§ WAYS AND MEANS—considered in Committee.
§ (In the Committee.)
§ THE CHANCELLOR OF THE EXCHEQUER (Mr. CHILDERS)
Sir Arthur Otway, I shall commence my Statement, in accordance with custom, by a review of the Finance of the year which closed at the end of last month—the year 1883–4.
With respect to the Revenue, the original Estimate, made in my Financial Statement last year, was that it would amount to £86,029,000, and that the Expenditure would amount to £85,789,000, the surplus being £240,000. But I stated in that speech that the Revenue did not include what was expected to come from the Parcel Post system, which would be established later in the year; and in the course of the Session we made this alteration, that, instead of deducting from the Revenue—as I proposed in my Financial Statement— £170,000 on account of the establishment of cheap telegrams, we added £200,000 to the Expenditure, part of £500,000 required to prepare for that establishment. The Parcel Post Revenue and Expenditure, according to the Estimate laid on the Table of the House later in the Session, were expected to reach £340,000 each. There were also one or two minor changes arising out of the Supplementary Estimates of the Session of 1883. When the Appropriation Act passed, the Revenue was estimated at £86,549,000, and the estimated Expenditure was £86,436,000, giving a surplus of £113,000. These figures have appeared since in the weekly statements of Revenue and Expenditure published every Wednesday. I may add that, during the present Session, Supplementary Estimates have been passed for £371,000 on account of the Army, and £147,000 on account of the Navy. We voted £500,000 on account of the contribution, towards the expenses of the Afghan War, in anticipation of the payment this year; and other Supplementary Estimates in connection with the Civil Service and Revenue Departments amounted to £367,000, making total Supplementary Estimates of £1,385,000. Of course, 500 against the Supplementary Estimates of the present Session savings are always expected on other Votes; and any comparison between the original Estimates of Revenue and those of Expenditure, if the latter include the Supplementary Estimates of the second Session, would be delusive.
Now, Sir, I will take, first, the Revenue of 1883–4, and I will compare the actual Revenue received both with the Estimate of it which we made and with the actual Revenue of 1882–3. I will take, first, the two great heads of Customs and Excise. It will be remembered that, in my Statement last year, I explained that it was practically impossible to divide the receipt of Spirit Duty between the Customs and the Excise, it being a matter of the greatest doubt whether the receipts on account of Spirits would be for foreign Spirits or British made Spirits. Following the line I then took, I will give the Committee, first, the receipt on account of Spirits under both heads; secondly, the Customs receipts, excluding Spirits; and, thirdly, the revenue of Excise, excluding Spirits. In 1882–3, Spirits had produced, according to my Statement last year, £18,540,000; and I estimated that we should receive, in 1883–4,£18,700,000. The actual receipt on account of Spirits was £18,435,000, being less than the actual receipt of 1882–3 by £105,000, and less than my Estimate of 1883–4 by £265,000. Therefore, Sir, we see that the slight increase of the previous year in the Spirit Duty stopped last year. If I am asked to give any special reason for that diminution, irrespective of the general reasons with which the Committee is well acquainted, I think I may say that the very open weather of last winter, undoubtedly, had a direct effect in the reduction of the amount received from the Spirit Duty during the winter months. This was especially felt in the Duty on Rum. Excluding the item of Spirits, the receipt in 1882–3, under the head of Customs, was £15,280,000. I estimated the receipt for 1883–4, in the Financial Statement of last year, at £15,350,000; and the actual receipt was £15,488,000. Treating the Excise in the same way, the receipt of 1882–3 was £12,765,000. I estimated it last year, for 1883–4, at £12,600,000, and the actual receipt was 501 £12,730,000. It is necessary, however, as a matter of form, to compare the total receipts on account of Customs and Excise with the Estimate; and I find that, whereas I took £19,750,000 for Customs and £26,765,000 for Excise, giving a total of £46,515,000, the Revenue actually received was £19,701,000 for Customs and £26,952,000 for Excise, being a total of £46,653,000, or £138,000 over my Estimate. Under the head of Customs, there is nothing which calls for special remark in the Revenue of last year; but there are one or two items in the Excise Revenue as to which I may give an explanation to the Committee. In my Statement last year, I referred to the Hop Famine in 1882 as having led me to be cautious in framing the Estimate of the Beer receipt, that of 1882–3 having fallen short of that of 1881–2 by £131,000. But when I spoke we had no indication of the hop crop of 1883. That crop, however, was a very fair one. The price of hops, which had been in March, 1882, £7 5s. a cwt., rose in March, 1883, to no less than £26 a cwt. The price, however, fell in the autumn, and last month hops were about £9 10s. a cwt. The result was that the Beer Revenue greatly improved, the receipt being £238,000 more than my Estimate, and, in fact, within £50,000 of the receipt of 1881–2. The total receipt for beer was £8,531,000 in 1881–2; it fell to £8,400,000 in 1882–3; and in 1883–4 it was £8,488,000; whereas I had only estimated it at £8,250,000. So much for the item of beer.
The second item to which I ought to draw the attention of the Committee is the Railway Duty. The Railway Duty, if no change had been made in it last year, would have been estimated at £800,000; and I expected that, in eon-sequence of the change, we should lose in the receipt of the year £135,000, bringing the net Estimate to £665,000. But, in point of fact, we have received £747,000, the excess being mainly, though not exclusively, due to a large payment by a particular Railway Company of arrears spread over several years.
The third item to which I wish to draw the attention of the Committee is the receipt from the Game Licences. One of the minor changes made in the Budget of last year was the introduction of a third rate of Game Licence in addi- 502 tion to the £3 and the £2 licences for a whole, or a half season. I proposed to Parliament, and the House approved, a licence of £1, which, would be available for 14 days. I am happy to say that this small change has turned out most satisfactorily. The £3 licences were not affected by it. About 4,000 £1 licences have been taken out, and they more than covered the diminution of the £2 licences. The Revenue gained in all £2,600. The number of licences was 3,300 more than in the season of the year before; and I am happy to congratulate some hon. Friends of mine, whom I see sitting opposite, on having availed themselves of this provision, granted for the first time last year.
I now pass to the receipt from Stamps. The Revenue of 1882–3 represented a payment into the Exchequer on account of Stamps of £11,841,000. I estimated last year that the Stamp Revenue would be £11,510,000; and the actual Revenue was £11,620,000. I mentioned last year, in explaining to the House the basis of my Estimate, that what are properly called the Death Duties for 1882–3 had exceeded the Death Duties of the previous year by £300,000, and had exceeded the Estimates made by my Predecessor by £600,000. Keeping in view this great excess, and apprehending that it might be due to temporary causes, I felt bound to act with great caution in framing any Estimate for 1883–4 on the basis of the previous year's receipts. But to a great extent the special circumstances of 1882–3, which were given in explanation of that high receipt, recurred in 1883–4, —that is to say, there was a large number of estates the duty on which came into the account of the year. It may interest the Committee to know that, on 10 estates alone in the year 1883–4, no less a sum than £283,000 was received on account of Probate Duty —an amount which I believe is almost without parallel. The Death Duties, in fact, in 1883–4 reached as nearly as possible the same amount as in 1882–3; while the other Stamp Duties fell below the receipt of that year.
The Land Tax in 1882–3 produced £1,045,000. I estimated it at £1,040,000. The actual amount produced has been £1,070,000. The House Duty in 1882–3 was £1,755,000. I estimated it at £1,785,000. It has actually produced 503 £1,805,000. On these two heads of Revenue, no remark occurs which I need make to the Committee.
