HC Deb 11 March 1880 vol 251 cc815-46

WAYS AND MEANS—considered in Committee.

(In the Committee.)


Mr. Raikes, I am very sensible of the great inconvenience which attends the bringing forward of the Financial Statement before the close of the financial year. It is necessary to complete the Estimates for the year that is expiring by a certain amount of conjecture; and my experience of Budgets has taught me that the last week or two of the financial year are frequently productive of modifications, and sometimes important modifications, in the statements which appeared likely to have been made two or three weeks beforehand. I must, therefore, in the statement I have now to make to the Committee, apologize beforehand for any errors that may eventually prove to be made in the statement; but I can assure the Committee that I have myself taken pains, and the Heads of Departments who are more specially concerned in the framing of the Estimates have taken very great pains, to make the Estimates as cautious and as little likely to mislead the House by too sanguine anticipations as it is possible for them to do. Now, Sir, in the Budget which I brought forward last year I estimated for a Revenue in 1879–80 of £83,055,000, and an Expenditure of £81,153,000, showing a surplus of £ 1,900,000, leaving out of the account the charge which we knew would have ultimately to be made on account of services in South Africa. Later in the year, when we had obtained some fuller information with regard to the progress of affairs in South Africa, I took a Vote of Credit for the sum of £3,000,000, which, with some small additions for other purposes, raised the Estimate of Expenditure to £84,216,000. Thus I loft an estimated deficit of £1,161,000. Well, Sir, I am sorry to say that the Estimate I then formed, of Revenue has been very largely disappointed. The Revenue was estimated at £83,055,000; but we can only take it as likely to yield some £80,860,000, showing a loss of £2,195,000 upon the Estimate of Revenue. As I had already estimated for a deficit of £1,161,000, that leaves a deficit of £3,356,000 upon these Estimates. That is assuming, of course, that the Expenditure would be what I reckoned it in the month of August last. I will abstain for a moment from entering into the particulars of the disappointment in the Revenue. I wish, first of all, to say a few words more on the subject of the Expenditure. Now, Sir, at the first blush, undoubtedly, the appearance of the Supplementary Estimates that have been presented in the course of the year is somewhat discouraging. We have had Supplementary Estimates presented this Session to the amount of £1,783,000, and if these Estimates represented a real addition to our Expenditure of that amount it is clear that the deficit would stand at something more than £5,000,000—that is to say, that is the amount at which it would stand if we had really spent all the money Parliament has empowered us to spend. However, it is a consolation to think that we have not spent all that money. Hon. Gentlemen are naturally, and very properly, sensitive upon the subject of Supplementary Estimates; but, at the same time, I must remind the Committee that Supplementary Estimates are the price that we pay for a scientific financial system. In olden times there was a much more rough and ready way of making Estimates and taking Votes than at the present time. You took Votes for certain Services, and if those Votes were not exhausted in one year the balance was carried on to another year; and, therefore, there was not any occasion for Supplementary Estimates as there is at present. We are now very precise; money is voted for one item in the Service, and it cannot be transferred to another; and, of course, it is always necessary to take your Estimates at a moderate rate, otherwise there would be a general tendency to extravagance. The consequence is that Supplementary Estimates area matter of necessity; but, on the other hand, they are commonly balanced by the savings on other Votes. The Supplementary Estimates of this Session are of two classes. There are those which belong to the ordinary Services of the year, which amount to £557,800, which have been entirely covered, and more than covered, by the saving on other Votes; and, secondly, there are those which belong to the expenditure on the South African Services, which the previous Committee has just voted, and which amounts to £1,225,200. Now, it is with regard to that second Estimate that I wish to engage the attention of the Committee for a few minutes. We have every reason now to hope and believe not only that we have seen the last of our troubles in South Africa, but that we have arrived at a correct knowledge of their cost. Reference was made a few minutes ago to the length of time which occurred in obtaining correct information as to the expenditure of the Abyssinian Expedition; and I know that gloomy parallels have been drawn between the expenditure in connection with that expedition and the probable expenditure upon the South African Services. But the cases are really not at all parallel. In the case of Abyssinia, the war services were conducted by the Indian Government, and the charges were made up by the Indian Government and sent home to the Imperial Government to be paid; and we know, unhappily, that that is a process which always involves a very considerable loss of time. On the present occasion, everything has been paid through our own officers; and not only so, but, as the Committee is aware, last Session we took the precaution of despatching three officers of the Government—Mr. White, the Accountant General to the War Office; Mr. Gurdon, one of the principal officers of the Treasury; and Mr. Lawson, of the War Office—for the purpose of inquiring on the spot into the expenditure which had taken place, and apportioning it properly under different heads. Well, these three gentlemen have completed their task; and I must say they have completed it in a manner which reflects the very highest credit upon them. They are gentlemen whose names are well known to Members of this House, and they have fully maintained the high reputation they had previously achieved in the Civil Service. They have produced a very interesting Report, which I propose shortly to lay upon the Table. In the meantime, through their exertions, and by the information we have collected in our hands, we are able to give with, I think, an accuracy that may be depended upon, the total cost of the Zulu War and other Services in South Africa. Now, the cost of the Zulu War to the Imperial Government, from first to last, has been £5,138,000. I believe that almost the whole of the cost has really been defrayed, so far, by the Imperial Government. There have been some charges which have been borne by the Colonial Governments. But at present the great bulk has fallen upon the Imperial Government; and the question how we are to regulate the repayment, which, no doubt, the Colonies ought to make of a certain proportion of that Expenditure, is a somewhat intricate matter, and one in which we are engaged in a correspondence that is not yet completed. But I will state the amount which has been paid for the Zulu War, independent of the other Services—the expedition against Secocoeni and the occupation of the Transvaal. The amount was £5,138,000, of which £4,396,000 belonged to the Army, £692,000 to the Navy, and £50,000 to contingencies. How has provision been made for that purpose? It has been partly made in the ordinary Army and Navy Estimates of 1878–79 and 1879–80, but chiefly by the two great Votes of Credit taken in these two years—one for £1,500,000, and the second for £3,000,000. Well, now, hon. Gentlemen will observe that Votes of Credit are in the nature of Supplementary Votes, to make up a deficiency in the ordinary Votes for the Army and Navy; and when any expenditure, or war, or special service