HC Deb 25 April 1879 vol 245 cc1187-214

in rising, pursuant to Notice, to call attention to the expenses of the Charity Commission, and to move, That the maintenance of the expenses of the Charity Commission should no longer be defrayed out of the Consolidated Fund without some equivalent amount being contributed by the charities under its jurisdiction, and that such means can be alone provided by removing the exemption of these charities from the income tax, or imposing some tax on them corresponding to the Succession Duty, from the operation of which they are also exempt, said: This is not a new subject, but one which must, from time to time, continue to engage the attention both of the country and Parliament. The first proposal to place a tax on charities emanated from Lord Lyndhurst in 1845, under Sir Robert Peel's Government, when it was suggested to impose on all endowed charities a tax amounting to 6d. in the pound. In 1863, the subject was raised by the right hon. Gentleman the Member for Greenwich, under circumstances not unfamiliar to the House, and when he gave such convincing proof of the words of which, upwards of 50 years ago, Lord Eldon made use, when he said— That all the charities in the county were conducted with gross mismanagement and constant breach of trust. In 1867, a Resolution, to the effect That the expenses of the Tithe, Copyhold, and Inclosure Commission, Inclosure and Drainage Acts, should not be borne by the public, was carried by a majority of 1 in the House by the hon. Member for Chippenham (Mr. Goldney); and, in 1871, the then hon. Member for South Essex (Mr. Andrew Johnston) carried a Resolution to the effect— That discontinuing the exemption of endowed charities from Income Tax is a suitable method of carrying ont the decision of this House against the payment of the expenses of the Charity Commission out of public funds. Four times in the last 60 years, endowed charities have been the subject of investigation by official inquiries—1st, in 1818; by the Poor Law Commission of 1834; by the Education Commission of 1859; by the Schools Inquiry Commission of 1864, which issued their Report in 1869—and all of which reported these charities as injurious and demoralizing. If charity is looked upon economically, the inevitable conclusion is that, as usually understood, it is distinctly mischievous. There can be no greater proof of this than that amongst those who take the most active interest in Poor Law administration there is a strong feeling, which under recent administration of the Poor Law has had a striking development, that the great State charity—I mean the Poor Law—should be absolutely abolished. At a conference, held at Canterbury, in the autumn, a delegate proposed a resolution to this effect, and considerable sympathy was shown in its favour, though he ultimately consented to withdraw it. That such a feeling should exist is unfortunate, for though the State charity of the Poor Law has been mischievous, certainly far greater evils would ensue were the country without the Poor Law than with it. In a speech made by a former Member of this House—the only speech which, unfortunately, he ever delivered in it, by Mr. Denison, the late Member for Newark, whose experience of the charity of the Poor Law was formed through personal investigation and at great personal sacrifice—he declared that the conclusion he arrived at was that the abolition of the Poor Law would be a great benefit. All tends to prove that charity, in its colloquial sense, may so far be said to be, to some extent, mischievous, as to enforce this conclusion to those who have closely and practically examined the workings of it. It is a principle which you cannot controvert that the existence of any fund for the support of the poor, the appropriation of any revenue, however raised, which must peremptorily be expended in maintaining such as have no other means of subsistence, has, on the whole, a direct tendency to increase the numbers. It discourages industry, foresight, and economy—the great preventives of pauperism, and encourages improvident marriages—the great source of poverty. It is also clear that the increase will always exceed in proportion to what the revenues in question can maintain. It has been so from the earliest periods of history, as witnessed by the historian, Tacitus, who remarks that, without independence, without natural prompting of hope or fear, men degenerate and become burdensome to their neighbours. If these observations apply generally to charily, to almsgiving at haphazard in the street, to that charity which is known as indiscriminate even to a Poor Law administered with great rigour and watchfulness, it applies with far greater force with respect to endowments. To enter broadly into the expediency or inexpediency of endowments is not at the moment my province; but that if they have done good, like other things, they have done harm, is accepted by nearly everybody. There are some who place public endowments very much in the same category with private property, and deem that any deviation or alteration from the original intentions of founders is to be deemed impious sacrilege. There was no Poor Law at the time many of these charities took their origin; and when at last there was a Poor Law, it was a very imperfect and defective organization compared with that which is now administered in Wales and England. It has been pointed out by historians that the early history of these endowments was due to the alarm and apprehension caused by the dispersion of the valiant beggars and sturdy wayfarers who at one time Hocked to the doors of the despoiled monasteries. It has been well said that the history of endowments is the social history of England, and every epoch of that history is marked with institutions called for by and indicated by the wants of the times, from the leper-house of the 12th, to the baths and washhouses of the 19th century. These endowments are as much out of place in the existing state of society as the leper-house would be to us in the present day, and the baths and wash-houses to the social condition of the 12th century. With this difference, I confess there is greatly wanting now the same spirit of laborious charity to which the churches and the cathedrals of our country bear such living evidence. It is impossible not to think that where endowments were of a purely ecclesiastical origin, that many were given by men distinctly pious, that they wished to administer to the wants of the unfortunate, and that sometimes, by erecting stately buildings, they sincerely desired that a love of genuine and sober labour should present itself, if not to every parish, at least to every county in the land. Charity in those days was connected with something far purer, far higher, far more elevated than the somewhat degrading and contemptible surroundings with which the wind is only too frequently associated, suggestive of the sounding brass or tinkling cymbal. If it originally was connected with pious superstitions, in more recent times it is associated with purely utilitarian purposes. In 43 Elizabeth, c. 4, 1601, the Statute of Charitable Uses sets out the following purposes as the legitimate objects of charities:— For the relief of aged, impotent, and poor people, for maintenance of sick and maimed soldiers and mariners: schools of learning, free schools, and scholars in universities, for repair of bridges, ports, havens, causeways, churches, sea banks, and highways, for education and preferment of orphans, for a townfolk relief, stock and maintenance for houses of correction, for marriages of poor maids, for support in aid and help of young tradesmen, handicraftsmen, and persons decayed, for relief and redemption of prisoners or captives, and for aid and case of any poor inhabitants, concerning payment of fifteenths, setting out of soldiers, and other taxes. That the terms of the Preamble of Elizabeth's Statute should have been so broad and comprehensive