I next pass to the Income Tax. In 1882–3, the actual receipt on account of the Income Tax, at the rate, nominally, of 6½d., but not a full year's receipt, for some of it passed on to 1883–4, was £11,900,000. I estimated that the receipt for 1883–4, on the basis of 5d. in the pound, with the balance of the 6½d., would be £10,265,000. The actual receipt was £10,718,000, or £453,000 beyond the Estimate. I shall allude later in my Statement to this remarkable rise in the receipt from Income Tax; but, under the circumstances, I think no one can question the wisdom of the caution which we exercised last year. Now, these items constitute the whole of the Tax Revenue of last year. The Estimate was £71,114,000. The actual receipt was £71,866,000, as compared with the actual receipt in 1882–3 of £73,128,000. That higher receipt, as I have said, was mainly due to the additional 1½d., Income Tax.
I now pass to what is called the Non-Tax Revenue. The Post Office collected in 1882–3 £7,300,000, and I estimated that we should receive from it in 1883–4 £7,740,000, £340,000 of that sum being on account of the Parcel Post. We actually received £7,730,000. The Telegraphs in 1882–3 gave £1,710,000. I estimated for 1883–4 £1,750,000, and the actual amount received was £1,745,000. Crown Lands produced last year precisely what they produced the year before, and what I estimated —namely, £380,000. The Interest on Advances, which had been in 1882–3 £1,219,000, I estimated at £1,185,000, and it amounted to £1,196,000; and the Miscellaneous Revenue, which in 1882–3 had been £5,268,000, I estimated at £4,380,000, and it amounted to £4,288,000. Thus, altogether, the Non-Tax Revenue, as against £15,876,000 in 1882–3, and an Estimate for 1883–4 of £15,435,000, produced £15,339,000. To some points in reference to this Revenue I shall not refer now, but I shall deal with them when we come to the estimated Revenue for the present year 1884–5. The total Revenue, therefore, of last year, compared with the actual Revenue of 1882–3, which was £89,004,000, was estimated by me at £86,549,000, and was actually 504 £87,205,000, or £656,000 more than the Estimate.
I now proceed, Sir, to the Expenditure of last year. The permanent charge for the Debt was estimated at £28,954,000, and it actually came to £28,974,000. The Interest on Local Loans, which I estimatedat£525,000, came to£478,000. The interest on the Suez Exchequer Bonds came to just what was estimated— namely, £200,000, and the other charges on the Consolidated Fund, which I estimated at£l,640,000, came to£l,590,000, so that the total charges on the Consolidated Fund, which I estimated at £31,319,000, were £31,241,000.
And now, Sir, I will go to what are called the "Voted Services," and it is necessary to make some comparison both with the original and the final Estimates, including the Supplementary Estimates. The original Army Estimate was £15,607,000, and including the Supplementary Estimate, mainly for the expedition to Suakin, it was£15,975,000. The actual expenditure was£l5,910,000, as compared with £15,502,000 spent on the Army in 1882–3. On the Army Indian Home Charges the expenditure was originally estimated at £1,230,000, and the amount expended was exactly that sum. The charge for the previous year was £1,110,000. The original Navy Estimate was £10,757,000, and including the Supplementary Estimate, also for the expedition to Suakin, the total was £10,899,000. The actual expenditure was £10,729,000, as compared with an expenditure in 1882–3 of £10,409,000. We estimated last Session for a Vote in repayment to India on account of the Afghan War of £500,000. This Session I felt justified in asking the House to pay an additional £500,000 during the last financial year, and the whole of that £1,000,000 has been paid. The actual expenditure for 1882–3 under this head was, of course, only £500,000. We paid nothing last year on account of the original Egyptian Expedition, or on account of the small balances for the Transvaal Wars, which appeared in the Estimates for 1882–3. The amount of that expenditure in 1882–3 was £3,909,000. On account of the Civil Services, our original Estimates were £17,253,000, and including the Supplementary Estimates, they were £17,593,000, the expenditure in 1882–3 having been £17,336,000. 505 The actual expenditure, however, was only £17,181,000in 1883–4; and I think that the Committee will not fail to notice the successful struggle for economy which these figures exhibit. For the Customs and Inland Revenue Departments the original Estimate was £2,775,000, the actual expenditure was £2,772,000, and the expenditure for the previous year had been £2,870,000. The original Estimate for the Post Office was £4,124,000, and including the Supplementary Estimates, the main part of which had reference to the Parcel Post, it was £4,565,000. The actual expenditure was £4,507,000, against an actual expenditure in 1882–3 of £3,828,000. The original Estimate for the Telegraphs was £1,518,000, and including the Supplementary Estimates, it was £1,718,000. The actual expenditure was £1,707,000, against an actual expenditure in 1882–3 of £1,510,000. For the Packet Service, the original Estimate was £706,000, and with the Supplementary Estimate it amounted to £724,000. The actual expenditure was £721,000, against an actual expenditure in the preceding year of £720,000.
And now I will compare the totals. The total Expenditure had been in 1882–3 £88,906,000. I estimated it originally at £85,789,000, and including the Supplementary Estimates, it stood at £87,819,000; but the actual Expenditure was only £86,999,000, and the Revenue having been £87,205,000, we have a surplus on the year 1883–4 of £206,000.
I will defer some remarks which I have to make on the Expenditure of last year until I deal with the Expenditure of the present year; but before passing from 1883–4, I think I ought to explain to the Committee the effect of the Debt operations of that year. The Committee will remember that last year we passed a very important Act dealing with the National Debt for 20 years. That Act provided that £70,000,000 of Funded Debt should be at once cancelled, and that Annuities amounting to £5,130,000 falling in in 1885 should also be cancelled, and that there should be substituted for them fresh Annuities. This operation has been carried out in its integrity. The result on the Debt, including the normal reduction in the year, is as follows. The Funded Debt, on the 31st of March, 1883, was 506 £712,699,000. On the 31st of March last it was £640,631,000; so that the diminution in the Funded Debt has been £72,068,000. That has brought the total Funded Debt to a lower amount than it has ever been since 1811, and the interest on it is less than it has been since 1805. The Funded Debt now consists of the following denominations of Stock:—Consols, £345,302,000; Reduced Three-per-Cents, £83,491,000; New Three-per-Cents, £183,968,000; Two-and-a-Half-per-Cent Stock, £13,580,000; and all other denominations of the Debt, including the Debt to the Banks of England and Ireland, £14,290,000; in all, as I have just said, £640,631,000. The Unfunded Debt at the end of March, 1883, was £14,185,000, and it stood at the end of last March at £14,110,000. The value of Terminable Annuities at the end of 1882–3 was £27,571,000, and on March 31, 1884, it stood at £91,666,000. So that the total amount of Debt, which was at the end of March, 1883, £754,455,000, was on March 31, 1884, £746,407,000, making a net diminution of £8,048,000. This diminution is exclusive of £1,000,000 paid off in the year of the remaining liability to India for our contribution towards the cost of the Afghan War. Against this I must place the reduction of the balances, which were at the end of 1882–3 £6,973,000, and were at the end of 1883–4 £5,633,000. The reduction of the Debt in the four years from April, 1880, to the end of March, 1884, has been £25,198,000, besides the £4,500,000 paid off in respect of the Debt of £5,000,000 to India, and with balances increased by £2,349,000, making a total reduction, as nearly as possible, of £32,000,000 sterling.
And now, Sir Arthur Otway, I have finished my task of reviewing the finance of the year 1883–4, and I will proceed to the estimated Expenditure and Revenue of the financial year 1884–5, in which we now are. I ought, perhaps, to say, in connection with the Debt, that I have taken the occasion of the creation of a new series of Terminable Annuities to carry out still further a very valuable suggestion made by my right hon. Friend the Member for the City of London (Mr. Hubbard), and that is to value them, not as they have hitherto been valued, as if Stock stood at 92 3, but as if Stock were at par. 507 It is upon that assumption that all the figures I give are based, both in regard to past years and to those of 1883–4. I think it will also be interesting to the Committee to know, in the same connection, that of the War Debt of £7,850,000, which we took over from our Predecessors in 1880, and of the promised contribution of £5,000,000 to India, making altogether £12,850,000, £11,000,000 have been paid off in four years, so that only £1,850,000 remain to be provided. We have also paid £6,860,000 out of our income for the whole of the Transvaal, the Egyptian, and the Suakin war expenditure. I have no other matter relating to the reduction of the National Debt to mention to the Committee.
