TAXATION AND EXPENDITURE. (Hansard, 11 February 1864)

§ SIR HENRY WILLOUGHBY
rose to call the attention of the House to the amount of taxation levied for and expended in Supply during the years 1860, 1861, 1862, 1863, and 1864. He said, this was a question well worth the careful consideration of the House, and he took that opportunity of making a few observations upon it, because what he had to say referred to Supply in general, and not to any particular Supply. He believed the amount of taxation and expenditure during the last five years, including the present financial year, up to the 31st of March next, would be found to be wholly unprecedented in the history of this country. Within the last five years the amount of taxes levied upon the taxpayers of this country was nearly £350,000,000. Bearing in mind that that House was the guardian of the public 474 purse, it might be worth while to ask why it was thought necessary to impose on the taxpayers of this kingdom such an enormous amount of taxation. The amount was almost unprecedented. Except hon. Gentlemen recurred to the period when this country was engaged in the French war, the most expensive war she ever had in hand, during the years 1813, 1814, 1815, and the two succeeding years, 1816 and 1817, they would not find that so large a sum as £350,000,000 had been ever raised, in five years, independent of loans, out of the pockets of the taxpayers of this country. There must be some reason for a taxation and expenditure so large. Some £70,000,000 a year were levied in a time of profound peace. There had been alarms of war, but there had been no actual warfare worth speaking of. And if that was done in time of peace, where was there any margin left for a state of war? This taxation was entirely independent of local taxation—a taxation too large to be forgotten, for it amounted to some £20,000,000 a year. No doubt our neighbours the French were apparently nearly as heavily taxed as we; but it must be remembered that the French mixed up the local with the public taxation, and if their Secretary for the Home Department were to bring in a separate budget for local taxation, it would show a sum of about £14,000,000, while in this country the local taxation was upwards of £20,000,000. It would appear, indeed, that the chief object of an Englishman was to pay taxes. It must be borne in mind that in the question which he was calling attention to he was dealing solely with public taxation and expenditure. He should prove in a few words that our expenditure during the last five years was unprecedented, or nearly so. The expenditure from 1830 to 1854 did not exceed an average of £54,000,000—it was rather under it. It was true that at that time it did not include the expense of the collection of the revenue; but making allowance for that, it would be found that during those twenty-five years our expenditure was some £13,000,000 a year less than during the last five years, and how were we to account for that enormous difference? But the question of increase became more striking by taking the last twenty years. Dividing the twenty years from 1842 to 1862 into four periods of five years each, the gradual rise and progress of the taxation and expenditure of the country would be at once seen. In the first epoch, from 1842 to 475 1846, the annual average expenditure was £50,250,000, so that the total expenditure in that period amounted to about £251,000,000. In the next epoch, from 1847 to 1851, there was a slight increase, the annual taxation expenditure being £51,750,000, and the total during the epoch about£258,000,000. Then came the Crimean war in the next period of five years, when, no doubt, there was a great rise in the expenditure, and during that epoch the expenditure and taxation of the country rose to an average of £66,750,000, or about £330,000,000 and odd for the whole epoch. During the last epoch to which he referred there was no war, though perhaps one year might have been influenced by the expenditure for the Crimean war, and in that epoch the expenditure and taxation rose to the enormous average of£69,750,000. The House, then, ought to consider the important question, whether there was any necessity for this extraordinary increase within the last twenty years; and whether it could be maintained with justice to those whom the House represented? He would not attempt, on the present occasion, to enter into the causes of this extraordinary expenditure; but if it were said that, as in the case of the French war, it took the country fifteen years after its termination to come down to a reasonable expenditure, so it might be impossible for the House or the Government to come suddenly down from the expenditure of the Crimean war, he would observe that not only had the Government not reduced the expenditure of the period of war, but there had been an actual increase since. He believed that it would require all the vigilance of that House to check this tendency to increased expenditure, and that the Government, with all its good wishes, was unequal to the task. The Government had advanced into the enormous expenditure of maintaining manufacturing establishments, all of which must necessarily be carried on at a great Cost, and, he did not hesitate to say, at a great loss. He believed that a system of contracts with checks to prevent trickery would be one cause of economy, and might of itself effect a great deal. He felt so strongly with respect to the enormous amount of taxation and expenditure which he had adverted to, that he determined to take the first fair opportunity to bring it under the notice of the House. Knowing the extreme value of the privileges belonging to that House as the guardian of the public purse, and seeing how lamely the 476 representatives of the people in such an assembly as that of Prussia got on from want of their powers being distinctly marked out, he thought that the Members of the House of Commons should show to the country that they did not neglect their duty of watching the expenditure.

