Commons Sitting of 23 April 1874

MINUTES
WAYS AND MKANS—considered in Committee—Resolutions [April 16] reported.
PUBLIC BILLS—Ordered—First Heading— Registration of Births and Deaths* [80]; Locomotives on Roads* [81].
Third Reading—Harbour Dues (Isle of Man)* [65], and patted.

ARMY—LANDGUARD FORT.

  QUESTION.
  COLONEL JERVISasked the Secretary of State for War, Whether it be true that the Royal Artillery stationed at Ipswich are unable to carry on artillery practice, as heretofore, at Landguard, owing to the objection of the Lord of the Manor of the district; and, in consequence, have to march to Lowestoft to carry on the said practice, at a considerable increase of expense to the public; whether it is true that a toll
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  is levied by the said Lord of the Manor upon all material landed for the works which are now being carried on at Landguard Port; whether such toll is arbitrary at the option of the said Lord of the Manor, no such toll ever having been claimed until lately, when it was fixed at 6d. per ton, since raised to 18. per ton, often amounting in the aggregate to £40 a month: whether such toll is not equally applicable to the landing of guns, shot, shell, gunpowder, and other materials of war for the defence of the said fort; whether it be true that a pier erected at the cost of some £800. for the purpose of landing certain iron shields for the fort, has to be pulled down as soon as that work is completed, in consequence of objections of the said Lord of the Manor, thus leaving no facilities for landing war material for the future for the fort, excepting over an ever-shifting shingle; whether it be true that the War Office has been prohibited by the said Lord of the Manor from erecting orrepairing certain groynes, by means of which alone the outworks of the said fort have for years been saved from being undermined and washed into the sea; and, whether, if these be facts, and assuming that the said Lord of the Manor has been simply exercising his legal rights, the War Office will at once come to some arrangement by which a stop may be put to a state of things so injurious to the public interest?
  MR. GATHORNE HARDY: The prohibition by the Lord of the Manor of practice at Landguard makes arrangements for carrying out artillery practice in future at Lowestoft necessary. A jetty was erected at a cost of £909 by the War Department in 1871–2 for landing iron shields and other materials. Colonel Tomline, the Lord of the Manor, claimed the foreshore on which it stands, and was successful in the Court of Chancery in maintaining his claim. He then charged a royalty of 6d. per ton, with a threat of cutting down the pier if it were not paid. On November 19. 1873, his agent gave notice that from January 1, 1874, 1s. per ton would be charged. There was no alternative but to pay these demands. The tolls average £32 per month. These tolls would be applicable to guns and other materials of war. No steps will be taken to remove the pier, as negotiations have been and are in progress

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  with a view to a settlement of disputed points between the War Department and Colonel Tomline. Groynes have been maintained by the War Department since at least 1732; but since the decision of the Court of Chancery that the Bent Hills, in the rear of the groynes, and in another case the foreshore on which they stand, are the property of Colonel Tomline, it is not proposed to construct more until some definite understanding has been arrived at. The War Department are in communication with Colonel Tomline, and are most desirous to come to a settlement with him on the points in dispute.

IRELAND—TRINITY COLLEGE, DUBLIN.—QUESTION.
MR. BUTTasked the Secretary of State for the Home Department, Wheany application has been made by the Board or Fellows of Trinity College, Dublin, for a Queen's Letter, altering essentially the Statutes of the College: and, whether before the issue of any Queen's Letter, an opportunity will be given to the Senate of the University, or to this House, of expressing an opinion upon the proposed alterations?
MR. ASSHETON CROSS, in reply, said, that as far as he was able to learn, no application of the kind had been made up to the present moment. No such application had been made either to the Home Office or to the Irish Office in London, and if such application were made the Government would think it right that the House should have an opportunity of considering the matter.

FINANCE OF INDIA—BORROWING POWERS.—QUESTION.
SIR CHARLES MILLSasked the Under Secretary of State for India, If all the borrowing powers of the Secretary of State for India under previous Acts of Parliament have been exhausted; and, if they have not, if he will state what is the amount which still remains?
LORD GEORGE HAMILTON, in reply, said, that the borrowing powers of the Secretary of State under all Acts previous to the Loan Act of the present Session had been exhausted, with the single exception of the power contained in the Loan Act of last Session, by which he was enabled to borrow temporarily a sum not exceeding £2,000,000.

CONTAGIOUS DISEASES (ANIMALS) ACTS—LEGISLATION.—QUESTION.
MR. J. BARCLAYasked the Vice President of the Council, Whether the Government intend to bring in a Bill to carry into effect the recommendations of the Committee of last Session for amendment of the Contagious Diseases (Animals) Acts?
VISCOUNT SANDON: Considering the complicated character of this Question, the conflicting evidence respecting it, and the great and varied interests involved, Her Majesty's Government are not prepared, at any rate this year, to bring in a Bill on the subject. The proceedings of the Committee of last year, upon which the hon. Member bestowed so much labour, are a very valuable contribution to the consideration of the Question. The Lord President is giving the whole matter his most serious attention: but until the Government sees its way to a satisfactory mode of handling it, we do not think it right to engage to bring in a measure.

LICENSING ACT, 1872.—QUESTION.
MR. JOHN TALBOTasked the Secretary of State for the Home Department, Whether he has any objection to lay upon the Table of the House any Reports which have been received at the Home Office from Chief Constables or other police authorities as to the working of the Licensing Act, 1872?
MR. ASSHETON CROSS, in reply, said, he had received communications from various authorities throughout the country with reference to this Act. Part of those communications were of a confidential character, and he did not think it would be right to lay them before the House. But if the hon. Member would do him the favour of calling upon him at the Home Office, he would have the pleasure of showing him such communications as were not of that character.

THE ASHANTEE WAR—CAPTAIN GLOVER.—QUESTION.
MR. KNATCHBULL-HUGESSENasked the First Lord of the Treasury, Whether it is the intention of Her Majesty's Government to recommend that any mark of distinction be conferred upon Captain Glover in consideration of

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his services in connection with the Ashantee War?
MR. DISRAELI, in reply, said, Her Majesty's Government had recommended that a mark of distinction should be conferred upon Captain Glover in consideration of his services in the Ashantee War.

COMMITTEE ON PUBLIC ACCOUNTS—REPORTS OF THE AUDITOR GENERAL.

  QUESTION.
  MR. DILLWYNasked Mr. Chancellor of the Exchequer, What course is adopted by the Treasury in cases in which the Auditor General is unable to certify to the correctness of payments charged in the Appropriation Account?
  THE CHANCELLOR OF THE EXCHEQUER, in reply, said, it was the duty of the Auditor General to make a Report as to any part of the public expenditure in which there had been any irregularity. Those Reports were presented to the House of Commons and were referred to the Committee on Public Accounts. That Committee took evidence and reported their conclusions to the House, and, as a general rule, the Treasury were guided by the opinions of the Committee.

WAYS AND MEANS—LOCAL TAXATION—LUNATICS.—QUESTION.
MR. LEITHasked Mr. Chancellor of the Exchequer, Whether the proposal of the Chancellor of the Exchequer to make a contribution from the Consolidated Fund towards the maintenance of lunatics will apply to Scotland; and, if so, whether it is to apply to lunatics confined in "the fatuous wards" of the poor houses as well as to those confined in lunatic asylums?
THE CHANCELLOR OF THE EXCHEQUER, in reply, said, his noble Friend (the Earl of Dalkeith) also had another Question of the same character upon the Paper. He could only say that the proposal of the Government of course extended to Scotland, as well as to England and Ireland, and in due time it would be their duty to present an estimate to the House. He thought he might only be misleading the public if he were to give an answer now as to the particular cases like that mentioned. The contribution, as a general rule, was intended to be for
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those who were maintained at asylum rates, as distinguished from those maintained at poor house rates.

BROADMOOR ASYLUM—CRIMINAL LUNATICS.—QUESTION.
MR. WALTERasked the Secretary of State for the Home Department, Whether his attention has been called to the several Reports of the Commissioners in Lunacy, and of the Council of Supervision of Broadmoor Asylum, suggesting the urgent necessity of adopting measures for the better classification of the criminal lunatics in that asylum; and, whether he is prepared to carry into effect all or any of the suggestions contained in those Reports?
MR. ASSHETON CROSS, in reply, said, the Council of Supervision had pointed out the difficulty of dealing adequately in Broadmoor Asylum with two classes of lunatics—namely, those who were convicts under sentence of penal servitude and those who had been acquitted of offences on the ground of insanity. The Inspector of Convict Prisons was induced to think that the former class should be transferred to another asylum. That recommendation he had referred to the officer in charge of this particular department, and as soon as that gentleman sent in his Report he would take some action in the matter.

INDIA—REGISTRATION OF BIRTHS, DEATHS, AND MARRIAGES.

  QUESTION.
  COLONEL MAKINSasked the Under Secretary of State for India, Whether, looking to the great value of the Returns of the late Census in Bengal in reference to the present famine, the Government proposes to introduce into India a system of Registration of Births, Deaths, and Marriages?
  LORD GEORGE HAMILTON, in reply, said, that under a recent Act the Lieutenant Governor of Bengal was authorized to adopt such system of registration as he might consider feasible. Some statistics had been collected by way of experiment, and with a certain amount of success. In other parts attempts to collect vital statistics had been unsuccessful.

WAYS AND MEANS—THE INCOME TAX—APPEALS AGAINST SURCHARGES.

  QUESTION.
  MR. ARTHUR MILLSasked Mr. Chancellor of the Exchequer, Whether, in the trial of appeals against surcharges to the Income Tax some means can he devised by which the present system, which places in the hands of persons engaged in trade the power of investigating into the affairs of their immediate neighbours, may be avoided, and the appeals decided by some public officer unconnected with the locality?
  THE CHANCELLOR OF THE EXCHEQUER: It seems not to be known so generally as it ought to be that any person who is surcharged under Schedule D may appeal to the Special Commissioners, instead of to the Local Commissioners.

ARMY—THE ASHANTEE WAR—PAT OF OFFICERS ON THE GOLD COAST.

  QUESTION.
  MR. SACKVILLEasked the Secretary of State for War, Whether it is the fact that Officers who served with their regiments during the late operations on the Gold Coast are only to be allowed climate pay of 8a. a day, while Special Service Officers have received extra pay at the rate of £11 s. a day: and, if so, if he would explain to the House what is the reason for the great difference of allowances to the two classes; whether Officers serving on the West Coast of Africa have not usually received extra pay and allowances amounting to 8s. 6d. a day; and, if he will lay upon the Table any Correspondence that may have passed on the subject, either between Sir Garnet Wolseley and the War Office or between Sir Garnet Wolseley and the Officers under his command?
  MR. GATHORNE HARDY: One guinea a day was given as a consolidated rate in lieu of all allowances to Special Service officers, and field-officers received hammock pay in addition. Regimental officers already on the Gold Coast received a uniform rate of climate pay at 3s. a day, plus their local allowances, which varied according to their rank. The regimental officers who were sent from England with the expedition
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  were only to be entitled to the same climate pay and allowances as regimental officers already on the Coast. A difference has always been recognized between staff and regimental pay and allowances. I must decline to lay the Correspondence on the Table.

PUBLIC HEALTH (SCOTLAND) ACT—THE COUNTY POLICE.—QUESTION.
SIR WINDHAM ANSTRUTHERasked the Secretary of State for the Homo Department, If he has considered the amended Rules and Regulations for the government of County Constables issued from the Home Office by the late Secretary of State for that Department; and if he is now prepared to cancel the same, so as to enable the police to aid the authorities and officers in counties acting in the execution of the Public Health (Scotland) Act.
MR. ASSHETON CROSS, in reply, said, he stated the other day that, with regard to the burghs in Scotland, he was prepared to alter the order issued by the Home Office respecting the appointment of the police as Inspectors of Nuisances in boroughs. With regard to counties that would be a somewhat different thing, because there the police boundaries and the sanitary boundaries were not identical. He thought, however, he could meet the case by altering the order issued in December last on the application of both the police and the sanitary authority to the Secretary of State.

WAYS AND MEANS—THE DUTY ON REFINED SUGAR.—QUESTION.
In reply to Mr. SAMUDA,
THE CHANCELLOR OF THE EXCHEQUERsaid: After the fullest consideration I have been able to give to the subject, I do not see in what way I can meet the wishes of those sugar refiners whom my hon. Friend represents. If we postpone further the abolition of the duty on refined sugar we shall necessarily inflict a loss on a considerable number of persons who have made arrangements in the expectation that the duty is to come off on the 21st of May. I With regard to making a distinction between loaf and crystallized sugar, it is impossible to do so, in consequence of our treaties with foreign countries; and with respect to other means of compen-

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sating gentlemen for loss there is none, unless the Treasury repay them for stocks in hand, and that would be far too serious an operation to undertake.

WAYS AND MEANS.
Resolutions [April 16] reported, and read the first time.
On Question, "That the Resolutions be read a second time."
MR. GLADSTONE: The Motion, Sir, that you have just announced from the Chair is, I apprehend, the first practical step which the House will be called upon to take for the purpose of giving effect to the financial plans of the Government, the assent which it gave to certain Resolutions in the Committee on a former evening having been, as it were, only a formal step taken for practical purposes, and without reference to the subsequent course that Parliament may think fit to pursue. I, therefore, apprehend that this forms a suitable and convenient occasion for offering any general remarks on the financial proposals of Her Majesty's Government and of my right hon. Friend the Chancellor of the Exchequer. As it was my fate to be his immediate predecessor in the office he now worthily fills, perhaps the House will not think it strange that I should choose this opportunity for offering to it a few remarks. I have the satisfaction to say I do not rise for the purpose of entering on a general course of hostile criticisms of the proposals of the Chancellor of the Exchequer. Still less do I rise for the purpose of placing in contrast or comparison with them any other proposals. The plans entertained by the late Government and by myself have been completely disposed of by the verdict, if not of the nation in every sense, yet of the constituencies at the recent General Election. I therefore feel myself able to approach the consideration of this subject without any prejudices or prepossessions, the influence of which might be largely felt provided there were some other scheme still within the possibility of being adopted, and in which I felt a nearer and a more affectionate interest than in that of my right hon. Friend. Again, if I look at the Amendments which have been placed on the Notice Paper, there is not one of those Amendments which I am disposed to support in contradistinction to the
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schemes of the Government on the point to which it relates. Some of them may assert principles which are in certain respects sound, and have claims on the attention of the House; but when they are considered as practical proposals, I am not aware that any one among them makes it my duty to give a vote adverse to the scheme which has been put before us with the authority of the advisers of the Crown. It will naturally occur to the mind of the House that the subject of the finance of the year must on every occasion fall into three main divisions. There arc, first of all, the Estimates, which have been submitted to the House by Her Majesty's Government, of the probable Revenue of the fiscal year, now recently commenced; then there is the subject of the Estimates of the probable Expenditure of the same financial year; and next there is the comparison resulting from the juxta-position of these two sets of figures, and the proposals which may be submitted by the advisers of the Crown either for making good the deficit—if a deficit there be—or for disposing of the surplus, in the happier alternative which it has been the fortune of the Chancellor of the Exchequer to take up. A good deal has been said here and elsewhere on the subject of certain alterations which have taken place, whether in this year or whether in some recent year, in the mode of making the statements of Revenue which are submitted to the House. I do not think that is a subject into which it is expedient for the House largely or profoundly to enter. In my opinion, the true and only security of Parliament with reference to the Estimates of Revenue on which it is called to proceed is to hold the Executive Government of the day strictly responsible for those Estimates. If we begin to examine what is behind the scenes, and to scrutinize the relations between the Chancellor of the Exchequer and his permanent advisers, cither in the Treasury or the Revenue Departments—if we come forward with our own attempts to criticize and rectify the figures which he may have submitted, I. believe we may do something to diminish the dignity of our proceedings with reference to finance; but I am persuaded we shall not obtain additional security in any one particular for the public interests. That is the principle on which I shall proceed with reference

