HC Deb 19 May 1879 vol 246 cc756-82

Order for Second Reading read.

Motion made, and Question proposed, "That the Bill be now read a second time."—(Mr. Chancellor of the Exchequer.)


Mr. Speaker, the terms of my Amendment to the second reading of this Bill are— That this House will not recognize or accept as binding any Treaty or other engagements entered into by Her Majesty's Ministers, which might forestall or limit the control of this House over the financial resources and taxation of this Country, until further information as to such contemplated engagements has been laid upon the Table of this House, and this House shall have had an opportunity of expressing an opinion thereon. It is due to the House that I should explain why I have ventured thus early to call the attention of hon. Members to the subject of my Motion. It is now 19 years since this important subject was seriously debated in Parliament, and during those 19 years this House has undergone great changes. The number of Members who had scats in the House during the debates of the year 1860 upon the Commercial Treaty with France is very limited; and I find that among the other Members of the House there prevails in a certain degree a misunderstanding of the real position of this House with respect to Commercial Treaties, especially as that position is affected by the announcement of Her Majesty's Government that negotiations are pending for the renewal of the Commercial Treaty with France for six months. That, Sir, seems to be a very limited period; but my experience of the effects of the Treaty of I860 is such, that I think I am bound immediately to claim the attention of the House before these negotiations proceed further. Sir, the Treaty of 18(50—the Commercial Treaty with Franco—is not an ordinary Commercial Treaty. The Party, who at present sit on this side of the House, felt very strongly in 1860 that, in its substance and in the circumstances under which it was negotiated, the Treaty of 1860 constituted a very wide departure from the only precedent of a Commercial Treaty with France which at that time existed—the Commercial Treaty negotiated by Mr. Pitt in the year 1787. Let me refer for a few moments to the circumstances under which the Treaty of 1860 was negotiated. It was not until the 23rd of December, 1859, that the public became at all aware, far less this House, which was then in Recess, that there was any idea entertained of contracting a Commercial Treaty with France. It then appeared that the late Mr. Cobden, a distinguished man, but not a Member of Her Majesty's Government, was employed in Paris in negotiating for a Treaty of Commerce directly with the late Emperor of the French, and that he had for some time been in communication with M. Rouher, one of the French Ministers. Lord Cowley, our Ambassador, was informed that such negotiations were going on, and he wrote to the late Lord Russell, then Secretary of State for Foreign Affairs— I conclude that your Lordship is aware that Mr. Cobden is unofficially negotiating for a Commercial Treaty between England and France. The reply of Lord Russell, I believe, confessed that he was aware of the circumstance; but up to or about the 23rd of December, 1859, Lord Cowley, our Ambassador in Paris, knew nothing of it. Lord Cowley concluded his despatch by saying that he could have no feeling of jealousy on the subject, and that he hoped Mr. Cobden would be officially intrusted with the conduct of the negotiations. Immediately upon that, Mr. Cobden was officially employed; and let the House observe, the first information that negotiations were in progress arrived on the 23rd of December, 1859, and upon the 23rd of January, 1860, the Treaty was signed. Parliament met upon the 24th of January, and on the 10th of February the Chancellor of the Exchequer made his Financial Statement, having induced this House to take Ways and Means before Supply, so that he might include in his Budget the substance of the Treaty, so far as it affected the finances of this country. Her Majesty's then Ministers, under the Leadership of Lord Palmerston, had a large majority in this House, and on the 20th of February, in considerably less than two months from the first announcement, this House found itself committed to the substance of the French Treaty, so far as it affected the taxation of this country. These were very rapid and unexpected proceedings. The Conservative Party used every exertion to induce Her Majesty's then Ministers to conform to the precedent of 1787, but without success. When Mr. Pitt undertook to negotiate a Treaty of Commerce with France, how did he proceed? He negotiated the Treaty. He placed it before the commercial public, and so left it for five months before he proposed it I to Parliament; and when he proposed it I to Parliament, he did not propose at once to incorporate the provisions of the Treaty in the Budget, but asked the consent of each House of Parliament to that Treaty by Resolution. Could there, Sir, be a greater difference between two modes of procedure, than between the mode of procedure adopted by Mr. Pitt, and the mode of procedure adopted by the Government of Lord Palmerston? I know that among the Members of this House, who cannot clearly recollect what occurred in 186!), the idea exists that Parliament has little or nothing to do with Commercial Treaties—that the conclusion of a Commercial Treaty is an affair of the Government, and that Parliamentary consent, if necessary at all, is a mere formality. No Member of this House, Sir, except he be a Member of the Government, acting on behalf of Her Majesty's Ministers, can propose the imposition of any tax, or the increase of any tax: and exactly upon the same principle no Member of this House, unless he be a Member of the Administration, and is authorized by the Government, can negotiate a Treaty, and least of all a Commercial Treaty; because a Commercial Treaty may affect the financial resources of the country for years to come; it may affect, as the Treaty of 1860 affected, and control, as the Treaty of 1860 controlled, the power of taxation, which is vested in this House, not for one year only, but for 10 or 20 years. I will now state to the House why, after the experience we had in 1860 of the secrecy and rapidity with which the last Commercial Treaty was negotiated, I have thought it my duty, on the first intimation that that Treaty is to be continued, renewed, or altered—I believe it is intended that this Treaty is to be altered—to intervene. I have, therefore, thought it my duty to ask the House to affirm that we have not forgotten the functions of the House in reference to this matter, because the House forgot its position in this matter. The conclusion of the Treaty would, to the extent of its provisions, incapacitate this House from performing its function of regulating and granting taxation. This abdication on the part of the House might be for an unlimited period, for any period which it might please the Government to assign as the duration of the Treaty. I have reason, as I will presently show, to remember these circumstances. Under this Treaty the number of articles in the British tariff was reduced from 419 to 48. The duties abolished were almost entirely upon articles, not of necessity, but of luxury. It will be enough to state, in illustration of the sweeping nature of this Treaty, that the total amount of taxation which it either abolished or reduced—mind you, abolished or reduced—not for the year, nor for five years, but during the period of the existence of the Treaty—for 10 years Parliament deprived itself of all control over financial resources which yielded £1,700,000. If these Customs duties had been left, according to the natural increase and growth of Customs duties, they would have yielded more than £2,000,000 now. This is not a small item. I will not trouble the House by going through the principal articles affected by the Treaty—such as the reduction of the wine duties in favour of French wines, which