HC Deb 28 May 1863 vol 170 cc2062-71

WAYS AND MEANS considered in Committee.

(In the Committee.)


rose to move to resolve— That the exemption from Duty granted by the 9th section of the Act passed in the 7th and 8th years of Her Majesty's reign, chapter 85, in respect of the conveyance of Passengers by Cheap Trains, shall not extend to any Railway Train which shall not be a Train running on at least six days of the week; or else a Train running to or from a market town on a market day, and approved by the Lords of the Committee of Privy Council for Trade and Plantations as a Cheap Train for the conveyance of Passengers to or from market. The Resolution as now worded aimed at carrying out the intention which he announced when making the Financial Statement, to bring what were called "excursion trains" within the scope of the duties levied upon the ordinary railway traffic. The Resolution had been altered with respect to what was called "low-fare traffic," which had originally been intended by Parliament to include only a limited class of traffic, amounting, as was expected, to but one or two trains a day; but gradually the "low-fare traffic" had become an important branch of railway business. It would, however, he considered, create too great a disturbance, and would operate too unequally between various companies, if an attempt was made to bring all descriptions of traffic under the operation of one equal duty. Whether the exemptions now existing were sound in principle, might be a question to consider. They had been extended beyond the intention of Parliament, and without its full cognizance; but he should hesitate to create so great a disturbance as would be involved in an endeavour to place all traffic upon the same footing. The phrase "excursion train" could not be used in the Resolution, and the best terms which could be devised had been adopted to specify the particular traffic to be affected by the Resolution— that the exemption should not in future extend to trains which did not run on at least six days in the week, or trains running to or from market towns on market days. There was no intention to tax every part of the ordinary traffic which was not now subject to taxation, but only to tax what was known as "excursion traffic." The grounds for abolishing the exemption from taxation which excursion traffic had hitherto enjoyed were, that it was on the main a pleasure traffic; and next, that although it had afforded advantages to the public, yet those advantages were not unmixed. There had been great loss of life and increased danger arising from those trains. There were no reasons for discouraging or prohibiting excursion trains, but there were no reasons why special exemption from taxation should be continued to them. Some doubts had been suggested whether the words of the Resolution would apply to other trains, such as those employed in the transport of troops; and if any improved form of words could be proposed, he should be willing to consider them.