I will now pass to the Estimates of Revenue and Expenditure for the current year, 1884–5. In the first place, I will deal with the estimated Expenditure. Before, however, giving the figures in detail, I must explain that, as the Committee will perhaps have observed from the Army Estimates, there no longer appears as a separate Estimate that for Indian Home Charges which was devised some years ago. For myself, I may say that I never quite understood why that Estimate, separate from the Army Estimates, was framed. But, however that may be, it was balanced by corresponding items of Miscellaneous Revenue, and in our view the time has now come for its disappearance, and for the preparation of the Army Estimates in such a way as to show the actual net expenditure; the gross expenditure being given in one column, and credits of this character in another, the difference being the net amount the Committee is asked to vote. I shall have to refer to this again later, when I come to the Army Estimates; but I ought here to say that, in the comparisons I shall have to make, this item will be omitted from previous years, so that the comparisons will be in all respects fair. I will now take the Expenditure of the year under the different heads. The Permanent Charge of the Debt we take at £28,884,000, as against an actual expenditure last year of £28,974,000, being a reduction of £90,000. That is due to our having been able to pay, last year, out of our balances, the whole of the £2,000,000 which was first a loan, and then a grant to India on account of 508 the Afghan War. The Interest on Loans for Local Purposes we take at £525,000, as against £478,000 in the previous year. The charge for the Suez Loan is the same—namely. £200,000, and the other Consolidated Fund charges amount to £1,495,000, as against £1,590,000 last year. I will not weary the Committee with the details of this reduction; but the last year's charge contained the grants to Lord Wolseley and Lord Alcester, of £30,000 and £25,000 respectively. The total Consolidated Fund charges are, therefore, this year £31,104,000, as against £31,241,000 last year. Passing to Voted Services, the charge for the Army is £15,931,000, against an actual charge for 1883–4, adjusted, as I have explained, with reference to the Indian Home expenditure, of £16,095,000. I will now explain to the Committee the augmentation which is necessitated by the new arrangement made for the receipt from India on account of the Non-Effective Services. I should weary the Committee were I to endeavour to explain, on the present occasion, the details of this most complicated matter. Speaking shortly, however, I may say that amended arrangements were made with India, first in 1861, and secondly in 1870, under the latter of which the charge becoming payable in each year for the first time on account of soldiers taking their pensions was capitalized on the basis of 4 per cent interest, and the amount of the capital sum received from India was paid into the Exchequer and appeared among the Miscellaneous Receipts. But the result of this arrangement was somewhat remarkable. The arrangement was eminently favourable to India, because it—I know not why— omitted all the charge for previous pensioners, and unfavourable to us, because it assumed that we could invest at 4 per cent, whereas we can only invest at 3 per cent. But, in point of fact, India has been for some time considerably in arrear to us on account of these payments. On the other hand, the Exchequer also gained unduly, the capitalized value of any one year's first-granted pensions not really representing the pension charge for that year. It was a rough-and-ready method; but it turned out in the end to produce very different results from those which had been anticipated. For instance, in 1873–4, the 509 sum paid into the Exchequer exceeded the real charge on the year by £92,000, and in 1879–80 by £186,000. We are now making fresh arrangements, under which, in the first place, India will pay up the arrears, and the overpayment to the Exchequer in past years will be gradually wiped out, at a cost to present and future years. Of course, this is unfortunate for us at the present time; but it would be impossible to allow past over-payments to the Exchequer to be left unadjusted, however much we have to suffer for the undue gains of former years. I shall lay upon the Table a Treasury Minute, in which we explain exactly the details of this change. Next I come to the Navy Estimate, which is £10,812,000, against £10,729,000 in 1883–4. The Estimate for the grant to India in respect of the Afghan War is £250,000, against £1,000,000 which we paid last year—1883–4—and this leaves only £250,000 payable next year, instead of £500,000, which would have been payable but for the prepayment I have described. When that is paid, the whole amount of the contribution to India will, I am happy to say, have been wiped out. The Civil Service expenditure is estimated at £17,244,000, against £17,182,000 last year; the Customs and Inland Revenue charges at £2,734,000, against £2,772,000; the Post Office expenditure at £4,753,000, against £4,507,000; the Telegraph Service at £1,735,000, against £1,707,000; and the Packet Service at £731,000, against £721,000. The total Voted Services will thusbe£54,188,000, against£54,7l3,000 last year; and the total Expenditure, omitting for both years the Indian Home Charges, is estimated at £85,292,000, against £85,954,000 last year.
Here I think I ought to pause, to make a few remarks upon the present condition of our Expenditure. Last year, I promised my hon. Friend the Member for Burnley (Mr. Rylands) that I would carefully inquire, during the Recess, not only into the present rate of Expenditure, but also into the movements of Expenditure for some years past. My inquiry is not yet completed, but it has gone a long way. With the assistance of my hon. Friend the Secretary to the Treasury (Mr. Courtney), and the heads of the principal Departments, I have gone through the greater part of the Civil Expenditure; and in Committee of Supply on the Civil 510 Service Estimates some results of what we have done will be explained in detail, and our future prospects of economy will also be discussed. But I have made a comparison, which will interest the Committee, between the actual Expenditure of 1873–4—a year which can provoke no political feeling, as it was the last year of the former Administration of the present Prime Minister—and the Estimates which we are now submitting; and the figures, I think, may be studied with advantage. The net Expenditure on account of the Civil Service and Revenue Departments, after deducting the Extra Receipts, Fee Stamps, &c., was, in 1873–4, £16,442,000; and the net Expenditure proposed in these Estimates is £24,675,000, showing an increase of £8,233,000, or rather more than 50 per cent upon the former Expenditure. Now, I have analyzed this Expenditure as to its main, or, I may say, as to all its sources and branches, and I find this to be the result. Local Subventions, including the charge for the Police, have increased by £2,950,000; Public Education has increased by £2,367,000; the charge for the Post Office and the Telegraphs, including Post Office Buildings, has increased by £2,665,000; and these, together, give a total of £7,982,000. There remains, then, a balance of £251,000 to be accounted for. But there are some charges which, I think, stand out from the normal Expenditure when dealing with its increase. For instance, the collection of £5,700,000 additional Revenue has involved an additional charge of £83,000, after all only 1½ per cent on the Revenue collected. Parliament determined that the Surveys of the United Kingdom should be expedited, and this accounts for £112,000. The additional charge for the British Museum and Art Galleries this year amounts to £43,000; the recent arrangement as to the Friendly Societies' deficiency involves a charge of £48,000; Cyprus costs us £30,000; and the Irish Land Commission, although much heavier last year, is estimated to cost this year £87,000. If you add these figures together, you will find that they come to £8,385,000, against a I total increase of £8,233,000; so that all the other Civil Services, in spite of large demands in some directions, show an aggregate saving of £152,000. This is no argument whatever against economy. On the contrary, I hope, and with some 511 foundation, that we may be able to make even further savings than those we have succeeded in effecting by our investigations this year; but I think that the figures I have given shows a greater anxiety for economy on the part of the Public Departments than is commonly allowed. Even in the presence of my hon. Friend the Secretary to the Treasury, I ought to say that in this matter to no one is more gratitude due than to him. He has worked hard and successfully; for the last year's Civil Expenditure, as I said before, in spite of large Supplementary Estimates, fell short of the original Estimates by £75,000, and my hon. Friend has shown the greatest zeal for the public in preparing the Civil Estimates of the present year. I now pass to the Estimates of Revenue, and I must make, in the first place, a general remark. The present condition of the country is such that it is most difficult to forecast the Revenue with accuracy. We have to deal in this matter with very conflicting considerations. On the one hand, in many branches trade is still depressed, and, perhaps, may be still more depressed; profits