has to be paid for, and a Vote of Credit is asked for, the charge, in the first instance, falls, not upon the Vote of Credit, but upon the Army and Navy Votes, as far as they will go. It is only when they have been exhausted that recourse is had to the Vote of Credit. In this case, the ordinary Army Votes have borne £623,000 of that expenditure, and the Navy Votes £192,000 in the two years, so that £815,000 have been provided out of the ordinary Votes; and the expenditure out of the Vote of Credit has been £4,323,000. That, of course, has not exhausted the Vote of Credit; and the result is that the amount which Parliament has already provided for the Zulu War has paid the whole of the expenses of that War, and leaves a balance of £177,000 more than was necessary. That, I think, is a very satisfactory statement, because there has been great uneasiness as to the total cost which the War would impose upon the country. There has been great alarm lest a large addition should be asked for to complete the Expenditure, and it is certainly gratifying to find that we have already provided and already voted all, and more than all, that is necessary. Well, Sir, the Committee will naturally ask, if that is so, what is the meaning of the large Supplementary Estimates which we have just been asked to vote? With regard to the greater portion of that Vote, it is not a new Vote at all; but it is simply a re-Vote of £880,000 which was voted in the year 1878–9, but which could not be applied in that year from want of time. That, again, is one of the results of our scientific financial system, because, if a Vote of Credit is granted now, it is not granted as it was in olden times—to be used until it is exhausted; but it can only be made use of until the end of the financial year—the 31st of March. And although there was a great deal of Expenditure incurred in that year—1878–9—to which this was probably applicable, it could not be brought to the charge of the year, and it had to be surrendered and re-voted. With regard to the remainder of the sum, it is explained in this way—The disturbances in Griqualand West arose, not, perhaps, as the direct consequence, but probably as a consequence, of the hostilities in Zululand. Lord Chelmsford was unable, at the time, to spare any troops to suppress the rising that took place in Griqualand, and Colonel Lanyon, the Administrator, was obliged to take steps at once to put down the rising by the aid of Colonial levies; and in order to do that he was forced to apply to the Treasury Chest for an advance of more than £220,000. That sum was advanced; and we understand from Mr. White and Mr. Gurdon, who have reported on the subject, that no doubt the whole of that expenditure, and more than the whole of it, was incurred by the Colony, and the Colony could not at the moment have provided the money in any other way. The question as to how the repayment is to be made is one of the principal points we are at present engaged in discussing with the Colonial Government. Well, then, in addition to that came the Expenditure of the expedition against Secocoeni; but that is a matter on which we have not yet had as complete information as we have on other points, because the expedition had hardly come to an end at the time these gentlemen left South Africa. There is, therefore, something of guess-work in the Estimate, and some allowance must be made for the troops which have been kept in the Transvaal. I think we are taking a full Estimate—in fact, rather more than is necessary—in putting that sum at £300,000. I do not wish to delay the Committee by going into these details more than I can help, and I will state the general result of all these figures. It comes to this—that the total amount of the Supplementary Estimates of this year has been £1,783,000; but the total amount of savings is calculated at £1,800,000, so that the savings have more than covered the Supplementary Estimates. The result, therefore, although it is bad enough, is not so bad as at first sight might be thought. The result is that there is a deficit of £3,345,000 upon balance of Revenue and Expenditure for the year just closing; and this is due, not to any failure or incorrectness in our Estimates of Expenditure, but, with the exception of £ 1,160,000 included in the arrangements of last year, to the disappointment of Revenue to the extent of over£2,000,000. The details of that disappointment are as follows:—Customs are estimated to show a decrease of £700,000 below the Estimate. This loss arises almost entirely on spirits; £670,000 represents the falling-off on that head. There is also a small falling-off of £25,000 upon wine. Excise will probably show a decrease of £1,960,000, made up of £160,000 on licences, £940,000 on malt, £60,000 on railways, and about£800,000 upon spirits, so that the total failure in spirits during the year from the two great branches of Revenue, Customs and Excise, amounts very nearly to £1,500,000—£800,000 and £670,000. Of course, so far as the decline in the consumption of spirits is concerned, we must attribute it mainly, I suppose, to the failure of consuming power amongst the working classes and others who are in the habit of consuming spirits; but it is to be hoped that, to some extent, it may be an indication of an improvement in the habits of the people, and a movement in the direction of temperance. It is, at least, satisfactory to notice that, while the consumption of spirits has fallen off so largely, the consumption of tea and coffee and other articles, though it has not increased, has not fallen off at all. There is a large falling-off upon malt—£940,000. That, to some extent, I suppose, may be explained in the same way by the diminution of the consuming power of those classes who drink beer; but, on the other hand, it is also partly to be attributed to the very great failure and the great lateness of the barley harvest of last year; and I presume that this failure in malt is, therefore, to be looked upon, to some extent at all events, as one of an exceptional character. With regard to the other heads of Revenue, there is an increase in the probate stamps and legacies of £460,000. There is a slight falling-off in deed stamps and others; but latterly these have improved. Customs are £700,000 less than the Estimate, and Excise £1,970,000 less; stamps are £320,000 more; Income Tax, £50,000 less; the Post Office is £50,000 more, and the Telegraph Service £80,000 more; Crown Lands are the same as the Estimate; Interest on Advances is £75,000 more, and the Miscellaneous Services are taken at the sum that they were estimated at. With regard to the Income Tax, I may state that the assessments are fully up to the amount that was anticipated; but in consequence of this being one of the triennial years of the new assessment there has been some delay in the collection of the tax, and therefore there will be for the year, probably, a falling-off of about £50,000. Let me now turn to the Estimate for the Expenditure of the year which we are about to enter upon. The estimated Expenditure for 1880–1 is as follows:—We take the permanent charge of the Debt at £28,000,000; the interest on Local Loans at £500,000; Loan to India, £61,478; charge of the Suez Loan, £200,000; interest on Supply Exchequer Bonds, £284,000; other Consolidated Fund Charges, £1,712,000, making for Debt and Consolidated Fund Charges £30,757,478, or about £388,000 more than the issues in the current year. The charge for the Army is £15,541,000. The Exchequer issues in the year now closing are taken at £15,645,000, showing a decrease in the coming year of £104,000. The Home Charges for the Forces in India are £1,100,000, being nearly the same sum they were estimated at for the closing year. The Navy is £10,492,000, against the Estimate of the current year of £10,586,000, showing that upon the Navy the Estimate is £94,000 less than that for the closing