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to the Estimates of my right hon. Friend, and not because they precisely correspond—for I do not know whether they do correspond—with those which three months ago I was disposed to form. Indeed, the fact that three months hare elapsed since those Estimates were submitted disposes of anything like identity between them and those of my right hon. Friend, because all Estimates of Revenue have to be formed on the latest and freshest information. But I understand the case to be one which, if I am correct, will justify a single general remark. The House has been allowed to perceive that the Estimates have been framed in the present year—and possibly to some extent in preceding years—with a greater disposition to allow for an increase and expansion of the public Revenue from year to year, than has been the ease in former times. That, I believe, has been stated or admitted by my right hon. Friend, and I do not know whether such a conclusion might not have been gathered from some statements of my right hon. Friend who sits upon this Bench (Mr. Lowe), who at this time last year held the office of Chancellor of the Exchequer; and what I now wish to say is, without recurring to the question of what are incidental and what may be extraordinary changes in the sources of public revenue, that the time has arrived when there should be some modification of the Estimate of the Revenue of the year as would take into allowance that which may now be regarded as a regular increment; and for this reason—that 40, 30, perhaps 20, years ago the fluctuations of the Revenue were greater than of late years, and we were much more exposed at those periods than we are at the present time to the contingency of a serious deficiency of Revenue, either in connection with commercial depression or with the occasional recurrence of deficient harvests. In truth, in my early Parliamentary days, it was a trite and sound proposition to enunciate that a bad harvest made a bad revenue. It was even commonly said that the barley harvest, and the consequent condition of the malt tax-might be taken as the criterion of the public revenue of the year. When that was the ease it was necessary, in point of prudence, to form Estimates with great caution, for the purpose of avoiding, as far as possible, those great embarrassments
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in which the House was placed by the occurrence of serious deficiencies. Happily, as the Revenue of the country has become more expanded, and its elasticity more marked, its stability has likewise become greater. I do not mean to say that we are placed beyond the possibility of deficiencies now from special causes; but, if we look back to cases like that of the bad harvest of 1860, or of the Continental revolutions of 1848, I think we have had the most conclusive indications in the steadiness of the progress of the Revenue of late years, as well as in its stability, that from some cause or other we stand on firmer ground than we could flatter ourselves we occupied in former times. And if I myself were asked to suggest—or perhaps I should say to conjecture—an explanation of that satisfactory phenomenon, I find it in this—the great addition, not only positive, but relative, which has of late been made through the increase of wages to the means of the labouring classes of this country. We have greatly widened the basis of the taxpaying community by the command now given to the labouring class over what may be considered, more or less, the luxuries pertaining to their condition; and, provided the principle be not pushed too far, I believe it is right and just towards this House, and that it involves no serious elements of risk, that Estimates should be made with a greater disposition to assume that a portion at least of that increment which we have witnessed now for so many years will continue than could formerly have been the practice, or, at any rate, the practice justified by the general rules of finance. I do not know whether it would be in the power of my right hon. Friend the Chancellor of the Exchequer to give any information to the House in figures upon the question, so as to enable the House to judge what amount of difference in the mode of estimate they are to allow when they look at his figures. I do not know whether he could tell us, for instance, how much the present Estimates of Revenue are above what they would have been, provided he had proceeded exactly upon the same considerations as were in use, I may say, 20 years ago. It might be convenient to do so—I am not pressing my right hon. Friend on the subject if the course would be inconvenient—but the chief advantage I

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should expect from it would be that it would tend to dissipate exaggerated and unfounded impressions which may have been formed with reference to the sanguine character of the Estimates of the year. Then, with regard to the Estimates of Expenditure which are before us, I conceive it to be indubitable that the very same principles which should have prevailed with reference to the Estimates of Revenue must likewise be applicable, and conclusively applicable, with regard to the Estimates of Expenditure. I say this because it is supposed by some—I am far from assuming it to be the fact—that a different view of the probable Expenditure of the year is to be gathered, on the one hand, from the statement of the right hon. Gentleman the Chancellor of the Exchequer, and, on the other hand, from the Departmental statement of the right hon. Gentleman the First Lord of the Admiralty. I say it may be understood; but I give no opinion upon the subject whether such a conflict or contrariety exists or whether it does not. Undoubtedly, it reminds me that there is a great convenience in the old rule—which should never be departed from except under special circumstances—that the submission of the statement of the Navy Estimates, as well as the Army Estimates, should precede the statement of the Chancellor of the Exchequer. I dare say the circumstances of the present year may have warranted the departure from that usage in this particular case; I am not now throwing any blame, but I am desirous that the old and reasonable order should not be forgotten; and it is evident that the impression to which I have referred of an apparent contrariety could not have been created if the statements of the Budget had, in the ordinary course, followed the submission of the Navy as well as the Army Estimates. And hero I say that, in my opinion, there can be no such contrariety. It is not possible that there can be two statements submitted to the House by the same Government with reference to the probable Expenditure of the year. I come to the conclusion that if the First Lord of the Admiralty has been supposed to indicate a likelihood that, in the course of the year, he may have occasion, in the interests of the Navy, to demand a portion of that money which the Chancellor of the Exchequer is now going to throw away on
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the taxpayer, the First Lord of the Admiralty must have been wrongly understood. There is no doubt that the Government cannot speak with two voices on the subject of the coming Expenditure, and that the one voice with which it does speak is the voice of the Chancellor of the Exchequer. As in the case of estimated Revenue, so in the case of estimated Expenditure; it is the figures of the Chancellor of the Exchequer which have the sanction of the united Cabinet, to which, and to which alone, we have to look. And if it be true—I assume it is not true—but if it be true, that there was a likelihood of new demands upon the public purse other than those comparatively trifling matters which are apt to arise in the course of the changes incident to the annual services even in time of peace—if there was a likelihood of demands of a different class in the course of the present year—it would have been the duty of the Chancellor of the Exchequer so far to reconsider his financial proposals as might be necessary, and to reserve a sum sufficient to enable him to meet those demands, in case it should be the pleasure of the House to entertain them. I dwell with the utmost confidence on this principle—that it is not possible to relieve the responsibility of the united Government by the declarations of a particular Department of the Government. The House is entitled to expect—and must, from its very nature as a legislative and deliberative body, expect—one declaration, and one only; and must take as that one declaration the words which proceed from the mouth of the authentic organ of the Government with respect to Finance—the Chancellor of the Exchequer. I apprehend, therefore, that our course is clear and undoubted, and that, without any fear whatever, we may proceed without prejudice to the consideration of the proposals of the united Government. And now, with regard to these particular proposals, I will first take one of which, if I understand it rightly, the magnitude has been considerably exaggerated—I mean that which deals with the question of the reduction of the National Debt. Here let me say I entirely approve of the proposal made by my right hon. Friend so far as its principle is concerned. I am disposed, indeed, to offer him a suggestion, which has nothing to

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do with the principle of his proposal, but merely with the practical form of its application, and which is, I think, worthy of his consideration. Now that we have already, by the operation of former years, laid quite enough of load upon the back of 1885, would it not be as well to take some other date—10 or 20 years later—with reference to which to frame our Terminable Annuities? It is very much better to have a very large and enormous remission of charge accruing in any year than an enormous extension or enlargement of charge. But none of these enormous changes are desirable. What is desirable is to give as equable a movement to our finance as possible. The sum which will be extinguished in 1885 is very large, and it would be better that the operation now beginning, and other operations of the same kind which I hope will follow, should have a later date. I entirely agree in the wisdom and propriety of the proposal of my right hon. Friend; but it would be a mistake to suppose that the proposal is equivalent to applying to the reduction of the National Debt a new fund which hitherto has not been so applied. As I conceive, he applies, in a manner which is direct, intelligible, and certain, a fund which has hitherto found its way to the reduction of the National Debt in a manner which was indirect, completely concealed from the public eye, and by no means unequivocal or absolutely certain. It is, therefore, a great improvement in the detail of our administration rather than the adoption of a large measure for the reduction of the National Debt. Of course, we have all been attracted to the consideration of that portion of my right hon. Friend's proposals which relates to the income tax. It can never be expected that upon such a subject there will be unanimity of view in this House. There is much to be said in favour of its maintenance as a permanent and perpetual tax. For my part, I have always been of opinion that it is desirable, if it be possible, that the income tax shall be allowed to lapse when the country is rich enough to dispense with it. I am of opinion, which I expressed as a Minister of the Crown three months ago, that we have arrived at a period when this might have been done. But that question has now gone by so far as I am concerned.
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It is totally impossible, in my opinion, for any persons except the responsible advisers of the Crown to make the comprehensive proposals with reference to taxation and expenditure which would be absolutely necessary in order to admit of the entire abolition of the income tax. That being so, we not being responsible for the expenditure, and not having the power which belongs to those who possess the initiative in taxation, I have to look, as a subject of the Crown and as an independent Member of Parliament, to the proposal now made. Looking at the matter in this light, I cannot help saying that I am thankful and grateful to my right hon. Friend for the proposals he has made. But I feel bound to say that my gratitude has been caused in a considerable degree by the belief that the proposition he has made with regard to the income tax is an important step towards the entire extinction of that tax. I think it must be obvious to us all—at any rate, to the great majority of those who have considered this subject—that if there is to be an income tax in this or any other country as a permanent portion of the finances of the country, it ought not to be an income tax only of 2d. in the pound. As regards certain Schedules of the income tax, I do not think there can be any great objection to its maintenance even at an exceedingly low rate; but it must be observed that whether high or low we are subject to the same charge for collection. I must also observe that that part of the tax which depends on percentage allowance becomes exceedingly low as the tax is reduced, as I know well was the case when the reduction to 4d. took place, and claims—and well-founded claims—are made for some augmentation for this loss on the per contage, so that as the amount of the tax diminishes the proportion of the cost of collection to the net proceeds becomes rather serious. But that is not the main item for consideration. The principal thing that requires consideration has relation to one only of the schedules—to that Schedule which includes the lowest incomes liable to the tax—namely. Schedule D—and connected with which is a very large proportion of the grievances and difficulties complained of. There is hardly a case in which the tax is levied under Schedule D that does not entail upon the taxpayer a considerable amount of

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trouble—sometimes such an amount of trouble as to constitute in itself a serious tax upon patience and time. People who live in the country are compelled to attend a meeting of the Income Tax Commissioners, at a distant place, without great choice as to the means of conveyance, without certainty as to when the case will be heard, and this on account of very small sums. These are difficulties which clearly ought not to be encountered except for the sake of a large benefit—except on account of an imperious and absolute demand in the interests of the public service. I therefore, without committing the Chancellor of the Exchequer or the Government, look upon the proposal as being in itself an important practical step towards the total abolition of the income tax. I do not say it pledges the House; but I think it gives an indication of the mind of the House which may not be without importance at a future time. In that view I accept it with gratitude, independently of the fact that it is a serious diminution of a public burden. In regard to the abolition of the sugar duties, I cannot refrain from saying in the most emphatic manner that my right hon. Friend has made a wise choice of the particular article upon which he should bestow his bounty, and he has also done well in making a clean sweep of an entire duty affecting a great article of trade, instead of being content with any smaller measure. I know economists and financial politicians are divided into two schools upon this subject. There are those who say it is a very excellent plan to have a large number of duties laid upon a very large number of articles, provided they be not extravagant in amount. I must say my own experience and convictions are those of precisely the opposite school. I hold it is a good thing to substitute a low duty for a high one; but it is a still better thing to abolish a low duty in order to get rid altogether of the duties which bear upon trade. A considerable portion of the value of a duty lies, not in the precise amount which is collected, but in the trammels and fetters which the fact of its existence imposes upon trade. After duties lower than 5 per cent. called nominal duties, have been repealed, there has been something approaching to magic in the elasticity which has been communicated to a
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particular trade. In this particular case it is eminently desirable that a decisive resolution should be taken. I do not agree that you ought not to give up a tax because you cannot re-impose it; when an adequate public necessity arises you will always be able to re-impose a tax. I trust, however, that this great fiscal emancipation may be a perpetual boon, or, if not, that it will be a very long-lived boon. I am satisfied it is a superstition to suppose merely because we abolish a duty in this country that we cannot re-impose that duty, provided we are able to show an adequate public necessity. In this instance a great number of considerations concur in recommending the course taken by my right hon. Friend in the determination to devote a large sum to the relief of an article of consumption, and in the choice of sugar as that article. It is impossible to contemplate without dissatisfaction the position of the refining trade of this country. Although I know not whether the change will be one wholly unattended with difficulty to that trade, yet I am disposed to believe that only by the abolition of those duties can we give a clear and unembarrassed field of action to our Colonies and to all sugar-producing countries. They have not been accustomed to refine it. The differential duty that had to be paid on importation into this country operated most powerfully to prevent that development of skilled industry and the application of capital to machinery in tropical producing countries which I think the course of Free Trade will be very likely to produce in future years. We have been accustomed to consider Customs' duties as a system of taxing tropical commodities, and so it is in the main; but sugar is no longer a tropical commodity: on the contrary, it is a European commodity. The imports of European sugar increase from year to year; and I think this House, which is disposed to be keenly alive to the claims of agricultural industry, will welcome the proposal of my right hon. Friend on the ground that it opens up a new industry to the farmer and the agricultural interest. I know no reason why we should despair of seeing the production of sugar either from beet-root or from other commodities in this country, or of finding it taking its place among our great industries, as it has taken its place among the great industries of

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neighbouring countries, such as France, Belgium, and Germany. These are the main proposals: but there are two other points to which I shall refer. My right hon. Friend proposes to abolish the duty on horses, and I must own that I approach that subject with a greater mixture of feeling than that with which I approached the greater subjects to which I have referred. No doubt an assessed tax in this country never can be popular. There must always be a certain amount of annoyance connected with the collection of these taxes, and there can be no doubt at all that among the assessed taxes the horse duty is one which presents a very special element of weakness in the fact that it is not equally laid. I refer, of course, to the exemption from the duty of the horses employed in agricultural labour. I am not going to recommend the extension of the tax to horses employed in agriculture. I look upon that exemption as an ultimate and irrevocable fact; and I cannot deny that it weakens materially the foundation of the duty on horses, as compared with the other duties of the class which were formerly called assessed taxes. But I am very sorry that a question of this kind should be opened without its being carefully considered how much is implied in the proposal we are now asked to adopt, with reference to which, notwithstanding, we may be seriously fettering our own liberties for the future. I cannot deny, on the other hand, that there is rather a serious relation between the duty on horses and the railway tax. The question of the railway tax is somewhat special and peculiar. I expect that those who have been most anxious in promoting the repeal of the railway tax will be found very zealous advocates of the proposition for repealing the tax on horses, because they see the effect it will have in supplying a new argument in favour of the proposition they are so fain to urge. Then, I want to know what will be the effect of the repeal of the tax on horses upon the duties on carriages and servants? Are they also to go on the first practicable occasion? There is a great deal to be said in favour of abolishing these duties also; but then I want to know whether we have carefully considered the whole state of our taxation with reference to what is called personal property. The assessed taxes have this recommendation—that they
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are on personal property; and it is considered one of our great grievances that while we tax articles of consumption and so get at the labouring classes, while we tax real property and so get at the richer class, yet personal property, considered as a whole, does not bear all the charges in all respects which might be laid upon it. I do not say this is the case; but it is a serious matter to diminish materially the proportion of charge paid by personal property towards the expenses of the State. We have got, apparently, a policy that indicates a disposition to give up the income tax, or, at least, advances us a step towards its abolition; but, whatever the demerits of the income tax—and I must own, I think, its moral demerits to be very serious—whatever the demerits of the income tax, it certainly has this recommendation—that it does get at personal property; and if we are about to give up the income tax, or about to adopt a policy that savours of giving it up, it becomes a very serious matter at the same time to take steps that, in another direction and in another form, look towards the relief of personal and movable property from taxation. I am not saying, however, that the horse duty should be permanently maintained; but I think it a very serious question indeed, on which the House and the Government ought to have a fixed opinion, whether the assessed taxes ought to be maintained, and whether they can be maintained in such a form as to provide us with something like the sum which we now derive from them, at rates very moderate in comparison with those formerly laid on horses, carriages, and servants. I should have been very glad if it had been in the power of my right hon. Friend to bring the subject of the horse duty and the other assessed taxes before the House—because it is impossible to deny that there is a certain relation between them—at a time when he felt himself competent to propose a final and determinated settlement of the question of local taxation. As I understand it, the strength of the case of those who have so eagerly advocated change in regard to local taxation really lies in this:—They say—I fully admit with considerable force—"We lay exclusively on real property in the country charges in which personal property ought to share." I have no sympathy with the

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advocates of change in local taxation who seek to lay on labour the taxes heretofore borne by property; and I cannot refrain from saying two things—first, that the simple transfer to the Consolidated Fund of charges hitherto paid out of rates, whatever the immediate relief to the ratepayers at largo of all classes, is indubitably, in the long run, a transfer of a charge from a fund supplied by property to a fund jointly supplied by property and labour. I am putting it thus, assuming what I believe myself to be about the truth—though it is impossible to state it more than as conjecture—but I believe that one-half the general taxation of this country, and fully one-half, is paid by the labour of the country. If that be so, when we remove a charge from local taxation and place it on the Consolidated Fund, we are not simply relieving real property at the expense of property not real—about which I have no prejudice to prevent my concurrence—but we are relieving real property of a charge of a sovereign, and placing 10 s. of that pound upon property more generally, and taking the other 10 s. away. That is the first proposition I have to state with regard to this somewhat serious proposal; and the second proposition I have to state is this—I admit it is only a matter of opinion; but it is my firm and fixed opinion that, not for the purpose of the moment, but for the purpose of the distant future—to which all true Conservatives ought to look—among the many considerations they should have in view when settling the principles of our financial system, there is no one of such vital financial importance as this—that, on the whole, you should make a fair and equitable distribution of taxes as between property and labour. That, Sir, brings me to the last portion of the Budget, on which I do not find myself bound to place myself in any sharp conflict with my right hon. Friend, though his point of view is not our point of view. Outpoint of view with regard to this subject has been that when we dealt with it, it ought to be dealt with as a whole, and we ought not to commence by making those grants from the Exchequer in aid of local taxation, which we have always recognised as a portion of the work to be done in some shape or other; but we should reserve those grants, and use them as our levers for securing good
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arrangements in the numerous branches of that widely-complicated and difficult subject. I am not sure how far I have rightly understood the proposal of my right hon. Friend. I have stated our principle. His principle is a different one. He finds himself compelled to begin by giving away the money he intends to give, instead of reserving it till he has secured sound and good arrangements for making the present law of rating equitable, for developing the principle of local self-government, for leaving the largest possible amount of liberty to local administration, for providing against the dangerous tendency to extravagance in the expenditure connected with rates, which, unless we take great care, our system of public subvention will be calculated to encourage. My right hon. Friend naturally acts from his point of view, and I cannot expect him to act from our point of view. I do not complain of him on that account, for I dare say, in the position in which he now stands, he is acting in concurrence with the sense of the majority of the House, and, therefore, I wish him to understand that I am not a complaining party, although I wish to preserve my adhesion to the view of the subject we ourselves have taken. What I am anxious about is this. My right hon. Friend intends to reserve till another year many important portions of this subject. Then, what I hope is this—that he will not attempt, by any proceeding in the present year, to commit the House, with regard to the future, beyond the grant which he is now making for the current twelve months. Let us be allowed, when we come to discuss this matter next year, to approach it without prejudice in any respect to the course we may wish to take, except by the fact that we have distinctly held out to the payers of local rates that certain sums of money shall at least be given to them. I do not expect or desire that there should be any recession from the question of the amount now proposed; but every opportunity should be left open for considering many questions of the greatest importance, which we are bound, in the interest of all parties, carefully to examine, in order to a satisfactory settlement, which cannot be arrived at by any off-hand process. My right hon. Friend will understand that I am not officiously