generally are low, and incomes derived from land, whether by owners or farmers, are still in an unsatisfactory state. When I look to such indications as railway receipts, they do not give evidence of increase of prosperity, but possibly the reverse. On the other hand, I am bound to say that I think a careful study of the information we possess shows that the artizans and labourers of the country are doing well. Bread and the common articles of consumption are at a very low price, which tells much in their favour. The result, which is almost an infallible test, is that pauperism is steadily decreasing. I also notice as remarkable that, although there is much complaint among persons in easy circumstances, as well as among the recipients of still higher rates of income, there is a steady increase in the accumulations of the country, which is best evidenced by the growth of the Income Tax and of the House Duty. Putting these two considerations against each other, my Estimates of Revenue, although they cannot be called very sanguine, will not err on the side of undue caution; they will be fair Estimates, I hope neither timid nor exaggerated. I will now take each head of Revenue. The Cus- 512 toms produced in 1883–4£19,701,000, and my Estimate for 1884–5 is £19,850,000; the Excise produced £26,952,000, and my Estimate is £26,800,000, this diminution being due to the loss of the rest of the £400,000of Railway Duty. Stamps produced £11,620,000, and my Estimate now is £11,490,000; the Land Tax produced £1,070,000, and my Estimate is now £1,055,000; the House Duty produced £1,805,000, and my Estimate is £1,880,000; the Income Tax produced £10,718,000, and the Estimate at 5d,. with nothing left of the additional 1½d., is £10,050,000. It will be seen that 1d. of Income Tax is estimated now to produce over £2,000,000. A penny of Income Tax produced, in 1880–1, £1,850,000; in 1881–2, £1,900,000; in 1882–3, £1,950,000; in 1883–4, £1,970,000; and this steady increase justifies our present Estimate. The total Tax Estimate this year is £71,125,000, against a receipt last year of £71,866,000. I now come to the Non-Tax Revenue. Crown Lands we estimate at £380,000, the same as last year. The Interest on Advances produced last year£l,196,000, and the Estimate for the present year is £1,180,000. Miscellaneous sources (excluding Indian Home Charges) produced £3,243,000, and the Estimate is £3,170,000. The Committee will notice that I have omitted the Post Office and Telegraphs from their proper place. I mention the Revenue from those sources last, because matters of much interest are connected with it. The Committee will remember that, in 1883–4, two great operations were commenced by the Post Office. One was the introduction of the Parcel Post from the 1st of August; and the other consisted of preparations for cheap telegrams, the cost of which, irrespective altogether of the annual loss arising from the lower rate, according to a Treasury Minute laid upon the Table, was estimated at £500,000, which we intended to spread over the financial year 1883–4 and the first six months of 1884–5. We estimated that the expense of the Parcel Post during the eight months of the year in which the service was in operation would be covered by the receipts, then taken at £340,000. But I am sorry to say that this expectation has not been entirely fulfilled. The Parcel Post receipts for the eight months of 1883–4 were only £155,000, as against 513 the Estimate of £340,000. Now, when it was clear that the receipts would be so seriously deficient, my right hon. Friend the Postmaster General (Mr. Fawcett), without delay, undertook a vigorous attack upon the expenditure in connection with the Parcel Post, which had been based upon the original Estimates. In criticizing that expenditure, it must be remembered that the cost of the Parcel Post for the past year included about£150,000, which was initial or capital expenditure, and which will not recur in future years. Many economies are being proved by experience to be practicable which could not be effected in initiating a new service. We have every hope, therefore, that in due time the equilibrium between receipts and expenditure will be reached. We cannot hope, however, that it will be reached in the year 1884–5, in which, instead of £500,000 or more, as we had originally hoped to receive, the Parcel Post is only estimated to produce £240,000. It therefore becomes necessary for us to consider whether, under these circumstances, the reduction in the price of telegrams, which will also be very expensive, should commence as soon as the 1st of next October. If it is carried out then, further diminutions in the Post Office Revenue will of course take place, and the taxpayer will have to make them good. I may, perhaps, be allowed to remind the Committee, as a personal matter, that in the debate last year on the Motion to reduce immediately the price of telegrams, which I think was made by my hon. Friend the Member for Glasgow (Dr. Cameron), I urged that it would be wise for the House to pause, and not to insist on this costly reform until the result of the Parcel Post experiment was known. My warning, however, was not effectual; but I think I was justified by the events. The cost in this year's Budget, if the cheap telegrams commence on the 1st of October next, would be between £250,000 and £300,000; and this, as the Committee will soon see, I cannot afford. We propose, therefore, that the reduction in the price of telegrams shall take place on the 1st of August, 1885, and that the sum devoted to preparations shall be divided between this year and the beginning of the next financial year. The receipts for 1884–5 are therefore estimated as follows:—For the Post 514 Office proper, with 12 months' Parcel Post, £7,900,000; and for the Telegraph Service, £1,800,000; making a total of £9,700,000, against the actual receipts for 1883–4 of £7,730,000 for the Post Office proper, including eight months' Parcel Post income, and of £1,745,000 for Telegraphs, or a total of £9,475,000. The improvement in the receipts will thus be £225,000. On the other side of the account the Committee will remember that there is an increase of charge, according to the figures already given, amounting to £284,000. Adding Post Office receipts to the other items of Non-Tax Revenue, the whole will be £14,480,000; and as the Tax Revenue is estimated at £71,125,000, the total Receipt of the year 1884–5 will be £85,555,000. The Expenditure, as I have already stated, is £85,292,000, and my surplus, therefore, is £263,000. Now, Sir Arthur Otway, it will be evident that I have nothing to give away in the shape of important remissions of taxation. I have received lately a good many proposals of this character, and there are, or were lately, on the Notice Paper about 11 others formulated by hon. Members. There are also proposals, I need not say, for more expenditure. All these are very interesting questions in themselves; but, clearly, the present is not the time to discuss them. I ought, however, perhaps, to refer to one proposal in another direction which I have carefully studied since last Session—I mean the final settlement of what are popularly called the Death Duties. A final settlement in that matter ought to have two characteristics. It ought to give us some additional Revenue, and it ought, undoubtedly, to give us great additional simplicity. The present is not the time to indicate how much additional Revenue we might receive; but I have no doubt whatever as to the second point—I mean that the final adjustment must impose a heavier proportional charge than now on real compared with personal property, and must include property in mortmain. Now, I am bound to say that I do not think the time has come for this. The time is approaching, however, when, under a general Local Government Bill, relief will have to be given to the payers of local burdens; and this relief, whatever its amount may be, will accrue mainly to owners of land and houses— 515 that is to say, to real property. It seems to me that that should be the occasion for adjusting and finally settling the Death Duties. I have given considerable attention to this matter, and the problem, to my mind, is not one very difficult to solve. While dismissing for the present this large question, I have one or two minor changes to propose, both being reliefs to the payers of the Carriage Tax. We have received a great many complaints to the effect that the sum of £2 2s. a-year charged on licensed hackney carriages with four wheels is excessive. The complaints have come not only from London, but also from watering-places, from Scotland, and elsewhere, especially where the season is exceedingly short. I have taken some pains to examine those complaints, and I think that they are not without foundation. We propose, therefore, that where the fares of carriages for hire paying £2 2s. are fixed by law, or by local regulation, the duty shall be the same as that for two-wheel carriages—that is to say, 15s. And we also propose that the owners of all carriages which are used for the first time during the later months of the year—after September 30—shall be treated as "beginners" are in some other licensed trades, and shall only pay half duty. The loss from these two changes will be £22,000. Deducting this from my original surplus of £263,000, I am left with a final surplus of £241,000. I am bound to say that, considering the possibility of other claims arising, this is not too large a surplus.