created great jealousy on the part of the Spanish and Portuguese Governments. The number of articles upon which Customs duties had been levied, and which were thus cither abolished or reduced, was very large; these articles were chiefly the produce of France. That this should have been the case was the ordinary condition of Commercial Treaties between two countries; but the extraordinary condition of this Treaty is that this House bound itself to the Government of France not to impose or re-impose, during the period of the Treaty, these duties upon the produce of any country in the world. This extraordinary provision has, by the operation of this Treaty, been made fundamental as regards other Treaties—the foundation of engagements unspecified in other Treaties—and for the benefit of other countries. The direct engagement on the part of this country under this Treaty is with France only. The benefit which we receive in return for this abandonment of the power of taxation is reciprocated by France only, whilst the rest of the world gets the uncompensated benefit of our concession. Under this Treaty we can claim nothing from Germany, nothing from the United States, nothing from Austria, nothing from Belgium, or from Russia. The commerce of each of these States profits by this Treaty at the expense of this country. Such are the provisions which the Chancellor of the Exchequer of that day (Mr. Gladstone) declared to be consistent with the object of the Treaty; but they are provisions which I wish the House fully to understand before it commits itself to a renewal of this extraordinary engagement. I trust the House will allow me to verify what I have said by quoting the words of the Chancellor of the Exchequer. In his Financial Statement of the 10th of February, 1860, he said— I come next, Sir, to the English covenants. England engages, with a limited power of exception, which we propose to exercise with respect only to two or three articles, to abolish immediately and totally all duties upon all manufactured goods. There will be a sweep, clean, entire, and absolute, of manufactured goods from the face of the British tariff."—[3 Hansard, clvi. 834.] The right hon. Gentleman went on to say— France is perfectly aware that our legislation makes no distinction between one nation and another, and that what we enact for her we shall at the same time enact for all the world."—[Ibid. 837.] I have said that I have had reason to remember the effects of this Treaty. Among the duties which were immediately abolished under its provisions were the duties on silk manufactures, and these included the duty of 15 per cent upon ribands, the article chiefly manufactured in Coventry at that time, and in a district extending from Coventry 10 miles northwards, including the town of Nuneaton, and several other populous manufacturing places. Mr. Disraeli and the Conservative Party in this House were kind enough to assist me in the endeavour to prevent the abolition of this duty from being immediate; but the Government were inexorable. The abolition of the duty was immediate. Parliament broke up, and in the month of September following I found myself the chairman of a relief committee in my own neighbourhood, with 22,000 persons to provide for beyond those who could obtain relief under the Poor Law. This state of things was, in great measure, produced by the suddenness with which this Treaty came into operation—an operation as sudden as the negotiations for the completion of the Treaty were rapid. Her Majesty the Queen, with her usual benevolence, subscribed for the relief of the distressed workpeople. The Prince of Wales also subscribed, as did the right hon. Gentleman the then Chancellor of the Exchequer, who himself had forced on the Treaty. I was employed for three winters in distributing some £47,000 to relieve the distress which had been occasioned by the operation of that Treaty among my constituents. But the effects of the Treaty were not restricted to my constituents. I remember that there were in Manchester eight firms of broad silk manufacturers, who petitioned in favour of the Treaty and the abolition of the Customs duties. I have a copy of their Petition now. Every single firm whose representative signed that Petition has since failed, and in my own district this branch of industry has been reduced to one-third or one-fourth of what the trade was in 1860. I believe not more than one-fourth of what it was then remains. We were told that we were behind the time, and our produce was inferior to that of France; but I have the satisfaction of knowing that at the first Exhibition of Paris the riband, which won the first prize from all the French ribands, was manufactured, within four miles of my house in Warwickshire. I think I have some reason, then, to remember what has been the operation of this French Treaty; and I am most anxious that this House should thus early, after we have received the intimation that the continuation or renewal of this Treaty is contemplated, remind Her Majesty's Ministers that without the consent of this House—and I trust that the consent of the House will not be given without due consideration—it is impossible either to renew, to alter, or to continue this Treaty with France, or to negotiate any other. Allow me, for the information of those hon. Members of the House who have not had the advantage or misfortune of being here so many years as myself, to show that this House must be a party to, and responsible for, any Commercial Treaty that is contracted. We have nothing directly to do with negotiations for a Treaty, anymore than we have the power of proposing taxation. The negotiation of a Commercial Treaty, like the negotiation of every other Treaty, is a function of the Executive Government, just as the proposal of every tax is delegated to them—that is their duty and privi- lege; but the sanctioning of a Commercial Treaty is just as much the function of this House as is the consent which we are appointed to give or withhold from the proposals of the Government for taxation. In this very Treaty, the 5th Article, a very important one, begins in these words— Her Britannic Majesty engages to recommend to Parliament to enable her to abolish the duties of importation on the following articles," &c, & c. The 5th Article begins— Her Britannic Majesty engages also to propose to Parliament that the duties on the importation of French wines be at once reduced. And the 7th Article begins— Her Britannic Majesty promises to recommend to Parliament to admit into the United Kingdom merchandise imported from France at a rate of duty equal to the Excise duty," & c. This House, then, is responsible for every Commercial Treaty. It is the function of this House to sanction or reject every Commercial Treaty. This power is identical, which the House possesses, either to accept or reject the proposal of the Government for the imposition of taxes. It is perfectly true that this House ought not to directly interfere with the negotiations of a Commercial Treaty. I know that it was the general feeling that, until he was duly authorized and appointed, the late Mr. Cobden outstepped his duty as a Member of Parliament by the part he took in the year 1860. What he did was no doubt prompted by an excess of zeal; but if he erred in the first instance, his error was subsequently condoned, and more than condoned, by his being appointed the Representative of this country for the purpose of carrying on the negotiations. All the more, however, is it the duty of this House to avoid, if possible, the difficulty which might be entailed by the House feeling itself unable to sanction the provisions of any Treaty which may have been negotiated. I know that this feeling weighed very heavily upon some Members of the Conservative Party in 1860. The circumstances of Europe at that time were somewhat critical. It was thought by some a very great advantage to this country that we should be on good terms with the Emperor of the French, and I know positively that this