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and gratuitously introducing this subject. There was a doubt among some who heard him as to the intention of the Government with respect to the large sum of money they proposed to give in aid of the police rate. I may state that a fear was entertained that the Government intended to bring in a Bill during the present year which would fix a contribution from the Consolidated Fund in aid of the police rate by the authority of a Statute. I trust that course will not be taken. I should regret it, as fettering our future liberty in that particular respect in a most important and injurious degree. I think I could undertake to show, if necessary, that some of the regulations under which the present subvention in aid of the police rate is given, actually tend to gross local extravagance, and that this tendency would be greatly increased if the subvention were 50 instead of 25 per cent. I ask, on the part of the House—and it will be admitted to be a fair demand—that if my right hon. Friend is allowed to take the measure he has already slightly sketched as a measure for the year, to meet what he thinks the demands of justice for the year, we shall not find ourselves committed as to the principle on which we are to proceed in the mode of applying aid to local rates when we come to consider the subject in a legislative point of view. I have gone over the main subjects referred to in the speech of my right hon. Friend, and I trust that I have justified the declaration with which I set out, that I would not enter into the discussion in any captious or hostile spirit. I can and I do very cordially join in the general congratulation which my right hon. Friend has received from so many quarters on the ability with which he has handled his various and difficult subjects, which I was quite prepared to expect; and, further, I am quite able to say that although, as I have said, our positions and points of view are not the same—that I do not approach either the Revenue or the Expenditure precisely from his point of view, and that I do not hold myself pledged to his proposals upon those matters; yet looking at the position in which he stands as the organ of the Government, supported by a majority in this House. I think he has approached the whole subject of the financial arrangements of the year in a spirit
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of equity and of sound discretion, and that the proposals which he has made fairly demand, as a whole, the approval and sanction of the House as proposals that are worthy of the position he holds, and are at the same time conducive to the general interest of the country.
THE CHANCELLOR OF THE EXCHEQUER: The tone of the remarks which my right hon. Friend has just addressed to the House, and for which I beg leave to tender him my most cordial thanks, has been so favourable that there is little occasion for me to say anything which might be strictly described as an answer. My right hon. Friend has told us, indeed, that although on certain points he differs from the views which I have had to express on behalf of Her Majesty's Government, yet that he is not prepared to challenge our proposals, or to support any of the Amendments of which Notice has been given. At the same time, my right hon. Friend, speaking with that high authority which necessarily belongs to him, has called attention to one or two points upon which, under any circumstances, I should have wished to say a few words to the House, and which, as he has touched upon them. I think it desirable to notice without delay. In the first place, my right hon. Friend has referred to a matter which, as he truly says, has been a subject of comment both in the House and out of it—I mean the Estimates of Revenue and Expenditure in the coming year, which, on the part of the Government, I have submitted to the House. I have been asked whether I can without inconvenience give any further information with regard to the Estimate that I have presented of the Revenue of the coining year. Now, I entirely accept the doctrine which my right hon. Friend lays down—that in these matters of estimates the responsibility attaches, exclusively attaches, to the executive Government of the day: and if, in the remarks I made last week, I spoke rather more fully than is usual of the estimates which had been placed in my hands by the permanent officers of the Revenue Departments, it was not because I wished in the slightest degree to cast upon those Gentlemen any of the responsibility which properly belongs to us, but because I was anxious it should not he supposed that having very recently acceded to of lice we had presented estimates the correctness of which we

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had not taken duo care to test. I am prepared to meet the request of my right hon. Friend, and to mention with a little more detail than before, the foundation on which some of those estimates rest. Now, with regard to one most important estimate—I mean the estimate of the revenue from Customs—I should like to make one or two remarks. We have assumed that that revenue in the coming year will be, in round figures, £400,000 above the yield of the Customs in the past year. Well, I am met, not at all unnaturally, by the observation that there are signs of depression of trade and industry: that there are probabilities of a diminution of the consuming power of the population; and that, consequently, we must not expect that so large a quantity of the articles which contribute to our Customs revenue will be consumed this year as were consumed in the previous year. Now, let me just refer for a moment to the particular items upon which the estimate of an increase is based. The principal increase anticipated in connection with the Customs revenue is an increase in the estimated yield of the sugar duties. It is assumed that, whereas the duties on sugar and molasses brought £1,843,000 last year, they would this year bring £2,000,000. The House will perceive the importance of that fact. Hero is at once £160,000, out of the £400,000 of which I spoke, added to the estimate of revenue for the year with reference to an article which we are going to strike out altogether; and, therefore, if you say we are too sanguine in assuming that sugar would have yielded the high amount of £2,000,000, then we reply, make it any sum you please, only remember that, the less you assume the duties would have brought if loft alone, the less is the sacrifice of revenue which you incur in taking them off; and that being so, it docs not signify to me whether you take it at £1,843,000, or at £2,000,000. Under these circumstances, the most important by far of the articles on which an increase is estimated may be put aside. Then there is the item of tobacco, in regard to which an increase of £94,993 is assumed. Well, tobacco is an article that has not been much affected for a considerable time by alterations in duty, and when we see that it has been steadily advancing in consumption every year, we think it is not unnatural, allowing for the normal increase
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of the population, to believe that that advance will continue. But we have something else to judge by. We know from the Board of Trade Returns how trade has been going on for the first three months of this year, and that is a point to which I directed my attention in forming my Estimates. I found that upon a large number of articles of consumption that were not much or at all affected by duties, there had been up to the very latest date for which we had Returns—namely, March 31, a steady progress in consumption. I set aside the cases of tea and sugar, because they were affected by considerations and alterations of duty and other matters; but I took, for example, bacon and ham, and I found that in the first quarter of 1872 the consumption of these articles was 754,000 cwt, while in the same period of 1873 it was 867,000 cwt, and during the corresponding months of this year no less than 1,045,000 cwt. With regard to butter—still referring to the same three months in each year—the increase had been from 255,000 cwt in 1872 to 270,000 cwt in 1873, and to 337,000 cwt in 1874. As to eggs, the number of great hundreds in the first quarter of 1872 was 915,000, while last year it was 1,144,000, and this year 1,307,000; and so with regard to pepper, and several other articles of food. Of tobacco the consumption in the same period of 1872 was 10,924,000 lbs; of 1873, 11,489,000 lbs; and of 1874, 11,859,000 lbs, taking manufactured and unmanufactured together. Similarly, I found that, with regard to wine, the consumption had risen from 4,157,000 gallons in the first quarter of 1872 to 4,178,000 gallons in 1873, and 4,335,000 gallons in the corresponding period of 1874. So also, as to spirits, which increased in the same periods from 2,106,000 gallons to 2,523,000, and then to 2,604,000. I found, in short, that the experience of the early part of this year showed there was a steady progress in the consumption of articles of food by the great mass of the population of the country; and therefore I assumed that it was not unreasonable to regard the estimates given by the Revenue Officers as at once fair and moderate estimates. There is one other item I should like to mention as showing the progress of the country during the first three months of this year. I refer to the tonnage of

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vessels with cargoes cleaved, outwards and inwards, and in the coasting trade, during the three periods to which I have referred. The tonnage in the first quarter of 1872 was 12,361,614 tons; while in the next year it was 12,753,742; and in the corresponding period of 1874 it was 13,327,806. In all those directions I found that there were harmonious indications of advance in trade and in importation which justified, as I thought, the anticipations of a continued increase in the consumption of the various articles to which I have referred. It will be seen that sugar and tobacco are really the two great articles in which, an increase is estimated. In tea we do not count on an increase. Last year the duties on tea yielded £3,248,000, and the estimate for this year is £3,250,000, which is practically the same amount. The House will observe that this estimate is an exceedingly cautious one, for we are only assuming that the duties will produce the same amount as in the past year. But what were the circumstances of the past year? It is well known that the effect of the announcement that was made in January was very much to check the importation of tea, and for that reason alone we may expect that there will be a considerable spring in the imports of it this year. But it must also be borne in mind that we contemplate taking off the sugar duties, and what will be the effect of that change? We are going to reduce the sugar duties by £2,000,000, and are we expect that such a reduction will produce no elasticity in tea, coffee, and other articles of consumption? Therefore, I say that our estimate of an increase of £400,000 from Customs above the Revenue of last year is—I will not say ridiculously low—but a strictly moderate figure; and if I were getting up to criticize the Budget I should be inclined to say that the amount of our estimate was likely to be exceeded rather than that there was any danger of its falling short. Then, with regard to the Inland Revenue and the Excise, the two principal items are of course malt and spirits. We estimate that malt will show an increase of £220,000 over last year, when it produced £7,780,000. We estimate that it will yield this year£8,000,000. I would add that in regard to the income from malt we are not left entirely in the dark. A very
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large proportion of the revenue for the year to be derived from malt is already ascertained. The system on which the malt duty is charged is, that the officers go their rounds, bring to charge the quantity of malt already made, and collect the charge in the following round. They are thus able to compute the yield to the Revenue from the quantity already made. One of the most important rounds of the year has just been concluded, and it has been found that a very large quantity of malt has already been made; therefore, the officers of the Inland Revenue in their estimate of the income from malt this year gave an opinion which is not purely speculative, but derived to some extent from ascertained facts; and I believe that it will be found that they have been safe and cautious in their estimate. Then there is the great article of spirits. Undoubtedly a large increase in spirits has been estimated for. It is an increase of no less than £750,000 on the revenue of last year, which was £14,650,000. I cannot deny that that is an exceedingly large increase; but I find that year by year the quantity of spirits consumed has gone on steadily increasing. It is still my belief that the highest point of the consumption of spirits has not yet been reached; because I observe, on comparison, that the quantity of spirits consumed per head of the population in each of the subsequent years since 1852 has not yet reached the quantity per head of the population consumed in that year. The House will hardly be prepared for this statement, and it is a very remarkable one. Since the year 1852 there have been a good many changes in the rates of duty on spirits. The Scotch and Irish spirits have been gradually raised and brought up to the level of the English duty. The effect has been to check consumption; but, of late, the consumption has been again advancing, and it now stands thus:—In 1852 the quantity of British spirits consumed per 1,000 of the population was 918 gallons; in 1855 it was 908 gallons; in 1872, 844 gallons; and last year it was still only 899 gallons. The consumption of foreign spirits has, of course, also been increasing, though perhaps not in just the same ratio. The increase in the consumption of British spirits, at all events, has been going steadily on; but it has not yet quite readied the consump-

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tion per head of 1852, before the duties were increased. On the whole, therefore, I think that the Estimates that have been taken are Estimates which may be confidently recommended to this House, barring, of course, accidents which it is impossible to foresee. And although we have felt it our duty to warn the House that we have taken a rather sanguine view, yet we think it by no means a rash view, but that the Revenue of the coming year may be fairly and reasonably expected to reach the amount at which we have placed it. The next point to which my right hon. Friend adverted is the exceedingly important question of the Estimate of Expenditure of the year. My right hon. Friend made the observation—which, as a general rule, is perfectly true—that it is more convenient that the Army and Navy Estimates should be laid on the Table before the Financial Statement is made. As a general rule, I entirely agree with my right hon. Friend; but circumstances which the House will recollect made it necessary for us to depart from the rule this year. When we came into office there was very little time before us. It was impossible for us to examine the Army and Navy Estimates so as to lay them on the Table before Easter. It was of the greatest importance in the interests of trade, which was seriously paralyzed in some brandies, that the Budget should be brought forward as early after Easter as possible. We took the very first day after the Easter Recess for this purpose, and we were obliged to bring on the Navy Estimates after the Budget, instead of before it. The state of things, however, is not such as to affect the judgment of the House upon our proposals. The Budget statement was made on Thursday, and on the following Monday my right hon. Friend (Mr. Hunt) brought forward the Navy Estimates. The House has met to-night to consider how far they will give their approval to the financial proposals of the Government, and they have before them all the information necessary both with respect to the Army and Navy Estimates. Well, Sir, the Financial Statement is not, as some seem to suppose, made by the Chancellor of the Exchequer on his individual responsibility, any more than the Army or Navy Estimates are proposed upon the individual responsibility of the Secretary
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of State for War or the First Lord of the Admiralty. The financial proposals, both with regard to Revenue and Expenditure, are made on the authority of the whole Government, and of course we are responsible for the whole of what we present to the House. It may happen, as it has happened, that in the course of a Session of some months' duration, circumstances may arise which may upset the calculations made in the early part of the Session; but it would be a reflection on the Government of the most serious character if between Monday and Thursday they were to alter the whole scheme of their Expenditure. I can hardly conceive that we have done anything to lay ourselves open to the imputation of being so utterly "bird-witted" as to come forward on Monday with a totally different proposal from that which we had made on the previous Thursday. In what has been said and done we have acted with perfect consistency, and with a full consciousness of the bearing of one part of our proposals upon the other. I stated to the House, when I brought forward the Budget, that we accepted the Estimates of Expenditure left us by our predecessors. [Mr. GLADSTONE dissented.] My right hon. Friend was not here. In general terms, I said, we accepted, after a general examination, the Estimates prepared by our predecessors—that we considered that, upon the whole, these Estimates would suffice, or nearly suffice, for the Expenditure of the year. I threw out then a remark which I considered was within the cognizance of everybody—that every year there are Supplementary Estimates brought forward. I expressed a hope that we might go through the year without any, but I added that we could not be sure that that would be our fate; and when I look at the fact that, of late, almost every year there have been Supplementary Estimates of £200,000,£ 300,000, or £400,000, I cannot feel at all sure that it may not be our fate to provide for some such Supplementary Estimates as those. I hope still we may-escape any necessity of that kind. We have, however, a reserve of between £400,000 and £500,000, and if it should turn out that there are any Supplementary Estimates that might require an expenditure of £100,000 or £200,000, we shall be in a position to meet them without in any way upsetting the finance

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of the year. Some persons have run away with the idea, from what fell from my right hon. Friend the First Lord of the Admiralty in proposing the Nary Estimates, that the Government intend to bring forward some enormous Supplementary Estimate for something like a partial re-construction of the Navy, which will more than absorb the surplus, and, indeed, upset the whole of the financial arrangements of the Government. This idea seems to have taken a hold upon the public mind, and to have given rise to most extraordinary imaginations. One report stated that I was going to propose to negative the Resolutions with regard to the horse duty, and, in fact, some persons got so bewildered that they mistook plums for horses. Now, I sat by my right hon. Friend while he was making his statement on Monday, and though some things which he said with respect to the state of the Navy seemed to me to be by no means satisfactory, and although I thought he rudely dispelled the dreams in which many persons had indulged that the great reductions which were made by the late Government had been consistent with the maintenance of the Navy in that condition of efficiency which we all so much desire; yet I gathered nothing from the observations of my right hon. Friend that at all disturbed my equanimity as to the financial proposals of the Government. Indeed, it was not until the late First Lord of the Admiralty rose to address the House that I felt at all unhappy on the subject. He certainly did say something which, had I not stronger nerves than I am supposed to have, might have upset me. That right hon. Gentleman did not say that my right hon. Friend (Mr. Hunt) was entirely wrong in the views which he had expressed; he did not contend that our Navy was in a perfectly unexceptionable state of efficiency; but he said, "If those are your views"—not very much disputing their correctness—" you ought not to lose a day in coming down to the House and bringing forward Estimates for re-constructing the Navy. We may have left the Navy in a very unsatisfactory state, but then we have left you a surplus to put it in order again." These are not the views of my right hon. Friend or of the Government, but of the right hon. Gentleman the Member for the City of London
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(Mr. Goschen). But we decline altogether to be bound by the speech of the right hon. Gentleman or by the inferences which he has drawn. It is perfectly true that my right hon. Friend stated on Monday that some of our ships were not in a satisfactory condition; I have no doubt, too, that he is addressing himself to the question of what may be done to improve that condition; and we must presume that in course of time we shall have some representations made for an increase of expenditure; but I hope that this expenditure may be balanced by savings elsewhere, or that means may be provided for meeting the expenditure. This, however, I will undertake to say—that as we object very much to the principle of violent reduction into which our predecessors hurried when they took office, we equally object to any violent launching into sudden expenditure; and though we shall address ourselves, of course, to the very important task of putting the Navy of this country in what we consider to be a proper state, we do not intend to make any proposals this year which shall disturb the financial scheme of the Government. [A laugh.] I do not know what hon. Gentlemen opposite mean by that laughter; but, without entering into any inquiry as to its causes, I repeat that we stand by our Estimates, both of Revenue and Expenditure. Passing from that point, I should wish to refer briefly to one or two matters which have been touched upon by my right hon. Friend to-night. He alluded to the proposal for the appropriation of a certain sum of between £400,000 and £500,000 for the creation of Terminable Annuities winch were to expire in 1885; and while approving that proposal as a whole, he expressed it to be his opinion that it would be better to take a later date than the year I have named. Now, that is a question with respect to which I should very much like to have a quiet argument with my right hon. Friend. I should wish to know exactly what it is he means. Does he mean that we should make arrangements for redeeming a larger portion of the Debt at a later date? At all events, we appropriate such a sum as will exactly extinguish £7,000,000 by the year 1885, and £7,000,000 of Debt happens to be within a few hundred thousand pounds of the amount which the Controller of the National Audit