Well, Sir, this concludes my review of the past and my anticipations of the present year. But before concluding my Statement, I must explain to the Committee two important financial operations which we propose to undertake during the present year. The first relates to the Gold Coinage, and the second to the Interest on the National Debt. The first question in regard to the Gold Coinage is one of great importance. Since the late Mr. Jevons's paper on the subject in 1868 was published, the condition of our Gold Coinage has more and more occupied the attention of bankers, of the Press, and, indeed, of the general public. As I shall show, more than half of our existing gold coins have ceased to be even a legal tender. Nor is this wonderful, for no- 516 thing has been done for more than 40 years to correct the gradually declining condition of the coinage. I will explain in a few words the actual law. A sovereign, which is supposed to weigh 123⅓ grains, becomes light, and is no longer a coin of the Realm, when it weighs less than 122½ grains. If I go into a shop and tender such coin for a purchase, the shopkeeper may either refuse it before he takes it in his hand under the 4th section, of the Act of 1870; or, if he takes it in his hand, then, under the 7th section of that Act, he is bound then and there to break it up, and charge me the loss. For this purpose, both he and I are supposed to have—I carrying them with me in my pocket—scales with proper gold weights, and instruments for. breaking up coin; and if we either tender light coin or fail to break it up, then we are both guilty of a misdemeanour punishable by fine and imprisonment. Similarly, at a railway station, suppose I take a ticket and get gold in exchange for a note, the law presumes that both the railway clerk and I have scales, and a coin-breaking instrument, and the same penalties attach for either tendering or receiving light coin or refusing to break it up. That is the principle of the law under the 4th and 7th sections of the Act of 1870. I said just now that more than half the present Gold Coinage was light. Of this the testimony is so concurrent that there can be little doubt about it. But the quantity of gold coin current in this country is much more uncertain. Apparently, since the restoration of the Gold Coinage in 1817 more than £300,000,000 worth of sovereigns and half-sovereigns have been put in circulation here and at the branch Mints, while not more than £50,000,000 are known to have been withdrawn. But by the best computation of bankers, and others who have paid attention to this extremely difficult subject, there remain at the present time in the United Kingdom about £90,000,000 in whole sovereigns, and £20,000,000 in half-sovereigns, of which 55 per cent are light, and are therefore not a legal tender. Of the sovereigns about 50,000,000 are, on the average, 2½d. light, and of the half-sovereigns 11,000,000 are 2¼d. light. The deficiency in the case of the sovereigns is £510,000, and in the case of the half-sovereigns £200,000, or, in 517 all, £710,000; besides the wear down to the point of legal currency—namely, the difference between 123⅓ grains and 122½ grains. This appeared to me so serious that for some months I have given the subject my most careful consideration, and I have been consulting the best authorities as to remedies; and I am bound to say that though there is not any great difference of opinion as to the evil, there is a great difference in the suggestions for remedying it. The first recommendation is to leave matters alone. But that is evidently impossible, as the evil would only get worse; and the result would be, in the end, to bring serious discredit on our coin as an instrument of exchange. Then it has been proposed to put the law into operation, as in 1842—that everyone should be obliged to weigh his gold coins, and that the Mint, through the Bank of England, should give the fixed price of £3 17s. 10½d. an ounce for light gold, instead of for bullion only. I think that, if weighing gold were to become universal, there would be a great inconvenience to the public, and that it would produce far greater discontent than it did in 1842. It was found to be very inconvenient then; it would be tenfold more inconvenient now. Then it has been proposed to charge this £710,000 immediate loss and the cost of re-coinage on the taxpayers to all time; and this, I may say, would probably at first involve an addition to the Income Tax. I am not prepared to adopt this course. It has also been proposed, practically, to remove the sovereign from circulation by issuing £1 notes, charging the cost of renewing the half-sovereign on the profits of issue. This is a serious question. I think the issue of £1 notes should depend on other considerations, and I am not prepared to mix up the two questions together. My noble Friend and Predecessor (Viscount Sherbrooke) had a proposal for diminishing the weight of the sovereign; but, to my mind, that would be open to grave objections. Then it has been proposed by competent authority to keep up the weight, but to impose a mintage charge sufficient to maintain the coinage in a sound condition. This question was very carefully examined by Mr. Graham, the late Master of the Mint, and Colonel Smith, the Master of the Calcutta Mint, some years ago, and their Report shows 518 that this mintage charge must be 1⅔ per cent, or 1s. 4d. an ounce. But in that case it would be impossible to maintain the price of £3 17s. 9d. an ounce, at which, under the provisions of the Bank Act, the Bank of England is bound to purchase all gold brought to it. I am not, therefore, prepared to propose a mintage charge of 1s. 4d. an ounce. Finally, I have considered a proposal which has great authority for it—namely, to enforce the present law, sharing the loss between the taxpayer and the last holder. But that would have all the inconveniences of the present law, without relieving the public from charge, and I am not able to adopt it. None of these plans I think will commend themselves to the Committee. There is, however, another remedy, which has not been recently very prominently before the public, but which finds favour with high financial authorities, both present and past. I have laid great stress on the importance of making no change as to the sovereign. Its currency should be always preserved in a sound condition, and its weight should not be altered; and I attach some, but not paramount, importance to its being minted without charge. The sovereign is really an international coin, largely used in Exchange operations, and known to the greater part of the civilized world. But there is another gold coin, governed apparently by the same law, but of an. entirely different character—I mean the half-sovereign. This is not an international, but a purely domestic coin. I have made careful inquiries during the last few months, and I can find no instance of half-sovereigns being sent from, this country in any considerable quantities as remittances or for Exchange purposes. On the other hand, while it is a domestic coin, it is a very expensive coin to maintain. From the figures I have obtained as to the average deficiency in sovereigns and half-sovereigns, I find that its wear and tear is double that of the sovereign, and that it becomes light in half the time of the latter. It is with this coin that we propose to maintain the condition of the sovereign. My plan, therefore, is to issue, instead of half-sovereigns, as now, 10-shilling pieces of gold, containing only nine-tenths of the present amount of gold. Thus, the 10-shilling pieces would have the same relation to 519 the sovereign as the crown and half-crown, and would be a token coin, as they are. Just as the crown is worth a quarter of a sovereign, so the 10-shil-ling piece would be worth half-a-sove-reign, neither the one nor the other having, with respect to the metal contained, the full intrinsic value attributed to it. Of course, it would be necessary to restrict the extent to which the new 10-shilling piece would be a legal tender. Silver coin is only a legal tender up to 40s.; 10-shilling pieces should probably be a legal tender for payments up to £5. Arrangements will, however, be made with the Bank of England for the receipt from bankers of redundant 10-shilling pieces, just as redundant silver is received now. The change in the half-sovereign will enable us to withdraw, by degrees, from circulation the whole of the present light coinage, substituting coins of full weight, without either inconvenience to the public or charge to the taxpayer. In other words, we shall be able to rehabilitate the sovereign, the character of which, both as an instrument of exchange and circulation, should be most jealously preserved. Not only this, but we shall be able to maintain its integrity for the future without any cost to the taxpayer. I will now explain the mode of operation. In the first place, we shall take steps gradually to withdraw, by arrangement with the Bank of England and the private banks, the whole of the half-sovereigns now in circulation, the Mint issuing as they come in the new 10-shilling pieces. Similarly we shall withdraw, and finally call in by proclamation, sovereigns of Reigns prior to that of the Queen. When these two operations are approaching completion, towards the end of 1885, we shall commence withdrawing the light sovereigns of the present Reign, issuing as rapidly as possible new sovereigns in exchange. The Committee will observe that this operation, if carried out without any qualification, might operate as an incentive to sweating or some similar fraud; and we therefore propose that no sovereign of any date which has obviously been tampered with, or which shall be light by as much as 6d., shall be received except as bullion, and that no sovereign of less than 10 years' currency shall be exchanged at all. All the half-sovereigns will be exchanged, 520 except such as have been tampered with or are light by as much as 4d. When the whole of the present light coins have been got in, and the coinage has become normal, the same process will be continued with the sovereign. Under this plan, bankers would have no temptation to retain or re-issue coin which has become light by fair wear and tear. This coin would, in the ordinary case, find its way to the Mint through the Bank of England. I may mention here that we do not propose to give Gold Coinage circulating abroad this privilege of exchange. All such coin passing through the Custom House would be sent, as the great majority of it is now sent, to the Bank of England to be weighed and dealt with according to the present law.
