RESOLUTION.

HC Deb 04 April 1872 vol 210 cc735-74

MR. VERNON HARCOURT

rose to move, as an Amendment— That, in the opinion of this House, the National Expenditure is capable of further reduction without danger to the safety and good government of the country, and that it is desirable that such expenditure should be reduced accordingly, in order that the taxation of the people and the public debt may be diminished in a larger measure than is proposed in the said Resolutions. The hon. and learned Gentleman said, if it was necessary to offer any apology for the course he was about to take, it was to be found in the fact that the sums of money voted in Committee of Ways and Means must depend on the expenditure of the country. Those who had the misfortune, like himself, to regard the expenditure as greater than was necessary for the purposes of defence and good government, of course were of opinion that the amount asked for in Committee of Ways and Means was a larger burden than ought to be imposed on the people. The question was one which was inevitably intact, and in dealing with it the only arguments which were good for anything were facts, and the facts which he thought led to the conclusion which he wished to establish he would state very briefly. The first fact he would mention was, that it happened to a House of Commons elected by household suffrage, and to a Liberal Administration twice in the course of four years to raise a Revenue from the inhabitants of this country greater, by more than £4,000,000, than had ever previously been raised, not only in times of peace, but even under the most extreme pressure of war. The Revenue which had been raised in 1870 was upwards of £75,000,000; while the Revenue raised in the year which had just concluded was £74,500,000. That was a fact which was in itself an argument, and the Revenues raised in each of the two years to which he was referring stood upon a different footing. In the year 1870 the £75,000,000 of Revenue included many part payments on account of the Abyssinian War, and was attended by large remissions of taxation. The Revenues raised in the year just concluded stood, however, upon an entirely different footing. There had been no war to absorb that Revenue, and there had been, not with standing the statement of the Chancellor of the Exchequer a few days ago, really no remission of taxation, for, in point of fact, all that had been done was to take off the people a burden which ought never to have been imposed upon them. An artificial surplus was created by unnecessary taxation, and in the result the remission of taxation was delusive. If, moreover, an income tax of 2d. in the pound had not been levied last year, the condition of the people would have been better, because they would have in their pockets, instead of the Government, the sum which that extra tax realized. The result was that, in a time of the greatest commercial prosperity which England probably had ever known, there had been substantially for the last two years no sensible remission of taxation beyond the reduction of the duty on coffee and the abatement in the rate of the income tax under a certain amount. In 1870, at the end of the two first years of the financial administration of the present Government, things were very different. There existed less prosperous circumstances, and yet, with large demands on account of the Abyssinian War, there was a large remission of taxation, exclusive of a remission of the income tax, amounting to something like £4,000,000. The Chancellor of the Exchequer explained the financial success of those two years when he said it was due to "heroic" exertions in economy. Unfortunately, that "heroism" had ceased and disappeared, and the financial want of success of the last two years was doubtless due to the absence of those principles of economy in the administration of the Government of this country. Economy, he feared, had now ceased and disappeared on the first cry of panic. There was an old and accustomed phrase in the well-known document called the Queen's Speech, which declared "that the Estimates had been framed with due regard to economy." That was the tribute which extravagance paid to the virtue of economy; but it had very properly disappeared from the Queen's Speech of this year; and those who thought that the Queen's Speech had not improved in point of style, must at least admit that it had improved in point of candour and accuracy. When he stated that the expenditure proposed for the coming year was upwards of £71,000,000, he might say of that, as he said of the Revenue of which he was speaking before, that it was a larger sum than ever was raised in England in time of war at any time. It was more by £4,000,000 than the sum raised only two years ago. He made that statement on the authority of a speech of the First Minister of the Crown, to which he would presently refer. It could not be said that this was occasioned by exceptional circumstances; for, on the contrary, a stereotyped form of expenditure appeared to be now reached; and the expenditure this year was within a few hundred thousand pounds of the actual expenditure of last year, which amounted to £71,700,000, while the estimated expenditure for the current year was £71,300,000. It might be said that they had got the expenses of abolition of purchase to meet; but there would always be something or other of the same character to be defrayed, whether it was fortifications, or barracks, or the abolition of purchase, or the Abyssinian War. Let the House examine how this matter had arisen. It was not easy to go through the public accounts, for they were kept, like the proceedings of the old Roman lawyers and of the old Roman priesthood, "in a language not easily to be understanded of the people." Let him state very briefly the estimated expenditure of the next year. It was £71,000,000 gross, and £65,000,000 was the net amount, after deducting the cost of collection; and it consisted of four different items—namely, Debt, £27,000,000; Army and Navy, including the cost of the abolition of purchase, £25,300,000; Civilcharges,£12,600,000; cost of collection, £6,500,000. He would compare this expenditure with that of 20 years ago. In 1852 the gross expenditure was only £54,000,000, and the net £50,000,000; and the following were the items:—Debt, £28,000,000; Army and Navy, £15,000,000; Civil charges, £7,000,000; and cost of collection, £4,000,000. Therefore, there had been a net increase in their expenditure of £15,000,000 in the last 20 years, to which must be added an increase of £8,000,000 upon the local rates, or practically, a total net increase of something like £23,000,000. The increase in the expenditure in the Army and Navy was £10,000,000 gross, or £9,000,000 net—a sum which had been stated at Manchester the previous night to be equal to the annual income of the House of Lords. The Civil charges had increased £5,000,000 in the same period; but he desired, in fairness, to point out that the increase of £15,000,000 in the annual expenditure did not represent an increase of £15,000,000 in the annual taxation. The receipts in 1872 were estimated at £71,000,000; but from taxes only £62,000,000 were obtainable, and therefore, £9,000,000 came from other sources. The Post Office and Telegraphs stood for £5,500,000, and £3,500,000 were derivable from miscellaneous sources. In 1852 the receipts from taxation amounted to £51,000,000, as against £65,000,000 in 1872. But the receipts from the Post Office and from miscellaneous sources were only £3,000,000 in 1852; whereas they were £9,000,000 in the present year; therefore, the net increase in our expenditure since 1852 was £11,000,000 in taxation, and £6,000,000 in other sources of Revenue. These figures proved that the increase of taxation was—to use a mathematical phrase—exactly as the Army and Navy expenditure, and not at all as the Civil expenditure of the country; for in proportion as the Civil expenditure had grown, it had been covered and more than covered by the increase of the Revenue from sources other than taxation; so that, if to-morrow they were to return to the naval and military expenditure of 20 years ago, they might maintain the increase in the Civil expenditure without adding at all to the taxation that was levied on the country in 1852. He knew that it would be argued that it was absolutely necessary that the expenditure of the country should grow with its wealth and population. That was the fatalistic doctrine of progressive expenditure; but he denied that such a doctrine received any sanction from experience. For instance, let them take the period from 1820 to 1850. In 1820, just after a Continental war, the public expenditure amounted to £52,000,000; in 1830 to £49,000,000; in 1840 to £49,000,000; and in 1851 to £49,000,000. Therefore, in a whole generation, from 1820 to 1850, not only was there no increase; but there was an actual decrease of £3,000,000 in our expenditure; yet, would anyone pretend to say, that in those 30 years the nation experienced no growth in its wealth and population? But the expenditure was in those days in the hands of financiers and statesmen who knew how to control it. The Government was economical, and the House of Commons was vigilant. The celebrated Finance Committee of Sir Henry Parnell led, in 1830, to a reduction of the expenditure from £52,000,000 to £49,000,000. The Reform Parliament, which found the expenditure £49,000,000, reduced it to £44,000,000; but even in that Parliament, that strict economy was not maintained to the end, and in 1840 the net expenditure again reached £49,000,000. When Sir Robert Peel took office the expenditure was over £49,000,000, and when he left office, in a period of great commercial changes, the public expenditure was £300,000 less than what it was when he found it. So much for the doctrine of necessarily progressive public expenditure. When Sir Robert Peel had left office the administration of the finances came into feeble hands; and from 1846 to 1848 the public expenditure increased from £50,000,000 to £53,000,000; but in 1848, Parliament forced on