1015
Office tells me can be conveniently and safely applied from the Post Office Savings Bank money to the purpose of creating Terminable Annuities. If you go about redeeming Debt by means of annuities, you must find somebody who will buy those annuities: for it is not possible to dispose of Terminable Annuities in the open market. You can, consequently, have recourse to them only by taking them out of one of the funds which are under your own control; and what funds, let me ask, are they? There is one fund which can be conveniently used for this purpose. It is the Post Office Savings Bank fund, because there being a national guarantee for the amount of that fund, there can be no difficulty in investing it in the purchase of Terminable Annuities. There are other funds which the Government hold as trustees. There is the moderate fund which is vested in them as trustees of the old savings banks, and the great fund which they hold as trustees of the Court of Chancery. But, then, the difficulty would be to deal on the spur of the moment with those funds, and an Act of Parliament would, I believe, be required for the purpose. That being so, and taking into account the short time the Government had to consider their plans, I think they took the best and most convenient course in applying the Post Office Savings Bank funds to the extinction of a certain amount of Debt, as they have proposed. It is not that we do not contemplate in the future the possibility of some more extensive dealing with the Debt in reference to the funds under our control, but these are matters which require grave consideration; and I feel assured, if we had dealt on the spur of the moment with so great a fund as the Chancery fund, we should have had all the lawyers upon our backs, that many doubts would have been raised as to the expediency of the proposal, and that much valuable time would have been lost. But my right hon. Friend says that we are laying a great load on the year 1885. I say, quite on the contrary, that we are taking a great load off that year. A sum of between £4,000,000 and £5,000,000 per annum will then fall in, which will no doubt be a very large relief to the expenditure of the country. I will not on this occasion, however, enter into a
1016
general discussion on the subject of Terminable Annuities. I will merely add that we had a fund with which we could deal easily and conveniently on the spur of the moment, and that we dealt with it in what we considered to be the best and most appropriate way. But then my right hon. Friend says that we are, after all, not doing much in making this proposal, because the money must have in some way or other found its way to the relief of debt. Now, that is a statement to examine which would lead me into too technical a discussion, and I will now content myself with saying that the remark is to a certain extent just; but I must enter a caveat against being supposed to admit its correctness to the full extent of my right hon. Friend's manner of stating the question. Now, as to the income tax. I do not think the House will be surprised if I abstain from entering into a discussion which my right hon. Friend hardly seemed desirous of raising. The great question of the income tax is one which we have distinctly and avowedly reserved for full consideration next year. We have made certain concessions to the payers of income tax, but they in no way touch the principle of the impost. We evaded—and we did so deliberately—all questions as to the incidence of the tax, because we wished to keep the subject open for the present. I will merely add, therefore, that so far as the income tax is concerned, we adhere to the proposals which we have made. As to the sugar duties, my right hon. Friend has given in better language than I could command the reasons which induced the Government to abolish instead of reducing those duties. I will mention, while on this point, a story which I heard a few days ago, and which well illustrates the inconvenience and the uncertainty of the sugar duties. I was told by a friend of mine that he met a gentleman who said to him—"I have a cargo of sugar at this moment coming to this country. It depends upon the decision of an officer of the Customs—of whose qualifications I know nothing—whether it should be put in one class or another, and according as it is put in one class or another I shall either make or lose by the cargo £1,200." Now that is, I think, a very strong illustration of the way in which the sugar duties operated as regards the different classes

1017
of sugar. Then, the right hon. Gentleman, after having expressed his approval of our proceedings with respect to the sugar duties, expresses his dissent from our proposals relating to the horse duty. Well, the remission of that duty has, no doubt, been received with some surprise in certain quarters. It is said that it is a remission which was not called for, and one of which the advantage will mainly be felt by the rich. Now, I entirely deny the accuracy of both these propositions. As to the repeal of the horse duty not being asked for. I would remark that although I certainly did not receive any deputations on the subject, yet I have had memorials—very important memorials—from Glasgow, Manchester, Edinburgh, Liverpool, Aberdeen, and various other places, all urging on me the importance of relieving trade from that heavy burden. I will not trouble the House by reading them; but they are memorials from persons who represent that they are very seriously burdened in carrying on the trade of the country by this duty on horses. That was a matter which was pressed on me almost daily from many influential quarters—some of them in large towns. It was a matter also which was brought under my notice by the officers of the Inland Revenue, whose attention was directed to the collection of this tax. They represented to me that the tax, being entirely founded on exemptions, was one which it was exceedingly difficult and inconvenient to levy; that there were constant complaints made as to the levying of the tax on a horse, which ought to be exempt, because a man happened to ride it once. And so again with what was connected with that duty—the horse dealers' licence duty—there was a difficulty as to who was and who was not a fit subject for the impost. We took these memorials into consideration, and also the representations made by the officers of Inland Revenue, and we believed—and still believe—that in repealing this tax we are conferring a great boon, not so much on the agricultural interest—although to some extent it is a boon to them and to horse breeders—but to a far greater extent on the commercial and trading classes of our great cities and towns. Well, my right hon. Friend says this connects itself with the railway passengers duty, I admit that
1018
there is a kind of seeming analogy between them; but I do not think they stand on the same ground. At the same time, I have always said that the railway passengers duty is one which, if we could see our way to couple its remission at a future time with proper regulations with respect to railway traffic, we should be very glad to deal with. With regard to carriages and servants, the tax upon which has been mentioned by my right hon. Friend, I do not know that we need go into those questions now, as we are making no proposal with regard to them. But I wish to say a very few words on the concluding remarks of my right hon. Friend about our proposals as to local taxation. My right hon. Friend says he agrees with us in thinking it fair and reasonable that some remission should be made and some benefit conferred on local ratepayers; but he thinks that the proper way to do that would be to reserve the grants which would be made as levers to assist in bringing about improvements in the system of local taxation. Well, we were not in a position exactly to reserve those grants as levers; because if we had done so it would have meant that we were reserving a considerable surplus which we now propose to dispose of, as the House is aware. We should have been reserving that and what would have been the consequence? We should have have had applications made to us which it would have been difficult to resist, for the appropriation of that surplus to other objects; and we should have had no levers left to effect our operation. But we had another thing to consider. My right hon. Friend and his Government had been applying these levers for a considerable time, without, as it seemed to us, producing any great result. And it appeared to us that, perhaps, a somewhat different mode of proceeding would be preferable, and that we should do better by taking up the question of local taxation in the way we have done, showing our anxious and earnest desire really to deal with it, announcing at the same time—as we have said, in the most distinct manner—that we do not regard the grant towards the cost of lunatics and the police as the be-all and end-all of this subject, but pointing out that the question is one of the greatest questions of the clay, and not to be disposed of in one year or in two, but that the

1019
whole question of local administration and local agency closely connects itself with those great economical and social improvements which it is important to make, and that we are prepared to deal with local taxation with the view of promoting and facilitating those improvements. And when my right hon. Friend talks about transferring burdens from funds supplied by property to funds supplied by property and labour, he is really carrying us off into disquisitions which I think are altogether wide of the mark. This is not, in our view, a question of the shifting of burdens; it is a question of the adjustment of taxation with a view to administrative reform; and we altogether deny, in the first place, the truth of the saying that this is a transfer of burdens from property to property and labour; and, in the second place, we say, even if it were in any sense such a transfer, the object for which it would be made is the benefit, not of property, but of the country, and of the labour of the country especially. It is because we feel that these improvements are of such great and vital importance to the labouring classes—improvements in the character of their dwellings, improvements in the sanitary arrangements of the country, improvements in the development of habits of providence, and other things of that kind, which depend on the establishment of a sound system of local agency, founded on a sound and proper system of local taxation—it is because we believe this, that we are so urgent in pressing this matter and putting it as our first question for consideration. We entirely agree with my right hon. Friend, that if we stopped where we are now, and simply made the subsidies we propose, and left everything else as it is, we should deal very inadequately with this great question. But, as I said when introducing the proposals of the Government, we do not intend to stop here. We intend to take up this question as a whole, and we trust that what we are doing now will not hinder, but will help that which we shall feel it our duty to propose in another year. These are the principles on which the financial proposals of the Government are founded; these are the principles on which we submit them to the House, and we trust it will support us in giving effect to them.
MR. GOSCHEN: Perhaps the House will permit me to offer a few words in explanation after the statement of the right hon. Gentleman opposite. I understood the right hon. Gentleman to say that the other night I had practically admitted the truth of the statements made by the present First Lord of the Admiralty. I beg to say most emphatically that I admitted nothing of what the First Lord of the Admiralty said. ["Oh!"] Hon. Members will search the record of the debates in vain to find that I uttered one single syllable to depreciate the state of the Navy at the present moment. Three long speeches had been made from three different quarters as indictments of the Naval administration of the last five years. To those three speeches it was my duty to reply. One of those speeches proceeded from the right hon. Gentleman the present First Lord of the Admiralty (Mr. Hunt), and it was not only what he said, but the manner in which he said it, that impressed the House at the time. There was in it that ominous inuendo which was taken up by the Press next day. I did not think that I could in an hour's time refute all the statements made in the course of the evening. I knew that our vindication would come, and also whence it would come. I knew it would come from the front bench opposite, and from Her Majesty's Government. I knew that by the proposals which they would ultimately submit to the House the country would see that they were wrong in the inferences they had drawn from the speech of the First Lord of the Admiralty. And now we see that the whole of this "scare" which has frightened the public for these two days is a matter of about £100,000 on an expenditure of £10,000,000. If after an administration of five years when the Conservative Government come into office they think there are no greater errors to repair than that, I say that it is the best vindication of our conduct—better than if I had made a speech of two hours denying or dealing with every part of the First Lord of the Admiralty's statement. I thank the Chancellor of the Exchequer for the statement he has made to-night. Now, we shall be able again to discuss the Navy Estimates on a reasonable footing.

1021
First Resolution read a second time, and amended, by inserting, after the word "Marmalade," the words "Plums preserved in Sugar."
Resolution, as amended, agreed to.
THE CHANCELLOR OF THE EXCHEQUERsaid, that he had intended to lay a tax on plums preserved in sugar; but finding that the lax as proposed would only yield a revenue of £12 per annum, he had now to propose that the second Resolution should be negatived.
Second Resolution disagreed to.
Subsequent Resolutions agreed to.

WAYS AND MEANS.
Order for Committee read.
Motion made and Question proposed, "That Mr. Speaker do now leave the Chair."

MALT TAX.—RESOLUTION.
MR. JOSHUA FIELDEN, in moving, as an Amendment, that "in the opinion of this House, the Malt Tax ought to be reduced," said, that in 1888 he pledged himself to his constituents that if returned he would do all he could to procure its repeal, but circumstances prevented more than one discussion on it and had there been more full discussion, it could have led to no satisfactory result, the late Prime Minister having never concealed his opinion that the tax ought not to be repealed. A division, however, might have shown the opponents of the tax, who were their friends and who were their foes. The position was now a different one. The present Ministry had been elected, to a large extent, by persons anxious to see this tax repealed. From such a Ministry those persona had a right to expect that some relief would be given them. The present Prime Minister had in 18.52 proposed to Parliament to repeal one-half of the malt tax; and in 1866, when he was Chancellor of the Exchequer, he had stated to a deputation that he had never concealed his opinion that the malt tax was a bad tax, adding that they, the farmers, did not sufficiently support him in 1852. But, notwithstanding these facts, a Budget had been introduced by the present Ministry, the so-called farmers' friends, showing a surplus of £6,000,000, and nothing whatever had been given to
1022
the payers of the malt tax. When were the advocates of repeal to move if not now? Many Friends around him had told him he would injure the cause by dividing; but he conceived it his duty to go to a division that it might be seen who were the friends of repeal, although many who would have supported him had they been in Opposition would now vote against him. He had not entered the House as a party man, and did not think that the fact of 12 or 15 Gentlemen walking from one side of the House to the other was any justification for an alteration in the opinions which he had always entertained. One of the reasons urged by the Chancellor of the Exchequer for not dealing with the tax was its enormous amount, for it had the last year produced £8,000,000. The large amount of a duty was not used as an argument against its reduction by the right hon. Gentleman the Member for Greenwich when he proposed to reduce the tea and sugar duties. In 1863 the tea duty produced a revenue of £5,485,159. In that year the malt tax yielded £5,389,908. In 1863 the right hon. Gentleman reduced the tea duty, and the reduction he estimated at £1,641,541. In 1865 he made a further reduction of the tea duty to the extent of £2,214,981. In 1864 the revenue from the sugar duties was £6,158,701; but that was no argument with the right hon. Gentleman why these duties should not be reduced. On the contrary, in that year they were at his suggestion reduced £1,744,384. In 1870 they were further reduced to the extent of £2,786,281, and this year they were to be abolished altogether. From 1863 to 1874. both inclusive, they had reduced the tea duty by £3,856,522, and the sugar duties by £6,256,665, while the malt duty had not been touched. He could not see why the objections to a tax which pressed with exceptional hardship on the labouring people and on the cultivators of the soil should always be ignored. The feeling in the country towards the present Government would be—"Save us from our friends!" The malt tax amounted to 21 s. 8d. on every quarter of barley made into malt, and though the price of barley was now high, the average taken on 10 or 15 years did not exceed 32 s. to 36 s. a quarter. He would demonstrate the hardship of the tax by stating that if the average price of bar-

1023
ley was 32 s., the tax would amount to 70 per cent; if the average price was 36 s., it would amount to 60 per cent. It was a tax, too, that violated a principle which the House and the country had adopted; that an article should be taxed as near the point at which it went into consumption as possible. But this tax was laid on a raw material—upon barley on its conversion into malt. The amount that it brought into the Exchequer did not by any means represent the amount taken out of the pockets of the taxpayer. This had been most ably shown by the right hon. Gentleman the Member for the University of London. In 1869, in his Budget speech, he said—
"Again, it is a tax on a raw material in its very rawest state; this 1s. a quarter—or whatever it is—has to hear the profit of the millers, the retailers, and all the different persons through whose hands the corn passes before it reaches the poor man in the form of a loaf."—[3 Hansard, xcv. 388.]
This was said in reference to the 1s. a quarter duty on corn. How much more forcible, when the argument was applied to the 21 s. 8d. a quarter tax on malt. The maltster had to pay the tax of 21 s. 8d. It was an expenditure on the first process of his manufacture, and it was therefore in effect the same as though he had spent so much extra money in the purchase of barley. He would, of course, charge interest and profit for the capital employed—say 5 per cent for the former, and 10 per cent for the latter; in all, 15 per cent on the tax of 21 s. 8d., or 3s. 3d., thus making the charge 24 s. 11 d. The brewer would charge a like 15 per cent for interest and profit upon the amount he paid to the maltster, which would be 3s. 9d making the charge of the brewer 28 s. 8d. The retailer often disposed of his beer before he paid the brewer; therefore he would not charge anything for interest on his capital, but 10 per cent for his profit which would come to 2s. 8d., which brought the sum charged to the consumer to no less than 31 s. 6d. The average price of barley, as he had stated, was 32 s. a quarter. The tax, therefore, that the consumer of beer had to pay was at the rate of 100 per cent. In other words, while the malt tax brought into the Exchequer £8,000,000 a-year, it took out of the pockets of the people, owing to its being laid on the raw material which fostered the great monopolies of malting, brewing, and retailing beer, at least £11,500,000. He
1024
contended that such an impost was wholly unjustifiable in principle. He was not about to advocate the placing of the tax upon any other article in order that malt might be relieved. If beer was to be taxed, it ought, he thought, to be placed as near as possible to the point of consumption; but what he did advocate was the reduction and final repeal of the tax in question. He had received a letter that morning from a farmer, a gentleman who wrote with some authority on the subject—Mr. Fowler, who lived near Aylesbury, and was a very strong supporter of the Prime Minister. He said—"I grew about 60 acres of barley last year, and placed it soon after harvest. I sold 300 quarters of malt, the duty on which will be £320, or at the rate of £5 10 s. per acre." He was only sorry that the writer of that letter and other constituents of the right hon. Gentleman at the head of the Government did not press him hard upon the subject during the late Election. Then when malt was exported the tax was taken off. In the extremely wet year of 1860 a farmer on the south coast of England applied to the Excise for permission to malt his barley, which otherwise would be spoilt. Permission was refused, whereupon he got his barley malted, paid the duty, shipped it to France, and got the duty returned. He next shipped off his sheep after it, and when they had thus been fattened upon untaxed malt in France, he brought them back and sold them in the English market. Facts like these showed the gross injustice which this tax imposed upon the former. He should doubtless be mot by the remark that the only effect of reducing the malt tax would be to increase the quantity of beer drunk in the country, and that at the present time more beer was drunk than was good for the people. His answer to that statement was that it was not the amount of pure beer drunk that injured the people, but the quantity of adulterated poison sold under the name of beer, which was the cause of the misery and wretchedness they all so much deplored. He was anxious to restore the practice of cottage brewing, which, in consequence of the high price of malt, had fallen into disuse in most agricultural districts, although it still existed to a great extent in the suburbs of manufacturing towns like Halifax,

1025
Leeds, Huddersfield and Todmorden. In 1865 he sent a reliable person round to collect information as to the extent of cottage brewing in that part of the

TOWNSHIP.