shows how different were the conditions of that age to the present. Side by side with endowed, it is impossible not also to consider the marvellous multiplication of institutions of purely spontaneous and J voluntary charity. We have lately heard a great deal about local distress. It may be doubted how far the relief of that distress is adequately alleviated by the distribution of coals, blankets, beef, and soup. Those districts which have the largest contributions draw largely from the poorest classes, and are like sponges, which collect the streams in the recesses, and become more widely extended receptacles of misery. We have been told, on high authority, that the poor are always with us; but it is strange that, with all these agencies, rather than a diminution, there is, with the increasing population, an increasing charity, and an almost inexhaustible supply of distress and misery. It is most unfortunate that we should have in this country so many agencies acting towards the same end, but often in ignorance, if not actually in antagonism, to one another. I might quote by scores illustrations of the evils of this sort of indiscriminate charity. I will take, as an instance, the City of Canterbury. Canterbury has an unenviable notoriety in connection with charity. A few years since, Mr. Martin, a Charity Commissioner, made the endowments of Canterbury the subject of a special investigation. There is only one—by name, Lovejoy's—which I propose to comment on. A sum of £250 is distributed yearly amongst 500 persons, subject to the condition that the same person is not to receive it for two consecutive years, and no person in receipt of Poor Law relief is to participate. Out of these 500 persons, in a particular year, Mr. Martin discovered that 145 were improper objects. Of these 145, 4 were brothel keepers, 18 confirmed drunkards, 36 regular, and 18 occasional, paupers, and 51 not needy. I asked a churchwarden in Canterbury—a Conservative churchwarden—a gentleman of somewhat enlightened opinions, but who always supports the Conservatives at Election time—"What do you think of the state of your endowed charities?" He sent me the following memorandum:— The endowed charities of that City are a perfect nuisance to everyone—they are a sort of scramble. Everyone would like to be rid of them; but any proposal to get rid of or to modify them meets with such relentless opposition, and the recipients are so powerful at the time of an election, that it is difficult to hope for any reform. It is very instructive to examine the comments of the Commissioners of 1834 on this point. At page 361, they say— Closely connected with the relief provided by the Poor Laws is the relief provided by charitable foundations. As to the administration and effect of those charities which are distri- buted among the classes who are also receivers of the poor rate, much evidence is scattered throughout our Appendix, and it has forced on us the conviction that, as now administered, such charities are often wasted, and often mischievous. In many instances, being distributed on the same principle as the rates of the worse managed parishes, they are only less pernicious than the abuse in the application of the poor rates, because they are visibly limited in amount. In some cases they have a quality of evil peculiar to themselves. The majority of them are distributed among the poor inhabitants of particular parishes or towns. The places intended to be favoured by large charities attract, therefore, an undue proportion of the poorer classes, who, in the hope of trifling benefits to be obtained without labour, often linger on in spots most unfavourable to the exercise of their industry. Poverty is thus not only collected, but created, in the very neighbourhood whence the benevolent founders have manifestly expected to make it disappear. These charities, in the districts where they abound, may interfere with the efficacy of the measures we have recommended, and on this ground, though aware that we should not be justified in offering any specific recommendation with respect to them, we beg to suggest that they call for the attention of the Legislature. Theoretically, I cannot regard endowments as wholly evil. Rightly administered, I see no reason why they should not become a great factor in the progress of humanity. Endowments should hold before us the prospect of a condition of ideal excellence, and stimulate effort for its pursuit—a kind of electric light, which, however distant, every class of the population should behold, and which, though often unconsciously, should always have a beneficial effect on our conduct. I may reasonably approach particular abuses, to show that, however excellent theoretically, endowments, practically, have often produced the worst possible evils. Practically, they are always regarded by the ignorant as a property, or means of relief or enjoyment of a certain money value, to which everyone has a claim, and that value is, in most cases, exaggerated. In the minds of those who expect to participate great expectations are excited, and as suddenly abandoned. Dr. Chalmers, writing 50 years ago, observed— That there must be a mockery in the magnificence of those public charities, which have not, to all appearance, bettered the circumstances or advanced the comforts of the people amongst whom they are instituted beyond those of a people where they are wholly unknown. He speaks, further, of public charities as an Adhesive nucleus, round which the poor accumulate and settle, misled by vague hopes of benefit from the charities they fail to confer. And he adds— They cause a relaxation of the relative duties of parents, children, and relations. I will give a few choice specimens of particular abuses arising from endowed charities. There are two parishes at Fulbourne, in Cambridgeshire, to one of which the bulk of the charities belongs, while the other is less liberally endowed. When cottages fall down in one they are rebuilt in the other, and all new cottages are erected within the confines of St. Vigor's parish—the one which has the greatest claim upon endowed charity. One of these is known as the "Bread and Sixpence Charity." In the course of the year, 6,289 loaves are given away; and Mr. Martin says, with few exceptions, the whole of the labouring population receive. Another Fulbourne charity is a money dole, distributed on a graduated scale according to the number in a family. A single woman gets 3s.; but if she has a single illegitimate child, she is excluded from receiving for one year, and subsequently receives 2s. 6d. But this slight expression of virtuous indignation is compensated for by the fact, that for every child of which she has the misfortune to become the mother she receives an additional 1s. Mr. Martin made an arithmetical calculation, that the woman who has three illegitimate children gets 2s. 6d. for herself, 1s. for each of her oifspring—total 5s. 6d. A virtuous girl gets 3s.; thus the balance in favour of immorality is 2s. 6d. In the City of Worcester, a sum of more than £500 is given away in doles of 2s. each. On a certain occasion, one of the distributers obtained a number of new florins for the purposes of distribution. On the day after the dispensation of the charity, he sent round to the various public-houses in the City and got his florins back, to be ready for the following year. Mr. Bryce, in his Report to the Schools Inquiry Commission, observed— That he could hardly remember an instance in which anyone who was asked what his experience of their working was, did not answer that they demoralized the recipients, that they were a vexation to those that relieved them, and that they created far more want than they relieved. Much notoriety exists in connection with charitable endowments in the City of Lichfield. About £1,000 a-year goes in doles. In out-maintenance of the poor, Lichfield contributes nearly £4,000, a sum considerably in excess of that of many of the