§ Order for Committee read.
§ Motion made, and Question proposed, "That Mr. Speaker do now leave the Chair."—(Mr. Chancellor of the Exchequer.)
§ SIR JOSEPH M'KENNA
said, he would appeal to the right hon. Gentleman the Chancellor of the Exchequer (Mr. Childers), who was in charge of the Bill, to say whether this was grave legislation or not; whether it was seemly that, at 25 minutes to 3 in the morning, the proposition should be made that they should go into Committee upon a Bill of such importance as this? Surely the right hon. Gentleman did not mean that they should now go into Committee. Let him (Sir Joseph M'Kenna) explain to the House what the Motion meant. The right hon. Gentleman the Chancellor of the Exchequer (Mr. Childers) introduced the Bill about a couple of months ago; and he (Sir Joseph M'Kenna) ventured to say that the measure was either drafted by draftsmen who did not understand accounts, or it was drafted by an accountant who did not understand drafting, or it was drafted by an accountant and a draftsman who did not understand one another. He ventured to say that nine-tenths of the Members of the House were unable to make out what the drafts- 409 man was driving at until the Government, in another Paper, gave them an inkling of it. He regretted that the right hon. Gentleman, at such an hour that they could not expect that a report of the proceedings would appear in the papers, should move that the Speaker leave the Chair. Before they arrived at the second reading of the Bill, the Premier stated gravely to the House that he would not proceed with the measure, if he believed there were serious objections to it in many quarters of the House. It was not then open to him (Sir Joseph M'Kenna) to make use of the argument which he could now employ; but he had now no hesitation in saying that there was no one in favour of the Bill except a few hon. Gentlemen sitting immediately behind the Treasury Bench. As a matter of fact, the right hon. Gentleman the Chancellor of the Exchequer, as well as many of the staunchest Liberals, was opposed in every way to the Act of Parliament to which the Bill professed to be a logical sequence; whilst on the Opposition side of the House, the only Member who had offered even a lukewarm support to the Bill was the hon. Baronet the Member for Chippenham (Sir Gabriel Goldney), who did say a word or two in favour of proceeding with the measure. The Bill was in no sense called for; it would deal with a state of facts which would not arise until 1885; and it was intended, if passed into law, to fetter the action of that House for the next 20 years; while, as brought in in the first instance, it had been intended to fetter the discretion of the House for ever. He would do the right hon. Gentleman the Chancellor of the Exchequer the justice to say that he had extended to them a small amount of mercy in conceding that the Act should only operate up to 1904. The right hon. Gentleman, however, had not made any statement as to what length of time, under the operation of such a Bill as this, it would take to pay off the National Debt. The measure was one which might be fairly described as a Bill to saddle the Income Tax on the country for the next 40 or 50 years. It might be described as a Bill requiring the present inhabitants of the country to pay somewhere about £750,000,000 or £770,000,000 sterling. Let them take the first sum which the Chancellor of the Exchequer proposed to deal with— 410 the Annuities amounting to £3,600,000. If the right hon. Gentleman stopped there in his scheme of appropriation, that sum, annually reserved and invested, would, during the lifetime of one man, pay off the whole of the National Debt. £3,600,000 a-year, applied for the purpose of the extinction of the National Debt, would pay off, at the highest price we need to pay, something like £200,000,000 in 37 years; and the £3,600,000, with the interest of the £200,000,000 of Consols, would pay off in 30 more years the whole of the principal of the National Debt. He asked, would not that be a fair and sufficient measure to take to pay off a Debt which had been the accumulation of centuries—a Debt which it had been the custom of that House to deal with from time to time by small appropriations to a Sinking Fund? He asked whether it would not be better to conduct themselves upon lines of moderation, and be content to put by some £3,600,000 a-year out of present taxation, instead of embarking upon the elaborate scheme suggested by the Government. When the right hon. Gentleman at the head of the Government spoke as if there was no opposition in the House to the Bill, he (Sir Joseph M'Kenna) supposed that the