said, that while he could not approve of the Resolution, yet he felt bound to offer his thanks to the right hon. Gentleman for the attention which he had paid to the statements of the railway representatives who had waited upon him, and for the modifications which he had introduced in consequence. He objected to the Resolution, on the ground that it was neither just nor wise. It was not just to impose additional taxation upon railway companies at the present time. Those companies had spent large sums on undertakings which had been productive of great public advantage, but of little corresponding advantage to the proprietors. He asked for no special exemption on that ground; but he submitted that railway capitalists should be placed upon the same footing as capitalists who embarked their money in other undertakings. This was notoriously not the case at present. Even in the case of the income tax, which appeared to press equally upon all capitalists, railway proprietors had to pay upon a larger assessment; because, in consequence of the companies printing their accounts periodically, they were charged to the last farthing, while other capitalists made their own returns and their own deductions. The passenger tar, which the present Resolution proposed to make more stringent than hitherto, was imposed in 1832, and altered in 1842. It was devised at a period when railways were regarded as mines of wealth—an idea that had long proved to be unfounded, and it was difficult to conceive any good grounds for increasing this tax at the present time. The case as to local taxation was still stronger, because railway companies paid rates on a large proportion of the profits of their business; while bankers or insurance companies were only rated for the houses they occupied, the profits of their business, however large, being wholly exempt. It had been shown by Mr. Laing, before a Committee of the House of Lords, in 1850, that the Brighton Railway Company were paying one-third of the whole parochial taxation of the parishes through which that line passed, so indefinite and unjust in its application to railways was the law of rating. The excessive amount of compensation which railways had to pay in cases of accidents afforded another reason for exempting them from additional taxation, of which they already paid a much larger proportion than any other capitalists. Such being the position of railways, he contended it was unjust to lay upon them additional taxation at a time when there was a considerable surplus of revenue. But even assuming that additional taxation was necessary, it was unwise to impose it upon excursion traffic. The excursion train was the poor man's train; for, except in cases where working men travelled at their masters' expense for purposes connected with their employment, they were rarely able, out of their small pittance, to travel in great numbers by the ordinary trains. The Parliamentary trains, as they were called, carried passengers for 1d. a mile, while the rates in the excursion trains varied from ¼d. to ½d. per mile. The reasons for exempting the Parliamentary trains from taxation was, that while conferring large benefits on the poorer classes, they produced very small benefit to the company. Surely this reasoning, which was undeniably sound, applied still more strongly to excursion trains; for if it was just that trains which travelled at 1d. a mile should be untaxed, it was unjust that trains which travelled at ½d. per mile should be taxed? Was it desirable that working men should be enabled to travel? He scarcely thought an answer in the negative could be given to that question. The greatest danger which had arisen to the stability of our manufacturing industry in modern times sprang from the tendency of the operatives to combine under the leadership of selfish men with mischievous objects in view. These leaders acquired their influence entirely in consequence of the gross ignorance of the men, who by leaving home occasionally and visiting places of interest would return with considerable additions to their limited stock of ideas. He appealed to the experience of all large employers, whether those among their workmen who had visited other scenes of labour did not exhibit greater intelligence on their- return, and whether travel did not tend to render them more orderly and respectable citizens. The tax proposed would affix a stigma on excursion traffic, which he thought most unwise. The right hon. Gentleman, in his budget speech, stated that in the eighteen years preceding the year 1862 the annual income of the country had increased £65,000,000. This surprising increase was spread over the three great classifications of agriculture, manufactures, and commerce. Of agricultural operations he claimed to speak with knowledge. The great improvements made of late years in that science were mainly due to the results of the periodical meetings of the national and local societies, which assembled together agriculturists from a wide area, who bore away with them to their homes the sound and practical information there acquired. These meetings would be comparatively trifling and ineffective were it not for the excursion trains, the cheapness of the traffic assembling great numbers, whose contributions swelled the funds and thereby increased the usefulness of the agricultural societies. As an instance of this, he might mention that at the Great Agricultural Show at Leeds, in 1861, 70,000 persons entered the yard in one day, whose payments for entrance, at 1s. a head, yielded no less a sum than £3,500 to the general finances of the Society. The same argument applied to the case of our manufactures. The manufacturing industry of this country could not maintain its present proud position if it were not for the facility and cheapness of conveyance, which gave our products access to foreign markets at more moderate rates than they could there be produced. Nothing contributed more to the increasing excellence of our manufactures than the great social gatherings convened by the British Association and other scientific bodies, at which all the latest and most valuable information was collected and digested. Whenever one of those meetings was about to be held, nearly the first duty of the managers was to communicate with the directors of the neighbouring railway company, requesting that they would give a number of excursion trains at very low rates, adding that the meeting would be dependent for its success upon these trains. The excursion trains were the legitimate offspring of the 1d. per mile trains, which owed their existed to the right hon. Gentleman himself, and he hoped he would not seek to devour his own grandchildren. The Great International Exhibitions were supposed to have given a fillip to the productive industry of the country, and, during the continuance of both, railway companies were pressed to stimulate excursion traffic. Representations in favour of this course were forwarded last year to all the principal railway companies by the Royal Commissioners, one of them a noble Lord holding high office in Her Majesty's present Government; and the great employers of labour had made similar appeals to them to afford facilities for the working classes to travel on these occasions. Excursion trains had in consequence been organized at extremely low fares, and had contributed very much to the success of the International Exhibition. They had also been of much service in enabling the Volunteers to practise themselves in those manœuvres which would fit them for defending the country. A remarkable instance of what they could do in this way was shown on the occasion of the great field day of the Volunteers on Brighton Downs last Easter Monday. On that occasion one company brought down 24,000 Volunteers to Brighton within about four hours, and carried them back to London after leaving them in Brighton for a time sufficient to fight a great battle. That was a great feat, but it was one that could not have been accomplished without considerable practice and experience. The Government must not think to discourage the running of railway excursion trains at ordinary times, and expect them to effect great operations in periods of emergency. He admitted that some lamentable accidents had happened to excursion trains. He deeply regretted the circumstance; but could it have been otherwise? When the running of such trains was first begun, there was not a sufficiency of rolling stock, and the officials were new at their business. He was satisfied that many more of the accidents on railways were attributable to the poverty of railway companies than to the running of excursion trains. That poverty compelled companies to carry on their business with an insufficient number of hands, and to employ boys to do the work of men. He would not divide the House on the proposition before it; but he hoped the right hon. Gentleman would consider those suggestions, and not press his Resolution on the Committee.