PARISH.

Total Families.

Brew at Home.

Would brew, but can't afford.

Buy Beer.

Do not drink Beer.

Elland

Halifax

1419

1237

51

73

58

Hipper-holme-cum-Brighouse

Ditto

1737

1301

141

157

138

Quarmby-Cum-Linley

Huddersfield

987

784

84

71

48

Idle

Calverly

2231

1643

220

106

262

Lansfield

Halifax

876

610

46

48

172

Middle Third of Stansfield

Ditto

798

591

54

49

104

Todmorden and Walsden

Rochdale

1774

1293

139

93

249

9822

7459

735

597

1031

Given in another form it might be stated as follows:—76 per cent of the inhabitants of these townships brewed at home; 8 per cent would brew, but could not afford to do so; 6 per cent bought beer; 10 per cent did not drink beer. The habit of cottage brewing prevailed at one time to a vast extent all over England, and it was ill consequence of the increased price of malt, owing to the malt tax, that it had fallen into disuse. Cobbett told them in the Political Register, vol. 87, p. 720, that—
"Mr. Ellman stated to a Committee of the House of C ominous in 1821, that 15 years before that, when he became a farmer, every labourer in his parish of Glynde where he lived, brewed his own beer, and drank it by his own fireside, forty-five years back from 1821 takes us to 1776. At that time there was no tax on malt if made by persons for their own consumption. In the year 1783 this permission ceased."
In the districts where the practice of cottage brewing was in force, the husband and sons of the woman who brewed the beer were among the most sober and respectable of the population, remaining at home in the evening with their families instead of going to the public-house. Where cottage brewing had disappeared, men were forced into public-houses, and were there led into temptations which attendance at such places gave rise to. Beer was increased in price about 100 per cent by this tax, and this increase in the price was a great inducement to adulterate it. China clay was first used in the cotton manufactures because of the high price of the raw material, owing to the American War, and so adulteration in beer was encouraged by the high price of malt. The high price of beer undoubtedly encouraged
country, and the information he obtained was most interesting. He had it put: into a concise form and would read the result:—
the drinking of spirits—a fearful source of evil. The man who got his glass of beer at home was not the man who would get drunk on spirits—or what were called spirits—sold at public-houses. Therefore it was in the interests of temperance and of the pub-lie health that he sought for the reduction of this tax, which would enable cottagers to brew a pure and unadulterated drink. He had been looked upon almost as a visionary for supposing that the country would ever go back to cottage brewing. The Times had done him the honour of ridiculing him in a leading article for some remarks that had fallen from him relative to cottage brewing when he introduced a deputation to the Chancellor of the Exchequer the other day in reference to this question. That article was doubtless written by a man who had lived in London all his life, and who knew nothing about the habits of labouring people in the country. The correspondent of that journal, who was engaged in collecting facts in connection with the lock-out of agricultural labourers, alluded in more than one of his letters to the fact that malt was given out in harvest time to the farm labourers, which they brewed themselves. Therefore the statement in The Times article was contradicted by The Times correspondent. Evidence was given before the Malt Tax Committee in 1868 to show that the farm labourers preferred beer to tea, and that they could work better on the former than on the latter beverage. A labourer from Playford, of the name of Elias Amos, gave the following evidence—

1027
(Q. 4768.) "Yon think the people would prefer beer to tea?—I do.
(Q. 4769.) "Could they work better upon the beer?—Yes.
(Q. 4770.) "Is there no other reason why you think they would drink beer instead of tea? Would it not cost more to have a fire, night and morning, to make your tea?—Beer does you more good than tea.
(Q. 4799.) "I make good beer when I brew it for the harvest. I brew 2 bushels instead of 1½ bushels, and make the same quantity of beer in harvest. I want better beer when I work hard."
If our labourers did not drink beer, what were they to drink? He should be told tea. Our physicians were arriving at a very different opinion with respect to the wholesomeness of tea from what was entertained a few years ago and they found that it was impossible for a man to undergo laborious exercise as well upon tea as upon beer. Thus Dr. Smith, the physician appointed by the Privy Council to inquire into the dietary of the poor, had reported that the continuous use of either tea or coffee was calculated to have an injurious action upon the brain. These were his words—
"The action of both tea and coffee, but particularly the former, upon the brain is well known. The importance of this action is not So well appreciated as it ought to be; but I am fully persuaded that it has a most injurious influence upon health and even upon sanity. Tea is hurtful in the absence of food after a long fast (as at breakfast), to the poor and ill-fed. It is not adapted to sustain exertion."—practical Dietaries, by Edward Smith, M.D., one of the Physicians employed by the Privy Council to inquire into the Dietary of the Poor; and dedicated, by permission, to Mrs. Gladstone.
Then, again, we had the evidence of Dr. Simon—
"Unhappily, agricultural labour, instead of implying a safe and permanent independence for the hard-working labourer and his family, implies, for the most part, only a longer or a shorter circuit to eventual pauperism—a pauperism which, during the whole circuit, is so near, that any illness or temporary failure of occupation necessitates immediate recourse to parish relief."—Seventh Report of Dr. Simon, the Medical Officer of the Privy Council.
It was all very well for those who had plenty of meat, and who did not undergo much physical exertion, to do without beer; but to the hardworking and underfed labouring man it was an absolute necessary of life. But he was not alone in his condemnation of this tax. He was sorry the right hon. Gentleman the Member for Birmingham had left the
1028
House, for he, of all men, would recognize the opinions he was about to quote, and if the right hon. Gentleman were consistent be would certainly vote for his (Mr. Fielden's) Motion. Mr. Viliers, in 1839, said—
"Would the landed interest be willing, if the malt tax were taken off, to relieve the country from the tax on corn? For of this he was sure, that all those who were injured by the operation of the com laws would be willing, nay, would be anxious, to get rid of the malt tax. By acceding to those terms, the produce of the malt tax would be lost to the revenue, no doubt; but £4,500,000 was a small sum indeed, compared with what might be raised through the medium of taxation if the energy of the country were allowed its full and natural play."
Lord John Russell, in 1846, said—
"If I were Prime Minister when protection to agriculture was abolished, the first tax I would repeal would he the malt tax."
The late Mr. Cobden said—
"We sympathise with the farmers. We will never tolerate one shilling duty on com but we will co-operate with them in getting rid of the malt duty. We owe the farmers something, and we will endeavour to pay them in kind."
And speaking as late as February, 1864, he said—
"It has often occurred to me to compare the case of the British agriculturist who, after raising a bushel of barley, is compelled to pay a tax of 60 per cent before he is permitted to convert it into a beverage for his own consumption, with what I have seen in foreign countries, and I can really call to mind nothing so hard and so unreasonable. I am quite sure that the cultivators of vineyards and the growers of olives in France and Italy would never tolerate such treatment of their wine and oil."
He agreed with Cobden that this was a most unfair tax. It pressed most unjustly and harshly upon one class of producers, and also upon the whole population of this country; and seeing year after year that the surplus revenue had been devoted to a reduction of duties on foreign articles, he thought it was high time we turned more of our attention to a tax on an article of homo production and home consumption. The hon. Gentleman concluded by moving his Amendment.
MR. STORER, in seconding the Amendment, contended that a Government which had been raised to office by the agricultural classes would, by the course which they had adopted by their Budget, give very grave dissatisfaction. He had heard the right hon. Gentleman the Member for Greenwich (Mr.

1029
Gladstone) say that the late Government was always keenly alive to the wants of the agricultural interests; but he (Mr. Storer) was not aware of it. This he was aware of, that the agricultural interests had been languishing, and that for many years grave burdens had been imposed on them. He regretted to see that those Members who ought to be now here were absent. Though the question had been long before the country, many persons were ignorant of how much this tax injured the agricultural community; and oven the Press, which generally gave assistance to the down-trodden, did not do anything for the agriculturists. He hoped that when writers were better informed they would advocate the abolition or reduction of this tax, especially now that the Conservative party was in power, and when there was a good opportunity of considering the claims of agriculturists. They had an equal claim with the sugar refiners and the shipping interest, to any surplus of Revenue that there might be. The tax upon malt was said to be a consumers' question. He granted that; for the artizan and mechanic paid double the price he ought to do for his beer, and he wondered how it was that they submitted to such an imposition for so long a period of time. Perhaps, when colliers and others were obliged to return to their normal beverage of beer, they would inquire how it was that the price was doubled by the original tax of 50 per cent on the average price of barley for the last six years, as shown by the Returns, and by the necessary profit on that tax charged in increasing progression by the maltster, the brewer, and the publican. Next, the cultivators of the soil were largo consumers of malt. Their consumption amounted to a tax of 6d. to 1s. per acre upon the arable land from which their corn was produced; that was to say, from 6d. to 1s. in the pound, upon their profits; but take it at 1s. in the pound, what trade, profession, or manufacture, he would ask, would tolerate such a tax—heavier than any income tax of late years—on their special productions? Beer was a beverage which farmers were compelled to consume, for without it they could not cultivate their lands. They might, in the midland and eastern counties, as well attempt to grow corn without beer as without horses or implements. Labourers, when coming for
1030
harvest from all parts of the Kingdom, asked, as their first question, how much beer he gave to the acre; and if he replied "only milk or tea"—though they would accept these as extras—they would shoulder their scythes and walk away. And it should be remembered that farmers could not recoup themselves like coal-owners, and manufacturers, and others; they could not combine to raise the prices of their productions, but they were obliged to pay this iniquitous tax and suffer the loss which it entailed. Eminent farmers—Mr. Sanday, of Notts, particularly—in a pamphlet, read at a Notts Chamber of Agriculture meeting, and now quoted, Mr. Fisher Hobbs, and others, had stated that cattle would eat malt when they would eat nothing else, that the advantages of malt as an article of food for cattle were incomparable; and, therefore, that for the rearing of cattle, farmers ought to be allowed to use malt free of duty. The importation of barley, owing to failing crops abroad, had fallen off this year from 2,857,875 in six months ending March, 81, 1873, to 1,531,032 in six months ending March 31, 1871, and the home failure was great also, which accounted for the high price of barley this year so that no argument could be based on that. If the duty were abolished a farmer would be enabled to give more beer to his men and the argument that labourers ought to emigrate to those countries where they could get untaxed beer would be taken from the months of agitators who tried to cause dissension between the employer and the employed. The mechanic and the artizan got more beer than did them good, but the agricultural labourer generally got less than he ought to get. In his (Mr. Storer's) part of the country (South Nottingham) a small quantity of malt was given to agricultural labourers which they brewed at home. When they did not get enough malt to brew at home they resorted far more frequently than they ought to the public-house. Some Returns had been presented to Parliament showing the state of the beer and malt duties on the Continent and in the United States. Those Papers could lead to no other conclusion than that the English agricultural producer, consumer, and labourer were placed at a great disadvantage compared with their brethren abroad, inasmuch as in none of those coun-

1031
tries was the duty, whether on malt or beer, at all equal to the English duty: and, in nearly all cases, the farmer and labourer wove free to use malt for brewing or feeding cattle. Much bad been said in that House about justice; but justice was not done to the farmers, and he hoped, unless justice were done to them, never to hear more of justice. He regretted the absence of the right hon. Gentleman the Member for Birmingham. (Mr. Bright), because an appeal to him as a free-trader might well have been made on this occasion on behalf of the British farmer. The social aspect of this question must have struck everyone. It was well known to all who had investigated the subject that this was the real key to the temperance question. It was impossible to stop people drinking; but they might discourage the system of drinking ardent spirits by encouraging home brewing and the supply of better and cheaper beer, and this was illustrated most strongly in the report from Belgium, where Mr. Barron complained of the increase of intemperance, and use of ardent spirits since beer duties were increased. The Chancellor of the Exchequer feebly professed his regret to be obliged to raise so large a revenue from the consumption of spirits. On his forehead might almost have been seen the confession—
"Video meliora proboque;
Deteriora sequor."
But the right hon. Gentleman condescended to get up a cry. He could not but admire the consummate skill with which the Chancellor of the Exchequer had thrown his sugar bait across the right hon. Member for Birmingham, who had readily risen to the cry of "a free breakfast table." If the right hon. Gentleman invited a cry he would give him a better one—"a free dinner table." The working man was quite as fond of beer as of tea, and he would prefer to have the duty taken off his beer to having it taken off his sugar. In one of the classical productions of the Prime Minister, Tadpole and Taper were represented as rejecting the cry of "the Church and the Malt. Tax," and adopting that of "our young Queen and our old Constitution;" while in Coningsby there was a remark singularly applicable to the present time—that "all the country gentlemen knew of
1032
Conservatism was that it would not repeal the malt tax, and had made them repeal their pledges." The present Government was too strong to need a cry. It had been borne to power on the full tide of public opinion, believing that they would deal with these questions in a just and comprehensive spirit; and, although they might differ from them now, he hoped they would agree before long. It was, perhaps, too late now to expect an instalment of justice in the shape of a reduction of the malt tax; but he would appeal to the right hon. Gentleman at least to give some pledge that he would take it into his serious consideration with the view of abolishing at no distant date this obnoxious impost, which was a great burden upon an industrious and overburdened portion of the community; that he would do his utmost for the expurgation of this pestiferous tax, which had been condemned by the greatest authorities, past and present, and which was opposed to every principle of free trade, every dogma of political economy, every consideration of right and justice. The hon. Member concluded by seconding the Amendment.
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 Malt Tax ought to be reduced,"—(Mr. Joshua Fielden,)
—instead thereof.
Question proposed, "That the words proposed to be left out stand part of the Question."
MR. D. DAVIES, having been a working man at the age of 14, bespoke the indulgence of the House while he opposed the Motion of the hon. Member opposite (Mr. Fielden). He had never had 6d. that he had not made himself. He had commenced life as a working man, and during the last 18 years had employed on an average 2,000 men, and he therefore claimed to be as good a judge as any Member of that House of the requirements of the working man. Not only had he acted as a working man for a considerable number of years, but he had mixed with them afterwards as the principal partner in a large colliery-owning firm where 2,500 men and boys were employed.