adjacent Unions; and Mr. Hare, who reported, said that, by the testimony of the most intelligent inhabitants, the charities produce a vast amount of beggary, idleness, lying, and profligacy, destroying the feelings of self-respect and independence, and thus becoming great instruments of demoralization in Lichfield. I will pass to another Cathedral City. Notwithstanding all the charities, the great mass of the poor in Salisbury are in no better condition, either physically or morally, than in other places where the endowed charities, if any such exist, are insignificant in amount. As far as I can ascertain, there are few places in England in which the sum raised by rates for the relief of the poor has been, or is now, higher in proportion than has been the case in Salisbury. The expenditure for the relief of the poor for the last 20 years has fluctuated from £4,400 to £6,400 a-year, or from about 10s. to 14s. a-head on the whole number of inhabitants, besides the fund for the charities, which would make the sum per head from 3s. to 4s. higher. With the circumstances connected with Smith's Charity everyone is familiar. If the current opinion as to doles is sound, this is a great offender. Every parish in Surrey is supposed to participate in it. About £5,580 is distributed yearly amongst 23,000 persons, in amounts of 4s. 10d. each. At Hartlepool, in the County of Durham, £200 a-year goes out yearly in doles, with what advantage may be best judged from a hospital surgeon of the place. He says— It is my opinion that the fund distributed by Smith's Charity Trustees tends only to increase the number of paupers in this neighbourhood, and I believe it is generally here known that the pawnshops receive the great proportion of the articles thus distributed. There is a well-known case of a will under a man known as "Spiteful Jarvis," so called spiteful, because, for private reasons, he disinherited his daughter and all his family relations, and left £100,000 in 3 per Cents to be bequeathed to three specified Herefordshire parishes—Lelton, Bredwardun, and Stanton-upon-Wye. They might, primâ facie, be supposed to have been; fortunately situated. One might imagine that for ever ignorance, poverty, disease would be banished from this Arcadia. An Inspector of Charities, who reports on the case, says— No sooner was the charity established than the poor flocked in all directions, and of the most worthless class, even thieves and prostitutes. Illegitimate children very soon increased in number. There was a block of eight small cottages that housed 57 people; most of the cottagers took lodgers. The rent of a small cottage rose from £3 to £5 and £6 annually. It is true that this charity has been dealt with under Act of Parliament; but, on the authority of Canon Robinson, a Charity Commissioner, I may say there is still urgent need for reform, and the funds continue largely to demoralize the recipients. To anyone who has taken an interest in these subjects, it is pertinent to note the condition of parishes without endowments, as well as with them; and in all cases one is brought to the same conclusion—that their absence has increased physical comforts and well-being, and that the benefits, where they exist, are as often illusory, eating like a canker into the spirit of manliness, thrift, independence, and self-respect. I will quote the case of Etwall. Etwall is a parish having an almshouse for six of the poorest of the parish, who receive weekly £1 8s. Careful inquiries were made by the Commissioners, which showed that the chance of being elected into the almshouse had attracted to Etwall a class of persons who liked to live at others' expense. The poor rates were infinitely higher than the average rates of neighbouring populations. Again, there is Tancred's Charity. The avowed object of the founder of this charity was to prevent his property from being divided or disconnected with his name; and, accordingly, though he had five sisters, he left all his property away from them, and turned his house and ground into a residence for 12 decayed gentlemen. The house was to be called Tancred's Hospital, the inmates Tancred's pensioners; while an unfortunate curate had to read prayers and preach a sermon periodically on Tancred's virtues on every anniversary of Tancred's death. The Report of the Commissioners on this almshouse describes the mode of life forced on the pensioners as so wretched and so great a scandal, that they described it as "A hell upon earth." There was a charity once left to found an almshouse at Woodbridge. At the date of the foundation the income was about £110. Now it is £3,600. The almshouse cannot possibly absorb it, and how to dispose of the income has given rise to endless litigation and quarrelling; while the unhappy place itself is said to be greatly demoralized. Cases of this order might be indefinitely multiplied; and hitherto the personal interest or the private caprices of the trustees block and crowd out reformers, who stand up for the cause of the public—the people mainly interested. It has been observed that there is hardly an intelligent person who will not be tempted to say, "Village charities, village curses." I will allude to a curious endowment in Cambridgeshire, where an estate is charged yearly with the duty of growing two acres of white peas for the use and relief of the poor. An Inspector reported that two acres of land, changed from year to year, are annually sown with garden peas, which, when ready, on a day of which notice is given, are picked green by all the inhabitants of the parish. From 200 to 500 people assemble on the land, and pick as fast as they can. Some succeed in carrying off five or six pecks. The value of the crop is supposed to be about £10 an acre, or £20 in the whole. There is no express regulation or control of the picking, and it is said that many who are not amongst the settled inhabitants of the poor of the parish assist there. In reply to the doubtful benefit of such a charity one of the inhabitants stated that— This distribution was a beautiful thing. There is enough," he said, "for everybody. Parsons, doctors, and lawyers get peas when they like; the poor do not. It would be a pity to lose so good a thing. There would be more cry, were the peas taken away, than anything. Why, if so many charities are mischievous in their effect, should they receive indirect pecuniary subvention from this House? The institution of the Charity Commission was well described as a judicial discovery, and has been of enormous advantage to all who take an interest in the judicious administration of charitable endowments. The Secretary to the Treasury has on more than one occasion given his warmest assurances that the Office should be self-sustaining. In answer to a Question in the autumn, it was stated that it should be supported either by fees from suitors who came to it, or by raising a small tax upon each charity that passed through the Office. Both one and the other of these schemes is quite impossible. In the first place, because the very object of the Office was to make it easy of access to suitors, and as convenient as possible; and, in the next, to fix a proportionate tax upon each charity would, to say the least, be a process extremely difficult, cumbersome, and complicated. Now that we have a declining Revenue and an increasing Expenditure, it appears to me that a moment above all others favourable presents itself, and that a fair proportion of Income Tax should be exacted from these charities, if not for increasing the Public Revenue, at least for sustaining the Office. It should be remembered that there are in the State four distinct sources of charity. You have, first of all, private charity in the ordinary sense. Next, there is all the money contributed by the rates, against which very strong mutterings in certain quarters exist; 3rd, there are the endowed charities; and 4th, funds which proceed from indirect taxation, and which mainly affect