the Government, and the Government accepted, a Committee to inquire into the finances of the country. The Committee was strongly supported by the right hon. Gentleman now at the head of the Government, who said it was absolutely necessary, in order to maintain a healthy condition of the finances of the country, that there should be periodical inquiries respecting them by the House. That was the last year in which the House of Commons did its duty in this matter. In the preceding 30 years there had constantly been Financial Committees of this House, and the public expenditure never increased; since 1848 the House of Commons had abandoned its duty in this respect, and the expenditure had increased £15,000,000. He had been told that the period in which the expenditure did not increase was one of peace and tranquillity, and that it was therefore easy to keep the expenditure down; but the last decade in which the public expenditure was not allowed to increase was a decade which included the Rebellion in Canada, the Oregon question—a difficulty which brought us more nearly to war with the United States than ever we had been since the affair of Acre and the Syrian complication with Prance, the affair of Tahiti, and, above all, the French Revolution; and in our social affairs we had the development of the education system, a new police, and improvement in the conduct of lunatic asylums—all matters which necessarily increased expenditure; but the financiers of the Government and of the House of Commons knew how to meet the charges thus created without permitting an increase of public expenditure. These were the facts which conclusively refuted the fatalistic doctrine of progressive expenditure. After this period came the unhappy event of the Crimean War, which he would not describe in his own words, as it had been described within the last 24 hours by a master hand. In his speech at Manchester, the right hon. Gentleman (Mr. Disraeli) said— The calamity of the Crimean War, whose consequence was a great addition to your Debt, an enormous addition to your taxation, a cost more precious than your treasure—the best blood of England. Nor are the evil consequences of that war adequately described by what I have said. All the disorders and disturbances of Europe, those immense armaments that are an incubus on national industry and the great obstacle to progressive civilization, may be traced and justly attributed to the Crimean War. That these sentiments should be delivered in the Free Trade Hall, Manchester, by the Leader of the Conservative party, was certainly matter of surprise and satisfaction; it would seem as if the shade of Cobden were avenged; and they seemed to justify all the language ever held on the subject of that war by the right hon. Member for Birmingham (Mr. Bright). When there was added to this an eloquent protest against the unconstitutional practice of maintaining in this country great standing Armies, the right hon. Member for Buckinghamshire would find that he had many supporters in these sentiments on the Government side of the House. The Crimean War was not only a political blunder, but it was also a great military disaster. We attempted to do that which we could not accomplish, and we had been paying for the attempt ever since. We attempted to ally ourselves with great military Powers, and to cope with great military armaments; we succeeded only very indifferently, and last year we surrendered all the result we ever hoped to accomplish by the war. The estimated cost of that war was £90,000,000; but that was a very small part of the cost, for it added £10,000,000 a-year to the cost of the military establishments of this country; so that we had paid £200,000,000 on this account since the war, and we should continue paying £10,000,000 a-year as much longer as we had in contemplation the pursuit of such a policy as that which led us into the Crimean War, and which the right hon. Gentleman (Mr. Disraeli) so justly denounced at Manchester the other night. £10,000,000 a-year was the interest upon more than £300,000,000; therefore, the result of the war, apart from its first cost, had been the same as if we had paid an indemnity of £300,000,000. In 1859 the expenditure had returned to what might be called its normal footing after the war. The expenditure of 1859 was £60,000,000 net against £50,000,000 net before the Crimean War. The Army and Navy cost £22,000,000 at that time; and it was a remarkable epoch, because the present Prime Minister again became Chancellor of the Exchequer, and within two years the expenditure increased £4,000,000—from £60,000,000 in 1859 to between £64,000,000 and £65,000,000 in 1861. It was not surprising that the Chancellor of the Exchequer took alarm at the growth of the expenditure under his control; and he did what was an unusual but a very beneficial thing; he protested in the Budget against the expenditure he provided for. In 1861, when he was called upon to provide for an expenditure of nominally about £70,000,000, but which, as he showed with proper corrections, was under £70,000,000, the right hon. Gentleman said— In point of fact this is simply a question of expenditure, and I will not speak of expenditure as a thing that can be suddenly and rapidly dealt with…. But, looking forward into the picture, and desirous to afford such indications as I can, I should hazard an opinion that, if the country is content to be governed at a cost of between £60,000,000 and £62,000,000 or £64,000,000 a-year, there is not any reason why it should not be so governed without the Income Tax, provided that Parliament shall so will it to be. If, on the other hand, it is the pleasure of the country to be governed at a cost of between £70,000,000 and £75,000,000 a-year, it must, in my judgment, be so governed with the aid of a considerable Income Tax.—[3 Hansard, clxii. 586.] This was an indication that, in his opinion, the taxation of the country was £10,000,000 more than it ought to have been. He added— If there be any danger which has recently in an especial manner beset us, I confess that, though it may he owing to some peculiarity in my position, or some weakness in my vision, it has seemed to me to lie during recent years chiefly in our proneness to constant and apparently almost boundless augmentations of expenditure…. I do not refer to this or that particular charge or scheme. I do not refer to the Estimates of the year; but I think that when, in an extended retrospect, we take notice of the rate at which we have been advancing for a certain number of years, we must see that there has been a tendency to break down all barriers and all limits.—[Ibid, 595.] That was the language of the right hon. Gentleman when the expenditure was £2,000,000 less than it is now. This appeal to Parliament did not answer its purpose; the Government of that day was in favour of great expenditure; and the right hon. Gentleman found it necessary to take strong measures against the expenditure of his own Cabinet. During the Easter Recess he went to Manchester—whither great men found their way during the Easter Recess—and the right hon. Gentleman, at Manchester, made a speech against his own Budget, in which he said— During the last three years our Revenue has been on the average £70,500,000. I may say with substantial truth that this is the largest Revenue which has ever been raised in this country, not only in time of peace, but even in time of war. In the three years of the Russian War, when the income tax was 1s. 4d. in the pound, the Revenue raised was £70,250,000. In the last three years of the great Revolutionary War, when the income tax was at 2s. in the pound, the Revenue raised was £70,750,000. But as this was raised on a depreciated currency, the £70,500,000 we have been raising is really greater. The reason why I mention these, and point out to you that the present state of affairs is not one compatible, in my opinion, with a thoroughly healthy state of finance is because, as I have said, this country is in the main a self-governing country. I am in your hearing, gentlemen, when I say that partly no doubt this expenditure has been a right and justifiable increase connected with the increasing wants of the country, and connected with real necessities; but taking it on a whole, it has been demanded by the public voice. If we are, therefore, to have an alteration, it must be an alteration brought about by a turn of the public mind. I cannot say that I do not believe—for I do believe—not indeed that we can go back to the expenditure of 1853, but that with judgment and firmness material reductions may be progressively made. If it be the pleasure of the nation to force upon its representatives the advocacy of all kinds of measures, warlike or peaceful, or both peaceful and warlike—I can draw no distinction—if it be the pleasure of the nation to force these measures upon Parliament, Parliament must force them on the Government; and it is not in the power of the Government to resist. If, on the other hand, it be the desire of the people, founded upon a perception of the true state of affairs, that we should contract in some degree the scale of our expenditure, then I say, gentlemen, that you know as well as I do, that it will take no long time to bring that result about. This was in the speech of the Chancellor of the Exchequer, for which he was attacked on his return to London by hon. Gentlemen opposite. On that occasion, the right hon. Gentleman the Member for Buckinghamshire, who was very accommodating, and who thought he saw an opportunity of assisting the Chancellor of the Exchequer to turn out the Prime Minister, delivered his celebrated speech against "bloated armaments," one of the best speeches ever made against great military establishments. A very important incident then occurred. There met at a Free Breakfast Table somewhere in Pimlico certain Members of that House who were determined to support the views expressed by the Chancellor of the Exchequer at Manchester, and who agreed to propose an economical Resolution. The present Vice President of the Council (Mr. W. E. Forster) presided, he