. Malins) tended directly to the reverse of the decision which he announced, to my utter astonishment, that he was himself prepared to join in. This is much too serious a matter to be treated with the levity with which some hon. Gentlemen are disposed to treat it. In the first place we are told that the abolition of this duty will be a great relief, and that the whole amount will go to the insurers. Will anybody insure me that a great portion will not go to the insurance offices? When the tax was taken off beer we were told that instead of its being any relief to the consumers it would only be a fair compensation to the brewers for the expenses they had incurred without any remuneration. So the charges of the insurance offices may be increased; but, be that as it may, I say we are not in a condition at present to determine with regard to any particular tax whether or not we can afford to repeal it. The country is bent upon being put into a state of security with respect to external defence. The people have raised 150,000 Volunteers at great trouble and expense to themselves in order to secure the country; and, under these circumstances, it is trifling with the great interests of the country to pronounce a decision upon any particular tax before we know whether there are any taxes which we can reduce, and, if we have such taxes, whether the tax now under consideration is the one which ought to be selected. I hope the House will not listen to the arguments of those who are in favour of this Motion, but will give to my right hon. Friend, the Chancellor of the Exchequer, that fair opportunity which he is en titled to have to take a large and general view of the whole financial state of the country, and will suspend its judgment upon any particular portion of our finances until that view shall have been laid before it.

MR. H. B. SHERIDAN,

in reply, denied that the insurance offices would derive an immediate benefit from the passing of his Bill. They would, on the contrary, suffer an immediate loss, because they gained something from the collection of the tax. He was willing, if the Motion were agreed to, to defer the second reading until after the Budget had been brought.

Motion made, and Question put, "That leave be given to bring in a Bill to reduce the Duty on Fire Insurance."

The House divided:—'Ayes 49, Noes 138: Majority 89.