circumstance weighed very deeply with some Members of this House, who otherwise might have been anxious to press some modification of the obligations which this country undertook by that Treaty. It is for this reason, Sir, I now invite an expression of opinion on the part of this House with regard to this important subject. As this Treaty must expire on the 31st of December next, I ask this House now to consider, I ask the commercial public now to consider, whether there are any provisions in that Treaty which, in their opinion, need alteration; and if that be their opinion, now is the time that they should approach Her Majesty's Government with their suggestions. Now is the time, and the only time, when, conveniently and safety, the commercial experience and opinion of the country can be brought to bear with a view to the future. I hope the House will forgive me for thus bringing under its notice the position in which we are placed. In the year 1860 the feeling was in favour of the system of free imports, to which, for nearly 20 years, this country has been bound to a great extent by tins Treaty—bound to the system of free imports from the whole world, whilst the expectation of Reciprocity is by this Treaty limited to our commerce with Prance only. For nearly 20 years, then, we have been fettered by this Treaty. In 1860 the expectation was rife that the great commercial countries of the world, that Europe and the United States would reciprocate the abandonment of import duties which this country had then adopted, and of their own accord freely follow our example in this respect. Sir, there is no such expectation now. Russia shows no sign of an intention to relax her high tariff. Some persons speak of Russia as if her Government were ignorant on this subject. But Russia reduced her import duties, with a view to the adoption of Free Trade, as far back as the year 1815. She tried the system for five or six years, but found it to be so ruinous that she abandoned it in 1821, and never after renewed it. Again, in 1816, the United States largely reduced their import duties; but they, too, found the system so ruinous that they raised their duties in 1828, and have ever since, though not so steadily as Russia, refused to abandon their Customs duties. With reference to this commercial legislation and these commercial engagements, it behoves the House to consider the political temper of the world. The tendency of the world, I need hardly say, is now in the direction of Imperialism. You have the German Empire established, the Austria-Hungarian Empire consolidated, and the Empire of Russia extended. France has not abandoned an Imperial policy in matters commercial because she is a Republic; and there is no commercial policy more Imperial than the commercial policy of the United States of America. What are the United States but a Federation of Sovereign States? The Republic, which combines these Sovereign States, by this Federal Union is essentially Imperial. Look at her financial policy, her Imperial power, and her central combining Republican Government, the seat of which is at Washington, yet the Central Government cannot impose direct taxation except in time of war. The imposition of direct taxation is the privilege of each Sovereign State, and they guard that privilege against the Federal power with the utmost jealousy. In times of peace the only financial resource of the Federal power of America is taxation by Customs duties. That distingushed man, General Grant, ex-President of the United States, visited Birmingham last autumn; and, on that occasion, the able junior Member for Birmingham (Mr. Chamberlain) made an eloquent speech—such as, indeed, he usually makes—in the expectation that he would receive from the ex-President some encouragement to hope that the United States would abandon their protective system. And what said General Grant? He said that he had not been accustomed to make political speeches until he came to England; but he could assure the hon. Gentleman who had been so eloquent, and whom he had found hospitable as a host, that the example of England had been firmly impressed upon her descendants in the United States; that they had seen England's commercial greatness and power grow up under a protective system of Customs duties; that the people of the United States would follow the example of the people of England, and that when their commercial prosperity and power became as great as that of England had been, perhaps they might adopt the system of free imports. You will always find an Imperial system of government disposed to levy taxation by means of Customs duties on imports, just for the same reasons as that which induced the framers of the Constitution of the United States of America to prescribe that system. You may, in the face of this Imperialistic movement throughout the world, call this retrogressive policy, or what you like; but it has become, none the less, but the more, a duty incumbent upon Her Majesty's Government to consider this matter most carefully and thoughtfully before they again commit themselves to the system of free imports in favour of all the world, by a renewal of this Treaty, under which they have Reciprocity from one State only—France. Apart from the question of commercial gain—whatever the House may think of the economical disadvantages of Customs duties—there is no doubt that taxation by Customs duties is the form of taxation most easily levied throughout a wide Empire—in the distant portions of a scattered Empire. That is a consideration which at once recommends it to the Minister of an Empire. I have heard great surprise expressed that Prince Bismarck has recommended a high Customs tariff for the German Empire. When I heard that that most estimable of Sovereigns, the Emperor of Germany, had been twice assailed, and at last wounded, I felt grieved. Have we not heard of Nihilism, and of the revolutionary and discontented spirit prevailing in Germany and in Russia? May it not have occurred to Prince Bismarck that, if he needed fresh taxation, it would be well if, by the form of taxation he should recommend, he might revive the filial feeling of the German people towards their Emperor, to whom they had looked up as to a father? Was it not wise on the part of Prince Bismarck to sacrifice some economical advantage, if by the establishment of a system of taxation that, without extreme pressure, would favour the feeling of filial devotion in the nation towards their Emperor as the Chief of a paternal Government, while it would furnish the means of cementing the Empire he had so successfully laboured to erect? I venture, then, to move the words that stand in my name; and I do so in the hope that the Government will take the same broad view that they took in 1787, and give the House an assurance that they will not imitate the Government of Lord Palmerston, and deny to us, and thus deny to the country, full opportunity of considering the provisions of any Treaty which, they may renew or propose. So that, before the House of Commons is asked, as it must be asked, to give its sanction to any new or renewed Commercial Treaty, we shall each and all of us be assured that we shall have time to consult our constituents. If any engagement is to be entered into between this country and Franco, I hope it will be with France alone, leaving this country at liberty to negotiate with the other Powers; not compromising our position towards the whole world through France, but negotiating with France, for herself only, so as to secure Reciprocity with France, whilst our hands shall remain free to seek Reciprocity from the other nations of the world. I hope that any future Commercial Treaty will be in the sense of Mr. Pitt's Treaty of 1787—that the Conservative Ministry of the present day will follow the example of that great Conservative statesman, by affording ample opportunity for consideration and inquiry, before they propose that this House should commit itself to any scheme they may have in hand.