believed, on that occasion, and there were present the President of the Poor Law Board (Mr. Stansfeld), and his hon. Friend the Member for Montrose (Mr. Baxter), the Secretary to the Treasury. Well, this Free Breakfast Table gathering resulted in an economical Amendment being proposed by the present President of the Poor Law Board. That Amendment was substantially the same as that which he now intended to submit to the consideration of the House. The Amendment came on for discussion, and his right hon. Friend the Member for the University of Cambridge (Mr. Walpole) also had an Amendment on the Paper; but as there was some fear that it would succeed, and as the Prime Minister had said he would resign if it did, his right hon. Friend, with his usual prudence, withdrew it. This occurred on the eve of the Derby, and the right hon. Gentleman the Member for Buckinghamshire said—"the favourite had bolted." The result was a general scrimmage. On a division the economical Amendment of the Free Breakfast Table was rejected, as all Amendments were when both sides of the House were combined; but it, nevertheless, had its effect, for it showed the Prime Minister of that day that the expenditure could not be defended, especially as the Leader of the Conservative party had become alive to the claims of public economy. The Prime Minister accordingly allowed the Chancellor of the Exchequer to have his own way, and the consequence was, that the public expenditure, which had increased by nearly £4,000,000 between 1859 and 1861, became in 1866, £4,000,000 less than it had been in 1861, and £4,000,000 less than it was at the present time. Then the Conservative Administration ran the expenditure up about£2,000,000, exclusive of the Abyssinian War; and the new Liberal Government, fresh from its pledges of economy, reduced it by nearly £3,000,000 as compared with the expenditure of their predecessors. The expenditure was now increased again. He thought, however, hon. Members would discard the doctrine of necessarily progressive expenditure, and come to the conclusion that the progress of expenditure depended upon the policy of the Government and the vigilance of the House of Commons. It might be said that armaments were more expensive now than they were formerly. But great guns were used to a greater extent in the Navy than in the Army, and yet, owing to the efforts of his right hon. Friend the Member for Pontefract (Mr. Childers), the expenditure in the Navy had been largely diminished. The increase had been in the Army, where the "expensiveness" was less necessary. It might also be said that the expenditure on the Army and Navy was not greater than it had been at former periods during the last 10 years. This was undoubtedly true, although he could not agree with the statement made by the Chancellor of the Exchequer the other night, that the expenditure was less than it had been at any period since 1859; because if the proper corrections were made, it would be found that within the last three years the expenditure had been lower than it was at present. However this might be, he and his hon. Friends were not returned to Parliament for the purpose of supporting the Palmerstonian Military and Naval Estimates. Indeed, they had always protested against the Palmerstonian expenditure. They understood from the Manchester speech of the Chancellor of the Exchequer and from his Budget speeches that the right hon. Gentleman did not approve that expenditure, and it was no answer to them to say that the expenditure was no greater now than it was in Lord Palmerston's time. Perhaps the House might be told that since that period a number of taxes had been remitted, and that we could therefore well afford to increase our expenditure. The weight of taxation might have been made less oppressive to individuals; but we were at this moment raising out of the fund from which the labour of the country was employed £11,000,000 more than we did 20 years ago. Again, it might be urged that the area on which the taxation is levied is better able to bear it than formerly. Undoubtedly, the wealth of the country had grown enormously, but pauperism had increased quite as rapidly. [Mr. STANSFELD: No, no!] At all events the public Returns showed that in 1853, when the population of England and Wales was 18,000,000, the number of paupers was 800,000, and the number of able-bodied paupers 125,000. In 1870, when the population of England and Wales was 22,000,000, the number of paupers was 1,000,000, and the number of able-bodied paupers 194,000. Then the poor rate had grown from £5,000,000 to £7,500,000, or a rise of 50 per cent. In fact it was the same to a farthing as it was in 1841. That being so, what had we to boast of in the progress of our wealth to justify our national extravagance? The wealth had grown on the surface of the population, to which the House of Commons belonged—and which it too exclusively represented, agitated by the fluctuating waves of prosperity and adversity—who knew the difference between the alternations of commercial advance and depression; but below these classes there was one of unaltered and unalterable want, to which the word "wealth" conveyed no meaning at all. What idea could the increased prosperity of the country convey to men who had to support themselves and their families on 10s. or 12s. a-week? He agreed with his right hon. Friend the Member for Halifax (Mr. Stansfeld) that tea and sugar were necessaries of life to the poor. But it was from these people that the Government took £7,000,000 in taxes which might be remitted to-morrow if the expenditure were reduced to that of 1852. The tea and sugar duties might be abolished, together with 2d. from the income tax, and still the reductions would not exceed the £10,000,000 of expenditure added for the Army. One of these Resolutions before the Committee was to re-impose the tea duty, which would have been unnecessary, if we had confined ourselves to the Estimates of 1870, which were considered adequate to the wants of the country. The Estimates for that year would have given us a surplus of £4,000,000, which, after remitting the duties on tea and sugar, would have left a surplus of £1,000,000. He knew that the Chancellor of the Exchequer was not an admirer of the free breakfast table, and he was sorry for it. He had laid down a principle, humane and sound, in regard to the lower class of income taxpayers, saying they ought to be exempted on account of their struggle for life. He had said that the citizen must live; it was true he had added that the citizen lived that he might be taxed; but it was clear that living was a condition precedent to his being taxed at all. Taking the ordinary consumption of tea as 4lbs and sugar as 42lbs a-head, it was no exaggeration to say that a labourer with three or four children would pay 12s. a-year in taxes upon tea and sugar, or a week's wages. That was too much. If proof were wanted that such earnings should not be taxed, it was to be found in a statement of the Secretary to the Local Government Board to the effect that he was continually being asked to supplement the wages of labourers by payments out of the rates, because those wages were insufficient for their support. Such a class was as much in need of exemption as the lower class of income taxpayers. He was sorry that they had lost many friends of economy from the benches below the gangway, and who had proceeded to the Treasury Bench, from which economy never came. But in place of those he expected to find new allies, not willingly, but necessarily, from the other side of the House. The farmers were about to discover that they could not pay high rents, high wages, high rates, and high taxes. When they did find this out, they would be the best economists in the country, and the country gentlemen, however, much against their will, would have to follow them. Perhaps, when this had come to pass, a Liberal Government would admit the claim of economy. The great question of the future was the question of rating, and it demanded a solution. We could not continue to levy £25,000,000 a-year by rates direct and indirect, so long as the system was so unjust as it was at present. The system must be reformed. Sir George Lewis had laid down the principle that the presumption was always to put the public charge on Imperial and not on local taxation. He believed that principle to be true, and had always been of opinion that local taxation ought to be relieved by Imperial taxation. But that could only be done by lowering the Imperial expenditure. When that principle came to be properly understood, hon. Gentlemen opposite would become the true friends of economy. How had this vast expenditure arisen? From panic, which had been fostered instead of being resisted by Governments. Instead of advising the country not to yield to these panics, the Government had encouraged them by advising a large expenditure, upon the extraordinary grounds, as stated in The Times, not that the expenditure was reasonable, but simply because the panic existed, and because the expenditure of this sum would prevent all future panics. But this had been the course adopted during the last 20 years. Expenditure upon the Militia had been followed by expenditure upon the Volunteers, upon fortifications, and upon harbours, and now £3,500,000 was to be spent upon barracks. Panics were not to be got rid of by feeding them in this way any more than a man with dropsy would be cured by repeated doses of water. Nothing would satisfy the noble Lord opposite or his hon. and gallant Friend beside him. They took what was given them as an instalment, and waited for the next opportunity to ask for more. Compliance with the demands of professional alarmists would never put an end to panics. In conclusion, he hoped the right hon. Member for Halifax (Mr. Stansfeld) would excuse him for having adopted his Resolution, and not think, because he had omitted the word "compromise," that he was prevented from voting with him on the present occasion. The hon. and learned Gentleman concluded by moving the Amendment of which he had given Notice.