right hon. Gentleman assumed that the Amendment of the hon. Member for Burnley (Mr. Rylands) would be withdrawn. It was evident that the right hon. Gentleman scarcely calculated at that time upon the opposition of the hon. Member for Bradford (Mr. Illingworth); and, moreover, he could scarcely have calculated upon the opposition of the hon. Member for Wolverhampton (Mr. H. H. Fowler). He (Sir Joseph M'Kenna) asked whether now, at a quarter to 3 in the morning, and on the 14th of August, there were not strong reasons for withdrawing the Bill altogether? The right hon. Gentleman the Prime Minister was not present to hear any arguments that might be advanced against the measure; and he did not do him (Sir Joseph M'Kenna) the honour to hear what he had to say in opposing the second reading of the Bill. The measure was surely not wanted in the country; but if it were passed into law, and acted upon, it would lay the foundation of a fund which would be seized upon by Parliament whenever occasion arose, or temptation occurred to expend 411 the money. The people of England would not relish paying the Income Tax in order that they might, out of their industry, in the case of the working classes, and out of their life tenancies, in the cases of the propertied class, pay off a Debt charged upon the inheritance. ["Oh, oh!"] Hon. Members who interrupted ought to bear in mind that he had exhibited a great deal of patience while their Business was proceeding. He could assure the House that the interruption with which he was being menaced would only make it necessary for him to dilate at greater length upon the Bill than he had otherwise intended. He wished it particularly to be understood that he did not, in the least degree, disclaim the advisableness of taking real measures to reduce the National Debt; his opposition was directed against a scheme bound to break down in consequence of its singular unfairness. The right hon. Baronet the Member for North Devon (Sir Stafford Northcote) introduced a Bill in 1875, and that Bill was the law at present. Nothing, however, was needful to be done till 1885; and, seeing that they were always entitled, at one year's notice, to pay off the Consols, he did not know what objection there could be to postponing the consideration of the Bill till next Session, when they could deal with it at their leisure. He trusted that the House would agree to the postponement of the debate; and he would move that the House should resolve itself into a Committee on that day three months.
To leave out from the word "That" to the end of the Question, in order to add the words, "this House will, upon this day three months, resolve itself into the said Committee,"—(Sir Joseph M'Kenna,)
§ —instead thereof.
§ Question proposed, "That the words proposed to be left out stand part of the Question."
§ MR. WARTON
said, it really was too late in the Session to proceed with a Bill of such great importance as that now before the House—a Bill which would really have the effect of tying down our financial system for 20 years to come. The occasion for the Bill would only arise two years hence, and it was surely hardly prudent for the Government to anticipate matters by two years. At 412 the present moment, the Revenue was £4,000,000 less than they could reasonably have expected it to be three years ago; and with a diminishing Revenue it was certainly unwise for the Government to propose what really would amount to a very heavy burden upon the people. Who could tell that the present pacific state of Europe could continue? The Egyptian Question was by no means settled. In fact, in plain words, what sensible man could forecast the future? It was utterly imprudent to anticipate what would be the condition of the Revenue two years hence. Under the Act of 1875, the reduction of the National Debt was proceeding steadily and regularly; and it was perfectly clear that, in about three or four years' time, the Debt would be reduced to about £700,000,000. It was more than likely that in 47 years' time, if they were to proceed at the present rate, the whole of the Debt would be cleared off. Ho, however, was disposed to ask the House whether it was of the utmost importance that the Debt should be paid off? Consols formed a sound investment for trustees and others; and, indeed, in many ways it was well that the country should have a Debt. Our Debt made us the bankers of the world, for, as a matter of fact, there were many Sovereigns who would not invest money in their own funds, while they would do so in the funds of this country. He trusted that the House would agree to the proposition of the hon. Member for Youghal (Sir Joseph M'Kenna).