the exemptions now under discussion. There is very little hope that the State will do anything really useful on the subject of charitable endowments unless the national conscience is aroused. What is that duty with reference to endowments for the poor? It must not be forgotten that, after all, posthumous charity is a low form of virtue. The charity or love which has its example in the Christian dispensation is that of the living, that of immediate and personal effort and sacrifice, the duty of man to his neighbour. There is no Divine commendation of one who has made a disposition of his property for the good of others, which he can no longer himself enjoy. It is needless to dwell on that consideration, or to seek to discredit posthumous gifts by suggesting enmity, vanity, or any other discreditable motive. Mr. Hare once observed— When we consider what is really involved in recommending that a certain portion of the fruits of the earth shall for over be distributed in a prescribed way, we cannot but shrink from so proud an act, inconsistent with perfect wisdom and goodness. The founder of a charity assorts an authority which should be obeyed through all time. His will is to have a perfect effect on the condition of mankind; it is to operate from year to year and age to age, like rain and sunshine on the earth. He assumes an attribute of Divine Providence, and attempts by additional laws to supplement those of Creation and Nature. It is due to one whose expression of will is to be thus clothed with so much authority and sanctity, to suppose that, casting off the restrictions of time, place, and sense, he has become animated with that extensive benevolence which is no respector of persons; which, overlooking the bounds of class, craft, or parish, is ready to say of the ignorant or suffering, wherever found—"The same is my father, sister, and brother." There is the strongest possible ground for special favour to be shown in particular instances, if there is due encouragement given to industry and thrift, and the existence of the institutions can be shown to be a clear benefit to the State. But are they so beneficial? There have been this year the Reports of the proceedings of the Poor Law Conferences held in the autumn, and at many of these the discussions on charitable endowments have formed a topic of much interest. And what has been the consensus of opinion? Why, nothing more or less, by an evidence both of fact and of opinion—which has been quite overwhelming and almost unanimous—that endowed charity has largely contributed to unthrift and pauperism. The maintenance of this Office, which is to confer benefit on the public, and reduce the advantage to a minimum, should thus be obviously self-sustaining. I will take one more illustration from what was stated at the Conference held in London under the Presidency of Lord Hampton. When the member for Leicester was speaking, he computed that there were not more than 7,500 poor people in the City of London, and out of the £100,000 of parochial charity which exists in the City of London there is an income of £33 for each such person. Now go to other cases. I take Charterhouse or Christ's Hospital, of which, as a Governor, I know something. Is it for a moment justifiable that large bodies of this character should be entirely exempt from contributing something towards the Office which largely benefits them; that though benefit may accrue to a number of Governors, or to a certain number of capriciously-selected children, the public should give a large indirect pecuniary subvention to this special institution? The establishment of a large asylum or hospital may frequently be rather injurious to neighbouring owners of property. The benefits of large London hospitals are often very inconsiderable. St. Thomas's is half empty; St. Bartholomew's is kept up by the doctors; and, for a great part, they are limited in practice to those who have the most easy access to them. Instead of a tax on the nation to increase their incomes, it would be more reasonable to apply the same in aid of hospitals in other parts of the Kingdom, or hospitals less richly endowed, whereby the benefits might be more equally distributed. The income raised from this Office is about £2,000,000, Income Tax on which, at the present rate, without exemptions, would amount to £60,000—and I greatly doubt the justice of exemptions. I think there is not the smallest doubt that even were exemptions left out, £30,000 on the charities in this Office might be raised at least, whereby to keep up the whole of its expense. I wish that the House of Commons would pursue in this matter the same course as that commended in the matter of rating by Lord Denman, who extricated the law on this subject from a well of fallacies. Lord Denman observed— How does it concern the ratepayers of St. Philip and St. Paul in what manner any persons manage the property taken and held in the parish? Suppose the Governors of Bristol to have taken 100 acres of land only, and to have brought such of men paupers as were capable of labour from a poorhouse in Bristol, to employ them on the land as a beneficial mode, according to their opinion, of disposing of the poor. Suppose, also, that the return, whatever it might be, was given solely towards the maintenance of the poor who had laboured on the farm, or of those who were unfit to labour, and had been left behind, how can this constitute a better claim to exemption from rateability in the parish where the property lies than a losing occupation, which it is quite certain does not affect the question of liability at all? The same rule applies to every kind of property."—[Governors of Bristol Poor v. Wait, 5 Adol. and E1. Pep. p.9.] A few years later, when exemption was claimed by reason of the public purpose, the same Judge said— Though the maintenance of the poor be a public purpose, the maintenance of the poor of this particular district is a burden on that district alone; the occupation is not beneficial to the guardians individually, but the most advantageous mode of relieving the poor is an advantage to that body."—[Adol. and E1. vol. 10, p. 269.] Finally, on a still later decision, he classed the authorities for exemption as reconcilable only on the principle that— The public, as such, unlimited by the bounds of county, borough, or parish, had a direct and substantial interest in the benefit the application of the funds produced. To the public, properly so called, it matters not by whom the poor children of this parish are clothed, educated, and apprenticed. That they should receive anything beyond what the parish rate is bound to afford them concerns the public so indirectly that its interest cannot be deemed tangible and substantial enough to be considered in the question at all. All which decisions have been on appeals sustained. If anyone will take the trouble to turn to the Papers on Charities, 382, 1865, and examine the Correspondence between the Inland Revenue Commissioners and the Treasury which then took place, it is a question how far many of these charities which are applied for parochial purposes are now legally exempt. There is only one thing which the Government are slow in confronting. They recollect the opposition manifested to the late Prime Minister by that celebrated deputation headed by the Duke of Cambridge, the Archbishop of Canterbury, and followed by the indiscriminate crowd of Metropolitan trustees and vestrymen when he made this proposal. If a charity is so super-excellent, let it go to the Treasury and make out its case. No one would wish, for example, that the Patriotic Fund should be taxed; but, under a plea of capricious benevolence, to tax the public for an Office which mainly benefits the endowments, which are often mischievous and demoralizing, is a course obviously unjustifiable, and an abuse for the removal of which the courage, wisdom, and justice of the House of Commons must on no distant occasion prove itself equal.