MR. RICHARD

, in seconding the Amendment, said, he felt deeply grateful to his hon. and learned Friend the Member for Oxford, for the courageous pertinacity with which he had insisted on proclaiming that economy was one of the cardinal articles of the Liberal creed, although it had fallen into discredit with many Members of the Liberal party. He believed that the national expenditure was capable of considerable reduction without danger to the safety and good government of the country. It might be said that the recent Budget had been received with general satisfaction, although its principal achievement consisted in taking 2d. off the income tax, which everybody admitted ought never to have been put on. No doubt the country felt relieved at this much as a patient would if relieved of a blister which should never have been put on; and the fact that the country was pleased with the other remissions in the Budget only showed what a long-suffering and easy-tempered people we were, and for what very small mercies we were thankful. It was impossible not to compare what had been done by the Chancellor of the Exchequer, compared with what might have been done if the Government had entered on a course of real and substantial retrenchment. When the House remembered the promises made by the Members of the present Government, which induced their followers to promise also—and to an extent which made it disagreeable now to meet their constituents; when the House remembered the recent declaration of one who was no longer a Member of the Government, that no Government was deserving of the confidence of the country which could not carry on the administration of affairs in a manner consistent with the dignity and security of the nation for a smaller sum than £70,000,000—and especially when we remembered the Cassandra tones in which the Prime Minister deplored and denounced the extravagant national expenditure—it was impossible not to feel bitterly disappointed and disheartened at the contrast. The House had no right to blame the Chancellor of the Exchequer, who was bound to devise the Ways and Means required by the Government; but he was surprised that the right hon. Gentleman went out of his way to defend the enormous sums expended on naval and military armaments. Why should the right hon. Gentleman rob the House of the consolation of believing that there was at least one Member of the Cabinet besides the Prime Minister who must look with regret at the present state of things, for he clung to the belief that the Prime Minister was a genuine friend of national economy, and that it was no satisfaction to him to find the Government entering on the path of downward extravagance. What was the cause of this? No doubt all Departments of the State had become more costly—the Civil Service Estimates having in a special manner increased, owing to the disposition to demand of the Government to do all sorts of things for the people, which in former times they were accustomed to do for themselves. But the great increase in the expenditure was in the growth of our armaments. In 1835 the total number of our forces at home and abroad was 145,846 men. At present there was some difficulty in arriving at the number of men, because of the variation in the mode of stating it. If it was thought necessary to minister to the national pride, the number of available forces was made as large as possible; if it was thought necessary to minister to the national fear, the number was made as small as possible. But as far as he could make out the latest Returns there were at the present time 500,000 men under arms in one form or another. Were we more secure now than in 1835? On the contrary, it appeared to him that just in proportion as the armaments were increased was the decrease in the feeling of security from foreign invasion. To show how greatly the military expenditure had increased in recent years he would quote from the Returns moved for by the Prime Minister. They showed that from the year 1817 to the year 1826 the total expenditure of the War Department was £171,000,000, or 29 per cent of the total expenditure; from 1827 to 1836 it was £141,000,000, or 26 per cent of the total expenditure; from 1837 to 1846 it was £145,000,000, or 27 per cent of the total expenditure; from 1847 to 1856 it was £214,000,000, or 35 per cent of the total expenditure; and from 1857 to 1866 it was £272,000,000, or 39 per cent of the total expenditure of the country. Why was it that we had that enormous increase in the military expenditure? He had looked in vain for any reason for such increase. The Secretary of State for War had stated last year, and had repeated this year, that the object of increasing the expenditure was to prevent the recurrence of those ignominious panics which had so frequently dishonoured our national character. If the right hon. Gentleman believed that, as he no doubt did, he must be the most sanguine of mankind. The same promise had been made in regard to every addition of our forces. In 1852, in consequence of certain changes in the Government of Prance, a violent panic went through the country. There was a cry for the Militia, and the Militia were called out with the assurance that if they were embodied England need fear nothing from the invader. Very few years elapsed before the panic returned again, and the Militia were held to be nearly useless by those who had clamoured for them. Next there was a cry for a Volunteer Army—a citizen force—whose motto was "Defence, not defiance," and it was said we could then sleep comfortably in our beds. Prodigious at first was the puffing of this force. But after the lapse of a few years the panic was upon us, and then it was said that the Volunteers were a "sham Army." Then arose the cry for an immense system of fortifications, and at the time Mr. Cobden was employed in negotiating the Treaty of Commerce with Prance, Lord Palmerston asked for £11,000,000 for fortifications to defend us against our French neighbours. In the year 1869, nearly half of that sum having then been spent, The Times published an article in which it declared that we might just as well have thrown the £5,000,000 into the sea. The cry for more protection was, The Times said, as loud after all that had been done as if nothing had been done. It was in 1859 as it had been in 1849; and in 1869, as in 1859, we were described as being in the same defenceless position as we had been 10 years previously. Again, when the war on the Continent broke out two years ago, in spite of all the money that had been spent since the Peace of 1816, and which amounted to more than 1,000 millions for our armaments, a demand was made for 20,000 men and £2,000,000, to defend us against what or whom he did not know. And now the Secretary of State for War had brought forward his nostrum as a specific against panics. But the fact was, that there was but one way of preventing the recurrence of panics, and that was by resolutely refusing to yield to them. Every Government denounced panics, but invariably gave way to them. Sir Robert Peel stated on one occasion, that if the House listened to the opinions of military men, who were naturally credulous on the subject, they would involve the country in an outlay that no Revenue could bear. The officers of the Army were assumed to be the bravest men in the country, and proved themselves so when it came to fighting, and yet they were singularly devoid of what might be called civic courage. They were in a state of chronic fright when not fighting, alarming the whole island by hysterical cries of terror and alarm. At the request of Mr. Cobden, when he was writing his celebrated pamphlet on the Three Panics, he (Mr. Richard) went down to the British Museum to inspect what might be called the panic department of literature in the library of that Institution, and was completely surprised at the number of volumes which had been written to show how an enemy might invade England, and pointing out our defenceless position. All these works were written by officers, admirals, generals, commanders, colonels, and majors. How was it that these men were in a state of perpetual alarm? It might be, perhaps, that they had little or nothing else to occupy their attention, and that "Satan finds some mischief still for idle hands to do." In replying to the comments on his Military Estimates, the Secretary of State for War somewhat alarmed him by saying that it was necessary for us to have large armaments on account of the great military monarchies of Europe. Did the right hon. Gentleman mean that we were to enter into that rivalry of armament by which those nations were rushing to their ruin? If that were so, he ventured to answer him by the words of Sir Robert Peel, when a somewhat similar argument was used in the House: Sir Robert Peel said—"We must, indeed, consider what is going on upon the Continent; but we should consider it rather as a warning than an example." The right hon. Gentleman the Member for Buckinghamshire (Mr. Disraeli), upon one occasion made a remark which had the merit of condensing into a phrase the whole essence of the argument on this subject—it was, "that expenditure must depend upon policy." The question, therefore, was, what was to be our future foreign policy? We had tried three different kinds of foreign policy. The first had been that of constant armed intervention in European quarrels which, as declared by Fox in 1792, had resulted in a lavish and unprofitable waste of our blood and treasure. Then we had tried the policy of incessant diplomatic meddling for a period of about 30 or 40 years, during which we had quarrelled with every Power in Europe and America, and had reached the verge of war with France and the United States again and again. From those who cast a lingering look behind upon that policy, which they appeared to think necessary to maintain the honour of the country, he differed toto cœlo, inasmuch as it had resulted in this nation having been compelled to eat more humble pie than at any time since the reign of Charles II. Twice our Ministers were dismissed summarily from foreign Courts; once the French Ambassador was angrily recalled from England; and over and over again we had to submit to lectures and snubbing from the various despotic Governments of Europe. At the present time another policy was unreservedly adopted by the Leaders of all parties in this country—that of non-intervention, which, in his opinion, was the wisest that could be pursued. It had been suggested that this was a new-fangled policy; but the truth was that it was the ancient policy of the Liberal party. In 1830, in the first speech he made as Prime Minister, Earl Grey said that ourtrue policy was to maintain universal peace, and to abstain from interfering in foreign disputes. He was delighted to find that the Leaders of the opposite party had frankly and loyally accepted the principle of non-intervention to its fullest extent. The present Lord Derby had said— We may be called cold and indifferent to the affairs of foreign countries, we may be accused of selfishness and isolation; I am very well content to take my share of these reproaches, because I firmly believe that by minding our own affairs, by living at peace with our neighbours as long as we can—and we may depend upon it when we don't quarrel with them they won't be in a hurry to qnarrel with us, and by setting them an example of economy and good order in our government at home, we are doing more for other countries, and more for the good of the cause of freedom and order and commercial prosperity throughout the world, than we could by any armed interference. In 1864 the right hon. Gentleman the Member for the University of Oxford (Mr. G. Hardy) said, referring to our intervention in the Dano-German quarrel in 1864— These facts point to the conclusion that the position of England, free from Continental complications and embarrassments, fits her for being the mediator of Europe. They point out that, having nothing to gain from the oppression of the smaller States, nor from the damage of the larger, she is qualified to occupy a position of dignified neutrality, a position in which she can wield more influence than she could ever gain by war. She may gain a crown of glory by war, but she can more certainly gain that crown by being instrumental in the preservation of peace; but she cannot maintain peace when she mixes up her advice with threats and promises to take steps which complicate her position, and disqualify her from exercising that impartial influence which her character as a neutral should confer upon her…. We may occupy a dignified position towards all other nations, and may hold out to them the hand of friendship, saying—'In your embarrassments come to us for mediation, but not for the sword.'"—[3 Hansard, clxxvi. 1022–3.] That appeared to him to be an admirable definition of the duty of this country in her relation to foreign nations. If, therefore, we had abandoned the policy of intervention, and were determined for the future to mind our own business, why should we continue to beep up our present enormous armaments, which could have no other object than to enable us again to interfere in the affairs of Europe? He earnestly hoped that the Prime Minister would be able to assure the House and the country that the inordinate and profligate expenditure of the past should be altered, and that the Government would become what they professed they would be when they were bidding for office—an economical Government, preserving the dignity and safety of the country without resorting to such an extravagant expenditure as that which the country had now a right to complain of.

Amendment proposed, To leave out from the word "That" to the end of the Question, in order to add the words "in the opinion of this House the National Expenditure is capable of further reduction consistently with the safety and good government of the country, and that it is desirable that such expenditure should be reduced accordingly, in order that the taxation of the people and the public debt may be diminished in a larger measure than is proposed in the said Resolutions,"—(Mr. Vernon Harcourt,) —instead thereof.