Amendment proposed, To leave out from the word "That" to the end of the Question, in order to add the words "this House will not recognize or accept as "binding any Treaty or other engagements entered into by Her Majesty's Ministers which might forestall or limit the control of this House over the financial resources and taxation of this Country, until full information as to such contemplated engagements has been laid upon the Table of this House, and this House shall have had the opportunity of expressing an opinion thereon,"—(Mr. Newdegate,) —instead thereof.

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


said, that he had listened to the speech of the hon. Gentleman who had just sat down with much interest, as he had given them a new idea of the intention of protective duties, for it appeared that those duties were levied in Russia to protect the life of the Emperor. The hon. Member was enthusiastic in favour of his old scheme. He (Sir Wilfrid Lawson) had lately read in a newspaper that there were only three great statesmen now living who believed in Protection—namely, Prince Bismarck, Lord Bateman, and Mr. Mac Iver. But it was plain that a fourth might be added to these in the person of the hon. Member for North Warwickshire. Now, looking at his Amendment, he must say that it was well worthy the consideration of the House, though he might say that he was rather doubtful about the grammar—he thought it was bad, but it was good sense; and he was very glad that the hon. Member had had the courage, sitting on the Ministerial side of the House, to move an Amendment to the Budget of his own Chancellor of the Exchequer, because, although they had two nights' debate on the Amendment of the hon. Member for Burnley (Mr. Rylands), the subject had not been thoroughly thrashed out even on that occasion. He had himself intended to propose an Amendment at a subsequent stage of the Budget proceedings; but his noble Friend on the front Opposition Bench got up and asked him, as a matter of convenience, not to move it then, and he had acceded to his request, though at the time he thought he was rather pooh-poohed by his noble Friend. In fact, his Amendment was rather too good for the noble Lord. However, he thanked the hon. Gentleman opposite for giving him the present opportunity of expressing his views on the Budget. No policy could be carried out without involving more or less expenditure, and that was the meaning of the expression of the Prime Minister; but the expenditure depended upon policy. He presumed that the reason why his hon. Friend had brought forward this Amendment was because his hon. Friend felt as he felt—that on many important occasions the policy which the Government were going to adopt had been unduly kept back from the House. The House had been kept far too long in the dark concerning it. The hon. Gentleman, in his Amendment, advocated the desirability of not Recognizing or accepting as binding any Treaty or other engagements entered into by Her Majesty's Ministers which might forestall or limit the control of this House over the financial resources and taxation of this Country, until full information as to such contemplated engagements has been laid upon the Table of this House. Well, their opinion on the great lines of policy had been very often ignored and their power limited, but eventually they had the bill to pay. When anybody talked of late about the foreign policy of the Government, they were told—"It's no use talking about it; let bygones be bygones." If the policy of the Government were abandoned, there would be something in that advice; but they found that the Government intended to proceed on exactly the same line on which they had formerly proceeded. At a late Conservative dinner, Lord Salisbury said the Government, for the sake of peace, had given up a great deal, but they could give up no more. It was the foreign policy of the Government—a policy which they seemed resolved to persevere in—which entailed the enormous military expenditure, and that expenditure was the heaviest burthen of the enormous Revenue which had to be raised. He need not dwell upon the details of the Budget; it was a Budget which might be summed up in the sentence in which the moralist advised the young man—"Always live within your income, even if you have to borrow money to do it with." It was the old story—the Liberals came in and earned money; the Conservatives came in and spent it. The Liberals were the drudges of politics, who earned the money; the Conservatives were the Gentlemen who succeeded them, and spent it. ["Question."] Well, he thought the question was the Budget. ["No, no!"] When all this money had been borrowed to carry out the policy of the Government, he was rather surprised at the course taken by hon. Gentlemen opposite, who condemned the proposed remission of the Income Tax by the late Prime Minister in 1874. The First Lord of the Admiralty said we had not a ship or a man too many. He (Sir Wilfrid Lawson) thoroughly agreed with that statement. If they wore to carry out the policy the Government intended should be carried out, in his humble opinion, they had far too few men, because they were told that the Government were resolved to do its duty to the world. If this little Island were to do its duty to the world in the sense of the Government, three times the money asked for at present would be required for that purpose. He wished Ministers, who regarded it as their duty to be interfering in every part of Europe, would bear in mind the speech in which their Colleague, Lord Cranbrook, had asked what divine right this country had to go crusading in every part of the world? The present was not the right time to call upon the country to raise an enormous sum of money. There were, of course, two opinions about the depression now existing in the country. One was the opinion held on the other side of the House, that it arose from four bad harvests, one hard frost, and the failure of the City of Glasgow Bank. The other was the opinion prevalent on this side of the House, that, although those causes had something to do with it, the commercial depression had been greatly aggravated by the enormous expenditure which had been imposed, and by the feeling of insecurity which the foreign policy of the Government had created. ["Question."] He knew that hon. Members on the opposite side of the House did not wish him to go at any great length into this matter. He had heard right lion. Gentlemen on the front Ministerial Bench declare that theirs was a policy of Peace, Retrenchment, and Reform. He need not say more with respect to their policy of peace, than that they had already two wars in hand, and any number on the stocks. As to retrenchment, the country was now called upon to raise a larger Revenue than it had ever previously been required to furnish; and as to the reforms effected by the present Administration, the less said the better. He had said that England was engaged in two wars; but they had heard that night that one of those wars had been brought to a conclusion. [Cheers.] He heard the cheers of hon. Members on the opposite Benches who rejoiced that peace had been made; but he condemned the war in spite of the success that had attended it, for he could see nothing to be delighted at in the fortunate issue of a policy of triumphant wrong. What the cost of the war in Africa would be no one knew, and why was it carried on? He supposed it was to retrieve what was called the military situation. In other words, revenge, because they had been defeated in one battle. He altogether condemned the spending of money for such a purpose. He, therefore, gave his hearty support to the Amendment of the hon. Member for North Warwickshire, not because he thought that Commercial Treaties were the only Treaties which should be brought under the review of the House, but because that Amendment struck at the neglect of the opinion and sentiment of the House; and because he felt that if the views embodied in the Amendment were carried out, it would be more difficult in future to involve the country in those ruinous enterprises which had done so much to bring discredit upon them, and which, if not prevented in the future, would involve them in still greater disasters and distress.