year. The Vote of Credit for the South African War does not re-appear. The Civil Service Expenditure is £15,436,000; the Budget Estimate last year was £l5,084,000, showing an increase of £352,000. Customs and Inland Revenue are £2,816,000. Post Office, £3,420,000; Telegraph Service, £1,210,000; and Packet Service, £710,468. That makes the charge for Expenditure £81,486,000, as against £81,153,000, which was the Budget Estimate last year. This shows an excess of £333,000 upon the Estimates for this year. Well, then, Sir, we have to consider what is the Revenue that we shall have to meet that Expenditure. In taking the Estimates for the Revenue, I have, as I have already stated to the Committee, endeavoured to impress upon the heads of the great Offices to be as careful and as moderate as possible in the Estimates that they might frame; and they have, I think, fulfilled their duty in a spirit of very great caution and moderation. The Customs, which will produce £19,300,000 in the present year, are taken at the same amount for next year—namely, £19,300,000. The Excise, which will this year produce £25,300,000, is taken for the next year at £26,140,000. That shows an increase upon the Estimate for the Excise of £840,000. That, of course, is taken on the assumption that we shall receive the ordinary amount of Malt Revenue, or something nearer the ordinary amount of Malt Revenue, than that of last year, which fell about £900,000 below the usual amount. The average of seven years shows a lower figure than that which we have taken. But this sum has been arrived at after very great care has been taken, and it is certainly adopted with confidence by the Board of Inland Revenue. Then, for Stamps, the Exchequer receipts for this year are taken at £11,100,000, and the Estimate for next year is put at the same amount. If, however, we are fortunate enough to see a continuation of the present improvement in trade and business, we may hope for an increase in the Revenue from Stamps, though we have not calculated on any increase in receipts from this source, but have taken the figures at the same amount as this year. With regard to the Land Tax and House Duty, it will be this year £2,700,000, and for next year we take them at £2,760,000, making an increase of £60,000. The Income Tax is expected to yield this year £9,200,000, and the Estimate for next year is £9,000,000, or a smaller sum by £200,000. This is a cautious Estimate which it is thought wise to take in consideration of the depression which has existed so long, and the fact that as the Income Tax is taken on an average of three years it will probably make a bad return for next year. The Post Office Revenue for this year will be £6,300,000, and we estimate it for next year at £6,400,000, making an increase of £100,000. The Telegraph Service will yield this year £1,420,000, and we take it at the same for next year. The Crown Lands yield this year £390,000, and that item is taken at the same figure for next year. The interest for advances on Local Works and on Purchase Money of the Suez Canal Shares is £1,250,000, which I take also at the same amount for next year. There are also Miscellaneous Receipts, which are £3,900,000, and which I take for the ensuing year at £3,800,000, or £100,000 less. The total result is that as against the income of the present year of £80,860,000 we estimate for the year to come an income of £81,560,000, showing an advance of £700,000 on the whole estimated Revenue of this year, as compared with the Revenue of last year. That Estimate is, as I have said, a very cautious and practical one. It amounts to a Revenue of £81,560,000, as against an Expenditure of £81,486,000, showing a surplus of £74,000, or what we may call, practically, an equilibrium between Revenue and Expenditure. So far for the Revenue, as we have it at present; but I must remind the Committee that there is a Bill before the House, which, although not introduced as part of the Budget arrangement itself, of course forms a material feature, if it is passed, in the finances of the year. I mean the Probate and Administration Duties Bill. I understand, Mr. Raikes, that some remarks have been made upon the fact that that Bill has been introduced separately and independently of the Budget. Undoubtedly, if at the time when I contemplated it I had foreseen that I should bring in the Budget quite so early, it might have been better to put the two together. But it was important that if that Bill was passed it should be passed before the close of the present financial year, so as to produce its full effect in another year, and it will be in the recollection of the Committee that that Bill was introduced not primarily with a financial object, but primarily on account of a Resolution which was carried, or rather which was accepted, nearly unanimously in the House last Session with regard to the scale of charges for probate and administration duties. What I should now propose to do with regard to that Bill would be to read it a second time concurrently with the Budget Bill, and then, when they come to Committee, that there should be an instruction given to amalgamate the two Bills in one, so that the practice, and the very proper practice, of this House of having all its financial arrangements in one Bill, and sending them up to the other House in that form, may be observed. It has not always been observed, for there was a case in 1870, when the stamp duties were consolidated and raised, and when that was done by a separate Bill, affecting the Revenue to a considerable sum; but I quite admit that it would be a proper thing to put the two Bills together when we go into Committee. The effect of that measure will be naturally to increase the Revenue by at least £700,000, and adding that amount to the £74,000 which I have found to be the surplus upon my Estimate for the coming financial year the total may be taken at £774,000. There, of course, remains one very important question into which I must go rather in detail. Before I do so, however, I wish to mention a matter in passing, and to allude to a small alteration of the law which it is proposed to introduce into this Bill upon a matter which has caused some little interest. A great many questions have been raised with regard to the co-operative stores, and great complaints have been made by some persons that the stores are unfairly excepted from the Income Tax. Of course, whatever our opinions may be upon that general subject, it is wrong that that advantage should be given to the stores. The matter has been inquired into, and it is found at the Inland Revenue that the state of the case is something of this kind. Of the great co-operative stores one only, the Civil Service Supply Association, has escaped the payment of Income Tax. It has done that by enrolling itself as an industrial and provident society. Believing that the exemption granted to industrial and provident societies was never intended to apply to a wealthy corporation like this, the Board of Inland Revenue have considered how best to repeal the exemption enjoyed by the stores in question, without injuring those bonâ fide industrial societies whom it was intended by Parliament to exempt. The Chairman of the Board of Inland Revenue has consulted the Registrar of Friendly Societies and other gentlemen, who are well acquainted with the working of co-operative societies; and they have agreed upon a clause which, it is understood, will accomplish the object that is desired, without doing any injury to the industrial and provident societies. This clause will be inserted in the Budget Bill, and it is as follows:— Notwithstanding the provision contained in Sub-section 4 of Section 11 of the Industrial and Provident Societies Act, 1876, a society registered under that Act shall be chargeable under Schedule C and Schedule D of the Income Tax Acts in case the society sells to persons who are not