said, he wished to say a few words, not on behalf of the railway companies, but on the part of those who received the greatest amount of advantage from cheap trips, the working population of the country. In times not very remote it was a thing unknown for artisans to be absent from work on country expeditions. Of late years, however, it had become a general rule for working people to ask permission to go to the seaside for a certain number of days with their wives and families; and this he believed they could not do but for the facilities and inducements afforded to them by the cheap trains. The proposition of the Chancellor of the Exchequer would have the effect of discouraging excursion trips, by reason of the withdrawal of the exemption from taxation which they now enjoyed. If the Parliamentary trains which ran six days out of the seven were entitled to exemption, why were not also the occasional excursion trains, from which the working population derived such a large amount of benefit? It was a very monotonous thing to be going every day from the cottage to the workshop and back again, and he hoped the Chancellor of the Exchequer would not do anything to lessen the chances which the working man now had of occasionally escaping from that monotonous course of existence. He hoped the right hon. Gentleman would take further time to consider the matter. If the inventions of genius and application of machinery to the economizing of labour only tended to increase wealth without giving any advantage to the working man, it would considerably diminish the estimation in which they should hold the mechanical progress of the age.


said, he should oppose the Resolution, accounting it to be of vital importance to the interests of the country that the working classes should have the means of enlarging their stock of knowledge. Excursion trains did much to afford them an opportunity of doing so, and he could not imagine anything more narrow and degrading than the clutching at the few halfpence which could be obtained by taxing that which conferred this benefit.


said, he thought it was a misfortune that such taxes as that under discussion should exist at all. Originally, they were sumptuary taxes, intended to be paid by the rich; but now they were imposts upon the industry, activity, and enterprise of the country. However, the principle of the exemption from the tax in this case was that Parliament, having, of its superior authority, come in and imposed on railway companies a duty which they had not undertaken, and which they represented as an oppressive one, it was reasonable that they should be allowed an exemption from the ordinary taxation on railway trains in respect of those which they ran at the direction of Parliament and for the benefit of the public. But it now turned out that railway companies could run trains profitably at considerably less than a penny a mile; and that being so, the ground on which the exemption had originally been claimed turned out to be a fallacy. It further appeared that the principle of the exemption had in practice been much extended. The exemption was now allowed in respect of trains which were not compulsory or onerous, but which were run by the railway companies for their own profit. That being so, he did not see how the same Committee which had imposed a tax on all pleasure traffic by means of horses and carriages, could oppose a Resolution declaring that an exemption from taxation should not be allowed in favour of pleasure traffic by railway trains. He himself should be glad to see the tax upon locomotion abolished altogether; but whilst it remained it should surely be levied in a fair manner, without giving one particular kind of traffic an exemption.