1033
He went regularly amongst them every fortnight. He did not object to as much drink as was good for a man, if he required it at all; but three things he had noticed all his life promoted excessive drink—high wages, cheap beer, and convenient public-houses. Before 1870 he paid 4s. a ton for labour for the coal raised, or £100,000 a-year for 500,000 tons, and wages having advanced 50 per cent he should have paid between 1870 and 1870, 6s. per ton, or £150,000, but he actually paid £50,000 more in 1873 than in 1870 for the same amount of work. Instead of the coal costing £150,000 it cost over £200,000, so that here was £50,000 pure waste. How had that great loss arisen? From the irregular working of the men. There were other colliery owners in the House and they would bear him out in what he said. His coal was very good coal—it was one of the best coals in the world—but it was an expensive coal to work, and he would be borne out by other coal-owners in saying that the expense of the work was increased by irregularity. On Monday they raised about 1,000 tons, half the men only being at work, on Tuesday 1,400 tons, on Wednesday, 1,700 tons, on Thursday, 2,300 tons, on Friday the same amount, and on Saturday a like amount in proportion to the time of working. In consequence of this irregular working, employers were obliged to keep 25 per cent of stalls more than would otherwise be required to get the same quantity of coal, for if the men worked every day 75 stalls would do where 100 were now necessary. While the men were away drinking in the public-house the roof of the working was cracking, and the buttresses were giving way, and the preparations for carrying on the work had to be commenced over again. Hence the increased expense, and the waste. That was what became of the £50,000. But this loss was not the worst of it. An hon. Gentleman was about to propose that the employers should have to pay for injuries done to the workmen; but the fact was that three out of every four men who were killed lost their lives from this cause—irregularity of working. If we assumed that the drink system did as much injury to other trades as it did to coal mining, the loss to the country would be not less than £123,000,000 a-year. But, taking it at less than half that sum,
1034
or £60,000,000, this meant that we had to compete with our neighbours on the Continent, where there was not that excessive drinking, with an annual waste of £60,000,000 on our side. Would it not be better that the capitalist should have £20,000,000 of this sum, and the workman and the consumer each a similar amount? If he had been ten years in the House and had been a bit of a statesman, the hon. Gentleman opposite would not have a single vote on his side. It was not the loss of the money that vexed him, but the misery which was brought on the men and their families. He was popular with his workmen; he had never any trouble with the Master and Servant Act, and no man of his had ever brought him into the County Court. What he wanted was to promote the well-being of everyone in the United Kingdom. But if the maltster, brewer, and publican drove things too far they would kill the goose which laid the golden eggs for them. The hon. Member apologized to the House for having risen to address it without adequate preparation. He would, therefore, only say that he would give his support to the proposition of the Chancellor of the Exchequer.
COLONEL BARTTELOTsaid, he was very glad to hear the remarks of the hon. Member for Cardigan Boroughs (Mr. I). Davies). They were fortunate in having among them a man who, by industry, integrity, and honesty, had raised himself to his present proud position to represent that class of the community whose interests he had so much at heart, and whose wants and wishes he was so well able to enforce. He (Colonel Barttelot) concurred with the hon. Member that public-houses and drink were the bane of the country. With reference to the immediate question under discussion, he had consistently advocated the reduction of the malt tax. He brought forward the subject on the 14th of April, 1864, when he moved a Resolution that—
"The consideration of the Duties upon Sugar be postponed until the House shall have had the opportunity of considering: the expediency of the reduction of the Duty upon Malt."
What was the division on that occasion? The ayes were 347, the noes 99. There was a majority of 248 against the reduce-

1035
tion of the malt duty, and in favour of a reduction in the sugar duties of £1,900,000—about one-third of the malt tax. His hon. Friend (Mr. Fielden) had brought forward the question without consultation with any one, so far as he knew, and a Ministry which had just taken office was assailed upon its Budget by his hon. Friend. If his proposal was carried to reduce the malt tax by £6,000,000, or even the half of that sum, the money must be provided by the Exchequer, and what would then become of the Budget? Was his hon. Friend prepared to take on himself the responsibility of forming a Government? If not, he should have been more careful how he dealt with the subject at all. It would have been wise for his hon. Friend to consult with those who had fully considered the subject before rashly entering on a question of this kind. What forces had he at his command"? He said he had never brought forward the question when the right hon. Member for Greenwich (Mr. Gladstone) was in power, because he knew he should have been hopelessly beaten; but had he asked himself whether he was not likely to be beaten on the present occasion? Would he have the support of those who were for the repeal of the brewers' licence or of those who were anxious to remove the tax on railways, to reduce the income tax or to abolish the duty on horses? Had the question of the malt tax been mentioned when he was canvassing his constituents? Did he not know that, although when barley was at 30 s. a quarter the farmers were anxious for the reduction of the malt duty, yet the question appeared very differently when barley varied from 47 s. to 57 s. a quarter—nearly the price of wheat? He did not disguise from himself the importance of the question; and he was sorry to find that the Chancellor of the Exchequer had given no reasons for not touching it and if he had reduced it from 2s. 8½. to 2s. per bushel the farmers would have been perfectly satisfied. The right hon. Gentleman lived in a county where the people paid no tax on the material of their drink, and he might have been more considerate for those who did; but, as the right hon. Gentleman the Member for Greenwich had truly said, they must have public opinion on their side, and a majority to go with them into the lobby.
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He hoped his hon. Friend would not divide the House on the question. With a new Ministry just installed in office, with a Budget more or less accepted by the House and the country, it would ill accord with their usual practice, and tend to prejudice the interests his hon. Friend had so much at heart, to press to a division his vague Resolution. He hoped he would be satisfied with the discussion he had raised. He should support the Government.
SIR JOSEPH M'KENNAsaid, he thought the Amendment of the hon. Member put the issue before the House in a very simple form—namely, that, in the opinion of this House, the malt tax ought to be reduced. The hon. Member supported that view by the arguments the House had heard. He (Sir Joseph M'Kenna) ventured to say that in his opinion, for the reasons he would adduce, the malt tax ought not to be reduced. An examination of the operation of the malt tax would prove that, as a sumptuary tax it was one which rested very lightly on the class which alone it affected. He denied that it affected the farmers injuriously to any extent; but he was not about to go into that branch of the subject, which had been dealt with long ago. He believed there had been a public inquiry on the subject, and the conclusion arrived at, at the end of the inquiry, was that the farmers were not at all damaged by the tax in respect to the price of the articles they produced. His (Sir Joseph M'Kenna's) argument against the reduction of the duty stood on other grounds. The House should bear in mind that the brewers were manufacturers of alcoholic liquors to quite as great an extent, on the whole, as the distillers; and the House must treat this important subject consistently, and remember that the malt duty was practically the only tax which reached alcoholic liquors of a certain description. On an analysis which had been made long since—and although in a debate arising in this way he could not at once give authorities, still he pledged himself to the fact—it had been shown that whilst on whisky the duty was fixed at the rate of 10 s. a gallon for every gallon of proof spirit contained in that liquor, which the Irish and the Scotch preferred to drink, the spirits contained in brewers' drinks, which were most consumed in England, paid a very small

1037
duty indeed. He thought the hon. Gentleman who seconded the Amendment (Mr. Storer) stated that there were some in Scotland and Ireland who preferred to drink whisky; and they must take it as a fact that certain classes of the community and natives of certain countries did prefer whisky. Well, then, this was how the system worked. The duty on the alcoholic liquors which these persons consumed was at the rate of 10 s. a gallon for every gallon of proof spirits contained in their whisky, whilst the tax which alone reached the consumers of beer operated as a tax of only 2s. a gallon on every gallon of proof spirit contained in their beer. The hon. Gentleman, in seconding the Motion, said that great delusions prevailed in that House on that important subject. He (Sir Joseph M'Kenna) agreed with him in that, and was astonished at the complaints which the House had heard from some hon. Members, that the right hon. Gentleman the Chancellor of the Exchequer had altogether omitted from his scheme the reduction or removal of the duties on the licences to brewers. That was a very trivial matter; but, whatever it amounted to, it did, perhaps, in that infinitesimal degree also affect the consumer, although, as he had said, the only duty which substantially affected the price was the duty on malt. He pledged himself to the House that it would be found on analysis that both duties amounted only to a duty of 2s. a gallon on every gallon of proof spirit contained in the liquors of the brewers. Now, that was the sumptuary tax which alone affected the great consumers of beer, nine-tenths of whom were residents in Great Britain; whereas the Irish, who he admitted, preferred to consume whisky were taxed at the rate of 10 s. a gallon. The Irish preferred to consume whisky, probably, because they were not so well fed or so well clothed as the English working people, who could take their liquor in a cooler form, and in much greater quantity. The duty on alcoholic liquors affected the Irish consumers and the English respectively in the ratio of 100 to 20; and, therefore, not merely on the ground that it was inexpedient, as the hon. and gallant Member for West Sussex (Colonel Barttelot) said, but for the reasons he had stated, he opposed the reduction of the duty. The hon. Member who proposed the Resolution
1038
(Mr. Fielden) hoped that he would obtain from the Chancellor of the Exchequer a pledge. He (Sir Joseph M'Kenna) hoped, if the right hon. Gentleman gave a pledge on this occasion, it would be a pledge to review the whole question of the duties on alcoholic drinks, and he (Sir Joseph M'Kenna) pledged himself to support any scale of duties, however high, which pressed equally on consumers of every class of alcoholic liquor.
THE CHANCELLOR OF THE EXCHEQUERsaid, he thought the question of the malt tax alone was a pretty considerable one. The question raised, not unfairly, by the last speaker of the whole incidence of taxation on alcoholic drinks was one of such portentous magnitude that it showed them at once how impossible it would be to deal summarily with a subject of that kind. He hoped the hon. Gentleman who had made that Motion (Mr. Fielden) would take the advice of the hon. and gallant Member for West Sussex (Colonel Barttelot)—than whom no man had fought more consistently for the abolition or reduction of that tax—and not go to a division at so unfavourable a time for his proposition. A great many topics had been brought forward that night which were well deserving of attention. For instance, the Seconder of the Motion (Mr. Storer) had referred to the Papers on the system tinder which the duty on beer and malt was collected in foreign countries. He confessed he had not made himself master of those documents, as it was desirable they should do before dealing with that question. It would be almost impossible to go, and there would be no advantage in then going, into a real and exhaustive discussion of the merits of the malt duty and its relation to the different taxes on spirituous and alcoholic liquors. But he admitted that if they were treating the malt tax it would be necessary to treat it in connection with the duties on spirits, wine, and to a certain extent also on tea. There was a great force in the remarkable speech of the hon. Member for Cardigan (Mr. D. Davies), showing the mischief done to the interests of the country by the unfortunate prevalence of drunkenness and indulgence in spirituous liquors among many of our working people, and no portion of the question affecting intoxicating drinks could be properly dealt with without giving full

1039
freight to the considerations urged by that hon. Gentleman. But he wished to point out that the malt duty was a subject from the examination of which the Government had in the present year deliberately turned aside: and for this reason, that there were other matters of much greater importance, both for the agricultural interest itself and other interests, which had a prior claim on their attention. Although the question had that night been brought forward in one or two able speeches, yet it had not been fully argued and discussed, and it would be unfortunate if the House came to a vote upon it on the present occasion. Such a vote would be misleading, to some extent also embarrassing, and it would really settle nothing. It would be far better if the hon. Mover would follow the advice of the able tactician who had so long led the anti-malt tax army (Colonel Barttelot) and not press for a division. But if there should be a division, the Question about to be put was, whether the Speaker should leave the Chair that the House might go into Committee to consider the various propositions of the Government? If the Amendment was carried, and the Speaker was not allowed to leave the Chair, the financial proposals of the Government were, of course, put an end to, and it would be necessary to reconsider very seriously the position in which they stood, and the alterations that would have to be made in their proposals. He therefore trusted that the hon. Mover, unless he saw his way to the substitution of a financial scheme wholly different from that which the Government had brought forward, would reconsider his determination, and, resting satisfied with having introduced that subject in an able speech, not deem it necessary to insist on a division.
SIR GEORGE JENKINSONsaid, he was content with the statement that the Government had turned over the question this year, owing to their having been only a short time in office, and because they thought that greater questions had to be considered; but he, nevertheless, thought the time had come when the question of the reduction of the malt tax deserved consideration. He thought there were very few persons who would not agree in the proposition laid down in the Motion—namely, that the time had arrived when the malt tax ought
1040
to be reduced. If the understanding was that the question should receive speedy consideration at the hands of the Government, he should hope that the Motion would not be pressed to a division. If his hon. Friend insisted upon going to a division he should feel bound to vote with him; but he entreated him not to take that course, because it would, under the circumstances, put them in the position of apparently voting against the Government.
MR. HENLEYsaid, he was one of those who always looked upon the question under discussion as one which affected the consumer, and, regarding it in that light, he thought it required great consideration. When, then, he was asked on the present occasion whether the Budget of a Government which was new to office—for that was the real question before the House—should be rejected in favour of a proposal such as that of his hon. Friend (Mr. Fielden) to reduce a certain tax, or whether the House should enter upon the consideration of the financial scheme which the Chancellor of the Exchequer had submitted to it, he should certainly feel it to be his duty to vote in favour of taking the latter course. The Motion of his hon. Friend not only raised, in his opinion, in a most unpractical way the subject of the malt tax, but endangered the attainment of the object which he had in view. The matter was not one to be knocked about as in a game of battledore and shuttlecock, and it was impossible, he contended, that a Government which had been but a few weeks in office could deal with the question so as to be able to arrive with regard to it at any just determination. For his own part, he had always thought that spirits, wine, and beer were legitimate objects of taxation—perhaps none were more so. Wine had been dealt with in regard to reduction of duty within the last 20 years, but such had not been the case in respect to beer. He should vote against the Motion of his hon. Friend, because he really believed that instead of forwarding the object he had in view, the only effect would be to thwart it.
MR. JOSHUA FIELDENwished, in reply to the observations of the hon. Baronet the Member for Wiltshire (Sir George Jenkinson), to say that it was he who had advised him to take the course

1041
which he had pursued. He felt it, he might add, to be his duty to go to a division.
SIR GEORGE JENKINSONsaid, that on meeting his hon. Friend that day he had bogged of him either not to bring on his Motion, under the circumstances—if the bulk of the party being against it—at the present moment; or, if he did so, he hoped he would not press it to a division, for the reasons he had already stated.
Question put.
The House divided:—Ayes 244; Noes 17: Majority 227.
Main Question, "That Mr. Speaker do now leave the Chair," put, and agreed to.

WAYS AND MEANS—considered in Committee.
(In the Committee.)
Motion made, and Question proposed,
"That, towards raising the Supply granted to Her Majesty, there shall he charged, collected, and paid for one year, commencing on the sixth day of April, one thousand eight hundred and seventy-four, for and in respect of all Property, Profits, and Gains mentioned or described as chargeable in the Act passed in the sixteenth and seventeenth years of Her Majesty's reign, chapter thirty-four, for granting to Her Majesty Duties on Profits arising from Property. Professions. Trades, and Offices, the following Rates and Duties (that is to say):
For every Twenty Shillings of the annual value or amount of all such Property, Profits, and Gains (except those chargeable under Schedule (B) of the said Act), the Rate or Duty of Two Pence:
And for and in respect of the occupation of Lands, Tenements, Hereditaments, and Heritages chargeable under Schedule (B) of the said Act. For every Twenty Shillings of the annual value thereof:
In England, the Rate or Duty of One Penny:
In Scotland and Ireland respectively the Pate or Duty of Three Farthings:
Subject to the provisions contained in section twelve of the Act of thirty-fifth and thirty-sixth Victoria, chapter twenty, for the exemption of Persons whose whole Income from every source is under One Hundred Pounds a-year, and relief of those whose Income is under Three Hundred Pounds a-year."
MR. LAING, in rising to move an Amendment substituting 3d. for 2d. in the pound as the rate of duty to be
1042
charged as Income Tax, said, that he had put this Motion on the Paper as the most convenient form of raising a discussion on the point which he wished to bring before the House. He was not at all opposed to the Budget. On the contrary, he approved its main features. The excrescence upon it was the sanguine estimate of an increase of £1,500,00, in round numbers, and the necessary corollary which alone justified the reduction of the income tax from 3d. to 2d. His main objection to that proposal was that he did not think it safe or prudent to adopt the estimate of the Chancellor of the Exchequer, and to reduce the income tax by a penny in the pound. The rose-coloured compliments which had passed that night between the Ministerial and front Opposition benches would not count for much outside that House. The right hon. Gentleman (Mr. Gladstone) was committed to these Estimates as the sole justification of the proposal he had made to the country in January; and the Chancellor of the Exchequer, having accepted them on the responsibility of the Heads of Departments, and based his financial proposals upon them, was also committed to the Estimates. If, however, hon. Members went outside the charmed circle of official life, and asked the opinion of those who examined the aspect of the financial barometer of this country, they might form a different opinion. He did not wish to discredit the ability of the permanent heads of the Revenue Departments, with some of whom he had worked: but he dissented from the doctrine that the House should accept their Estimates implicitly, for its duty—one which it was peculiarly fitted to discharge—was to exercise an independent judgment upon them. There was no mystery about them, for any man of business could judge whether revenue was likely to be in the ascendant or on the decline. If the rise and fall in revenue, the Board of Trade Returns, tin-railway traffic, and wages were indicated by curves on sheets of paper, they corresponded, as a rule, very closely; and if the barometric curve of commercial prosperity became stationary or declined, the Revenue would soon follow suit. Estimates of revenue had not always proved correct, and it was the duty of the House to correct these aberrations. The right hon. Gentleman (Mr. Lowe) offered Estimate, he presumed,