Amendment proposed, To leave out from the word "That" to the end of the Question, in order to add the words "the maintenance of the expenses of the Charity Commission should no longer be defrayed out of the Consolidated Fund without some equivalent amount being contributed by the charities under its jurisdiction, and that such means can be alone provided by removing the exemption of those charities from the income tax or imposing some tax on them corresponding to the Succession Duty, from the operation of which they are also exempt,"—(Mr. James,) —instead thereof.

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


said, he had brought a similar Motion before the House some years ago, which was accepted; but little had been done, and the charge for administering charities still remained upon the Consolidated Fund, They were increasing year by year, to the great detriment of the Revenue of the country, Their property in this country yielded about £4,000,000 a-year, and it was increasing rapidly—at the rate of £750,000 during the past 12 years. They were so nursed by the country that they had been exempted from the payment of Income Tax, Succession Duty, and Probate Duty; and they paid no local charges—even postage they were exempted from paying. He contended that charities ought, once at least every 25 years, pay a Succession Duty; and if that were done, they would contribute to the Revenue £600,000 a-year. The Charity Commissioners had, during the last 16 or 18 years, sold charity property which amounted, to £4,500,000, and the charity property now existing, if capitalized, would amount to £150,000,000. Now, if charity property paid the present Income Tax at 5d. in the pound, it would amount to £8,000 a-year; and they ought to pay it, as all persons had to do, and remissions should only be made in extreme cases. He thought the time had come when a Motion like that of the hon. Member for Gateshead (Mr. James) ought to be fairly considered. The amount of charity property in this country was not only immense, but, as he had said, was steadily increasing; while they themselves were growing at the rate of 160 a-year, and in the course of time would absorb a very large proportion of the Revenues of the country. If the recipients of charity were exempted from Income Tax, there could be no unfairness in making charitable funds pay a periodical Succession Duty in lieu of an annual charge. The details of the question could be easily settled, and there could be no possible excuse for saying that charities ought not to be made to pay a portion of the taxation of the community, and, therefore, he hoped that some measure would be adopted to that end. Before long, the question would have to be dealt with in a much, larger sense than that contemplated by the Resolution, which was so moderate that it ought to be accepted. New charitable trusts were created from year to year, and he thought the time had really come when the Consolidated Fund should be relieved from the Vote in respect of them which was taken annually.


said, that if all the charities were like those illustrated by his hon. Friend the Member for Gateshead (Mr. James) there would be no difficulty in dealing with them, for no one would oppose the Motion; but it was because they had many good charities that their sympathies were strongly affected towards them, and Parliament and the country looked with great suspicion on any proposal to tax charities. He willingly supported the Motion, however, remarking that the time would come soon when they would have to consider how far, not only as regarded charity trusts, but all other Corporations, they should allow the property of the country to be set aside in the hands of Corporations, and thus avoid much of the taxation it would bear if in the hands of individuals. Corporations never died, and their constantly increasing property absorbed so much from the Revenue of the country that it was becoming intolerable. In his opinion, all Corporation properly ought to be required to pay Succession and Probate Duty in a given number of years—say, at least once every 19 or 25 years—or whatever might be found to be the average term of ordinary successions.