said, it was much to be regretted that the hon. Baronet the Member for Carlisle should, in seconding the very important Amendment introduced by the hon. Member for North Warwickshire, have favoured the House with a speech that must have been prepared for some other occasion, and sought to divert attention from the real point at issue. What had the speech of the hon. Baronet, save a little at the commencement and conclusion, to do with the Customs and Inland Revenue Bill? The renewal or abandonment of our commercial relations with France, however, had a great deal to do with it. When the right hon. Gentleman the Member for Birmingham (Mr. John Bright) should depart this life, his epitaph might be—"Estimable in all relations of private life, he gave us sour claret cheap, and ruined the weavers of Coventry." [Murmurs.] The motto of the Cobden Club was—"Free Trade, Peace, Goodwill amongst Nations"—good intentions enough, no doubt; but they had all heard of the way that was paved with good intentions. Well, the word "reciprocity" was a very much abused word; but he ventured to think that even Mr. Cobden never meant that the people of this country should fight the battle of Free Trade single - handed against the world. Where, except in England, he asked, could they find any statesman who seriously advocated unqualified Free Trade? The good intentions of the Cobden Club were not sufficient; and he thought that, without Reciprocity in some form, true Free Trade could not exist. They must be permitted to sell as well as to buy. All barriers between one nation and another should be broken down, and there should be the most unrestricted interchange of commodities between the nations of the world. That was the kind of Free Trade which he wished to see, and he was not the only man in England who wished to see it. It was not Free Trade at all unless they could sell with advantage as they bought, and they were not so enabled under the Commercial Treaty with France; they were not so under their commercial relations generally with the rest of the world. Why did the French people meet us so hardly in the case of sugar, for instance? Was it not the belief that we in this country were steadfastly and firmly wedded at all hazard to the principles of Free Trade, and that we should never modify them? He asked that we should look at the circumstances of each case by themselves; that we should be Free Traders as far as it was practicable, but that we should be Protectionists where it was our interest to be so. That was something very different from advocating Free Trade at all hazards. He would only trespass for a very few moments more upon the attention of the House; but he wished to make one quotation which many hon. Gentlemen opposite might have seen or heard of for the first time. It was from a book called Smith's Wealth of NationsIt must sometimes be a matter of deliberation how far it is proper to continue the free importation of certain foreign goods, when some foreign nations restrain by high duties the importation of some of our manufactures in their country. This case naturally dictates retaliation, and that we should impose the like duties upon some or all of their manufactures coming into our country. Such was the opinion of Adam Smith, and he commended it to the study of hon. Gentlemen opposite. Reciprocity, in his (Mr. Mac Iver's) view, meant, as in any good dictionary it was defined to mean, "equal mutual rights or benefits to be yielded or enjoyed." Reciprocity involved the great principle of fair trade as well as Free Trade; that we should encourage the mutual interchange of commodities. The commercial relations existing between this country and France did not meet his idea of Free Trade. What did they get from, and what did they give to, France? From the Board of Trade Returns he found that they imported to the value of about £45,000,000 of goods of one kind or another from France, and that they sent to France in exchange £25,000,000, of which only £14,000,000 worth could be said to be manufactured goods, the residue consisting of raw material. M. Michel Chevalier well stated French policy on this subject, in writing to the Liver- pool Chamber of Commerce two years ago, when he said— We collect Customs duties to protect the manufacturing interest, and the surtaxe d'entrepôt was for the protection of the shipping interests of France, by making it impossible for foreifin nations to compete with her shippers for the convoying of a largo part of her imports. He was glad to see the right hon. Gentleman the Member for Bradford (Mr. W. E. Forster) in his place, because he wished to tell him that, as regarded our commercial relations with France, he knew nothing whatever about the most important points affecting the shipping interests of the country. He wished to explain to the right hon. Gentleman and to the House that the surtaxe d'entrepôt, no matter what the theory might be, was, owing to our geographical position, practically a differential duty against Great Britain. England was the only country from which foreign produce was likely to be re-exported to France, and this was a special tax of about 30 francs a-ton against such shipments. They hoard a great deal, but he must say chiefly for election purposes, about what the Opposition would like to do. Let him point out what they had done. The French Treaty was unquestionably very much their work. He charged against the right hon. Member for Birmingham and his Friends that in this Treaty they reduced the duties on the luxuries of the rich; but they did nothing whatever that could in any way benefit the working man in England. ["Oh!"] Was that not true? Would the right hon. Member for Birmingham contradict it? They had done some things, no doubt. They interfered with sugar refining in Great Britain, and the ruin followed, not only of the sugar refiners of England, but of the sugar-growing Colonies, on whom the policy re-acted. We were a nation of producers; the consumers were the drones; but lie knew, as a carrier, that he was now taking to French and Italian ports cotton which, under other circumstances, would come to this country. This showed that other nations wore now making for themselves what we used to make for them, and they were enabled to do this by their restrictive duties, which we could never induce them to abandon unless we had something to give them in return. The silks and woollens we got from France could, in many instances, be made better and just about as cheaply in England, very little, indeed, would turn the scale. The extra cost of home-made goods—½d. or ¾d. a-yard—would be an inappreciable tax on the consumer. Hon. Members did not know whether their coats were made in France or England. [Laughter.] The loss to the English manufacturer was real indeed. He was at a disadvantage as compared with the more extended range of customers of the French manufacturer, for he must find his only market at home—he was shut out of our own Colonies as well as France. This Commercial Treaty with France was a thoroughly bad bargain, and he desired to see a new one more advantageous to British interests. Let hon. Members remember that John Stuart Mill had written— A country cannot be expected to renounce the power of taxing foreigners, unless foreigners will in return practise towards itself the same forbearance. The only mode in which a country can save itself from being a loser by the revenue duties imposed by other countries on its commodities is to impose corresponding revenue duties on theirs. Hon. Members opposite could hardly get over that. The day was gone by when mere abuse would be considered a sufficient reply.