SIR JOHN LUBBOCK

said, his two hon. Friends who had brought forward this Amendment, while attacking the expenditure proposed by Her Majesty's Government, had expressed their approval of the provisions of the Budget. No doubt it was gratifying to find that the Revenue was increasing, and that the expenditure had been kept within the Estimates. The right hon. Gentleman the Chancellor of the Exchequer had, he thought, acted wisely in proposing to reduce the coffee duty, though he confessed he did not see sufficient reason for altering that on chicory. He regretted that the Chancellor of the Exchequer had not proposed to prolong the income tax for somewhat more than a year. The inconvenience of not doing so, was shown last year by the fact that the dividends on several important stocks were actually paid without any deduction for income tax; while this year the same inconvenience was avoided only by taking the financial statement before the close of the year; and when, consequently, the figures were not finally ascertained. In fact, the result had been that the income of the country had exceeded the amount stated last week, by no less than £173,000, while the expenditure was £230,000 less, making a difference, fortunately in our favour, of no less than £400,000. All these inconveniences would be avoided if the Vote was taken for a year and one month, instead of for a year only. The Chancellor of the Exchequer had been blamed for his last year's Estimates; but it seemed to him that he had only exercised reasonable prudence. It was not his business to make clever guesses; he must take care to be on the safe side, to insure the due provision of the necessary Ways and Means. Some hon. Members had spoken as if the Revenue derived from the extra 2d. of income tax imposed last year had been wasted. If, indeed, the surplus of last year had led to unnecessary expenditure, this regret might be well founded; but, on the contrary, the estimated expenditure had not been exceeded, and the result of the extra 2d. had been that we and our descendants for ever would need to pay £100,000 a-year less than would otherwise have teen the case. No doubt remissions of taxation were always popular; but he doubted whether they were always wise; and he thought the right hon. Gentleman had gone too far in that direction. The present Budget was one calculated rather to please the House of Commons than to be for the benefit of the country. He was most anxious for economy; but it was in order that we might have ample funds for objects of real importance. They had heard a great deal during this discussion about the extreme poverty of the country. Poverty, however, depended more on a man's character than on his income, or on the amount he paid in taxes. Yet, to hear some hon. Members speak, anyone would suppose that we were a nation of paupers, and that the great object of human existence—the highest aspiration of an enlightened people, was to drink the largest possible quantity of cheap tea. From 1856to 1870 taxes were repealed amounting to more than £44,900,000, and deducting those imposed, £12,600,000, there had been a reduction of taxation amounting to no less than £32,300,000. If remissions of taxation could remove distress, there would therefore be little now to complain of. For his own part, he regretted that the Chancellor of the Exchequer had not taken this opportunity of placing in the Estimates a sum to be applied in the reduction of the National Debt. Such a course, steadily pursued for a few years, would greatly raise the value of our funds, and probably so much as to enable us to reduce the interest on the Debt from 3 per cent to 2½ per cent, thus effecting a saving to the nation of several millions a-year in interest. The Chancellor of the Exchequer, indeed, had congratulated the House on the progress recently made in this direction. He said—"During the last three years we have paid off £12,000,000, and have increased our balances £4,000,000." From this, however, must be deducted the amount of the taxes he had anticipated. But what were £12,000,000 in three very prosperous years? If it were wise to reduce our Debt we ought to do so on a scale worthy of a great nation. The Americans were paying off £20,000,000 a-year, and their funds had risen in three years from 80 to above par, thus enabling them to reduce the interest. The importance of reducing the National Debt had been strongly urged by the greatest political economists. It was well said by David Hume, that if the nation did not destroy the Debt, the Debt would destroy the nation. Adam Smith observed that the practice of borrowing had gradually enfeebled every nation which had adopted it. Similar opinions had been expressed by our leading statesmen on both sides. The right hon. Gentleman the Member for Buckinghamshire (Mr. Disraeli), when in office, spoke strongly to this effect. Lord Derby the other day said that, in his opinion, a portion of our surplus this year ought certainly to be devoted to this object. The right hon. Gentleman at the head of the Government had pointed out, with his usual eloquence, the necessity of reducing our Debt. Nay, the Chancellor of the Exchequer was himself of the same opinion. Every one who heard his speech last week, and that of last year, in answer to the Resolution of the hon. Member for Brighton (Mr. White), must have been struck by the contrast. This year he had evidently no pride or interest in his own Budget. Last year, on the contrary, his heart was in his work. He felt that he was defending a dignified and noble policy. In that speech he condemned his present proposals with far more force and eloquence than he (Sir John Lubbock) could command. He pointed out clearly the advantages we should derive from a reduction of our Debt—the probable diminution of the rate of interest, the power of borrowing again, if necessary, on better terms, the position it would give us in the eyes of other nations. He dwelt on the duty we owed to our children in this matter; pointed out clearly the great prosperity of the country, the comparative lightness of our present taxation, which had been gradually reduced from £2 9s. 3d. a-head in 1825, to £1 18s. 5½d. in 1870. He reminded us that we must not expect this state of things to last for ever, that circumstances might arise in which we might be called upon to make immense sacrifices, and that we should be ill able to make them unless we diminished our immense weight of Debt; that we ought not to— Allow ourselves to be enervated or relaxed by the ease of fortunate times, but to look forward carefully and prudently to a time—and we know not how near it may be—when the present condition of things may change, and when we may be called upon, as we have been in the course of our history, to contend for our very existence."—[3 Hansard, ccvi. 1457.] The right hon. Gentleman continued— All that we now enjoy is the result of a long course of self-denial, which has not been equalled, certainly not been excelled, in the history of the world. All that we now enjoy is the fruit of the incredible toiling of countless generations, and is it to be said we are to come in for this rich inheritance and do nothing for our children?…. Are we, in this period of prosperity, the like of which the world has never seen, to say we will do nothing for posterity?…. In France, the idol of the nation is glory, and a miserable idol it is; but a worse idol than that is the individualism and selfishness which lead a man not to consider public questions with respect to the community of which he is a member, or the interests of his fellow-men, but to confine himself within himself, and if he sees his way clear, to pass his own life in tranquillity and ease, to be content to let others shift for themselves. That is the danger of this time. The sinews of public morality and public duty are relaxed when people encourage a policy of selfishness."—[Ibid. 1466.] He knew the difficulties with which the right hon. Gentleman would have had to contend if he had endeavoured to act up to these sentiments. He knew the great and general expectation that the income tax would he reduced this year to 4d. He had quoted these passages, not to attack the right hon. Gentleman, but to justify himself. If our leading statesmen considered that the reduction of Debt was a mistake, he should bow with respect to their decision; but this was not the case, for they told us that we ought to reduce the Debt, but they shrank from the effort their words involved. Surely, then, he might quote to the Chancellor of the Exchequer his own words—"That is not the way in which it came to be written Sic fortis Etruria crevit." It was, no doubt, true that we were doing something to reduce the Debt; but if this were our true policy, we should carry it out in a manner and on a scale worthy of the nation. The right hon. Gentleman, indeed, said that by 1885 the Debt would be reduced to £737,000,000 if we had no war. But what an if! If war were so improbable, why were we spending such vast sums on our Army and Navy? If, on the contrary, we were unfortunately involved in any great war we should bitterly regret the short-sighted and selfish policy we were now pursuing, and the nation would have a just right to blame those who, seeing clearly the right course, had not courage to take it. It appeared to him that the right hon Gentleman had lost a great opportunity. If on the present occasion, he had withstood the temptation of momentary popularity, he might have produced a less-pleasing Budget; he might have had more difficulty in carrying his proposals than he feared he would now find; but he would have created for himself a great name in the financial annals of the country, and have earned the gratitude of posterity. Never, perhaps, was the country more prosperous, never were the taxes lighter; if, then, we were not now seriously to diminish our Debt, when were we to do so? Every great war would leave it larger than it was before, until at length it would crush the country, and England would fall as other great Empires had fallen before. The immediate reduction of taxation was, of course, a strong temptation, and those by whom it was carried out might obtain a temporary popularity; the country was, no doubt, glad to be told by those whom it trusted that this was really the wise policy; it was pleasant to have our taxes reduced, and to find our tea and coffee cheaper than ever; but he believed the country would feel more respect for, and place more confidence in, statesmen who had the courage to take a wiser and more prudent course. Sincerely did he hope that the hour would never come when in some period of difficulty and danger, we should bitterly regret that, in these years of peace and prosperity, we had done so little, so very little, to reduce our Debt, and lighten the permanent burdens of the country.

MR. R. N. FOWLER

, while admitting that much might be said in favour of the reduction of the National Debt, thought that so strong a feeling had existed with respect to the extra 2d. on the income tax, that the country would not have permitted the Government to have retained it simply with the view of reducing the National Debt. At the same time, he trusted that when the next financial year came round, the right hon. Gentleman the Chancellor of the Exchequer would take some steps to carry out the views which had been so ably put forward by the hon. Baronet who had just spoken. He begged to point out to the right hon. Gentleman that if the income tax were voted until July instead of April much inconvenience would be avoided.