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with the advice of the Heads of Departments, which out-of-doors were deemed so absurdly low that nobody could understand his object, unless it was to punish the House for rejecting his match tax by imposing an additional penny income tax. The House not having the moral courage to correct them, the penny was imposed—and as the next year showed—unnecessarily. Sometimes, on the other hand, Estimates might he deficient, involving the re-imposition of taxes taken off the previous year, deranging trade and causing serious inconvenience, almost as bad as the paying too much for a single year. In point of fact, if they took the last 44 years, the Estimates had in 17 been deficient. The actual result of the revenue had shown a considerable deficit below the estimate. It might be said that they occurred a long way back. That was the argument used by the right hon. Member for Greenwich; but it would apply more nearly than was supposed to more recent periods. For example, in 1862, and again in 1868–9, there were deficits. In 1861, there was a deficit of no less than £1,761,000 below the Budget Estimates, and in the succeeding year there was another deficit of £618,000. Again, in 1868. there was a deficit of £369,000. and in 1869 a deficit of £058,000. Where should we have been had not the income tax furnished a ready means of meeting temporary deficiencies without serious impediment to trade? These deficits had happened with the late Prime Minister as Chancellor of the Exchequer and with the aid of the most distinguished heads of the Revenue Departments. As long as trade was prosperous and made sudden bounds, the Revenue would rise with it, but when it became stationary, the Revenue would become so also. No doubt there had been an increment of revenue if they took a certain number of years. If they took seven years or five years it was perfectly certain that the Revenue never stood higher than it did now. But if they took a single year no such result was shown. If trade declined, and wages diminished, it was impossible to believe that the Excise would keep up, and instead of a surplus they might find themselves with a deficit. That was the present state of things. The present state of things was that we had had three years of extraordinary prosperity. In 1870–1 the trade and
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commerce of the country took extraordinary strides, and the Revenue naturally followed in their steps. Latterly, the Returns had shown a heavy falling off. In the first place, the rate of progression had diminished, and at last we had reached a point when the Returns no longer showed an increase on the preceding year, but were as nearly as possible stationary. The exports were the best criterion, the imports being largely affected by accidental circumstances, and some of the cases referred to by the Chancellor of the Exchequer to show that the consumptive power of the country was keeping up proved nothing of the kind. If we had imported more articles of food, it was due to a succession of bad harvests, while the exports, which the imports must, in the long run, follow, had become stationary. In 1871, they amounted to £223,000,000; in 1872 to £256,000,000; and in 1873 to £27,3,000,000. In the last quarter of 1872, they were £65,646,000; while in the last quarter of 1873, they were £61,397,000, so that the exports were actually diminishing. If they looked at the railway traffic, which was a very good guide to the real condition of the country, they would find the same thing. They would find the railway traffic taking an extraordinary start in 1871–2; but in the latter part of 1873 it began rapidly to decline. It had been going down rapidly ever since, and had now reached a point where scarcely any of the railways of the kingdom showed any increase at all. Take such a line as the Brighton, with which he was connected. It was a very good barometer to test the actual condition of the Metropolis. When the working men were earning high wages, they would run down to Brighton, and there would be an increase of traffic; but when there was a falling off in earnings, there would be a corresponding falling off in the traffic. At this time it was practically stationary. No one could fail to observe that the extraordinary increase of Revenue in the last three or four years had arisen mainly in the Excise through the consumption of the working classes. That remarkable speech which they heard with so much pleasure from the hon. Member for Cardigan (Mr. D. Davies), so worthy a representative of working men, and one whom they were glad to sec in that House, showed that one result of high wages

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was that the men, having more money did less work—that there was more idleness, more drinking, and the money they earned went to swell the public Excise Returns; and, further, that instead of observing St. Monday, they frequently observed St. Tuesday, and sometimes the half of St. Wednesday. Their doing so, of course, led to an increase in the consumption of excisable liquors. There was, however, a certainty that the wages in those departments of labour were coming down, and largely. He had seen it stated that in one of the principal mining districts of the North of Scotland a question had been raised of a reduction of wages to the extent of 40 per cent. Now, whether the reduction was 40 per cent or 10, 15, or 20, to be followed some time hence by a like reduction, the result would be a declining' Revenue. Anyone acquainted with the state of the iron trade must have known that a reduction of wages was necessary, or the iron trade, which was being worked at a loss, would be lost to us and go into the hands of foreigners. The same observation was applicable to Northumberland, Durham, and Wales. Workmen would receive 20, 30, or 40 per cent less money, and work 20, 30, or 10 per cent more time, and would have little time or money to spend in the public-houses. Was, this, then a time to calculate not only on an equal amount of Revenue being received for the ensuing year as was received last year, but even to count upon an increase of £918,000? Well, wonders, of course, might come to pass. The elasticity of the country was wonderful. The expectation might be realized; but among men of business out of doors, who were not pledged by any political antecedent, the general opinion—he thought the general opinion—would be found to be that it was rather a bold course to take the Revenue of last year, without addition, as an Estimate for the Revenue of the coming year. If he were responsible for the finances of the country, he, for one, would not have done so. As to making any addition, he should never for a moment, under present circumstances, have thought of it. So much for the question of fact. It was also a question of principle. Even if, by a piece of good luck, the right hon. Gentleman got out of the scrape he would be in if there were a deficiency, and
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supposing his hopes were realized, was it a prudent thing to run the Estimates so fine that it was a matter of doubt whether there would be a deficiency or a surplus? Should they depart from the old principle of not including the annual increment of Revenue in the Estimates, but of keeping on the safe side, so that in bad years they would not be lauded in a deficiency, and in good years they would have a surplus? That was the old-fashioned principle, and was it, in the first year of a Conservative Government, to be departed from, and the new principle introduced of living up to the last penny? That opened up a large question, in which many Members of high financial authority took a deep interest—namely, the reduction of the National Debt. He was himself a very disinterested witness in the ease, for he had always opposed the extreme course of keeping up taxation for the purpose of paying off Debt. He recollected when the right hon. Gentleman the Member for Greenwich (Mr. Gladstone) told them that their coal-fields were being exhausted; that it was a duty they owed to posterity to reduce the Debt; and that it was a disgrace to this country not to follow the example in that respect of our cousins in America; and the upshot would have been the imposition of probably not less than £5,000,000 of taxation, for the purpose of reducing the National Debt. He (Mr. Laing) thought it his duty thus to comment on the proposal made, as he was in favour of creating a moderate amount of Terminable Annuities rather than maintaining burdens on the people and pressing upon the springs of industry, for the purpose of paying off the National Debt. Now, however, a step was about to be taken in the opposite direction. The result, according to the Chancellor of the Exchequer, of adopting the old Conservative principle of finance, had been that we had reduced the National Debt since 1842 by the very respectable figure of nearly £70,000,000 capital, with a certainty that £50,000,000 more would go in 1885. That was, he thought, a very creditable and satisfactory result. He did not want to see the rate of reduction accelerated; on the other hand, he did not wish to see it retarded, and still less was he in favour of its being abolished. Within 10 years the reduction had amounted to £19,400,000,

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or nearly £2,000,000 a-year, independently of the reduction that would be effected by Terminable Annuities. He called that a fairly satisfactory result, and wanted to know why they were to depart from that Conservative policy, and inaugurate a system of estimating up to the last penny? The Chancellor of the Exchequer had on this subject uttered some very excellent sentiments in his Budget speech, but his practice had not been in accordance with his precept, for, instead of making provision for a moderate reduction of the Debt, he had taken off a penny of the income tax, on which tax they must rely for making any serious impression on the Debt. The question now involved was whether the principle of making any attempt to pay off the National Debt by direct payment was to be renounced. The manner in which the £500,000 was to be applied to the extinction of a portion of the Debt by means of Terminable Annuities was a mere matter of book-keeping. Under the old system it went to capital account; under the new system it went to revenue account. The main point was that for the sake of obtaining a little temporary popularity, the Government were about to give up a penny of the income tax and to run the risk of having a deficit at the end of the year, which was equivalent to saying that no further attempt was to be made in the way of paying the National Debt. The system introduced by the right hon. Member for the London University (Mr. Lowe), under which the income tax had to be paid in one sum at the beginning of the year, instead of by four quarterly payments, was most inconvenient, not only to the tax-payer but also to the commercial community, inasmuch as it occasioned the balances at the Bank of England to be unnecessarily large at the commencement of the year, when there was but little demand for money, and depleted them in the autumn, when there was generally a great drain upon our resources. Home time or another the result of this course would be to create a panic, which would do much more harm to our Revenue than we should derive good from following it for half a century. But, besides those general arguments, there were some special arguments which, in his opinion, ought to induce the Government to pause before they parted with so much revenue as was represented
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by a penny of the income tax. In the first place, there was the great question of local taxation before them. The Chancellor of the Exchequer had told them that this would be the greatest financial question of the future, and that a number of the most important social and sanitary questions depended upon our system of local taxation being placed upon a satisfactory footing. What had been done this year in reference to this subject was undoubtedly a step in the right direction, but it had only touched the fringe of the matter, and next year a very large question would have to be dealt with. The annual sum raised by direct local taxation amounted to £20,000,000, and in adjusting taxation to that amount it might be necessary to call upon the Imperial Exchequer for a consisiderable sum in order to do what justice and expediency might require. But how was this question to be dealt with next year if the sanguine estimates of the Government were not realized, and if, instead of there being a surplus, there was a deficit? Even supposing there were an equilibrium between the Revenue and the Expenditure, new Imperial taxation to meet the demands occasioned by the re-adjustment of the burdens of local taxation could not be imposed without considerable difficulty. Whereas, if the penny on the income tax were retained, such re-adjustment might be met without difficulty. But if the penny were given up, it could not be re-imposed without setting class against class and interest against interest. Therefore, by giving up the penny on the income tax the Government were precluding themselves from dealing with this great question with a free hand backed by a full Treasury. The Government would also have to face next year another question of equal importance—that of the state of our Navy. It produced a very uncomfortable feeling in his mind when he heard the new First Lord of the Admiralty state that our Navy was in such a condition that it was scarcely better than a paper fleet, and that out of our 37 ironclads only 14 were fit to go to sea. And he felt still more uneasy when all the late First Lord could say was that things, after all, were not quite so bad as they had been represented, and that if the late Government had left the country with a deficient fleet they had left it a surplus in its Treasury. Under

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these circumstances, while advising the Government not to take any spasmodic action in the matter, he should recommend them to take such action next year as would put our fleet in an efficient condition. It would be better to have ten efficient iron-dads, than to rest contented with the false security of a paper fleet which could not be sent to sea in case of danger. He did not think the Government were at all likely to set aside on the Monday the Budget they had brought forward on the Thursday; but, at the same time., this question of the efficiency of the Navy would have to be met next year, probably by an increased charge, as well as that relating to local taxation. If the income tax was to be repealed, let it be done openly, and let the country be made aware what taxes were to be substituted for it. But where was a tax to be found equally elastic, and with which, without disturbing trade, a deficiency, should it occur next year, could be so easily remedied? Was its repeal to be followed by an increase in the assessed taxes, as the right hon. Member for Greenwich (Mr. Gladstone) had foreshadowed? If so, he should like to know what was to be the amount and what the nature of those assessed taxes which were to be the equivalent of £5,000,000 or £6,000,000 of income tax. If, again, the income tax were done away with, how was taxation to be equalized among the different classes of society? It had been laid down as a first principle of taxation by the right hon. Member for Greenwich, that trade, real property, and labour, must be taken into account, and the burdens of taxation fairly apportioned between them. How was that to be done if the income tax were abolished? Every statistical writer who had studied the question would say that the income tax was the great equalizer of taxation among the various classes of the community; and if it were done away with, would not our system of taxation press unduly on the great mass of the people, and furnish agitators with the argument that the higher classes shirked their fair share of the national burdens? He wished the House, he might add, to take a warning from what had occurred in the case of sugar. He did not mean to blame the Chancellor of the Exchequer for abolishing the duty on that great article of consumption; but it was the policy of the right hon. Gentleman
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the Member for the University of London (Mr. Lowe), who reduced the duty ½d., and, saying that it was never to be reduced again, diminished it another ½d., which had led to that result. When the sugar duties were reduced ½d. for the second time, everybody felt that they had been killed, and that it was not worth while continuing the annoyance connected with them for the sake of the revenue which they yielded. So it would be with the income tax; and what, he should like to know, would be the answer of the Government to persons who argued with respect to it in that way? For these reasons he wished it had been open to him to take the opinion of the House on the proposal of the Government to reduce the tax. Of course he could have no great hopes of success if he were to take the opinion of the House. When a Government proposed to remit a tax, and more especially when there was a consent between the Leaders of the two benches as to that course, there was little chance for a private Member—["Divide," "Order."] Notwithstanding that, he had felt it to be his duty to bring the matter forward. He should not trouble the Committee to go to a division; but he trusted that the Government would take the question duly into consideration; and if they did so and acted upon it, they would find next year that he had been their best friend. At any rate, the first thing the country would naturally look for from a Conservative Government was Conservative finance.
MR. WHEELHOUSEhoped that to whatever other determination the Committee or the House itself eventually might come, the proposal now made by the hon. Member for Orkney (Mr. Laing) would find no favour whatever. He (Mr. Wheelhouse) did not hesitate to say, that for years he had been most anxiously desirous of seeing the income tax—more especially so much of it as was involved in Schedule—totally abolished. For the first time, since the days of Sir Robert Peel, we had now a Revenue, unaided by income tax, amply sufficient for the estimated Expenditure of 1874–5, as the nucleus of our present year's financial operations. That Expenditure, as estimated, amounted in the aggregate to £72,503,000, and the Chancellor of the Exchequer, as he (Mr. Wheelhouse) understood the right hon.

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Gentleman, anticipated that there would be savings from his proposed Army Purchase Vote, sufficing to cover any probable Supplementary Estimates. Now the various items of ordinary revenue, including income tax, taking the whole in a sort of tabulated form, from Customs down to Miscellaneous Estimates, as he (Mr. Wheelhouse) made out, amounted to £72,495,000, beyond which the Chancellor of the Exchequer calculated upon receiving £500,000 for interest and the due repayment of advances, to which, again, must be appended a further sum of £900,000 of uncollected income tax to be carried to the account of the current year, thus producing altogether an estimated Revenue of £73,895,000, or in other words, leaving a financial surplus of £1,392,000 above the Expenditure, and that without any new income tax being at present imposed or even asked for. Let it be remembered that these were the calculations and figures of the Department itself, and he (Mr. Wheelhouse) must confess that it seemed to him, the Chancellor of the Exchequer had provided—though, no doubt, with great foresight—a much larger "sinking fund" to meet possible contingencies than our prospective requirements were at all likely to demand. If it were really impossible at present to abolish the impost entirely, he trusted he might be permitted to observe that he, for one, believed the unconditional repeal of this tax—one imposed for a temporary exigency only, originally—would be looked upon by all classes of society as an inestimable boon. To keep it up at ½d. only was in his opinion to render it scarcely worth the cost of collecting, and it had far better go "at once and for ever." But, be that as it might, he earnestly hoped that if not now, at all events before long, they would recur to the doctrine which he would venture to remind the House had been laid down by nearly every Chancellor of the Exchequer, and, indeed, by the vast majority of English statesmen for many years past—namely, the plain, sensible, obvious, and straightforward principle, that while the income tax should be held in the armoury of reserve for special exigency, it should never be used as an instrument by means of which the fair, legitimate burden of general taxation should be removed from the shoulders of one portion of the community, in order
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to place it on those of another, often far less able, really, to bear the onus of it. Again he repeated that he, for one, earnestly trusted that the day was close at hand when this tax, at once so burdensome, so inquisitorial, so oppressive, and so obnoxious in every way, would be totally and unconditionally repealed. He would only make one single further remark. He desired to repeat in that House what he had taken occasion more than once to say elsewhere—and he was sorry not to see the right hon. Gentleman the Member for the University of London (Mr. Lowe) in his place, on the front bench opposite, that he might hear the statement. He (Mr. Wheelhouse) was one of those who believed that any such accumulation in the shape of a single years' surplus, as three or four millions of money, notwithstanding, even, that it might be attributable in some measure, to a period of unexpected and unexampled financial prosperity, practically demonstrated, in the plain and homely language of Yorkshire, something savouring very strongly of "extremely bad finance," because to have procured anything like that amount, it was abundantly clear that a sum of money, unusually and needlessly large, had been extracted from the pockets of the already overburdened taxpayer.
SIR JOHN LUBBOCKcalled the attention of the Chancellor of the Exchequer to the inconvenience of the present system, under which the Income Tax Act was passed for only a year ending on the 5th of April. As the financial year closed on the 31st March, and the Budget, therefore, could not be taken before that date, there was almost always an interregnum during which no income tax could legally be levied, and, though the Act rendered any dividends which might be paid during that period liable to such an income tax as the House might subsequently impose, the system was very inconvenient, and must involve a loss to the Exchequer. On the present occasion the dividends on the Public Funds themselves were paid on the 8th of April; but he did not quite understand, if they were due on or before the 5th, under what authority the payment was deferred until the 8th; or, if they were not due till the 8th, on what authority any income tax was deducted. But, however this might be, the dividends on