thought that the House would agree with him that the Chancellor of the Exchequer was very much to be congratulated that evening, as a diversion had been made in his favour. They had come down to hear the second reading of the Customs and Inland Revenue Bill, and they had had a discussion upon Free Trade. With regard to the arguments which had just been used, he was sure that the Chancellor of the Exchequer would be able to dispose of them in a very few sentences. His great object in rising was not to discuss the Protectionist measures of the hon. Member for North Warwickshire, or the remarkable speech of the hon. Member for Birkenhead (Mr. Mac Tver), but to make a few remarks upon the Customs and Inland Revenue Bill. The Chancellor of the Exchequer, on introducing the Bill, had stated that they should all feel that the demand this year upon the National Exchequer was unusually great. He thought it was generally agreed that the Chancellor of the Exchequer was asking for a very considerable sum of money. He was not about to find fault with the Government on the manner of defining payments which they proposed and to which he objected; but he thought that the policy which was being pursued cost the country a great deal of money, and would cause much further expenditure. It behoved them to look at what the state of the country really was at the present time, when they were indulging in a foreign policy which would require a large expenditure. If there was any trade or description of industry which required protection at the present moment, it must be agriculture. But would any hon. Member be bold enough to come down to the House to ask that corn and meat, or any of those articles the cheapness of which had done so much to vindicate the policy of the country, should have Protectionist duties placed upon them? And what was the state of the industries of the country? The manufacturing districts of the North, especially on the western side of the country, were at the present moment almost paralyzed. The iron and coal trades were in a very depressed condition. Whether they looked to the commercial, the agricultural, or the manufacturing interests of the country, they found them all in the same state. And when the Chancellor of the Exchequer came to the House and asked for an abnormal amount of taxation—5d. in the pound Income Tax—and no remission whatever of taxation, it became a very serious matter. The House might know by the state of the Poor Law Returns what the condition of the country must have been during the last two years. The figures of those Returns, showing the percentage of paupers, spoke for themselves; and in that state of things the Government ought to use every possible effort to stop the enormous expenditure going on abroad and at home. They had an extravagant war in South Africa, and it seemed to him that they had a Governor there who had violated every instruction sent to him, and who had acted in direct opposition to all the directions as to policy which he had received from the Home Government, and at that moment was plunging them into a war which was a disgrace to their Christianity and civilization. The war was condemned by Her Majesty's Government, and would cost them no less than from £5,000,000 to £10,000,000. Whilst things were in that state abroad, they might look for some check upon the expenditure at home. He had gone pretty carefully through the various items in the Estimates. There were various charges for education, for the police, and for grants which were made in aid of local taxation, and in almost every Department of the State the expenditure was increased. With regard to education, it seemed to him that the noble Lord the present President of the Board of Trade (Viscount Sandon) made a very considerable mistake in allowing the additional grants from the Government in aid of local taxation as regarded education. He would call the attention of the right hon. Gentleman the Chancellor of the Exchequer to a paragraph in the Report of last year, in which it was said that the demand for educational purposes from the Imperial resources would become still greater. By the Education Act they had again placed local hands in the Imperial pocket; and they had also done the same thing by giving an opportunity of borrowing for purposes neither national or Imperial. He believed that these facilities for obtaining money for education, for sanitary, and other purposes, was producing a very considerable waste. It was very easy to borrow; but it was very difficult to repay. He had not the slightest doubt in his own mind that if local taxation had been more resorted to for purely local purposes, they would have had the Imperial Exchequer not only left alone, but the local taxation considerably lower than at the present moment. He made these remarks because he felt that this country, if it were going again to be prosperous, must adopt the rules by which it had become prosperous, must practise economy at the present moment. Economy had to be exercised by all classes of the people, and ought also to be exercised by the Government, both in regard to their foreign and home policy. A reduction of expenditure seemed to him to be the only means of restoring that prosperity, the absence of which they so much deplored.