said, if all charities were of the kind described by the hon. Member for Gateshead (Mr. James), very few persons in that House would be found to defend their exemption from taxation; but there were very many who were far removed from the least liability to charges such as those of which so much had been said that night. He would remark, also, that this was not a charge on the Consolidated Fund, as supposed by the hon. Gentleman. What was the history of this agitation? He believed they had had debates on the subject ever since the year 1812, the year in which, if he remembered rightly, the attention of Parliament was called to the matter. The Government of that day exempted charities from a 10 per cent Legacy Duty to which they were liable. In 1845 an attempt was made to put an Income Tax of 6d. in the pound; but it came to nothing. That was in the time of Sir Robert Peel's Government. In 1853 the Charities Trusts Act provided for a rate of 2d. in the pound on all charities; but it was opposed, he thought, by Lord John Russell, on the ground that the good charities ought not to pay for the bad ones, and the clause was struck out in the Select Committee to which the Bill was referred. The next time when the matter came before the House was in 1863, when the right hon. Gentleman the Member for Greenwich (Mr. Gladstone) proposed a plan very similar to that now advocated by the hon. Member for Gateshead—namely, to put an Income Tax on charities. Whether from the effect of the deputation that had been referred to or not he could not tell; but the proposal was not pressed, and came to nothing. In 1868 the House of Commons really seemed to have taken the matter up seriously, for the hon. Member for Chippenham (Mr. Goldney) then succeeded in carrying a Resolution empowering the Charity Commissioners to meet part of their expenses by charging fees, and the same provision was also extended, at the same time, to the Inclosure Commissioners and the Drainage and Tithe Commissioners. As he had been reminded, the right hon. Gentleman at present at the head of the Local Government Board (Mr. Sclater-Booth) opposed that; but he thought that he also admitted that he would not object to a rate of 2d. in the pound. As a result of that Resolution, the Government did apply the system proposed to the Inclosure Commissioners, the result being that about two-thirds of the cost of the Commission were paid by the fees. Power was also taken at the same time to apply that system under the Charitable Trusts Act; but nothing was done afterwards. The question was next raised in 1869, when the right hon. Gentleman the Member for the University of London (Mr. Lowe) opposed the Motion, on the ground that the country objected to charging an Income Tax on charities, and that even if the tax were imposed, enough would not be raised to make it worth the while. In 1871 the late Member for South Essex (Mr. Andrew Johnston) carried a Resolution against the exemption; but it was passed in a very thin House, and nothing was done in consequence of it. In 1872 the right hon. Gentleman the Member for the University of London was again appealed to on the subject; but he declined to alter his previous opinion, although the House was divided on the Vote for the Salary of the First Commissioner as a protest. Ever since that time the Secretary to the Treasury had had to promise each year that he would take the matter into his consideration. The First Lord of the Admiralty (Mr. W. H. Smith), in his day, regularly promised it; and he (Sir Henry Selwin-Ibbetson) himself last year promised the House that he would consider the matter during the Recess, and see if something could not be done. He had, accordingly, in the autumn endeavoured to suggest some method by which, if this charge on the country for the administration of the Charity Commission Office could not be entirely abolished, it might be very much reduced from the sum at which it at present really stood—£21,700. He felt that, although the House had not required the imposition of an Income Tax on the charities, yet that a very large part of the work of the Office was so beneficial to the charities themselves that there was no justification for the work not being paid for. He suggested that a charge should be imposed, on all orders for payments of dividend, or for authorizing sales of real estate, or for grants of building or mining leases, or for appointing trustees and establishing schemes for vesting real estate, or for orders authorizing the transfer of Stock and the sale of Stock by official trustees. By means of these fees, they might raise a sum of money which would, to a considerable extent, save the expenses of the Office. His suggestion had been taken up very heartily by his friend, the First Commissioner; and only that morning he had received a scheme from him which would carry out what he had suggested. The amount to be realized was not very large, being between £7,000 and £8,000; but that depended entirely on the amount charged for fees, which might be increased, if it was thought that thereby they would not prevent the charities from availing themselves of the advantages of the offer. The Commissioners recommended that they should be allowed to charge ¼ per cent on the amount; and that if compulsory powers were given, that all investments of charity property should be made in Government Stock, the charge being made upon orders for payments of dividends and re-transfer of Stock. This was calculated to produce annually about £1,400. Then there would be a charge for authorizing sales of real estate, perhaps, one of the strongest cases of all, because this land was usually sold at accommodation prices, and other persons being very anxious to obtain it as outlying land, fabulous prices were often given. From this charge they might fairly expect to raise £1,600 or £1,700 more. For leases on building estates they would easily obtain £1,200; while from, the others the remainder would be obtained. Great care would be necessary as to the tax on establishing schemes, for at present there was the option of obtaining a deed of trust or of getting an order from the Commissioners. At present, a very large number of persons went to the Commissioners on account of there being nothing to pay; and therefore it was quite conceivable that if a large fee was charged, the legal advisers of those different charities would advise recourse to the Courts in preference, unless, of course, they were obliged to go to the Commissioners. Another case in which great saving was incurred was where trustees were constantly forced to go before the Commissioners, as in a case of the proof of death, or where the responsibilities incurred were very great. This would produce about another £1,000. Authorizing the transfer of Stock, of which 579 cases came before the Commissioners in 1878, would produce another small sum. There were 177 orders for the sale of Stock in 1878, amounting in all to the sum of £197,000, from which a small sum might also be raised. At all events, the Commissioners had reported that about £7,000 might be raised in this way, without in the least prejudicing the work that they were doing, or of driving away the charities which at present availed themselves of their services. He was aware that this was only a tentative scheme, and he knew that great difficulties surrounded it, and that great pressure had been brought to bear upon Parliament whenever an attempt had been made to deal generally with these charities on the same footing as other bodies. He did not say that a small Income Tax might not be usefully applied; but he did maintain that the country would not be justified in raising any sum from these charities in excess of the cost of the Commission; nor did he think the country would support any attempt to raise Revenue out of these particular funds. On the other hand, he did think that the object of the Government should be to make them, as far as possible, self-supporting, and to prevent the cost of the Office of the Charity Commission from being charged on the public. This plan had not yet been submitted to the Chancellor of the Exchequer, and it was merely the outcome of his attempt to work out a solution of the question; but he believed that it was the commencement of a system which would eventually work out, so as to prevent the work of this Commission being in any wav charged on the public funds.