members thereof, and the number of the shares of the society is limited either by its rules or practice. I do not profess to be an authority on the subject of co-operative societies; but I have high authority for stating that that clause will effect the object desired without interfering with the proper exemption of industrial societies. Now, Sir, there remains only one matter with which I have to deal—a matter which, of course, has in it much interest for the country. I have given the result of last year's finance, and shown that a large deficit has to be met. I have also shown what will be the Estimates of the Revenue and Expenditure for the coming year, and that there will be a surplus of nearly £800,000. We have now to consider what ought to be done with regard to the deficit of last year, and in connection therewith the accumulated deficits of former years which have thus far been represented by Exchequer Bonds renewed from year to year. These are those which we distinguish from the other portion of the Unfunded Debt by the title of Supply Exchequer Bonds. The Committee will see that, as we have gone on with various obligations, we have adopted a good many headings. "Interest for Bonds for Suez Canal Shares," "Interest for Bonds for Local Loans," and so forth; while those which have been created for the purpose of meeting the extraordinary Expenditure of the last year or two go by the name of Supply Exchequer Bonds. Supposing that the Bonds which are now just falling due are renewed, and supposing that the deficit of the year 1879–80 is to be met by the issue of more Exchequer Bonds, we find that that will amount to a sum which will require an interest of £284,000, the capital being something over £8,000,000. Now, before I proceed to say how we are to deal with this amount, I should like to say a few words with regard to the position of the Debt of the present year. In the first place, comparing the state of the Debt, as it will be on the 21st of this month with what it was at the beginning of the year, it is estimated that on the 31st of March the Funded Debt will amount to £710,490,000 Stock. The estimated value of the Terminable Annuities, commuted on the old principle and not upon that of my right hon. Friend the Member for the City of London (Mr. Hubbard), which may be more accurate, but which we could not introduce without disturbing comparisons with past years, is £38,206,000. The Unfunded Debt is £30,855,000, making a total of Funded and Unfunded Debt £779,551,000. The Funded Debt, of course, includes £2,049,000 of Stock created for the purpose of the loan of £2,000,000 to India. Comparing these figures with those for 31st March, 1879, I find that there is an increase in the Funded Debt of £1,059,000, and in the Unfunded £4,985,000, giving a total increase of £6,044,000; while Terminable Annuities show a decrease of £4,572,000, or, in other words, a net increase on the whole of £1,472,000. But this increase must be analyzed. In the first place, the debt caused by the war, which is not recoverable, will amount to £2,750,000. Then there is the loan to India of £2,049,000; the monies borrowed in the year for Local Works £2,300,000, making £4,349,000 of Debt which will be repaid; and making again a total of £7,099,000increase, against £1,055,000, which has been paid off by other means, leaving the net increase of £6,044,000. But after the re-payable Debt is deducted, as I think it ought to be, to get at the real increase in the Debt, we come to a very different result. By re-payable Debt I mean money that has been advanced upon the security of the different Local Bodies to whom it is lent; secondly, money borrowed for the purpose of paying the interest on the Suez Canal Shares, against which we receive a payment from the Khedive of Egypt; and, thirdly, there is the sum of £2,000,000, which has been borrowed for the purpose of being lent to, and being repaid by, India. Taking these amounts into account, then, we should find that the Funded Debt stands at £708,441,000, the Terminable Annuities at £32,206,000, and the Unfunded Debt at £18,555,000, making a total of £775,202,000, and showing a diminution since the 31st March, 1879, in spite of war expenses, of £2,877,000. Now, that is a statement which ought to be borne in mind by the House, because the incurring of Debt re-payable is not an increase of Debt in the ordinary sense; and next, because the House must remember that some portion of the increase which we have been obliged to make has been due, not to action of our own, but to measures undertaken by our Predecessors. [Mr. GLADSTONE: What is the diminution in Terminable Annuities?] The diminution in Terminable Annuities is £4,572,000. I may point out next that since the present Government came in in 1874 the movement of Debt has been as follows. The Funded Debt has decreased from £723,514,000 to £710,490,000, being a decrease of £13,024,000. The Terminable Annuities have decreased from £51,290,000 to £38,206,000, or a decrease of £13,084,000, making upon these two heads a total decrease of £26,108,000. On the other hand, Unfunded Debt has increased from £4,479,000 to £30,855,000, showing an increase of £26,376,000; so that upon the balance of Funded and Unfunded Debt, and including re-payable Debt with the non-payable, there is a total increase in Debt of £268,000. Of course, as I have said before, if you deduct the re-payable Debt, the result is very different. Now, during this period there have been heavy war expenses. We reckon the cost of the preparations in connection with the War in Turkey at £6,125,000. I have said that the cost of the War and the other Service in South Africa was £6,160,000, making a total for these two Services of £12,285,000. Of this we meet £8,100,000 by Bonds. I need not point out that these have been paid yearly, and that if our Estimates of Revenue had been more closely accurate and successful than they have been, the deficiency would be very much smaller than it actually is. I would also point out that in reckoning this amount of £8,100,000 we are reckoning without taking into account what we may recover—and we undoubtedly shall recover some substantial amount from the Colonies. ["Oh!" and laughter.] Well, but there is no doubt about it. There can be no doubt that, to a certain extent, the Colonies acknowledge their liability, though whether they take the same measure of it that we do is another matter. I leave that part of the question aside for the present, because I think I should be rather prejudicing the matter by going into details at present, further than to express what I am sure is the sense of the whole of the country—that in these matters the interests of the Colonies have been of such a character that it is right and proper that they should bear a fair proportion of the costs. That being so, I also wish to point out to the Committee that in the Estimates we have from time to time submitted to Parliament with regard to the expenses of these operations we have not been so very much beside the mark. In the first instance, when we took the Vote of Credit at the time when it was thought necessary to make preparations, we named £6,000,000 as the possible cost, and the result was that the expenditure which we incurred was £6,125,000. Then, with regard to another war, that on the Eastern Frontier at the Cape, we reckoned it at £600,000, and the result shows that the cost of it amounted to £500,000. We asked last year and the year before for £4,500,000 for the Zulu War, in addition to the sum provided out of the ordinary grants; and, as I showed a little while ago, our demand was fully adequate, and more than adequate, to meet the expenditure, and sufficient even to provide for other Services which were not then contemplated. That being so, I think that the forecasts that have been made by men of experience in these matters have not been altogether unsatisfactory.