The Committee will like now to know something of the financial result of this operation. I must repeat what I said before, that we have a very imperfect knowledge of the amount of gold coin in circulation. Taking, however, the calculations of the best authorities, which I have already explained, we estimate that £20,000,000 in half-sovereigns, now in circulation, will be withdrawn and replaced by the new 10-shilling pieces, and that for the next 20 years £250,000 worth will be issued annually. On the re-issue the gross profit would be £2,500,000. Against this have to be set, first, £200,000, the deficiency on the existing half-sovereigns which are below legal tender, and which would have to be withdrawn; and, secondly, perhaps, £20,000, the deficiency on those within legal tender weight, which will also be withdrawn. The loss on the sovereigns which are now light I have already estimated at £510,000. The loss on other sovereigns withdrawn during the next 20 years I take at £320,000. The cost of re-coinage I take at £70,000. Adding £50,000 for contingencies, the total charges will be £1,170,000, leaving a balance of £1,330,000, besides accumulated interest. This, in our judgment, will be sufficient to keep the Gold Coinage for the future in a satisfactory condition at a cost of above £40,000 a-year. We propose that these operations should be altogether outside the Consolidated Fund, and that the receipts should be paid into, and the charges defrayed from, a fund to be called the Gold 521 coinage Fund in the hands of the National Debt Commissioners.
Having explained the first part of my proposals, I now pass to the second important financial operation we propose to undertake—that is to say, in connection with the Interest on the National Debt. The Committee will remember the Act passed last year, in furtherance of the Act of 1876, under which arrangements were made for reducing a very large amount of Debt in the next 20 years by the method of Terminable Annuities. In asking Parliament to sanction that proposal, we not only had in view the mere reduction of the capital of the Debt upon a self-acting system, but we contemplated also that it would render more easy, at an early date, the reduction of interest on the three categories of Three per Cents, the aggregate amount of which is over £600,000,000. The time has now, in our opinion, arrived for taking the first steps in this most important operation. The Money Market seems to be prepared for it; for I notice that the Two-and-a-half per Cent Stock, which stood at 86 two years ago, with Consols at 101⅝, is now nearly at 91, with only a fractional increase in the latter, a rise of 5 per cent; and I am aware that there is a steady increase in the investments by large Companies in Two-and-a-half per Cent Stock, indicating their belief that it will become the Stock of the future. I will now explain to the Committee what we propose to do. In the first place, let me refer the Committee to the conditions under which the Three per Cent Stocks may be paid off. There are three classes—Consols, New Three per Cents, and Reduced Three per Cents—all of which are now liable to be redeemed; but the conditions are not the same. In the case of Consols and Reduced, the terms of the Act of 1870 are that, at one year's notice, they may be paid off, in quantities or parcels of not less than £500,000. In the case of the New Three per Cents no notice is necessary; but though the matter is not beyond doubt, it may be contended that the whole must be paid off at one time. Omitting, therefore, for the moment the New Three per Cents, we are enabled gradually to pay off the rest of the Three per Cent Debt (exceeding £400,000,000), however unwilling the holders may be, by giving, from time to 522 time, a year's notice to the possessors of manageable amounts, that they will then receive £100 in cash for £100 Stock, unless they agree to accept at once some offer in a Stock of lower denomination; and as both Stocks are now, and have been for some time, at a premium, and, but for the apprehension of their being paid off would probably be at a higher premium, this compulsory process might be safely commenced. I am, however, desirous to make our first step in this matter one of agreement rather than of compulsion; and what we now propose is to constitute a Two-and-three-quarter per Cent Stock, with quarterly dividends, not liable to redemption before 1905, and to ask Parliament to authorize the offer to the holders of any of the three denominations of the Three per Cent Stocks, such amount of that Stock not exceeding £102 for each £100, as the Treasury may determine; or, at the option of the fund holder, such amount of Two-and-a-half per Cent Stock not exceeding £108 for each £100, as the Treasury may similarly fix. A reasonable period would be named by the Treasury, within which the holders would have to elect to exercise either of these options. The Committee will observe that, by conversion into Stocks on which the Dividends are payable quarterly, all the holders will get the benefit of a quarter's payment for ever in advance.
It is necessary that I should now explain what would be the effect of any reduction of interest under this scheme, on the permanent charge of £28,000,000 a-year now appropriated to the service of the Debt. In our opinion, the net benefit of this reduction ought to go to the taxpayer—that is to say, the charge for the Debt should be reduced to that extent. I ought, however, to explain what I mean by net benefit. If the conversion either into Two-and-three-quarter per Cents or Two-and-a-half per Cents should lead to an increase in the nominal capital of the Debt, provision for the extinction of that increase should be made, out of the saving in interest, before the benefit is gained by the taxpayer. I will illustrate this by assuming that £1,000,000 of Three per Cents are converted into £1,020,000 of Two-and-three-quarter per Cents. I do not exclude obtaining a better price; but I base my illustrations on the extreme 523 prices to which I am asking the Committee to go. The gross saving then, in interest, would be £1,950 a-year. But from that would have to be deducted £200 a-year as a Sinking Fund, to extinguish, in 50 years, the premium of £20,000; SO that the net reduction in the charge for the Debt would be £1,750 a-year. Similarly, conversion into Two-and-a-half per Cents, at the extreme price of 108, would result in a saving, on the interest of each £1,000,000 converted, of £2,200 a-year. The Committee will observe that the offer in Two-and-a-half per Cents will be apparently not so good for the fundholder as that in the Two-and-three-quarter per Cents; but, on the other hand, the latter will be liable to be again redeemed in 1905, and, besides, it is not, as yet, a Stock known to the Market. It is impossible to estimate the extent to which either of these offers may be accepted; but the Committee will remember that there is behind them the compulsory process which we are satisfied that we could, without practical difficulty, apply gradually to Consols and Reduced Three per Cents, whatever the case of the New Three per Cents may be. But I repeat that we are not desirous to apply our compulsory powers if we can obtain the same ends by voluntary agreement.
I have now, Sir, concluded my explanation of the second of the two proposals which we make to the Committee in connection with the financial operations of this year, and it only remains to me to thank the Committee for having listened so patiently to an inordinately long Statement, containing a great number of figures. I trust that Statement has been as clear as I desired to make it, and that the kind attention accorded to it may be taken as a good augury for the success of the proposals which I have laid before the Committee.