Any mitigation, however slight, of the evils of the absurd position—for it is nothing else—in which we now stand in respect to these charges ought to be thankfully accepted. We ought to gratefully receive very small mercies when we cannot obtain large advantages; and, therefore, if the hon. Gentleman the Secretary to the Treasury can work out for us by fees, which will not drive away business from the Charity Commission—for that I take to be an essential part of the usefulness of such a plan—a system such as he proposes—and raise some £6,000 or £7,000 a-year, I apprehend there is no one who sympathizes with my hon. Friend the Mover of this Resolution (Mr. James) who will not, so far, be thankful to him. But I hope that nothing that may be said in this debate, or that may be done in consequence of it, will be understood in the slighest degree as settling the question. It hardly touches it—it nibbles at it, if I may use the expression, and can in no sense of the word be said to dispose of it. The hon. Gentleman has himself most frankly and candidly said that he cannot expect more than £7,000 or £8,000 a-year from his plan, which I take to be about one-third of the charge for the Charity Commission on the public; consequently, even if it were now approved and in operation, two-thirds of this whole burden would still remain upon the public. At this point, I am sorry to say, I must part company with the hon. Gentleman, because, though he regards his plan as only partial, and is quite willing to see it carried forward to such a point that it should overtake the whole charge of the Commission, yet, if I understand him aright, as soon as that is done, he would object to go further, and does not think that charity property should be made the subject of taxation. There is the whole root of the matter. It is improper, it is unjust to the general taxpayer that charity property should not be charged. I am told that many charities are good. But is it not a good object with which the whole of a community engage in labour for the support of their wives and children? Yet, notwithstanding the goodness of the object they have in view, they are rightly called upon to pay the taxes of the State. Why, then, is charitable property, which indicates a much less stringent moral obligation, which is far more subject to abuse, and is, upon the whole, much more likely to be abused, to be maintained at the expense of the community? I do not know that taxation is a burden without compensation. When we tax a subject, and he complains, we tell him that he obtains all the benefits of social order and security in return for the taxes he pays, and our answer is a good answer. But, then, it is a good answer to the charities also. These are the necessary purposes for which human society is formed, and taxes are the necessary conditions by which the laws of human society are maintained. If, therefore, we call upon individuals to maintain this property, which lies in mortmain, we, in fact, call upon the living and tax the living for the benefit of the dead. That, Sir, is a very great piece of liberality on the part of the State to allow to the dying man this enormous discretion in the disposal of his property, under circumstances which he cannot possibly measure or foresee. But to say to him also—"I will not only give to your property all the advantages which other property enjoys, but I will exempt your property from the payments which are the necessary price of those advantages—that is say, I will give those advantages to your property at the expense of the property of others, and at the expense of the labour of every labouring man in the country," is to state a doctrine which it is impossible to justify either in theory or in fact. I know very well that what I am arguing against appears to have captivated the mind of the Secretary to the Treasury. I am not finding fault with him, or with the present Government, for having gone thus far to effect that which so many Governments have failed to effect. The hon. Gentleman has recounted to us a most dismal list of failures from the year 1812. With one of those failures I was myself associated, and its history is as follows:—I proposed to lay an Income Tax upon charities. Of course, a considerable number of hon. Gentlemen on the Liberal side of the House were rather lukewarm about these proposals, and a small section on that side of the House was decidedly disposed to object. We found that if we proceeded with our proposition we should have to deal, not only with our own Friends who objected, but with the entire body—I do not say every individual—of the Opposition of 1863. Under those circumstances, it could have produced no practical effect to have gone on, and would have placed all those who approved of our plan in a very unfair position, by asking them to give votes in its favour which could not possibly produce any result. That is the history of my failure. We thought it better not to put our Friends—not our Party Friends, but hon. Gentlemen now sitting opposite—to the invidious effects of the performance of this duty, unless we could expect some result. Pray let it be understood I am making no charge or complaint against anybody; but I am endeavouring to show the irrefragable force of the pressure under which we acted. Nevertheless, we ought to find, in some way or other, the means of causing these properties to pay its part of the penalty which is part of the social law under which all political societies exist. If I might criticize the Motion of my hon. Friend (Mr. James), whoso speech I listened to, as I generally do, with very great pleasure, I should say the Motion was rather narrow. I would rather he had laid down in general terms that the charities should be brought under taxation substantially equivalent to that of the rest of the community. As it is, he calls upon me to vote a Resolution which contemplates that either the Succession Duty or the Income Tax should be imposed upon charities. But how is that to be made quite acceptable to those who think it in principle to be quite plain that both the Succession Duty and the Income Tax ought to be imposed? I feel in some difficulty with regard to that matter, although I should be very sorry not to accompany my hon. Friend. But, however, I am sure he would not call upon me to vote with him in settling matters on the basis of that distinction. I hope I have made it clear to the House that what we have before us at present is not merely one abuse calling for reform, but two. The other abuse, and the main abuse, is that the property of charities is not made to pay these taxes, which are the essential condition of maintaining the property at all, and without which no property can exist. That is the gist and the main point. Over and above that folly, which seems to be considerable enough, we go a great deal further, and we give them £21,000 or £29,000, whichever it be, every year out of the public funds, in order to provide gratuitously, or almost gratuitously, for purposes beneficial to the maintenance and development of their property. I do hope something may be done in this matter within a reasonable time. Perhaps some of us will be dead, but others may live to see the change made. I probably shall not. But if none of us do live to see it, let us hope something will be done by our children, our grandchildren, or our great grandchildren, or by some still more remote generation. We are now the great grandchildren of those who first raised this question, and the result of all our labours and inquiries amounts to nil. That is the state of the account down to the year 1879. But I still do not abandon hope for the future. As long as there is life there is hope, and to-night a little glimmering, a faint indication, has been afforded us from the other side of the House. Let me just say this, also. It is the fashion of all Governments—it was the fashion of our Government; I have very frequently practised it; and even of the present Government, the First Lord of the Admiralty did it last night—to find great fault with the House of Commons for pressing the augumentation of Public Expenditure. Therefore, the House ought to be encouraged in no grudging way, when it is offering a zealous co-operation to the Government in augmenting the Public Revenue. It is too much the fashion of those who are in Office either to get rid of a question of this kind in some way or other, or to satisfy it on the cheapest possible terms. I cannot congratulate myself, or the House of Commons, or anybody who hears me, on the history of this question in past years; but I do hope that in the future we shall take every opportunity of turning to the best account whatever chance may be afforded us of redeeming ourselves from what I think no inconsiderable; reproach, and of putting an end to a state of things which implies great folly, and of establishing equal justice between the several kinds of property which exist under the protection of the law, which enjoy the advantages of that protection, and which ought to pay its necessary price.