With regard to the question of the Public Debt, I say, if we were to exclude from the Debt that portion of it which is re-payable, the net result of our six years of office would not be the same as it appears to be on the figures I have named. According to that, the Funded Debt, which stood at £723,514,000 on 31st March, 1874, would have been reduced to £708,441,000; because, in reckoning it at £710,490,000, I included the £2,000,000 that had been lent to India. The Terminable Annuities would be diminished by £13,084,000, while the Unfunded Debt for Supply Services would only be £7,815,000 more than it was then. That would show a net decrease, during these six years, of £20,342,000, excluding the £2,000,000 for India, and the Debt incurred for the purchase of the Suez Canal Shares, and also for the purpose of providing funds to be advanced on loan to local authorities. Hon. Members are very well aware that there is a great deal of anxiety expressed, and I dare say felt, in some portions of the country with regard to the size of what I may call the Floating Debt. Of course, it is unsatisfactory that we should owe any money at all upon the Services of the last two or three years, and it would have been much more satisfactory if we had been able to clear that all off out of Revenue. But if we are to owe it at all, there seems to be, in some minds, an additional evil in the idea that it is in the shape of a Floating Debt. On the other hand, an impression seems to prevail that this is a very dangerous thing, which might, at any unexpected moment, produce very disastrous consequences. Undoubtedly, if you have a very large Floating Debt all in the hands of the public, which can be thrown upon you in a moment without warning, that would produce, in certain contingencies, inconveniences. But that is by no means the case with regard to the Floating or Unfunded Debt which now exists. It is made up, in the first place, of £5,163,000 Exchequer Bills, £5,431,000 Treasury Bills, £3,801,000 Suez Canal Bonds, £8,360,000 Local Loan Bonds, and £8,100,000 Supply Bonds, making a total of £30,855,000. Now, the greater part of this is not in the hands of the public. The amounts which are in the hands of the public are, in the first place, the Exchequer Bills—£5,163,000, and the Treasury Bills—£5,431,000. These are not very extravagant amounts to have on the market. There is no doubt that it is very convenient to the money world to have this form of investment; and certainly we find that the Treasury Bills, as offered month by month, are very much inquired after, are always sold with great readiness, and command very good prices. They are so arranged that about £1,500,000 are offered every month; and if, by any strange accident, we were unable to sell them at any particular month, there would be no difficulty in providing the sum which might be required. With regard to the great bulk of the rest of the Floating Debt, it is not in the hands of the public, but of the National Debt Commissioners, and £4,000,000 of it is at the Bank of England. This, of course, we may say, is in the hands of the public; because at any time that amount might be sold or invested; but with regard to the great mass of the Unfunded Debt, it is, to the extent of some £15,000,000 or £16,000,000, in the hands of the National Debt Commissioners. They are bound to find an investment for the very large amount of Savings Bank money which they hold, amounting to about £70,000,000. Amongst other things, they invest in these Exchequer Bonds; and there is no fear whatever that the National Debt Commissioners will throw these Bonds upon the public at a time that would be publicly inconvenient. They would never attempt to do so at ordinary times, because the fund of the Savings Banks is of such a character as to render it unnecessary to sell large amounts of Stock; and I apprehend if any unprecedented run were to take place on the part of the depositors, making it necessary for the National Debt Commissioners to provide very large sums, recourse must be had to Parliament, even though the deposits were invested in Consols alone. We know perfectly well it has always been the practice of all Governments to allow considerable sums to be invested by the National Debt Commissioners in Terminable Annuities with the Irish Church Commissioners, or, as now, in Exchequer Bonds. Therefore, I am anxious to impress this upon the Committee, in order through the Committee to impress upon the public that we are not in the least degree anxious with regard to the existence of this amount of Floating Debt; and I say that all the more because I am ready, on the other hand, to admit that it is not desirable that so large an amount should be kept in the form in which it now exists. I admit that it is not convenient, with regard to the regularity of our financial transactions, that we should have a large amount of Exchequer Bonds falling due year by year, and annually renewed. I think that that is open to objection, and I am going to make a proposition to the Committee, in order to institute a more regular way of dealing with the considerable amount of debt arising out of the recent war expenditure. I do not propose to deal with the whole £8,000,000. I think with regard to some portions of it that it would be better that we should renew our Exchequer Bonds for a short time, and that we should look to extinguish them by the ordinary processes of finance. I propose to take a sum of £6,000,000—three-fourths of the amount—and to provide for its immediate extinction by the creation of a Terminable Annuity, to last until the year 1885. The year 1885, as the Committee are aware, is the year long looked forward to when there will be a very great alteration indeed occasioned by the termination of the Annuities. I think it has always been desired since that date was first fixed upon by successive Chancellors of the Exchequer, when they have been creating Terminable Annuities, to bring them, as far as possible, to terminate at the same date, and I propose to set up a fresh series of Terminable Annuities which, shall last till 1885, and shall extinguish this £6,000,000 of Debt. I wish to remind the Committee that, under the pre- sent arrangement with regard to the Debt, a fixed sum of £28,000,000 is applied year by year to pay the interest of the Debt, and to go as far as it will towards the termination of that Debt. The difference between the amount that is required to pay the interest of the Debt and the £28,000,000 goes by the name of the New Sinking Fund, and that amounts at present to something more than £600,000. It is, in fact, something like £650,000 this year. An annuity of about £1,300,000 a-year, or rather more, will be sufficient for the purpose of cancelling this £6,000,000 of Debt by the year 1885. Of course, if you cancel a considerable proportion of the Debt, you diminish proportionately the amount you have to pay for the interest. I propose, therefore, to appropriate the New Sinking Fund of about £600,000 to this Annuity, and to add a sum of £800,000 outside the £28,000,000—that is to say, to raise the fixed amount of £28,000,000 for the next five years to £28,800,000, and to apply that £800,000 with the £600,000 from the new Sinking Fund to the discharge of these Annuities. So in five years, by 10 half-yearly payments, we shall cancel this £6,000,000 of Debt. That operation will affect the Balance Sheet in this way. The Balance Sheet, if that operation is agreed to, will stand thus:—On the Expenditure side there will be—Permanent charge of Debt, £28,800,000; interest on Local Loans, £500,000; interest on Loan to India, £61,478; charge of Suez Loans, £200,000; interest on Supply Exchequer Bonds, which will then be left at £2,100,000, £73,500; other Consolidated Fund Charges, £1,712,000. That would make the charge of the Debt £31,346,978. The other items of Expenditure would be the same as I have already stated, making the whole Expenditure £82,075,972. The income, including the estimated addition of £700,000 for Probate Duties, would amount to £82,260,000, leaving as the surplus of Income over Expenditure the sum of £184,028. I feel these are complicated calculations. I have endeavoured to make them as clear as possible, and I can only sum them up by saying that the nature of the proposal is as follows:—That we add to our Revenue £700,000, which I expect to get from an alteration in the Probate Duties; I propose to can cel £6,000,000 of the Exchequer Bonds which have accumulated in the past year by setting up a Terminable Annuity to the amount requisite for the purpose, and having completed that arrangement, I leave the Budget with a Surplus of £184,000. I hope and trust that we have before us a prospect of better times than those we have experienced. I have felt it my duty, and the Government have always felt it their duty, to do nothing that could in any way unnecessarily impede the revival of trade and commerce. If we should be happy enough to be blessed with a good harvest and a continued revival of trade, we may look for far better results than at present. The Estimates I have made have been made with a cautious spirit, and I present them to the Committee with great confidence.