MR. RYLANDS

trusted that the proposal of the hon. and learned Member for Oxford (Mr. V. Harcourt) would receive the attention of the House, and that the subject referred to by the hon. Baronet the Member for Maidstone (Sir John Lubbock) would be discussed when the proper time arrived. It was, however, unfair to throw upon the payers of indirect taxes a burden which was in the nature of a mortgage upon the land. The question was, whether the Government could show any necessity for an expenditure of nearly £72,000,000, and, seeing that a very much smaller sum had formerly sufficed, the burden of proof rested on them. The Chancellor of the Exchequer had gone back to 1858 in order to show that the Army and Navy had not since that time cost a smaller sum than was now proposed, with the exception of the original Estimates of 1870–1. It would, however, have been much fairer had he gone back to 1853, just prior to the increased Estimates consequent upon the Russian War. In that year the two services cost £16,325,000, or £8,000,000 less than the sum now contemplated. The right hon. Gentleman, no doubt, selected 1858, because since that time high Estimates had prevailed. In 1858–9 one of the most absurd panics which had ever occurred led to a large and, as was now admitted, a wasteful expenditure, in which the right hon. Member for Droitwich (Sir John Pakington), whom he regretted not to see present, took a leading part by a reconstruction of the Navy. The present Prime Minister during the electoral campaign of 1868 laid great stress on the extravagance of the Conservative party, and in a speech delivered at Warrington referred to the right hon. Baronet as having shown— As liberal a disposition, if that was the essence of true Liberalism, to attack the pocket of the taxpayer as any Minister he had ever known. The First Lord of the Admiralty this year, however, had proposed Navy Estimates nearly £300,000 in excess of those submitted by the right hon. Baronet. He was, therefore, a more brilliant specimen of "the essence of true Liberalism" than his Conservative predecessor. The Chancellor of the Exchequer had cited the expenditure of Lord Palmerston's Government in justification of the present Estimates; but he (Mr. Rylands) and hon. Members around him repudiated Lord Palmerston's expenditure, which they denounced at the time as extravagant, as any precedent. We had to thank Lord Palmerston for large expenditure not only in his lifetime, but subsequently, his policy saddling the country with hundreds of millions of taxation; but it was expected that the accession to office of the present Ministry would have relieved the country from the consequences of that policy. The country expected from the present Prime Minister a large diminution of expenditure, he having at the last Election condemned the extravagance of the Conservative party, and that expectation accounted for the return of many Liberal Members. Instead of excepting the Estimates of 1870–1, the Chancellor of the Exchequer ought to have paid special attention to them, for that was the very time when the Government had an opportunity of redeeming their pledges of economy. There was then a reduction of £1,256,000 in the Army, and £746,000 in the Navy Estimates as compared with the previous year, and the Chancellor of the Exchequer described that reduction as the basis of the prosperous state of the finances, adding that the secret of that success was economy, and that he saw no reason why the Government should not be encouraged to proceed in the course on which they had entered. The Liberal party had a right to complain of the non-fulfilment of the promise then held out. The Franco-German War led, indeed, through an absurd panic, to an increase of £1,500,000; but this excuse for expenditure had passed away, and why should the Government propose to exceed by £2,000,000 Estimates which in 1870–1 they deemed sufficient? At the beginning of 1870 France, under a rider with an inscrutable policy, was armed to the teeth, it being uncertain where he might first strike, and our so-called "magnanimous Ally" was treated by us as if he were the head of a nation of bandits and corsairs, who might descend unprovoked on our shores. Millions were spent in that way; but France could no longer be deemed a dangerous neighbour, and at no period had England been more secure against attack. A more favourable opportunity for reduction of expenditure could not occur. It must be admitted that there had been improvements in warlike weapons; but for expenditure in that direction ample provision was made in 1870; and yet it was proposed to spend for those purposes £3,000,000 in two years. The object of the Government should be to make gradual improvements, and for advocating such a policy they had the authority of the Prime Minister, who, speaking at Warrington in 1868, stated that— For the last 15 years we have been arming and re-arming, and building and re-building. If we have found a better mode of constructing guns and small arms, we construct them accordingly with precipitate haste, and immediately afterwards we find some other pattern that is superior, and the whole thing has to be done over again. Common sense would tell us that under such circumstances we should proceed with moderation. But what was then being done by the Conservative Government had been done by the present Administration, and it was disheartening to some Members of that House not to know to which side of the House they could appeal in this matter. He knew that the right hon. Gentleman the Member for Buckinghamshire (Mr. Disraeli) had made some good economical speeches, which had been quoted by his hon. and learned Friend (Mr. V. Harcourt); but he had seen no evidence of his desire for economy. On the contrary, when his Government succeeded that of Lord Russell, they immediately proceeded to increase the Estimates. But the present Government had less excuse for their policy. He supposed they would throw the blame upon the House of Commons. They would say that the House of Commons was extravagant, and so it was. He believed the House of Commons did encourage the Government to spend money, and he was afraid that many Members of the House had an interest in the spending of public money; and they must also take into account the influence of the spending servants of the Crown, who had been fitly described as having "a constant, quick, and unsleeping interest in feeding themselves on the produce of the public industry." Sir Robert Peel did not allow any extravagance on the part of the House of Commons or of the spending departments. Sir Robert Peel expressed an opinion which he (Mr. Rylands) recommended to the Government and to the House, Sir Robert Peel said if the House listened to the opinions of military men, who were prejudiced on the subject of war expenditure, they would involve the country in an outlay that no Revenue could bear; and in one of his last speeches in that House he said— If you choose to have all the garrisons of your colonial possessions in a complete state, and to have all your fortifications perfect, no amount of annual expenditure will be sufficient to accomplish your object. He (Mr. Rylands) believed that by a proper policy of retrenchment the expenditure of this country might without difficulty be reduced £10,000,000 a-year, and by that reduction, the burden on taxpayers would be diminished, the pressure on the springs of industry would be still further withdrawn, and the prosperity of this kingdom would be increased. If the Government adopted that policy, they might be carped at in the House; but they would secure the confidence of the country and the gratitude of the masses of the people.