was not going to follow the discussion into all the questions that had been raised, for he did not think that the Customs and Inland Revenue Bill was necessarily con- nected with the last Commercial Treaty with France. He wished to make a few remarks upon a portion of this Bill—namely, its provisions with regard to Income Tax. The incidence of the Income Tax was, as the House knew, of a very harsh character; and he understood it was the desire of the Chancellor of the Exchequer to mitigate the hardship inflicted upon persona who were made collectors of Income Tax against their will. If his object in introducing the 23rd clause into the Bill were only to meet the objection raised by the hon. Member for Plymouth with regard to the forced collection of the tax, he would not move the rejection of the clause; but he should move a provision to except the City of London from its operation. There was another matter upon which he begged to give Notice that he should propose in Committee a clause which should require all the collectors of Income Tax and of Inhabited House Duty to give a statement to the taxpayer of the demands made upon him. He should propose that the statement should contain the assessed value of the property, its nature, and the rate at which it was charged. At the present moment the collector of local rates gave a most perfect statement, showing the nature of all the rates levied, and the value at which the property was taken. It was indefensible that a collector should be allowed to demand the Queen's taxes without furnishing a similar document. He would offer no objection to the second reading of the Bill, and trusted the Chancellor of the Exchequer would not object to the Proviso which he wished to introduce.


It may be convenient that I should now say something on the subject of the Resolution of my hon. Friend the Member for North Warwickshire; and I am sure that, if necessary, the House will afterwards listen to any observations which my right hon. Friend the Chancellor of the Exchequer may wish to make. There is one observation made by the hon. Gentleman with which I agree, and that is, if the House is really to take notice of the Commercial Treaties which are likely to be negotiated within the next few months or years, now is the time to speak out. The Government will be happy to hear, not only what Members of this House, but what persons versed in commercial mat- ters throughout the country, may have to say upon the subject. I think it would be well for the House to reflect upon the character of Commercial Treaties generally. If the House will allow me, I will state in a few words my own opinion with respect to them. There are two kinds of Commercial Treaties—one which contains the "most favoured nation clause," and the other, which is a general tariff Treaty. For many years past, foreign nations have made two kinds of tariffs—first, a general tariff, relating to all nations; and, secondly, a conventional tariff, which covers the importation of goods from countries with which they have Treaties or Conventions. Unless a nation has made a Treaty containing a "most favoured nation clauses" with those countries, it will be treated under the general tariff, and not the Convention tariff. Then, with regard to tariff Treaties, England has but one—the Treaty of 1860—of which Ave have heard so much to-night. That Treaty, as we all know, was passed in consequence of the desire shown by France, in 1860, to relax her Protectionist policy. But after that Treaty had been concluded with France, others were made with Holland, Belgium, and other nations, all framed on the model of the Anglo-French Treaty. The consequence which immediately followed was a general lowering of tariffs all over Europe. The advantage derived there from by this country was not merely the advantage it derived from the increase of its commercial intercourse with France, but the advantages derived also from these other Treaties with other nations, from all of which we received the most-favoured nation treatment. In measuring, then, the advantages which we obtained by the Treaty of 1860, we must not only consider the advantages we gained by the lowering of the tariffs in France, but we must also take into consideration the advantages derived by our export trade all over the Continent under most favoured nation Treaties which we have with all European Powers except Spain. I do not think it is necessary for me to expatiate on the advantages which this country gained by that Treaty, because a very few figures will show the enormous increase in our trade since 1860; and statistics will speak far more eloquently than I can do on this subject. I will take three periods—the year 1859, before the Treaty was negotiated, and the years 1866 and 1877, after it. The value of the goods exported from the United Kingdom to all parts of the world in 1859 was £130,000,000; in 1866 it was £188,000,000; and in 1877 it was £199,000,000. Next, taking the particular tariff countries—Belgium, France, Germany, Holland, and Italy, we exported to them, in 1859, £26,000,000; in 1866, £45,000,000; and in 1877, £47,000,000. Contrast that with the trade to the three non-Treaty countries—Russia, Spain, and Portugal. In 1859, our exports to them were £7,119,000; in 1866—five years after the Treaties with these other countries—it was £7,258,000, or very nearly stationary; and in 1877, £6,190,000. That shows the enormous difference between the Treaty and the non-Treaty countries. In the non-Treaty countries we have an almost stationary condition of trade; while in the tariff Treaty countries we have, as I have shown, a very large increase. Next, let me give a few figures of the imports into the United Kingdom. In 1858–9–60, the imports into the United Kingdom from France averaged, in round numbers, £16,000,000. For the three years—1875–7—they were £45,000,000, an increase of nearly 200per cent. The exports of domestic produce from this country to France in the years 1858–60 averaged about £5,000,000. In 1875–77 they averaged more than £15,000,000, an increase of 300 per cent. I think these figures are the best answer I can give with regard to the success of these Treaties. There can be no doubt that things are in a very unsatisfactory state in foreign countries, for it is quite clear that Protectionist theories are making progress in many nations. I cannot feel, for one moment, that that is any reason for retracing our steps; and, on the contrary, I believe that the great Free Trade theories are growing stronger and more powerful every day in this country. I do not know whether it is the result of universal suffrage or not; but I am rather inclined to think that universal suffrage does at first tend to Protection, and until the voice of the consumer makes itself heard, I think it is very likely we shall see a continuance of those theories. But what would be the position of England if the Treaty with France were to lapse? We should have to submit to about 20 per cent higher duties being imposed on our exports all round, for we should simply be put under the new general tariff, which, though it did not promise to be so objectionable as the existing one, would certainly be far less favourable to our traders than the existing Convention Treaty. There are other topics raised by the hon. Member, such as shipping, into which I need not go; but there can be no doubt of one thing—that Commercial Treaties do insure what commercial men, above all things, require, even above low duties, and that is certainty. Under the Treaties, commercial men are able to make their contracts and their orders in advance, which is what is to them absolutely necessary. I know, from interviews I have had with various gentlemen every day, that there are persons who are at this moment suffering from the present uncertainty about the French Commercial Treaty, because they do not know what the French tariff will be six months hence. As I have already said before, the negotiations with respect to the new Treaty are going on; but the French Government, as is very natural from its point of view, says that it is impossible for it to enter into any negotiations with regard to a special tariff until they have settled what their general tariff is to be. That general tariff is now before the Legislature; and I am afraid it will be some time before its discussion is concluded. The arrangement which they have offered—and which I certainly think we shall accept—is that the present Convention shall continue for six months after the promulgation of their general tariff. That is the arrangement which has been proposed to us, and which we shall probably concur in. When the arrangements for the general tariff are concluded, we shall thus have six months after that for negotiation; and I do not think that these legislative changes in France will take place very rapidly, so that this country will have plenty of time to look round. With regard to two or three observations which were made by the hon. Member for North Warwickshire (Mr. Newdegate), I would say, in the first place, that it is no duty of mine here to-night to defend the exact procedure followed in the Treaty of 1860. It may very well be that it would have been better to have given a longer time before all the Budget arrangements were made. But, then, that Treaty was made by Mr. Cobden taking advantage of the particular disposition of the Emperor of France just at that time, and he was anxious to get the Treaty concluded as speedily as possible. Considering the enormous amount of detail gone through, I do not think the negotiations took a very long time. Perhaps it would have been better to have proceeded by Resolution, as was done in the case of Mr. Pitt's Treaty of 1787, and that, undoubtedly, would have given the House a greater opportunity of discussing the details. But that is not a matter before us now. There is no reason why the House should ever abandon the functions it possesses of considering Commercial Treaties; but that, again, is a very different thing from binding the House in the way proposed by this Resolution. Parliament, in fact, has already practically full control whenever any Customs duty is proposed to be altered, so that in all tariff Treaties the House has full control. Considering what the Forms of this House are, I do not think it is ever very likely that any Commercial Treaty would be carried without the House having many opportunities of giving an opinion on the subject generally.