§ THE CHANCELLOR OF THE EXCHEQUER (Mr. CHILDERS)
said, that all he need remark was that the House had, by a large majority, passed the second reading of the Bill. He had adopted the suggestion then made to insert words in order to limit the operation of the rolling-up Annuities to a fixed number of years; and, having done that, he did not think he was acting at all unreasonably in asking the House to proceed with the Bill at the present time. The hon. and learned Member for Bridport (Mr. Warton) had raised the question whether it was a good thing to pay off the Debt at all. He (the Chancellor of the Exchequer) thought that was a matter which, at this stage, the House would hardly be inclined to discuss. He trusted the House would assent to the proposal to go into Committee.
§ MR. J. G. HUBBARD
said, that at 3 o'clock in the morning on the 14th of August they were asked to go into Committee on this Bill—a Bill which was to fix for 20 years to come a burden of taxation upon the taxpayers for the redemption of Debt, that redemption of Debt amounting to something like £160,000,000 sterling. Such a burden ought not to be imposed upon the people except after most careful consideration. The right hon. Gentleman the Chancellor of the Exchequer (Mr. Childers) seemed to consider that he had done all he need do in adopting the Amendment of the right hon. Gentleman the Member for North Devon (Sir Stafford Northcote). It was true that right hon. Gentleman did make a suggestion which the Chancellor of the Exchequer had adopted. But it must be remembered that, in 1875, the present Chancellor of the Exchequer opposed the measure of the then Chancellor of the Exchequer for the redemption of the National Debt as utterly wrong and mischievous. The right hon. Gentleman the Chancellor of the Exchequer (Mr. Childers) at that time opposed, with the utmost vigour, the measure which he now proposed, because it came from the right hon. Gentleman the Member for North Devon; and he was so clear and express in his declaration that, not satisfied with discountenancing the Bill altogether as impracticable, he stated that "the measure of redemption which the Bill proposed was an impossibility." These words were uttered in 1875 by the right hon. Gentleman in charge of the present Bill (Mr. Childers). He (Mr. Hubbard) had no wish to call to account public men because they changed their opinions. Public men had changed their opinions very often indeed; but, in a question of this kind, there was a principle involved which must be either right or wrong. The right hon. Gentleman the Chancellor of the Exchequer was either right or wrong when he said that the measure of redemption provided for in the Bill of 1875 was an impossibility; and in asking the House to pass this Bill he was asking the House to pass a measure the aims of which he himself had granted were impossible. He (Mr. Hubbard) spoke upon the Bill with no little experience. He ought to be as familiar with financial questions as any man in 414 the House, for they had been his almost daily study for 40 years past. He knew what the Stock Market was, and they had all seen, within the last seven years, how the price of Consols had varied. He desired the extinction of the National Debt quite as much as his right hon. Friend the Chancellor of the Exchequer; but he wanted the thing to be done in a business-like way. He considered that £7,000,000 a-year was as large a sum as they could, with prudence, impose as a burden upon the taxpayers of the country. He had lately taken the opinion on this point of some very eminent members of the Stock Exchange; and they certainly believed that if more than £7,000,000 a-year were employed in the extinction of the Debt the price of Consols would be inconveniently driven up. What were they going to do? If they attempted to increase the redemption of the Debt to £8,000,000, £9,000,000, £10,000,000, £12,000,000, or £13,000,000, where would Consols be? Long before they reached that point the old system would be broken down, and then people would exclaim—" What a short-sighted principle it was; "and they would say also—" What a pity that the Chancellor of the Exchequer, in 1883, did not adopt the plan suggested in 1875." He (Mr. Hubbard) thought that an opinion out of Office was worth a great deal more than an opinion when in Office. The Chancellor of the Exchequer had a good deal of natural sagacity in these matters; but there were certain influences always at work on these questions, and the Chancellor of the Exchequer was required to be a great financial conjuror if he was to satisfy everybody. The Bill really consisted of a mass of contradictions. It adopted two absolutely conflicting principles, and tried to make them work together. [" Oh, oh!"] There would, however, be no use in wearying an impatient House with minute criticisms on the subject. He, however, protested against this mode of legislation. In an exhausted House, and with an almost empty Reporters' Gallery, they proposed to fasten taxes to the amount of £120,000,000 upon the people. He agreed with the object the right hon. Gentleman the Chancellor of the Exchequer had in view, because he was in favour of the redemption of the Debt; but, whatever was done, he 415 maintained that it ought to be done upon a reasonable, a business-like, and a sound basis.