THE CHANCELLOR OF THE EXCHEQUER

Sir, I hope it may be convenient to some hon. Gentlemen if I make an announcement which has the merit of having a strict reference to the subject before the House, and that is, with regard to the Resolution which will be proposed on the subject of coffee. During the vacation I have had an opportunity of carefully considering this question, and of understanding the wants of the trade; and I have come to the conclusion that we can fairly offer an extension of time to them, without injury to the Revenue, and in a manner which I hope will be satisfactory, as preventing loss to the trade. I shall, therefore, propose to extend the time from to-morrow, when the Resolution would have come into effect, to the 1st of May, which I am advised will be a sufficient period; and when the Resolution is laid before the House I will move to insert, after "that," the words "from and after the first day of May next." I now turn, Sir, to the subject of the debate. I beg to observe, in the first place, that this can hardly be regarded as anything more than a conversation. There is really no issue at stake before the House, because this is moved as an Amendment to the second reading of the Resolution. I feel confident it is not the intention of the hon. and learned Member for Oxford (Mr. V. Harcourt) or of the other hon. Members who have supported him, really to stop the passing of these Resolutions, to which no serious opposition has been offered on any side of the House. Therefore, I conclude that the hon. and learned Gentleman does not mean to press his Amendment to a division, and there is no occasion to treat it as a serious Motion intended to pass the House. That will relieve me from the necessity of criticizing the words of the Amendment; and I shall endeavour to make, as briefly as I can, such observations as I have to offer with regard to the able and discursive debate to which we have listened. I think the country is indebted to the hon. Member for Maidstone (Sir John Lubbock) for the observations he made about paying off the National Debt. They command my cordial esteem; but I am afraid my hon. Friend has too great confidence in human virtue, and that if he comes to fill the position which I unworthily fill he will be inclined, notwithstanding the advance which may have occurred in human virtue in the interval, to entertain considerable doubt as to the expediency of his own proposition. I think there are persons who would suggest to him that to leave a large sum undisposed of would be to offer a prize for the greedy hands of hon. Members, who would vie with each other in making proposals, and probably the hon. Member, instead of reducing the Debt, would find himself compelled to accept some proposition, which if left unfettered he would have been far from accepting. At any rate, his courage at the present moment is far greater than mine. I have never dissembled my opinions on the subject; but I do not, in the present state of affairs, feel myself competent to give effect to them. Then, with regard to the hon. and learned Member for Oxford. The hon. and learned Member has seized upon one very important truth, which he has repeated in the course of his speech, and that is, that finance depends upon expenditure; that it is in vain to adopt a particular line of policy, and to struggle, by mere financial means, against the necessary effects of that policy. That being so, I think he must admit that the responsibility for the policy of finance cannot be said to lie so much with the Minister of Finance at the moment as with those who lay down that policy. To show who those are I need only allude to the words of my hon. and learned Friend. He has said that it is this House which lays down the policy by which the finance must be regulated. It is said constantly that the policy we have been acting on, and which the House has sanctioned, is a policy of panic. That is the policy, not merely of the Government, but of the House of Commons. It is a policy which had been come to after repeated debates and much consideration, and it is not by calling it by a name implying disapprobation that that policy can be overruled. It may be that the House is wrong in that policy; but in the practical affairs of this life it is sufficient to know what the opinion of the country is in order to guide them, so long as that opinion is not so far divergent from their own that as conscientious men they cannot follow it, and that was not the case here. And here I must protest against the habit of speaking with disrespect, not of myself or of the Government, but of the deliberate resolution and decision of the two Houses of Parliament on great questions of public policy. These questions are like other questions to be decided on their merits; and will be judged not merely in the present but by posterity. But that man is not a practical statesman, or fit to be intrusted with the affairs of Government, who applies to the opinions of those from whom he differs epithets which imply discredit and reproach on the resolutions of legislative bodies or large bodies of men. But while I congratulate my hon. and learned Friend on having seized on one great principle, I must say that he has fallen into one not uncommon fallacy. He seems to think that expenditure is a kind of matter which can be dealt with in the abstract, and that by quoting large totals of figures, and comparing the expenditure of a different time with that of the present, putting aside all the circumstances in which they differ, he can make out a case for the reduction of expenditure. My hon. and learned Friend says in his Resolution— That in the opinion of this House, the National Expenditure is capable of further reduction without danger to the safety and good government of the country, and that it is desirable that such expenditure should be reduced accordingly. It is impossible for the House to reduce expenditure accordingly in that summary manner. Expenditure is not a matter of abstract consideration at all. Everyone is economical in the abstract. It is when you come to deal with details that the pinch is felt. It is like a memorable passage in the Biglow Papers, and cannot be too frequently impressed upon those who put forth economical doctrines— I'm willing that a man should go tolerably strong Against crime in the abstract, for that must be wrong; Tis always looked down on, and never is pitied, Because it is crime which is never committed. So, in like manner, economy is a matter of detail and labour, and is not to be effected by comparing the millions spent in one year with the millions to be spent in another, and striking a balance between them. If it is to be done at all, it must be done by inquiring into minute matters of detail, and by repulsive labour from which men naturally shrink, and take refuge in those immense balances, instead of condescending to miserable and paltry details of expenditure, by which alone savings can be effected. Now, when hon. Gentlemen talk about our extravagance, I wish them to consider the sort of pressure to which the Government is subjected. How many Questions are asked by hon. Members, how many Motions made in the course of the Session which have more or less a direct bearing to urge on the Government an increase of expenditure? The hon. Member for Warrington (Mr. Rylands) has said just now that Sir Robert Peel would never permit the House of Commons to be extravagant in his day. Yes; but Sir Robert Peel is one of those heroes who have gone away from among us, and to whom we may attribute any degree of superhuman virtue; but the men who live in these days no not possess that faculty. For my part, I heartily wish that the House of Commons would put pressure and duress upon me for the purpose of making me more economical than I am. But what are the facts? I get a fair share of the abuse which falls to the lot of ordinary mortals in my position. But did you ever see an article in a newspaper since I have been Chancellor of the Exchequer reproaching me for extravagance? No, it is for meanness that I am reproached; for niggardliness, for want of generous sympathy, for the absence of everything which tends to the profuse expenditure of the public money. The truth is, there is one way of avoiding extravagant expenditure, and that is by laying down a sound policy and acting on it; and if this Government be going into what is called a spirited foreign policy, if it is going to intermeddle with the affairs of our neighbours when we are not wanted, if we seek to play a leading part in the affairs of Europe which are not our immediate concern, if you see in our conduct any trace of these things, reprove and censure us. But what is the charge which is brought against the Government? No later than this very morning a document was brought under my consideration in which we were accused of a mean, truckling policy, and of being servile to our neighbours. All the Government can say is, that they do not agree with the hon. and learned Member for Oxford that this island cannot possibly be invaded because we have a superiority at sea. All that we wish is to defend ourselves; to preserve the good things that we have, and not to allow ourselves to become so weak as to encourage aggression. That, I can say, is the whole aim of the Government. Our object is to maintain peace, and we believe that peace is not to be permanently maintained without showing that we have a just sense of the duty of self-defence. Without putting ourselves in a position to commit aggressions on our neighbours we wish to be able to defend ourselves. We desire that, and nothing more than that. It must also be remembered, in what we have done with regard to our naval and military forces, that we aim at more than a mere increase of our Army. That increase might be covered by a sum of £500,000, or some such amount. But in what we are doing we have undertaken a Herculean task. We found our Army in what I do not scruple to call a state disgraceful to the nation. All those offices in which men are called upon for the most honourable duties on behalf of their fellow-subjects were bought and sold, and bought and sold in defiance of the law. We have found it necessary to put an end to such a state of affairs. We determined to make all our forces available, so that they might be bought back in compact masses; but it was impossible to carry out this reorganization without incurring a large increase of expenditure. Putting aside the matter of purchase, we have reduced the Army Estimates £1,000,000 below what they were last year. While that process is going on, I may not hold out the promise of much further large reduction under this head; but we may hope that simple and workable reorganization will result in economy. The hon. Member talked of keeping up garrisons in the colonies; but one of the merits of our policy is this—that our troops are being withdrawn from the colonies, and by that means we have an opportunity not only of effecting economy as regards the transport of troops, but we have induced our colonies, which formerly depended abjectly on this country, to raise a large Militia for their own defence. You cannot reconstruct an ancient system, with inveterate habits and traditions, without considerable expense; but the expense, I hope, will be of a transitory nature, while the economy will be permanent. And, besides, we have not at all seen the last of our reductions. The hon. and learned Gentleman (Mr. V. Harcourt) has said that the Estimates are capable of further reduction. But, as I have already said, economy is not to be effected by abstract calculations; it is a matter of detail. It is by guarding the inlets to extravagance that economy is to be effected. In the first place, you must adopt sound principles of action, and then you must guard against Parliamentary pressure in favour of particular schemes. Take, for example, the hon. and learned Member for Oxford himself. In a short time a question will come before this House whether we are to take away £40,000 worth of property belonging to the people of this country and give it to the wealthy inhabitants of London. If you take away that £40,000 you must replace it by a Vote from the National Exchequer. No doubt the hon. and learned Member for Oxford, who is so great on the abstract part of the question, will vote for giving away this £40,000, and when he has done that he will have made a precedent which other persons will not be slow to follow, and many a £40,000 may hang upon the decision of this question. That is an instance of the way in which money is taken out of the hands of the Government. I hope hon. Members will reflect on that, and that on a Friday evening, when they find the Chancellor of the Exchequer grievously beset for some aid to local rates or some remission of taxation, they will come to his assistance. It is vain to go into comparisons of the expenditure of this and other years. I have the figures here; but I will not inflict them upon the House. We have 5,000,000 more people to govern than we had in 1851, and we have undertaken to educate them. But, after all, the question is not whether we spend more now than we spent then; the question is, whether we spend as little as we can, consistently with the honour and good government of the country, and that must be measured, not by speculations such as those indulged in by the hon. and learned Gentleman, but by the wants and necessities of the country, and we must consider the honest pressure to which we are bound to yield, of the duties which are due from man to man. Upon these things we must base our Estimates, and not by going back to a particular year, or endeavouring to estimate our expenditure by standards which have become obsolete. I am quite sure there is a good deal to be done in the way of economy; but I fear not so much by the Government as by the House itself. If there was not so much pressure on the Government from below, if hon. Members would not so often unite to make raids on the Treasury, much might be done. I hope the House will not think I am showing it any disrespect in not going deeper into these questions, and comparing the figures year by year. Nothing, however, could come of such a comparison. We have to deal with the present. The Government have done what they could to cut down the expenditure of the present year as far as was consistent with the public interest. Nothing shall be wanting on our part to do so for the future; and I only hope, in addition, that the House will support us when we are endeavouring to save the public money. I will just mention one instance, which I think a strong one. We are continually called upon to supplement private expenditure in order to do things which private individuals can do just as well without the Government as with it. That is one fruitful source of expenditure, and one which I have done my best to resist. We not only waste public money very often by giving it in this way, but we chill the very fountains of charity and encourage people, in-instead of doing the best they can with their own money, to look to the Government for help. Nothing is more true than the opinion expressed by an hon. Member of this House that a paternal Government means a childish people. We are occasionally taunted with not being paternal; but of all the disgraceful epithets which can be bestowed upon a Government I think that is about the worst. Our business is to do our business and leave you to do yours. The more sharply defined that line is, and the less we encroach upon it, the better for all parties.