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several stocks—for instance, the Turkish Six per Cent of 1854, the Turkish of 1871, the Egyptian Seven per Cent of 1873, one of the Russian loans, and others had been paid without any deduction of income tax, and though, no doubt, the Act would give the Government a legal right to recover the amount, still, as a matter of fact, it would be difficult, if not impossible, to do so, and there must consequently be a loss to the Exchequer. In other cases 3d. in the pound had been paid: whereas the Resolution was only for 2d. in the pound. He would therefore ask the right hon. Gentleman to consider whether it might not be desirable to continue the tax for a year and a month, instead of a year, so that it should expire, not on the 5th of April next, but on the 5th of May, by which time, in all probability, the financial arrangements would have been concluded. In this manner he believed some uncertainty and inconvenience would be spared, and considerable loss to the Exchequer would be avoided.
MR. HANKEYcorroborated the statements of his hon. Friend, and hoped the right hon. Gentleman would accede to the suggestion.
THE CHANCELLOR OF THE EXCHEQUERrecognized the disadvantage and inconvenience to which attention had just been drawn, and promised to consult with the officers of the Revenue in regard to it. An hon. Friend of his, who was very acute in such matters, had suggested a difficulty by asking at what rate the tax would be levied for one month—whether at a twelfth part of 2d., or how? Perhaps the hon. Baronet would allow him to consult him privately on the subject.
MR. HORSMANacknowledged that although the Chancellor of the Exchequer had begun his speech in the earlier part of the evening with something like an apology for the undue prominence he had given to the Departmental officers who had assisted in the preparation of the Estimates, he had nevertheless followed it up with an explanation which seemed entirely satisfactory. The House ought not to be called upon to accept the opinions of the Revenue officers as to the Estimates with which Parliament had to deal. It was wrong, indeed, to apply the word "estimate" to what they laid before the Chancellor of the Exchequer. They gave him facts which he,
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as a statesman, had to scrutinize and to judge. He was supposed to have a higher financial knowledge, a stronger grasp of financial questions, than they, and when he submitted their facts and figures to Parliament, they became the Estimates of the Government. After the explanation of the right hon. Gentleman, they might regard the course which had been followed this year as exceptional, and might hope that in future the officers of Departments would not be brought forward in the same prominent manner. With reference to the income tax he would remark that there had been no disposition on the Opposition benches to criticize unfavourably the proposals of the Chancellor of the Exchequer. The circumstances of his position were such as to entitle him to great forbearance and indulgence, on one condition—namely, that the Budget contained no reactionary finance. In point of fact, the Budget was marked by great simplicity and common sense, and these qualities had made it generally acceptable to the House and to the country. He protested against the doctrine of the hon. Member for Orkney (Mr. Laing), that there should always be a respectable surplus to be applied to the reduction of the National Debt. The hon. Member said that the income tax was the basis of our whole financial system—the thing to which we owed surpluses, remission of taxation, and reduction of Debt. Everybody acknowledged the income tax to be a most objectionable tax—it was inquisitorial, it was immoral—["Oh, oh!"]—yes, it was, because the assessment was placed on a declaration made by the taxpayer, and it did not matter whether the taxpayer was a man of high character or of no character at all; and it was an unequal tax, because it taxed the clergyman as much as it did the capitalist. It was true that Sir Robert Peel had introduced it for another purpose than as a war tax. The object was to relieve the finances of the country under exceptional circumstances and to re-adjust taxation Either on account of war or as a means of re-adjusting taxation the income tax had been asked by Government and given by the country, and if it was not required for one or the other of these purposes, it ought in good faith to be repealed. He agreed with the hon. Member that it was good finance to have a safe and moderate surplus. If asked

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whether he would prefer a deficit of £500,000 or a surplus of £3,000,000 or £4,000,000, he would say that it was sounder and better to have the small deficit and to make up for it by taxation than to have a surplus of several millions applied to purposes which the country had never sanctioned or intended. His hon. Friend said they ought to have a safe surplus for the purpose of reducing the National Debt. If the country was to be taxed with a view to the reduction of Debt, let that fact be distinctly recognized and understood, and let it not be said that a surplus was applied to that object in a sort of surreptitious manner.
LORD ESLINGTONexpressed regret that the Chancellor of the Exchequer had come to a resolution to give up a penny of the income tax, and wished that the right hon. Gentleman had made up his mind to retain it. He (Lord Eslington) denied that the surplus was attributable to the income tax. He was not aware that any particular tax was appropriated to any particular purpose and it was the general prosperity of the country rather than any special source of revenue that gave us the surplus. The right hon. Gentleman (Mr. Horsman) said the income tax was an immoral tax. It might lead to cases of fraud in some few instances; but that was no reason for thus describing a tax which was an enormous engine of power in the hands of a wealthy country like this, which the right hon. Gentleman himself admitted to be the basis of our financial prosperity, and which he (Lord Eslington) should be exceedingly loth to part with. He thought the Chancellor of the Exchequer would have acted more prudently if, before proposing a reduction of the income tax, he had taken stock of the great spending Departments; and, after informing the House what that stock was, have left it to them to say whether it was such as to justify the parting with this revenue.
MR. HORSMAN: My noble Friend takes exception to my statement that the surplus was owing to the income tax. May I ask him how he made his calculation, and where the surplus would be without the income tax?
SIR JAMES LAWRENCE SIR JAMES LAWRENCE moved as an Amendment to the Resolutions of Mr. Chancellor of the Exchequer in regard to the Income Tax:—
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"That the exemptions provided for in the twelfth section of the Act 35 and 36 Victoria be extended to persons whose incomes do not exceed £200 a-year: and that from all incomes above £200 a-year, and not exceeding £500 a-year £100 be deducted before the Tax is charged."
The hon. Baronet strongly objected to the inhabited house duty, and maintained that it fell upon the occupier instead of on the landlord. It might not be known to the Members of the House of Commons now assembled that the main reason why the dwellings of the working classes were not improved was owing to the maintenance of the inhabited house duty. It was evaded in many instances by leaving out the front door leading to many dwellings. With respect to the Peabody Trustees, all their exertions in behalf of the working classes were; small as compared with the benefits that would result in the improvement of dwellings if the inhabited house duty was done away with. He had been asked what has the inhabited house duty to do with the income tax? He maintained that it was an income tax in another form. It was a property tax paid by the occupier and not by the owner; and it was desirable, for sanitary purposes, to repeal it. He would remind the Committee that when Sir Robert Peel originally imposed the tax, incomes of £150 a-year were exempted. It could not be denied that the income tax pressed most severely upon clergymen, clerks, and others having means not exceeding £200 or £250 a-year. Even the prosperity of which so much had been spoken was of no advantage to persons with small fixed incomes, inasmuch as, without any increased means, they had to pay higher prices for all the necessaries of life. He believed that outside the House three men out of every four would regard the Amendment of which he had given Notice as an attempt in the right direction to effect an equitable adjustment of a tax which pressed harshly and unequally on different classes of the people.
Amendment proposed,
To leave out from the words "Subject to the provisions," to the words "Three Hundred Pounds a-year," in order to insert the words "That the exemptions provided for in the twelfth section of the Act of thirty-fifth and thirty-sixth Victoria he extended to persons whose Incomes do not exceed Two Hundred Pounds a-year; and that from all Incomes

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above Two Hundred Pounds a-year, and not exceeding Five Hundred Pounds a-year, One Hundred Pounds be deducted before the Tax is charged."—(Sir James Lawrence.)
Question proposed. "That the words proposed to be left out stand part of the Question."
MR. SANDFORDexplained that one reason why he did not persevere with the Motion of which he had given Notice was that a Chancellor of the Exchequer who had been only six weeks in office could not be fairly called upon to consider the whole question. If, however, the hon. Baronet pressed his Motion to a division he should vote with him, although he must not be held responsible for the result of the division.
THE CHANCELLOR OF THE EXCHEQUER: The few words which have fallen from the hon. Member for Maldon (Mr. Sandford) go far to explain the position in which we stand with regard to the Amendment—namely, that it is opening a very large question, which it would be difficult, if not impossible, to settle at the present moment. I do not say much of the effect of the proposal of the hon. Baronet opposite (Sir James Lawrence). I believe its effect financially would be measured by about the sum of £240,000; and that would, of course, very materially diminish the surplus which I have left. On that ground alone I should feel a difficulty in assenting to it; but the real ground on which I advise the Committee not to assent to the Amendment is as follows—namely, that it is opening a very delicate and important question with which we are hardly at the present moment in a position effectually to deal. The hon. Baronet has reminded the Committee that when Sir Robert Peel originally imposed the income tax he exempted incomes below £150; but he did not also remind the Committee of the fact that some years afterwards the late Prime Minister, when Chancellor of the Exchequer, carried the tax to a lower stratum—namely, to the sum of £100 a-year, and that he did so on the ground that it was right to make a proper balance between the wage-receiving classes and the salary-receiving classes. Now, when you come to so delicate a question as that—as to where the wage-receiving class ends and the fixed income class commences—it is obvious you had better not touch the subject without full consideration;
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because it would be a grave question how to adjust the tax so as not to press unfairly upon any class. The Government have decided on adjourning the whole question of the maintenance of the income tax and its incidence till they can consider it more at leisure and more in connection with the rest of the financial system. Therefore, I deprecate any attempt to alter its incidence at this moment. I do not, however, wish to express any opinions adverse to the sentiments of the hon. Baronet opposite, for I grant that there is a great deal to be said in favour of his proposal, though I am not prepared to accept the exact figures he names, or even the principle that exemption ought to be carried any further. I hope we shall not be asked to go to a division on this question; because I think it would be an embarrassing and inconvenient vote which would rather prejudice the fair consideration of the question at the proper time. With regard to the other question which has been mooted by my hon. Friend the Member for Orkney (Mr. Laing), it is one into which I need not now enter. I accept with great respect the opinions of so high an authority as I freely acknowledge the hon. Gentleman to be; but I do not altogether share the views he expressed, and I am bound to say that, after consulting the best authorities on the subject, and having formed my opinion upon the best information I can obtain, I arrive at the conclusion that we may fairly put the Estimates at the amounts which we have taken. If the House likes to devote a larger proportion of the surplus we believe we shall have, openly, to the payment of Debt, I shall have nothing to say against it. But, having arrived at the conclusion that our Revenue will reach such and such a sum, it would not be right to underestimate that Revenue in order to cheat the House into allowing us a larger surplus.
MR. WHITWELLsaid, he was gratified at the large concession which had been made to the ratepayers in the reduction of local burdens; but he asked the Chancellor of the Exchequer to do the same with respect to persons of small income who had to pay this tax.
Question put.
The Committee divided:—Ayes 255: Noes 139: Majority 116.
Original Question put, and agreed to.
Motion made, and Question proposed,
"That, on the first day of January one thousand eight hundred and seventy-five, the following Duties of Excise shall cease to he payable (that is to say):—
"On Licences to keep Horses or Mules:
"On Race Horses:
"On Licences for exercising or carrying on the trade of a Horse Dealer."
MR. CHAPLINsuggested that it would be a great convenience, unattended by corresponding disadvantage, if the date were changed to the 1st of July next.
MR. PELL MR. PELL moved to report Progress, as he wished to have an opportunity of raising a discussion on Imperial and local taxation.
Motion made, and Question proposed, "That the Chairman do report Progress, and ask leave to sit again."—(Mr. Pell.)
THE CHANCELLOR OF THE EXCHEQUERhoped the Motion would not be pressed, as the Report of the Resolutions would afford a fitting opportunity for the desired discussion.
Motion, by leave, withdrawn.
Original Question again proposed.
THE CHANCELLOR OF THE EXCHEQUERundertook to consider the suggestion of the hon. Member for Lincolnshire (Mr. Chaplin), and, if it could be acceded to, the Resolution could be amended on the Report.
SIR GEORGE JENKINSONsaid, if this course were adopted it followed that he must move the Amendments which stood on the Paper in his name—namely—After "that on" insert '-'and after;" after "Excise shall," leave out "cease to;" after "be payable," insert
"to local funds of counties or boroughs, and shall he applied by local authorities in aid of the expenses of maintaining turnpike roads of which the trusts have become, or may hereafter become, extinct."
The hon. Baronet said, that the argument, that the revenue could not be spared, formerly used against the transference of these licences to the local authorities, could not now be used, because the Government were proposing to do away with the licence altogether. He asked that they should be continued, at all events for the present year, with the view of further consideration as to the
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maintenance of turnpike roads. By the expiration of the turnpike trusts an additional sum of nearly £1,000,000 would fall upon real property, and as this sum of £480,000 was derivable from a tax mainly on personal property which was already insufficiently taxed, he asked whether it was reasonable that so large a sum, which nobody had asked for or wanted, should be thrown away when it might be retained for the purpose of being used in the re-adjustment of one very considerable item of local taxation.
Amendment proposed, to insert after the words "That on," the words "and after."—(Sir George Jenkinson.)
THE CHANCELLOR OF THE EXCHEQUERsaid, he thought the two grounds on which his hon. Friend had urged this Amendment were not very consistent with each other. His hon. Friend thought the Government were rather rash in throwing away this large sum of £480,000, which he said nobody had asked for, and which the revenue could hardly spare: but, at the same time, he did not propose to husband the sum for Imperial purposes, but to give it away to the counties for the benefit of turnpike trusts.
Question, "That those words be there inserted," put, and negatived.
Original Question put, and agreed to.
Resolved, "That, on the first day of January one thousand eight hundred and seventy-five, the following Duties of Excise shall cease to be payable (that is to say):—
"On Licences to keep Horses or Mules:
"On Race Horses:
"On Licences for exercising or carrying on the trade of a Horse Dealer."
THE CHANCELLOR OF THE EXCHEQUER THE CHANCELLOR OF THE EXCHEQUER moved—
"That, towards raising the Supply granted to Her Majesty, the Duties of Customs now charged on Tea shall continue to be levied and charged on and after the first day of August, one thousand eight hundred and seventy-lour, until the first day of August, one thousand eight hundred and seventy-five, on importation into Great Britain or Ireland (that is to say): on Tea the lb.0s. 6d.
Resolution agreed to.
THE CHANCELLOR OF THE EXCHEQUER THE CHANCELLOR OF THE EXCHEQUER moved—"That it is expedient to amend the Laws relating to the Inland Revenue."
Resolution agreed to.
MR. J. W. BARCLAY MR. J. W. BARCLAY moved—"That it is expedient that the Gun Licence Act, 1870 be repealed." The hon. Member observed, that if the Motion were carried, it would not materially affect the financial arrangements of the Chancellor of the Exchequer, for the amount of revenue received from this tax exceeded by very little £60,000 per annum. The tax which they had now under their consideration was introduced by the late Chancellor of the Exchequer, and it was imposed not so much for fiscal purposes as a matter of police regulation. It was surely absurd that the farmers should have to take out this licence for the protection of their crops. It might be said that there was an exception in favour of the farmer, but that exception was so couched as to be practically useless. Of late years the rooks had increased to such a large extent that in many parts of Scotland it was necessary to employ a lad for protection of the crops. These birds would attack the crops at various seasons of the year, so that it was necessary to have a lad maintained all the year round, and it was very easy to understand that the farmers, when they saw the damage sustained from the rooks, should naturally associate that damage with the late Chancellor of the Exchequer. Speaking from his own knowledge of many country districts in Scotland, he could say that this tax had had no small effect in bringing about the change of parties in that House. He also objected to this tax upon a national ground. He thought it was extremely desirable that all the inhabitants of this country should be accustomed to the use of firearms. If they felt themselves stronger in the use of firearms, they should have less fear of invasion, and consequently they would not, as now, be subjected sometimes to invasion panic.
Motion made, and Question proposed, "That it is expedient that the Gun Licence Act, 1870, be repealed."—(Mr. James Barclay.)
LORD CHARLES BERESFORDmaintained that to repeal the Act would occasion great loss of life, as many guns would be used which would be far more fatal to the shooter than to the object aimed at. Tax collectors and other unpopular persons would not be safe, and many Members who now had seats would
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never have enjoyed the confidence of the constituencies they represented had the Act not been in force. There was one Member at least in that House who would not long represent a constituency if the tax were repealed.
GENERAL SIR GEORGE BALFOURsuggested that, as there was a certain similarity between the tax on dogs and the gun tax, it would be well that the two imposts should be considered together.
THE CHANCELLOR OF THE EXCHEQUERsaid, the question had been raised in a manner which took the House by surprise. It had not been brought under his—the right hon. Gentleman's—notice very much before this evening. Under the circumstances, he should like to have more time to consider the matter. He did not look upon it as a fixed question.
CAPTAIN NOLANcontended that the question was a fixed one. There was a great amount of damage done to crops through the want of firearms in the agricultural districts.
Question put.
The Committee divided:— Ayes 48; Noes 256: Majority 208.
Resolutions to be reported upon Monday next;
Committee to sit again To-morrow.

REGISTRATION OF BIRTHS AND DEATHS BILL.
On Motion of Mr. SCLATER-BPOTH, Bill to amend the Law relating to the Registration of Births and Deaths in England, and to consolidate the Law respecting the Registration of Births and Deaths at Sea, ordered to be brought in by Mir. SCLATER-BOOTH, Mr. CLARE BEAU, and Mr. Secretary CROSS.
Bill presented, and read the first time. [Bill 80.]

LOCOMOTIVES ON ROADS BILL.
On Motion of Mr. CAWLEY, Bill to amend the Law relating to the use of Locomotive Engines on Public Roads, ordered to be brought in by Mr. CAWLEY, Mr. HICK, and Mr. WKEHAM MARTIN.
Bill presented, and read the first time. [Bill 81.]
House adjourned at One o'clock.