(1.) Motion made, and Question proposed, That, towards raising the Supply granted to Her Majesty, the Duties of Customs now charged on Tea shall continue to be levied and charged on and after the first day of August, one thousand eight hundred and eighty, until the first day of August, one thousand eight hundred and eighty-one, on importation into Great Britain or Ireland (that is to say): on

£ s. d.
Tea the lb. 0 0 6."

Mr. Raikes, I do not propose, under the peculiar circumstances of the present year, to depart from what I think the very salutary and almost necessary practice of avoiding anything in the nature of discussion on the night that the Financial Statement is made, and particularly because the Statement of this evening is, as was very fairly stated by the Chancellor of the Exchequer, complex, from the necessity of the case, of course, and not from any defect of clearness or accuracy on the part of the right hon. Gentleman. I, therefore, would ask him to fix the time when he would consider it convenient for the Public Service that such remarks as may be necessary may be made, or such stops may be taken, if any Gentleman should think it necessary or expedient to take any steps of a substantive character. I do not anticipate the smallest difference of opinion on the question whether a day should be fixed for such discussion. I think that, evidently, in the position in which we stand, with a Dissolution immediately hanging over us, that discus- sion ought to take place as early as possible; and, for my own part, if the Chancellor of the Exchequer is of opinion that Monday is not too distant. [The CHANCELLOR of the EXCHEQUER: That would do.] If the right hon. Gentleman thinks Monday the best, that had better be the arrangement; but, with every disposition on our part to accommodate him in case he should think greater expedition necessary, as far as I understand the facts of the case, for though the Estimates of Revenue and Expenditure have, no doubt, been carefully and accurately laid before us, this is not the time for discussing them, and I will only just say one word upon them. I give the fullest concurrence to what has been said by the Chancellor of the Exchequer as to the care and attention with which these Estimates have been framed, both with regard to the small unexpired residue of the present year and the coming year. The Estimates of Revenue are difficult; but I have not the least doubt that they have been made with every care that prudence and sagacity could supply towards meeting them, and towards laying before Parliament the best and most trustworthy information. The point that will attract most attention in the Financial Statement naturally will be the amount to which the accumulated deficit of the successive years have now risen, and the mode of providing for it. As far as I understand, the total of this deficit is now £8,100,000, or, in round numbers, £8,000,000. With respect to that, the Chancellor of the Exchequer would not state what he meant to do with it, whether he would take Bonds over a lengthened period or not. I do not speak of this now as a serious omission; but, perhaps, it will be convenient for him presently to state what he means to do about it. With respect to the £6,000,000, the Chancellor of the Exchequer, to quote a favourite phrase of his own, spreads them over five years; but spreads them now in a totally different manner from the spreading to which we have been more or less accustomed on former occasions, because now the payments must be met. They will fall due, and they will now be met, and will become part of our regular Terminable Annuity system. That constitutes an annual charge of somewhere about £1,400,000, which is thus to be made up. The Chancellor of the Exchequer is called upon finally to offer up a victim upon the altar of—I know not what—evil fortune, or political justice—be it what it may, upon some altar or other he is called upon to immolate his own offspring of the New Sinking Fund, which, some four or five years ago, the House adopted on his recommendation, and, if I recollect right, by very considerable majorities. The rest of the charge, or rather more than half, is to be found by what has been referred to by the Chancellor of the Exchequer under the name of an alteration of the probate duty. The Budgets of the Chancellor of the Exchequer are always by way of being too brief rather than too long, and I am sorry he did not give us a fuller explanation of the nature of this new tax which he proposes to levy. It is a re-adjustment and re-construction of the scale in regard to which it will be very interesting to know the particulars, for it is, undoubtedly, a measure of very considerable importance. If I understand rightly, the Chancellor of the Exchequer has a charge of £1,400,000 to meet; and he meets it partly by means of the New Sinking Fund, which will now cease to exist, and partly by the new tax, which is brought in under the name of a readjustment of the probate duties, and which is to yield £700,000. I have no doubt he has taken the Estimate accurately, so that the two together will bring in the whole sum he wants. If I have not accurately stated the case the Chancellor of the Exchequer will correct me. I shall be very well content, Sir, to reflect on these matters till Monday; and when we do meet on that day, Sir, I have no doubt we shall be able to allow his Bill to proceed. In fact, there is not much choice left to us.


said, that he proposed to pass the Resolutions that night. On the Report next day, the hon. Member for Hackney (Mr. Fawcett) could raise the question relating to India. The second reading of the Bill would then be taken on a Monday. The occasion of the second reading would afford a convenient opportunity for discussion. If that were so, he thought that it might be very properly taken on Monday. With regard to other arrangements, he could only say that his right hon. Friend had accurately interpreted the statement he had made with regard to the £1,300,000 or £1,500,000 Annuity.


said, that he hoped the right hon. Gentleman the Chancellor of the Exchequer would give an opportunity for discussing his proposals with respect to the probate and administration duties.


said, that he rose for the purpose of asking the right hon. Gentleman the Chancellor of the Exchequer, whether it would not be convenient for him to lay before the House a Paper, similar to what had been issued for the last two Sessions, containing an Estimate of the Consolidated Fund charges? He also wanted to know whether, in the accounts of Expenditure given the Committee, anything whatever had been taken; and if so, how much in respect of the charges to arise from the Afghan War?




said, that, in that case, those large accounts would still remain to be dealt with. Then there was another set of figures that he thought it would be desirable they should have laid before them on paper. He referred to the loans granted to local bodies. A Return should be made showing the amount expended by local bodies, and affording other information with respect to them. It would be convenient if those Papers were put before the House when they dealt with the matter on Monday.


said, it would be necessary that they should give a very careful consideration to the measure. He should like to know whether they were to understand that the second reading of the Bill was to be taken pro formâ, and then that the discussion was to be reserved? The details certainly required very careful consideration.


said, he had certainly understood that at the commencement of the Session the right hon. Gentleman the Chancellor of the Exchequer would have made some statement with reference to the expenses of the Afghan War. So far as he could gather from his present statement, he had made no reference whatever to that subject. When he brought forward the matter on Report he withdrew his Amendment on the suggestion of the right hon. Gentleman; and he certainly understood that the House would have, probably on the Budget Speech, and certainly at no later period, a distinct declaration of the policy of the Government with regard to the apportionment of the cost of the Afghan War. In saying that, he thought he was expressing not only his own opinion, but that of every hon. Member on that side of the House; and it certainly was a matter of great surprise to them that the right hon. Gentleman the Chancellor of the Exchequer should have made his Budget Speech without having condescended to make the slightest reference to that subject. They were certainly placed in a very extraordinary position, and he thought they ought to have an opportunity of raising the question to-morrow. It was very much to be regretted that the right hon. Gentleman had not made some statement; but if he did not do so it would not prevent him from raising the question. Therefore, he wished to ask whether they were to understand that the Report of the Budget Resolutions would be the first Business of the House tomorrow? If so, he begged to give Notice that upon that occasion he should bring forward a Motion upon which, if nothing should interfere to prevent him, he should take sense of the House. The Motion he should bring forward would be to the following effect:—That, in view of the repeated declarations made by the Prime Minister, and by the Viceroy of India, and by others of Her Majesty's Ministers, that the Afghan War had been undertaken for Imperial purposes, that House was of opinion that it was unjust to make the entire cost which it had involved fall upon the people of India.