MR. FIELDEN

agreed with the hon. and learned Member for Oxford (Mr. V. Harcourt) that it was monstrous that in a time of peace there should be a taxation of £70,000,000. If this amount could not be reduced in a time of peace, where should we be landed in a time of war? When this question of taxation came on, it was easy for the Government to say that it was the House that forced extravagance upon them. For 14 out of the last 20 years the country had been governed by a Liberal Ministry, and the present Prime Minister had been Chancellor of the Exchequer during a larger portion of those 14 years. In 1868 he went stumping it through Lancashire, and the burden of his speeches was the extravagance of his opponents, and, by implication, the economy of himself and his party. They had seen what the result of all this had been. They had seen taxation increased until it was higher than it had almost ever been in time of peace, and all this had been done by a Liberal Government. They had up to the beginning of this Session been backed by a majority of 100, so that ample opportunity had been given them to put their intentions into action if they had so desired. The responsibility, therefore, must rest with them. He wished to refer especially to the question of the coffee duties. The Chancellor of the Exchequer said that the present duty on coffee was 50 per cent. At the time the statement was made he (Mr. Fielden) was satisfied that it was incorrect, and, having made inquiries from merchants in the City of London, he found that it was not a matter of 50 per cent but 36 per cent, and after the reduction now made it would be 18 per cent. There was another duty which fell much more heavily upon the labouring people of this country—he meant the malt duty. That was a duty of 70 per cent in the first instance; but, from the way in which it was levied, it went on increasing until the man who brewed his beer at home had to pay a duty of 100 per cent, and the man who bought it at a public-house had to pay a duty of 140 per cent. That interfered most injuriously with the farmer in the cultivation of his land, and it kept back from the agricultural labourer and the manufacturing operative the facility which they ought to have in securing a refreshing beverage. If taxation on this article was removed it would be a great boon to those classes in particular, and would secure to them a beverage free from the baneful effects of adulteration. The cause of adulteration was the high price at which malt was sold, which was owing to the malt tax. If the Chancellor of the Exchequer, when he had a surplus, would deal with the question of the malt tax, he would do more to abolish adulteration than would be done by any other step that could be devised.

MR. ALDERMAN W. LAWRENCE

suggested that the Chancellor of the Exchequer should frame the abstract of the Budget in such a way as to show how much money was obtained by taxation properly so called, and how much was actually expended on the services of the country. The hon. Members for the West Riding (Mr. Fielden) and for Warrington (Mr. Rylands) had talked of £71,000,000 of taxation. The hon. and learned Member for Oxford (Mr. V. Harcourt) had guarded himself by saying that the amount was a gross sum, and that there were certain items which could not be regarded as money taken from the pockets of the people. Instead of £71,000,000 being taken out of the pockets of the people in the shape of taxation, the amount actually taken was £62,330,000. The revenue arising from the Post Office, from Telegraphs, Crown Lands, and from Miscellaneous Receipts, could not be regarded as taxes taken out of the pockets of the people. In like manner the net amount coming into the hands of the Chancellor of the Exchequer to be spent upon the services of the country, and in payment of the interest of the Debt, after deducting the expenses of collection, was £59,709,000.

MR. J. B. SMITH

expressed the satisfaction with which he had listened to the observations of the hon. Member for Maidstone (Sir John Lubbock) on the subject of the reduction of the National Debt, and the concurrence of the Chancellor of the Exchequer in the principles which had been laid down. On the occasion of this question being brought forward by Mr. J. Stuart Mill, some years ago, he remembered the pleasure with which he had listened to an eloquent speech of the Prime Minister on the moral obligation of this country to make efforts to reduce the National Debt; but he (Mr. J. B. Smith) regretted to hear that, while the Chancellor of the Exchequer agreed in the opinions of the hon. Member for Maidstone, he feared that the people of this country would not submit to the necessary sacrifice to attain this great object. He thought the right hon. Gentleman took a low view of the people, and he felt persuaded that if an appeal were made to them to follow the noble example set them by the United States of America, it would be responded to. The Chancellor of the Exchequer had told them that their National Debt was reduced to about £800,000,000, and that in 1885 it would be further reduced by the expiration of about £55,000,000 of Terminable Annuities; but he had not told them how many millions they would yet have to pay between this and 1885 to effect this reduction. But even when this great feat was accomplished, how stood the comparison with America? Why, that in 1885, they would have paid off, after a period of 70 years of peace, a less sum than America had paid off after six years of peace. America had adopted the common-sense plan—not as we had done, by the cowardly and expensive plan of Terminable Annuities, paying off debt for the benefit of posterity—but of openly paying off their Debt from surplus Revenue, by which means the payers reaped the benefit of the saving of interest on the sums paid off from time to time, and thus relieved themselves by a continual reduction of taxation, while posterity was so far relieved of the debts incurred in the present generation. The saving of interest on the amount of Debt thus paid off by America amounted to about £8,000,000 sterling since the close of the war—a noble sacrifice worthy of their English descent. He hoped, as the Chancellor of the Exchequer agreed in the opinion that efforts ought to be made to reduce their National Debt, he would screw up his courage to devising some scheme to present to Parliament to effect this object.

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

The House divided:—Ayes 78; Noes 35: Majority 43.

Main Question put, and agreed to.

First Two Resolutions read a second time, and agreed to.

Third and Fourth Resolutions (Duties on Coffee and Chicory).

MR. CRAWFORD

thanked the Chancellor of the Exchequer for the boon which had been extended to dealers in coffee, and he suggested that when the right hon. Gentleman on any future occasion granted a remission of duty, some provision should be shown, so that anxiety, such as had arisen in the present instance, might be avoided. If the Notice had been given on Monday week that an interval up to the 1st of May would have been allowed to the dealers there would not have been any ground for complaint in the country. He knew one firm which would have lost £650 if the extension of time had not been granted. There was another point to which he wished to call attention. Two years ago the Chancellor of the Exchequer had allowed him to make a written representation of the views he entertained relating to the relaxation of the duties now granted. Some of the reasons given in his letter to the Chancellor of the Exchequer had been stated by the right hon. Gentleman the other night. But there was one point to which he had not referred, and it was a point of considerable importance. The coffee imported annually was 200,000,000 lbs; but the home consumption was only 30,000,000 lbs. The remaining 170,000,000 lbs was exported. The duty was levied only on the coffee which came into consumption at home; but all the other coffee imported was subject to a good deal of supervision, It was brought into the docks in ships, landed, placed in warehouses, and Customs' supervision became necessary on its account. Some measure ought to be adopted to relieve the Government of this supervision; and he had been informed, on very good authority, that the establishment of the docks could relieve the Government of the whole burden of supervision, and could even undertake the task of collecting the duty on that portion which came into home consumption.

MR. ALDERMAN LUSK

also thanked the Chancellor of the Exchequer for the boon he had granted to the coffee trade, and he thought it only fair that some previous information should be given to the public of such a change in the rate of any duty. He did not see how the proposal of the hon. Gentleman who had just spoken could be carried out, as merchants, when they imported, did not know whether the article would be consumed at home or re-exported, and consequently must be warehoused. The most effectual way of dealing with it was by abolishing the duty altogether.

THE CHANCELLOR OF THE EXCHEQUER

said, the point referred to by the hon. Member for the City of London would be considered.

Resolutions read a second time, and amended by inserting the words "from and after the first day of May, one thousand eight hundred and seventy-two."

Resolutions, as amended, agreed to.

Fifth Resolution (House Duties—Exemption of Warehouses, &c).

MR. ALDERMAN W. LAWRENCE

said, that the Resolution would give rise to difficulties between those who collected and those who paid the duty, because a caretaker in such establishments as were used by parties for carrying on different trades or professions was located either in the attic or in the basement. The part of a building which would be occupied by a caretaker would be a part that the proprietor would not be likely to let, so that it would be difficult to estimate the value of it. He hoped that when the Bill came again before them the Chancellor of the Exchequer would be in a position to get rid of the difficulty and uncertainty which the present provision would produce.

MR. W. H. SMITH

said, the benefit to be conferred by this Resolution would not be realized by the trading classes, who paid enormously high rent for the purposes of trade, while the fact that they lived on their trading premises was evidence of the struggle with which their position was maintained, and the benefit would be almost completely absorbed by persons who had taken their offices with a distinct understanding of their liability to pay house duty, which in many instances they could well afford to pay. If the house duty was to be maintained, let it be imposed on the inhabited portions of houses only; it was easy to determine what they were. But if the matter were postponed for a year, perhaps, the Chancellor of the Exchequer would be able to renew the offer he had already made, and to give up the house duty for local purposes, in which case the local authorities would decide how it was to be levied. Before they went into Committee on the Bill he trusted the Chancellor of the Exchequer would consider the suggestion.

Resolution read a second time, and agreed to.

Sixth Resolution (Duties on Tea) read a second time, and agreed to.

Bill ordered to be brought in by Mr. DODSON, Mr. CHANCELLOR of the EXCHEQUER and Mr. BAXTER.

Bill presented, and read the first time. [Bill 106.]