The House had the figures before them in that very Treaty.


No doubt; and, certainly, in 1860, there were many divisions, both in this House and, I think, in the House of Lords. Certainly, there were many long debates in both Houses. I can quite understand that it is possible that a Treaty can be made which it would not be formally necessary to bring before this House; but I do not think there is any danger of that occurring in a way to preclude Parliament from giving its opinion. Another objection to my hon. Friend's Resolution is that it would be perfectly impossible for this House to negotiate the details of any Treaty. Anybody who knows what it is to negotiate a Treaty, even on one particular article, knows what it is, and how awkward, how perfectly impossible, it is for this House to negotiate any one particular portion. Much less, of course, could that be possible in regard to the whole tariff. It is, of course, all very well to lay down the rule that you can make a better Treaty here in this House than you can by negotiations outside.


I expressly guarded myself against that assumption. I especially said that that was not our function.


I am very glad to be corrected by my hon. Friend. It is not what we think a good Treaty that has to be aimed at. You have to aim at something which both sides will think a good Treaty, and to attain that there must be give and take. This House cannot, in fact, enter into all the intricacies of these negotiations; and if it did, it would strike a deep blow at Ministerial responsibility. That is a principle which we should strive at every point to maintain. But this Motion takes it away from Ministers, both in regard to negotiating a Treaty, and in regard to the way in which it is to be carried out. Under these circumstances, I am afraid Her Majesty's Government cannot agree with this Resolution. At the same time, I agree most thoroughly with my hon. Friend that this question is very well worth consideration; and now that new Treaties are likely to be made with foreign Powers, I think the more that this question is considered, in and out of the House, the better.


confessed that he did not quite understand the answer which the hon. Gentleman the Under Secretary of State for Foreign Affairs had given him; for he had certainly never said that it was the function of the House of Commons to negotiate a Treaty. As the existing state of the negotiations, it appeared, from what the hon. Gentleman said, were in suspense, until the tariff of France had been formulated, it was, therefore, perfectly in vain to ask for further information. With the permission of the House, he would for the present withdraw his Motion, upon the understanding that any Treaty that might be negotiated would be submitted to the House in accordance with Constitutional precedent.

Motion, by leave, withdrawn.

Main Question put, and agreed to.

Bill read a second time, and committed for To-morrow, at Two of the clock.