§ THE CHANCELLOR OF THE EXCHEQUER
said, he did not know that it was incumbent on him to enter on the present occasion at any great length into the very important subject which the right hon. Baronet had so ably brought under the notice of the House. He had listened to the hon. Baronet with great satisfaction, for he thought that nothing was so desirable as that the representatives of the people should call the attention of the Ministers and of Parliament to the expenditure of the State, with a view to restraining it; and if, by the influence and authority and example of the hon. Baronet, the expenditure could be brought back to that of past years, he should rejoice indeed; but in his (the Chancellor of the Exchequer's) office, it would be vain for him to attempt to deal with general assurances. It should he borne in mind that with respect to some branches of the public service, the increased wealth of the country made it necessary that increased expenditure should be incurred. With regard to the wages of labour, whether physical or intellectual, it could not be expected or desired that that portion of the public expenditure should be limited to the point at which it formerly stood. No doubt, there was a general tendency to bettering the condition of all the persons engaged in the service of the State. In some instances it was allowed to go too far, for so great was the pressure for increased emolument and remuneration for public service, that it was found difficult to keep within bounds. He was sure that the hon. Baronet would vigilantly direct his attention to this subject, and he hoped that the hon. Baronet's example would induce other Members to walk in the same line. But it must not be expected that the expenditure could be kept at the point at which it stood twenty or thirty years ago—or, he should rather say, to bring it back to that point—and that was on account of the estimate which the community was inclined to form of its own wants. The hon. Baronet spoke of the control of the Treasury as being less efficient than formerly. That was true to a certain extent, and was owing to the enormous increase in the volume and mass 477 of the civil expenditure, and not to the want of effort on the part of the political and permanent officers of the Treasury, to keep down the public expenditure. The task of exercising control had become one of increasing weight and difficulty. He did not complain of any one on this account, but he pointed it out as the result of the state of things. The development of the civil service was sometimes extravagant; but in many cases it took place for most valuable and important purposes, and he knew not any way in which an undue increase could be prevented, except by the Government obtaining a more firm and uniform support from the representatives of the people on occasions when the Government thought it their duty to resist addition to the public expenditure. When it was considered that the Civil Estimates voted by that House, without including the Estimates for the collection of the Revenue, had grown in thirty years from less than£2,000,000 to about£8,000,000, notwithstanding the great economy effected in many branches of the public service, it was obvious that that circumstance indicated a different state of things as to the increased duties which the Treasury had to perform, and as to the necessity of the Government receiving support from the House when they thought it right to resist additional expenditure. He did not now wish to enter further into the matter, for when it should be his duty to submit to the House the annual statement of Revenue and Expenditure, then would be the time for any more general discussion on the point, and on the manner in which the Government had endeavoured to maintain the application of principles of economy in restricting expenditure.

§ MR. NEWDEGATE
said, he thought the House was deeply indebted to his hon. Friend for having brought the subject to their consideration. He had listened attentively to the remarks of the Chancellor of the Exchequer, who, he believed, fully coincided with his hon. Friend in a desire to limit the expenditure within reasonable bounds. He could not forget, when the right hon. Gentleman told the representatives of the people that it rested with them to limit the expenditure, that an officer in a high position, and with many years' experience, who remembered the more economical times of our expenditure, had constantly represented that the functions of his office had, by lapse of time and change of circumstances, and the alterations made 478 by legislation, ceased to have that control over the expenditure which it formerly possessed. Lord Monteagle, the Comptroller of the Exchequer, had over and over again represented to Parliament, that if the functions of his office were so improved and adapted to the present time as to enable him effectually to check the expenditure, and comment upon that which might appear in excess, the House of Commons, as the guardian of the public purse, would have in such an officer an adviser free from the trammels of party, not subject to the effects of public excitement, not liable to the pressure of private applications, because not connected with the appointments which caused the expenditure, which it would be his duty to supervise. He hoped the House would forgive him for having recalled their attention to the repeated warnings which had been given by an officer of high character, of high standing, and of long experience, that the present organisation, which, was intended to control the expenditure of the country, had become defective in as much as that an office, which once afforded an independent check, by affording independent information, had ceased to be effectual for the public service.