Motion made, and Question proposed,
That, towards raising the Supply granted to Her Majesty, there shall be charged, collected, and paid for the year commencing on the sixth day of April, one thousand eight hundred and eighty-four, 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):
§ MR. WILLS
said, hon. Members knew that every Chancellor of the Exchequer had a task of great difficulty in distributing the surplus at the end of the financial year, for which there were always many applications. The right hon. Gentleman had, no doubt, on the present occasion, done his best, and, in his (Mr. Wills' s) opinion, done it with success; nevertheless, he must not be surprised that there should exist a feeling, he would not say of dissatisfaction, but of disappointment, with regard to the matter of distribution. He was aware that the generosity of the right hon. Gentleman was largely in excess of the means at his disposal; and there were various interests which he was sure he would have conciliated and relieved if it had been in his power to do so. But there was one interest which particularly felt the difficulty of the right hon. Gentleman's position, and that was the tobacco trade. Now, on more than one occasion the Committee had permitted him to point out the conditions of that interest, which was of great value to him in the matter of Revenue, and of importance to the country, on account of the large consumption of tobacco. An injury was done to the trade in 1878, when the right hon. Baronet the Member for North Devon (Sir Stafford Northcote) was Chancellor of the Exchequer, by the imposition of 4d. per lb. additional duty upon tobacco, from which he was sorry to say the trade had never recovered. It was not the upper classes so much as the lower who were affected by this; it was essentially a poor man's question, and a 525 poor man's tax. It was all very well to speak of tobacco as a luxury of the poor man; but it was no less true that it was for him an absolute necessary of life. If he spent 3d. on tobacco, 2¼d. of that went to the Revenue. If he might be permitted to point out to the Committee how unfairly the tax affected the different qualities of tobacco, he believed it would be seen that a strong case was made out for future consideration. On the kinds of tobacco used by the working classes of the country the duty was about 700 per cent ad valorem on the price; on the finer growths of Virginia the duty was only about 300 per cent. On the higher classes, which included the tobaccos of Havannah and Turkey, the duty was from 100 down to 30 per cent; while upon the highest class cigars it was only 10 per cent. The result of this was that out of nearly £9,000,000 of duty, more than £6,500,000 were paid by the working classes of this country. He was quite sure the Chancellor of the Exchequer would have given relief to this interest had it been in his power to do so; and he need hardly say he regretted that it was not at present possible to give that relief. The right hon. Gentleman could not be surprised if a trade of such large importance, and suffering so cruelly, did year by year, on occasions like the present, take the opportunity of making its voice heard, in order to bring its claims before the Government and the country. He hoped that on some future occasion, when the elasticity of the Revenue had been to some extent restored—when, instead of the slow progress pointed out this year, they should have a brighter future of better seasons and restored trade, it might be in the power of the right hon. Gentleman to confer a boon upon the poorer classes in the country by reducing the duty upon this article of necessity.
§ MR. MACIVER
said, he had felt very much in sympathy with the hon. Member who had just spoken, until he concluded his remarks rather unexpectedly after having only half stated his case, and leaving it to the Committee after arriving at what appeared to him to be a somewhat lame and impotent conclusion. He agreed entirely, and he believed all who heard it would agree, with what the hon. Member had said as to the grievous burden which the Tobacco Duty constituted on that class of the com- 526 munity which most used tobacco; but the hon. Member had suggested to the Committee no means whereby that burden might be removed; and he had, moreover, entirely omitted to point out that which was a very serious part of the question—namely, that about one-fourth of all the tobaccos used in the country was grown in their own Colonies and Dependencies. To tax the productions of their own Colonies and Dependencies, and particularly that portion of them which was most used by the working classes of the country, seemed to him to be a crying shame and injustice; and he thought the hon. Gentleman who had just spoken would have done well if he had made some suggestion as to the mode in which that injustice might be removed. To tax the productions of their Colonies was bad enough; but to tax the poorer classes of consumers at home for what was almost a necessity of life was even a greater injustice. That being his view of the matter, he would endeavour to supplement the statement of the hon. Member, and to suggest to the Committee that which, in his opinion, the Government ought to do in respect of the burden which fell upon the poorer classes of the community. It was quite true that, as matters then stood, the Chancellor of the Exchequer had no surplus Revenue to give away; but it by no means followed that he might not have some means hereafter, which he could apply to the reduction of the duty on tobacco, and for the removal of the duty on Colonial tobacco entirely. But how could the Chancellor of the Exchequer raise the Revenue which would be required before he could make those remissions? He had no hesitation in saying that a considerable Revenue, quite enough to enable the right hon. Gentleman to abolish the duties on tobacco, tea, cocoa, and coffee produced in their own Colonies, and much more might be raised without disadvantage, but with great advantage to the country, by taxing foreign-manufactured goods imported into the country, which at present contributed nothing to the Revenue. Again, he thought that Revenue might be raised to a larger extent than at present upon foreign wines and spirits; and an additional reason for taxing them was that they came into competition with the liquors and spirits consumed in the United Kingdom. This question ap- 527 peared to him to be even of more importance to Ireland than it was to England.
said, he would point out to the hon. Member that he should restrict his observations to the Resolution before the Committee. At present he was giving them a development beyond that Question, which was that a certain amount of Income Tax should be levied in the financial year.
§ MR. MACIVER
said, he had, of course, no intention to extend his observations beyond the scope of the Resolution. Not only had he followed precisely the line of the remarks of the hon. Member opposite, but his own remarks were made in special connection with the Income Tax; and, therefore, he thought that, from every point of view, he was perfectly in Order. His contention was that not only the duty on Colonial tobacco, tea, cocoa, and coffee should be abolished, but that the Income Tax might also be reduced to a considerable extent if those duties were replaced upon foreign imports.
said, the argument of the hon. Member was entirely beyond the Resolution before the Committee. The observations with regard to tobacco had been very much to the point; but the hon. Member was now entering on a large question of Colonial policy, which was clearly irrelevant to the Question.
§ MR. MACIVER
said, he thought his observations followed naturally upon the question with regard to tobacco raised by the hon. Member opposite (Mr. Wills.) He would, however, now put that aside, and address himself to the question of Income Tax, which he understood to be the specific subject before the Committee. He would, of course, follow the ruling of the Chairman, and he believed he should be in Order in showing that his proposals with reference to the substitution of taxation upon foreign-manufactured goods imported into this country ought to be adopted, rather than those of the Chancellor of the Exchequer. It was frequently stated in the Press—and The Times was supposed to have advantages in speaking on this question, because it was known that Mr. Giffen was on the staff of that newspaper—that the importation of foreign-manufactured goods was very small indeed. That was declared by The Times four days ago; and if it were really 528 the truth, any scheme which he desired to present in the way of taxing those imports would, of course, fall to the ground. He believed the Committee would perceive at once that the whole force of his argument depended on the question as to whether the importation of foreign-manufactured goods was large or small.
said, the observations of the hon. Member with regard to manufactured goods were clearly not within the scope of the Resolution before the Committee.
§ MR. MACIVER
said, he bowed to the decision of the Chairman. At the same time, he would, in concluding his remarks, respectfully protest that his wish was to show that foreign-manufactured goods should be taxed to provide to some extent a substitute for the Income Tax. [An hon. MEMBER below the Gangway: The Cloture.]
MR. ALDERMAN W. LAWRENCE
congratulated the Chancellor of the Exchequer on the able manner in which he had laid his Statement before the Committee. The right hon. Gentleman had marked out what were, undoubtedly, two very bold plans. One of these had relation to the National Debt; and he had no doubt that having taken every means in his power to obtain information upon the subject, the right hon. Gentleman would be able to carry out the reduction of the Debt in the manner proposed. He believed, also, that the proposal would be a relief to the Money Market, because everyone would feel that at the present price Consols were not a secure investment.
§ MR. WARTON
rose to Order. He wished to know whether Consols were included with the subjects permitted to be referred to in connection with the Resolution before the Committee?