said, that before the right hon. Gentleman replied to the observations that had been made, he would wish to ask him when he proposed to make the statement promised by him with reference to the jumps which he had alluded to in the scale of the administration duties? The right hon. Gentleman had distinctly promised to lay upon the Table of the House a Paper showing those jumps, and also the details of his proposed new scheme. He would also desire to ask the right hon. Gentleman whether he was in a position to lay upon the Table of the House any figures showing how he arrived at the conclusion that the alteration in those duties would increase the Revenue by £700,000? That information was important, because he had satisfied himself, from a very careful examination of figures before the House, and from Reports of various Commissions, and especially of the Commission of the 18th of May, that instead of the increase of the Revenue being £700,000 it would amount to, if it did not exceed, the sum of £1,500,000. He did not propose to go into the question upon that occasion, as he wished to have an opportunity of discussing it fully hereafter. He thought that he should be able to satisfy the House that what he had stated was correct.


said, that it had been customary for the Chancellor of the Exchequer to place in the hands of hon. Members a Financial Statement at the same time that he introduced the Budget. That was a very convenient course to adopt, and he trusted that on that occasion it would not be departed from.


said, that at present he had only two copies of the Statement in question in the House; but on Monday, when the matter came on for discussion, the Paper should be in the hands of hon. Members.


said, he was glad to hear that this country would not be liable for any further questions in respect of the South African War.


said, it must be some time before the new scale of probate duty could come into operation. He would wish to know when the right hon. Gentleman the Chancellor of the Exchequer contemplated that the new scale would become operative? There were two periods at which the scale might come into operation—namely, with regard to persons dying after a certain date, or in respect of persons whose wills were proved after the date in question. He should be glad if the right hon. Gentleman could state which plan he proposed to adopt?


said, that the new rule would come into operation on the 1st of April.


said, that he should like to know whether it would come into operation in respect of persons dying after the 1st of April? for it would make a considerable difference if it were made to apply only to wills proved after that date. In the latter case, injustice was involved in the case of delay after proving wills.


said, that he was in the House during the whole of the discussion on the Afghan Motion. So far as his recollection went, his right hon. Friend the Chancellor of the Exchequer said that he would give an opportunity to discuss the subject; but he did not promise to make any statement whatever. He left it open to the Government as to whether they should add to the burdens of this country a certain amount for the Afghan War, or whether they should not do so. As he now understood, Her Majesty's Government had come to the conclusion not to add the expenditure of the Afghan War to the burdens of this country. The Motion which the hon. Member for Hackney wished to bring forward had for its object the taxing of this country in order to relieve India; and he hoped that in the discussion that would take place the next day it would be most fully considered. He could not help thinking that when the country at large came to consider this question it would not agree with the view adopted by the hon. Member for Hackney; and he must further tell the hon. Gentleman, that if the result he desired were carried out it would add enormously to the Expenditure of this country.


said, that there seemed to be some misunderstanding on the subject, for he most distinctly heard the right hon. Gentleman the Chancellor of the Exchequer make the promise to which reference had been made. For his part, he was very much surprised to hear his right hon. Friend finish his speech without alluding to the cost of the Afghan War, for the hon. Member for Hackney would be at considerable disadvantage in having to bring forward his Motion in ignorance of the reason for the policy of the Government. It would have been only right that his hon. Friend should have had the advantage of hearing a clear statement of the views of the Government on the subject. There was another matter to which, he should like to allude. Between 1 and 2, or 2 and 3 o'clock, the other morning, the right hon. Gentleman the Chancellor of the Exchequer formally introduced in Committee a most important change with respect to the probate duties, and went into some details, and gave a Schedule of his proposed plan; but he never hinted to the Committee that the result of his plan would be to raise an additional amount of taxation until the conclusion of his observations, when he casually mentioned that it might add £700,000 a-year to the Revenue. This was a very inadequate and insufficient treatment of a most important matter. There was no more difficult question than that of the probate, succession, and legacy duties. Any change in the probate, succession, and legacy duties involved the whole question of the relative charge upon real and personal property—a question of the highest importance, which, he thought, ought to be dealt with in a most fair and open manner. Whether the change proposed by the Government would increase the Revenue by £1,500,000 or by £700,000 he did not know; but, at any rate, the Government proposed to make a serious change in the taxation, and he did not think that a debate on so important a matter should have been initiated at so late an hour, and at the last moment only of his speech. The right hon. Gentleman the Chancellor of the Exchequer should have said—"By-the-bye, this scheme will increase the Revenue by £700,000 a-year." The subject should have been alluded to in the Budget Statement, and the House should have heard all the reasons which made it desirable to charge personal property so much more than it had hitherto paid. A proposal to lay an extra charge upon personal property, to the exemption of landed property, ought to have been made in a distinct statement to the House; and he was sure that, on reflection, the right hon. Gentleman the Chancellor of the Exchequer would admit the force of that observation. And now, when he was explaining in detail the finance of the past and future years, he thought the right hon. Gentleman might have condescended to have given them some sort of reason for proposing the alteration. He hoped that the right hon. Gentleman would now give them some distinct reasons for the very considerable addition which he proposed to make in the "death tax," on personal, to the exclusion of real, property.


said, that before the right hon. Gentleman the Chancellor of the Exchequer replied he should like to make a few observations. The hon. Member for Stockton (Mr. Dodds) and the hon. Member for East Sussex (Mr. Gregory) would be able to inform the Committee that the result of the scheme by which the Government proposed to deal with the probate and administration duties would have a very serious effect. He rose for the purpose of saying that he thought it would be a most unfortunate circumstance that, in the last days of an expiring Parliament, they should be called upon to pass, without sufficient discussion, a Bill which would impose an additional amount of taxation upon a particular class of property, and, at the same time, exempt the highest class of property in the Kingdom. Whether the additional amount to be charged upon personal property was £700,000 a-year or £1,500,000, it would be a tax upon the earnings of industry, and upon the personal savings of trade. Trading and other classes of the community were to be burdened with an additional tax, while the great landowners of the Kingdom were not to pay a penny of that additional taxation. He would remind the Committee that personal property represented the savings of the people—the earnings acquired by individuals—and that it already paid a very much larger legacy duty in proportion to land than land paid in the form of succession duty. In addition to that, personal property already had to pay a very large sum for probate duty, from which land was entirely free. He thought he was accurate in saying that in probate and legacy duties this particular class of property, chiefly possessed by the trading and industrial classes, paid four times as much as land at the present time. The right hon. Gentleman the Chancellor of the Exchequer now, in order to get out of his financial difficulties, placed another £1,000,000, or, as he himself said, £700,000 or £800,000, upon a class of property already overburdened to a much larger extent than land. In his opinion, the proposal was a monstrously unjust one; and if the right hon. Gentleman had proposed, in order to increase his Revenue, to place succession duty, in respect of land, on the same footing as legacy duty upon personal property, and had also proposed to place upon land an equivalent probate duty, then he should have said he was taking a course that was entirely in accordance with justice, and which would have produced him a considerable amount of Revenue. Instead of doing that, he proposed now to free the great landowners from additional taxation, and to place additional burdens upon the owners of personal property. He protested most earnestly against such an entirely unjust proposition.