said, that whilst agreeing with much that had fallen from his hon. Friend the Member for Whit by (Mr. Thompson) he must observe that he had touched upon many large questions which were entirely beside the present issue. No doubt there were many portions of the taxation imposed on railway companies, such as their rating to the poor rates, their assessment to the income tax, and their Parliamentary expenses, which well deserved consideration. He himself had voted for a measure which would have saved them in their preliminary expenses five times the sum asked from them by this proposal, by allowing them to prove their case before a joint Committee of both Houses, instead of having to prove it twice over at a double expense. He had noticed, however, that railway companies had not shown that great desire to cut down Parliamentary expenses which might have been expected from them, and it seemed as though it had occurred to some of them that it was not altogether an inconvenient thing that the getting up of a new Railway Bill should be a very expensive matter. With regard to the particular proposal before the House, he had some ground for saying that the railway companies generally were disposed to acquiesce in its fairness, and the present state of the House confirmed that opinion. He agreed entirely with the hon. Member for the Tower Hamlets (Mr. Ayrton) as to the expediency of encouraging cheap locomotion. When the Exchequer should happen to be in a state of repletion, taxes on locomotion in their turn might fairly claim the attention of Parliament; but while they remained, they ought to be levied as fairly and equitably as possible. The question had been argued as if the excursion trains were those which conferred the greatest benefit on the working classes; but the fact was, that the traffic most important for the working classes was not the excursion trains, which they used for their pleasure, but the ordinary cheap trains, which they used for their business; and he thought it would be far from consistent that they should exempt from taxation pleasure traffic as apart from business traffic. He contended that upon grounds of equity, fairness, and prudence, there was no reason why they should encourage by exempting from taxation this irregular description of traffic. They ought to tax occasional traffic upon railways the same as they taxed occasional traffic carried by means of horses; and during the present Session they had, without a word of objection, adopted a system for taxing excursion traffic carried by horses. There were special reasons for not giving a factitious encouragement to railway companies to extend the irregular portion of their traffic. It would be strange policy to insist on subjecting the regular portion of railway traffic to taxation, and exempting the irregular portion, which was attended with disadvantages which did not attach to pleasure traffic on roads—namely, that it disturbed the course of ordinary traffic and occasioned a considerable amount of risk. He did not deny that great advantages arose from excursion trains, but he could not admit that the lower classes had a predominant interest in them, believing that they were used for the pleasure of the middle class, of the lower middle class, and of the wealthier portion of the working class. Although there was perhaps a balance of advantage in their favour, they were attended with danger, and ought not to be made the object of factitious encouragement by Parliament.


agreed that excursion trains were not used exclusively by the lower classes of society, and that they were used for purposes of pleasure rather than business. But he thought there were two points which the Chancellor of the Exchequer had forgotten. It was deserving of consideration that railway conveyance was quite different from every other kind of conveyance, except that by canals. The railway company was the maker of the road, and was the maker of it at an enormous expense. In all other cases the road was made by others, and no part of the outlay was incurred by the carrier or stage coach proprietor. The railway company was also assessed for poor rates, not merely on the premises where the carriages were kept, but on every atom of profit earned throughout the line, whereas other carriers for profit had to pay rates only for the premises they occupied. Upon these grounds he thought they could not fairly compare railway traffic with other kinds of traffic. He quite agreed that the principle of exemption was wrong, but he also thought that taxation was bad with regard to locomotion generally, and he was not prepared to extend it, even to make it more consistent with taxation of other modes of conveyance. He believed that the system of taxation was not justified by sound reasoning, and he was quite certain that the two points he had mentioned were never sufficiently borne in mind when dealing with railway companies.


said, he was connected with railways; but as this was a direct tax, without the possibility of evasion, and would fall upon the capitalists and not upon the working men, he would support the Resolution. He did nut believe that the tax would make any difference in the dividends which would be paid by the railway companies, nor did he believe that it would interfere with the excursion traffic which was being pressed upon the companies more and more every year; while the directors had discovered that it was for the interest of themselves and shareholders to extend it. He believed, that if the companies would reduce their charges on passengers 50 per cent, there would be an enormous benefit to the shareholders. As to the expenses paid by the large companies, the fact was, they were huge monopolists, and as such they opposed every project, whether it would be for the benefit of the country or not, if they considered it would interfere with them.

Resolved, That the exemption from Duty granted by the 9th section of the Act passed in the 7th and 8th years of Her Majesty's reign, chapter 85, in respect of the conveyance of Passengers by Cheap Trains shall not extend to any Railway Train which shall not be a Train running on at least six days in the week, or else a Train running to or from a market town on a market day, and approved of by the Lords of the Committee of the Privy Council for Trade and Plantations as a Cheap Train, for the conveyance of Passengers to or from market.

House resumed.

Resolution to be reported To-morrow; Committee to sit again To-morrow.

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