I cannot help saying a very few words in answer to some of the observations of the right hon. Gentleman, the more, that in the struggle of which he has spoken in 1863, it was my duty to take a prominent part in opposition to his proposition. I have never asserted, nor have I ever felt, that there was any doubt of the propriety of making the property of charities pay, if it could be done, the expenses of the Charity Commission. I think that is a perfectly reasonable and proper proposition; and if a scheme can be framed by which, without driving away the charities from availing themselves of the useful machinery of the Commission, they can be made to bear the expense of it. I think it would be perfectly right and proper. My hon. Friend (Sir Henry Selwin-Ibbetson) has paid great attention to this subject, and I am in hopes that it may be possible to do something in that direction. For my own part, I shall be extremely glad if we find ourselves able to make these charities cover the entire expense of their own management. But otherwise I am afraid I must still remain in a position which must be unsatisfactory to the right hon. Gentleman. I do not feel myself able to accept his view that a tax on the property of all charities is a desirable source of Revenue. My right hon. Friend, in his Budget of 1863, included a proposition to abolish the exemption of charities from Income Tax which had previously existed. That was proposed, if I remember aright, with no special view of paying the expenses of the Charity Commission, but with the special purpose of making that property contribute to the general Revenue of the country. He puts the matter very mildly, when he says there was a great deal of luke-warmness on his own side, while he was bitterly opposed elsewhere, and that, therefore, he did not think it right to press those who were inclined to support him to do so. So far as I remember, this is only a faint indication of the true state of the case. My right hon. Friend brought forward that proposition in a speech of very great power—one of the most eloquent he ever made. If the question had been decided by the manner in which he addressed the House, and the vigour with which his arguments were put, he ought to have received very considerable support. But there was absolutely no response, so far as I can remember, in the course of that evening to any part of his proposition; while the strongest possible opposition was manifested in the country, of which the deputation to which allusion had been made was one of the indications. I remember one of the points which I took at the time in arguing against it was that if small incomes were exempt from the Income Tax, it was hardly reasonable that all charities should be subject to it. I do not think, however, that it is either desirable or necessary that we should revive that controversy, and certainly the Motion of the hon. Gentleman the Member for Gateshead (Mr. James) does not do so. I can quite understand it is one which is not finally closed, and I have no doubt it will be brought up again and again. Many persons, no doubt, think that there is force in the argument of my right hon. Friend. I remain of the same opinion that I was in 1863; and it is a noteworthy fact that, though some 16 years have elapsed since that time, though several successive Governments have been in Office, and though the excitement of that time has quite passed away, yet that no Government has thought it possible to carry through a proposition of that sort. I do not think either that we should undertake, or attempt to undertake, on mere grounds of theory, a course which it is probable, or almost certain, would have to be abandoned. The question at the present moment, however, is the suggestion of the hon. Member for Gateshead. I entirely agree that it is desirable to meet the expenses of the administration of these charities out of the funds of the charities, and with the suggestion that there is no real means of doing so without imposing some tax for that purpose. I do not know how far the plans of my hon. Friend the Secretary to the Treasury may be successful in partly meeting that demand; but I may say that in principle we are quite prepared to go the whole length of, at all events, paying the expenses of the Charity Commission out of the funds of the charities.


observed, that although the question had not been practically under the notice of the House very frequently, it had occupied the minds of hon. Members and of the public a good deal. He ventured to think that public opinion, although, perhaps, it did not go so far as the hon. Member for Gateshead (Mr. James), and certainly did not go as far as the right hon. Gentleman the Member for Greenwich, yet had changed, and had changed, as he (Mr. Pell) believed, considerably for the better. He regretted to hear the phrase, not that something would be done, but that something must be done, and something "ought" to be done, in the mouth of the Secretary for the Treasury. When he heard that phrase in the mouths of those who had the power to do something, he always felt discouraged. He understood that hon. Gentleman to indicate that charities which were well administered might fairly claim to be exempted from taxation, and he himself was in favour of that. But the proposition of the right hon. Gentleman the Chancellor of the Exchequer was likely to be productive of harm. The propositions already accepted by the House on the subject commenced with that of the hon. Member for Chippenham (Mr. Goldney), who carried a Resolution that the expenses of the Charity Commission ought not to be borne by the public. On the Motion of Mr. Andrew Johnston, who at that time was Member for Essex, the House became more precise; and on April 21, 1871, a Resolution was carried to the effect— That discontinuing the exemption of Endowed Charities from Income Tax was the only method of carrying out the decision of this House against the payment of the expenses of the Charity Commission out of public funds. Under that Resolution, an Act was passed enabling the Charity Commissioners to impose certain fees for the transaction of business. It was now suggested that that plan should be extended, and they now heard a plan which only this day had been submitted to the Secretary to the Treasury. As to that, he would only say that its first effect would be to prevent the reform of charities. Trustees who were anxious to mend their ways, and come to the Charity Commission for assistance, would be checked to a certain extent by a fear of the fees they would have to pay, while charities which were going on in their old evil ways would have an absolute exemption, which he held to be mischievous and wrong. They had had many proposals, none of which had been put in force; and as many Members desired to see this question dealt with practically, he should venture to move an Amendment. He knew the question was an exceedingly unpopular one, and, therefore, he thought the best way to prepare the public mind for a change, and to insure right and sound views on the subject, such as those of the right hon. Gentleman the Member for Greenwich, was to promulgate information right and left on the subject. Therefore, he should move, if the present Amendment of his hon. Friend the Member for Gateshead to the Motion that Mr. Speaker do now leave the Chair were withdrawn, that the question should be referred to a Select Committee for consideration, and to report by what moans, other than by a charge upon the Consolidated Fund, these expenses may be best defrayed.


said, he was quite willing to withdraw his Motion, by the permission of the House, in favour of the Amendment of the hon. Member for South Liecestershire (Mr. Pell).

Amendment, by leave, withdrawn.

Another Amendment proposed, To leave out from the word "That" to the end of the Question, in order to add the words "the maintenance of the expenses of the Charity Commission should be referred to a Select Committee for consideration, and to report by what means other than by a charge on the Consolidated Fund these expenses might be best defrayed,"—(Mr. Pell,) —instead thereof.

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


said, although the Government did not object to the withdrawal of the Motion, it was quite a different thing to agree to the appointment of a Select Committee. If he were anxious to do nothing in this matter, he should be very willing to accept the Amendment. If anything were to be done, it must be done speedily, and the appointment of a Committee would probably defer any action of any kind until another year. But this was really a question of administration. It was one for the Government to undertake; and he did not agree with his hon. Friend who moved the Amendment (Mr. Pell) that a Committee could obtain any information which was not now before the Government. All the information the Committee could obtain must be derived from the same gentlemen in the various Departments who had already given the Government all the information in their power. He could not really see how the Committee would do any good, and, in his opinion, the result of it would simply be that nothing would be done at all.

Question put.

The House divided:—Ayes 72; Noes 52: Majority 20.—(Div. List, No. 74.)

Main Question, "That Mr. Speaker do now leave the Chair," by leave, withdrawn.

Committee deferred till Monday next.

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