said, that the objection he took to this particular part of the Budget was that the right hon. Gentleman the Chancellor of the Exchequer had sprung a mine upon the country, which really knew nothing of the nature of the change and the extra taxation which would fall upon them. He thought few hon. Members were aware of the large increase which would be made, not only in the case of wills, but also in the case of intestacies. It was true that the double scale was to be abolished; and that, no doubt, was a move in the right direction. When the amount which might be left by a deceased person reached the sum of £10,000, the amount payable, not only on wills, but in the case of intestacies, would be much larger than at present. But in the case of large sums, say of from £100,000 to £500,000, the charge would be enormous. He wished to ask whether it was proposed to take the second reading that evening, or whether the right hon. Gentleman intended to postpone the discussion until Monday night when the Budget would be before the House? The Committee, in his opinion, was not in a position to express any opinion upon the subject at that moment.


said, that while listening to the Budger Statement of the Chancellor of the Exchequer he could not help thinking that if one thing was more apparent than another it was that it avoided putting one farthing in any shape or form by way of additional taxation on the industrial classes of the Kingdom.


I feel that I am open to the charge made just now by my right hon. Friend the Member for Greenwich of making my Budget Statements rather too short than too long. Perhaps I have been unduly anxious not to trespass on the patience of the Committee, and I feel I may have omitted matters which ought properly to have been brought into the Budget Statement. I particularly regret that I have omitted to say anything with regard to the Afghan War upon this occasion, because I know what is due to the hon. Member for Hack- ney (Mr. Fawcett), and still more so to the Committee. But the fact is, as I had no intention of submitting a Vote for any contribution, on the part of Her Majesty's Government, towards the expenses of that war, it did not occur to me that it was necessary to say anything upon the subject. I will merely repeat now what I have said on behalf of the Government on former occasions. This question is not a new one as regards this particular campaign. In point of fact, the whole question was before the House at a former time, as to whether the Government of India ought or ought not to bear the expense of military operations in Afghanistan; and I then expressed the views of the Government, to this effect—that it was important that India should be a self-supporting and self-protecting Power; that as protection involved the necessity of maintaining a secure Frontier—a Frontier which would not only be secure against an advancing enemy, but which would also secure the confidence of those who lived within it—it was also important that proper relations should exist between the Government of India and its neighbours beyond the Frontier; and that, in consequence of certain proceedings which had taken place of late years, it had been thought necessary for the purpose of protecting—at least, what were supposed to be—Indian interests, to undertake an expedition which has involved a certain amount of cost. I said then, and I repeat it now—and that is the line of argument which I should adopt if the question is again raised—that it would be a bad example if England were to allow the doctrine that the Indian Government might go to war, and England be called upon to bear the expense of that war. With reference to another question asked me by the right hon. Members for Greenwich and Pontefract, I suppose I spoke upon this subject too briefly; but I did say what I contemplated with regard to this sum of £2,000,000—that I did not intend to include them in the amount for which I made provision by Terminable Annuities, because I thought it desirable that they should be kept out until we could see what arrangements could be made with the Colonies. We propose to continue them by Exchequer Bonds for the present, trusting that we shall have the opportunity of being able to extinguish them altogether. I shall ask, at the proper time, for the renewal of the £2,000,000. [Mr. CHILDERS: For how long?] For one year. With regard to the question as to the Probate Bill, I do not propose to take it this evening. The second reading will be taken on Monday, and I shall then endeavour to proceed with the Budget Bill. With regard to the Return which has been referred to, I put this in hand at once, and it was immediately put in type; but it contains a very large number of figures, and I believe that some errors have been found in it, so that it has been found necessary to take some little time for corrections. The Return, however, is now correct, and I hope it will be in the hands of hon. Members to-morrow. I trust that, when it is studied, it will give full information as to the real character of the change proposed to be made. The hon. Member for Liskeard (Mr. Courtney) has asked me when the section would take effect, whether from the date of death or from the date of probate? It would take effect from the date of proving the will, not from the date of death. The hon. Member for Kirkcaldy (Sir George Campbell) has also asked me whether we make any provision for South Africa? To this I reply, No; we hope there will be no occasion to make any such provision. The ordinary Army and Navy Estimates are all framed with a view to the necessities of the Empire, and I do not think it necessary to make any express provision for South Africa. With regard to local loans, I shall be very glad to make such a statement as the hon. and learned Gentleman (Mr. Waddy) suggests.

Resolution agreed to.

1. Resolved, That, towards raising the Supply granted to Her Majesty, the Duties of Customs now charged on Tea shall continue to be levied and charged on and after the first day of August, one thousand eight hundred and eighty, until the first day of August, one thousand eight hundred and. eighty-one, on importation into Great Britain or Ireland (that is to say): on

£ s. d.
Tea the lb. 0 0 6.

2. Resolved, That there shall be charged upon the delivery for home consumption of Foreign Spirits which have been bottled in any Customs or Excise Warehouse, in addition to the Duties of Customs and any other Charges thereon, the rate following (that is to say): For every one dozen imperial or reputed quart bottles, or two dozen imperial or reputed pint bottles of such Spirits, Three Pence.

3. Resolved, That, towards raising the Supply granted to Her Majesty, there shall be charged, collected, and paid for one year, commencing on the sixth day of April, one thousand eight hundred and eighty, in respect of all Property, Profits, and Gains mentioned or described as chargeable in the Act of the sixteenth and seventeenth years of Her Majesty's reign, chapter thirty-four, the following Duties of Income Tax (that is to say): For every Twenty Shillings of the annual value or amount of Property, Profits, and Gains chargeable under Schedules (A), (C), (D), or (E) of the said Act, the Duty of Five Pence; And For every Twenty Shillings of the annual value of the occupation of Lands, Tenements, Hereditaments, and Heritages chargeable under Schedule (B) of the said Act,— In England, the Duty of Two Pence Halfpenny; In Scotland and Ireland respectively, the Duty of One Penny Three Farthings; Subject to the provisions contained in section one hundred and sixty-three of the Act of the fifth and sixth years of Her Majesty's reign, chapter thirty-five, for the exemption of persons whose income is less than One Hundred and Fifty Pounds, and in section eight of "The Customs and Inland Revenue Act, 1876," for the relief of persons whose income is less than Four Hundred Pounds.

4. Resolved, That it is expedient to amend the Law relating to Income Tax.

5. Resolved, That, towards making good the Supply granted to Her Majesty for the service of the years ending on the 31st day of March 1879 and 1880, the sum of £1,230,750 9s. 10d. be granted out of the Consolidated Fund of the United Kingdom."

House resumed.

Resolutions to be reported To-morrow, at Two of the clock;

Committee to sit again To-morrow, at Two of the clock.