§ SIR JOHN LUBBOCK
said, the House listened with respect to everything that fell from the right hon. Gentleman (Mr. Hubbard; but he (Sir John Lubbock) would now appeal to the right hon. Gentleman and to hon. Gentlemen opposite generally to allow the House to go into Committee, and to pass the Bill. The Motion was not opposed by the Leaders of the Conservative Party, and it was supported by the great majority of the Members of the House and the people of the country. As there was so much practical agreement on the subject, he hoped they would be allowed to go into Committee.
§ Question put.
§ The House divided:—Ayes 51; Noes 23: Majority 28.—(Div. List, No. 289.)
§ Question again proposed, "That Mr. Speaker do now leave the Chair."
§ SIR H. DRUMMOND WOLFF
said, that at that time of the morning it was out of all reason for the Government to try and force this Bill through Committee. It was now after 3 o'clock, and it was only on account of the mismanagement of Business by the Government that they were reduced to the position of having to consider a Bill of such importance at that time of the morning. He, therefore, thought it advisable that he should move that the debate be now adjourned.
§ Motion made, and Question put, "That the Debate be now adjourned."—(Sir H. Drummond Wolff.)
§ The House divided:—Ayes 14; Noes 56: Majority 42.—(Div. List, No. 290.)
§ Original Question put, and agreed to.
§ Bill considered in Committee.
§ (In the Committee.)
§ Clause 1 agreed to.
§ Clause 2 (Conversion of part of the perpetual annuities held by National Debt Commissioners on account of trustee and post office savings banks into terminable annuities).
§ MR. J. G. HUBBARD,
in moving, as an Amendment, in page 2, line 29, to leave out the word "three," in order to insert the word "six," said, that if the Bill were re-cast, in pursuance of his 416 Amendment, instead of being a composite Bill, it would go on one principle throughout, and the redemption of the National Debt would proceed regularly by the operation of Terminable Annuities. The provisions he proposed would require no renewal, but would operate until the Chancellor of the Exchequer of some distant day found a necessity for discontinuing them. His object was to work out the extinction of the Debt regularly, and that would be the certain effect of his Amendment.
§ Amendment proposed, in page 2, line 29, to leave out the word "three," in order to insert the word "six,"—(Mr. J. G. Hubbard,)—instead thereof.
§ Question proposed "That the word 'three' stand part of the Clause."
§ THE CHANCELLOR OF THE EXCHEQUER (Mr. CHILDERS)
said, the proposal of his right hon. Friend (Mr. Hubbard) was briefly this—to repeal the Act of 1875, and for its provisions to substitute others establishing a system of Terminable Annuities, which would operate so as year by year to reduce the £28,000,000 which the Act of 1875 set aside for the service of the National Debt. He (the Chancellor of the Exchequer) fully realized the simplicity of the right hon. Gentleman's plan; but he was not prepared to repeal the Act of 1875, and therefore he was not in a position to accept the Amendment.
§ SIR JOSEPH M'KENNA
A said, he supported the proposal of the right hon. Gentleman the Member for the City of London (Mr. Hubbard) except with regard to the amount. He considered that the right hon. Gentleman had proposed too large an annual redemption. If, however, the right hon. Gentleman proceeded to a Division, he should vote with him.
§ Question put.
§ The Committee divided:—Ayes 54; Noes 12: Majority 42.—(Div. List, No. 291.)
§ Bill reported, without Amendment; to be read the third time To-morrow.