MR. ALDERMAN W. LAWRENCE
said, he presumed the Statement of the Chancellor of the Exchequer was before the Committee at that moment. It was always usual that questions brought forward in the Budget should be subject to comment in that House when the 1st Resolution was before it. It would be satisfactory to everyone to learn the extent to which the reduction of the National Debt had taken place up to the present time; but there was another 529 question which, to his mind, was of as great importance, and that was the question relating to the coinage. On that question he could not coincide with the opinions expressed by the right hon. Gentleman. When Mr. Lowe was Chancellor of the Exchequer the question was brought forward of taking 3d. out of each sovereign, and it was said that no one would find it out. The reduction was to be made as a mintage charge, which was defended on the ground that the sovereign was a manufactured article, and there was to be some arrangement by which the Bank of England on demand was to give bullion in exchange for notes, which might be sent abroad, while the gold coin was to remain at home. But when that scheme was examined it was found that there would be a loss on every transaction. It was, of course, an impossibility that 3d. should be taken out of every sovereign, and no one would lose by it. Again, the second proposal with regard to the coinage, although it only related to the half-sovereign, was open to the same objection. It appeared that the whole of the Gold Coinage of the country, from long use and frequent passing from hand to hand, had become more or less light, a fact which, in his opinion, was largely due to the considerably higher wages paid to the labouring classes since this question was last taken in hand 40 years ago. During the period which had elapsed, artizans especially had received a much larger proportion of wages in gold than was the case formerly; and that had, no doubt, caused much greater wear and tear of the Gold Coinage than took place when it circulated almost entirely amongst the higher classes of society. It was calculated that the total quantity of sovereigns and half-sovereigns in existence were worth at thatmoment£710,000 less than the value which they represented as current coin of the Realm. They had not been troubled for 40 years with the weighing of sovereigns and half-sovereigns. The custom had ceased amongst traders, at the Post Office, the Savings' Banks, all Joint Stock and Private Banks, Railway Stations, and in other public Establishments, with the exception of the Bank of England and Somerset House, where the custom still obtains of cutting each light sovereign or half-sovereign into two pieces. He believed that had the custom continued 530 of cutting or refusing the light gold, the loss and inconvenience to the public would have been far greater than was represented by the sum of £710,000, the amount to which the gold coin had depreciated during the last 40 years. Well, that money, although it had slipped away and had gone no one knew where, was as much lost to the country as if the Government had put 710,000 sovereigns on board a vessel which had gone down in the ocean. And if that had actually taken place, what would be said if the Government attempted to lessen their responsibility with regard to it? Therefore, he said that the simplest, the cheapest, and only satisfactory way of dealing with the question of coinage was for the State to pay the money lost by wear and tear. It was the cheapest way, because to do otherwise would be to shake faith in the half-sovereign at home and abroad. The Chancellor of the Exchequer said that these coins were well known in every part of the world, and that they were taken in exchange for goods according to their current value; but under the plan proposed two half-sovereigns would not be worth a sovereign. The half-sovereign would only be a token. Their silver coins were tokens; but no person was bound to take more than 40s. in silver. It appeared that there were in circulation £11,000,000 in half-sovereigns. He presumed that these were to be called in, and that 10s. token gold pieces of the intrinsic value of 9s. only were to be issued to represent that sum of £11,000,000. But the result would be that, although these might pass current throughout this country, they could only be calculated at the Bank as so much weight of gold. After all, this depreciation of £710,000 which had taken place in 40 years was little more than £17,000 a-year, a comparatively small sum when it was remembered that they had got rid of all the inconvenience and dissatisfaction caused by having to use scales and weights to ascertain whether a sovereign was light or not. But this amount of £710,000 need not be paid by a tax placed upon the country at once. The simplest plan, he thought, would be to call in the light gold, and spread the cost of making good the deficiency over a number of years, he cared not how many, by way of Annuity. He was satisfied that the greatest difficulty would 531 arise from dealing with the matter in the way indicated by the right hon. Gentleman. Put it in any form they pleased, they could not take 1s. of gold out of a half-sovereign without inflicting a loss upon the community. It was said that by the process proposed a gain would be made out of the community for the benefit of the State amounting to £2,500,000 in 20 years. If this scheme were correct in principle, why not take 2s. out of the half-sovereign and realize £5,000,000? In the same breath it was said that no one was to lose; but how could that possibly be the case? They were aware that Foreign Governments had endeavoured to grapple with the state of things present to the mind of the right hon. Gentleman the Chancellor of the Exchequer by means of paper money; they were aware that in consequence of the large issue of paper money in Russia at the present moment the paper rouble had considerably decreased in value. Unquestionably, if 1s. worth of gold was taken out of the half-sovereign, the half-sovereign would be so much decreased in value. It must be remembered that what was so proposed would not affect some classes of the community to any very large extent. Those classes, for instance, who paid and received money by means of cheques rarely had much coin in their pockets. The retail traders of the country received half-sovereigns in large numbers; and it was well known that the working classes were very frequently possessed of half-sovereigns, so that it was upon those people that the loss which must inevitably accrue would fall. And then it was said that the Bank of England were quite prepared to take any number of the new 10s. pieces; but he could hardly credit that such was the case.
MR. ALDERMAN W. LAWRENCE,
continuing, said, that that would considerably aid the matter; but, nevertheless, he could not help thinking that the right hon. Gentleman the Chancellor of the Exchequer was in this matter proceeding upon a very wrong principle, and that he was setting a very bad example to other countries. As he (Mr. Alderman W. Lawrence) opposed the proposal to take 3d. out of each sovereign, which was ingeniously and elaborately 532 placed before the House by Mr. Lowe when that right hon. Gentleman was Chancellor of the Exchequer, he felt bound now to oppose the proposal to reduce the intrinsic value of the half-sovereigns—to reduce them, in fact, to tokens; and he believed that that was the first time that any country whatever had attempted to substitute gold tokens for gold coins. He was quite sure that it was the first time that any. Chancellor of the Exchequer had ventured to present such a scheme to a British House of Commons. Now, when the right hon. Gentleman the Chancellor of the Exchequer brought forward the question of the Death Duties, he (Mr. Alderman W. Lawrence) thought that the right hon. Gentleman was about to propose some final settlement of those duties; and he waited most anxiously to hear upon what basis the right hon. Gentleman was going to propose that those duties should be placed. It was most unfair and unjust that personal property should have to pay Probate Duty and Legacy Duty, while real property should be allowed to change hands without paying any Probate Duty, and only paying Succession Duty. Leasehold property was said to be personal property; so that if a man who had two houses, one freehold and the other leasehold, died, leaving the leasehold house to one son and the freehold house to another son, what would be the result? Why, that the one would have to pay Probate Duty as well as Succession Duty; while the other would pay Succession Duty, but no Probate Duty. The question of the Death Duties might be met, and he thought satisfactorily settled, without any great difficulty being encountered. Unfortunately, the alterations which had been made up to the present time in Probate and Legacy Duties had had the effect of making the duties payable in respect of freehold property lighter, while the duties paid in regard to leasehold property had been made heavier. He was pleased the right hon. Gentleman the Chancellor of the Exchequer had resolved to carry out what had long been desired— namely, a reduction of the tax upon locomotion represented by four-wheel cabs. When he (Mr. Alderman W. Lawrence) brought the question of the Hackney Carriage Duties, the Mileage Duties, and the Post Horse Duties, before the House, in 1866 and 1867, 533 there was an annual tax of something like £19 10s. upon every cab in London. Mr. Lowe, however, brought it down to its present figure. But it was quite clear that a tax of £2 2s. upon four-wheel cabs, and 15s. upon hansoms, was quite sufficient to cause a scarcity of the one and an abundance of the other. He was glad the right hon. Gentleman the Chancellor of the Exchequer had decided that, in future, 15s. should be the charge upon four-wheel as well as upon two-wheel conveyances. He did not desire to detain the Committee long; but as the House had so few opportunities of considering financial matters, there were one or two other questions which he wished to bring under the notice of hon. Members. There was, for instance, the question of the Land Tax. He thought that when they were dealing with other questions with respect to Consols the Land Tax ought to be looked into. There were 2,000 parishes in which the quota was under £10; of these 214 in which it was £1 but under £2; 122 above 10s. but under £l; 87 under 10s.; and 10 under 1s. In all these cases there were meetings of Commissioners and Clerks, Assessors and Collectors appointed. In the case of a redemption of the Land Tax, it was necessary, under present circumstances, to make a most elaborate calculation. The calculation was based upon the average price of Consols at the date of the contract, to which, sum 10 per cent was added, and then 17½ per cent deducted, so that one could readily see that the process was no easy one. He was of opinion that the Chancellor of the Exchequer ought to decide upon a certain number of years' purchase upon which the tax might be redeemed. He was not prepared to say how many years ought to be fixed upon; but he was satisfied that the method he suggested would be found the simplest and the best. In the case of land which was taken compulsorily by Railway Companies, by Corporations and other parties, he was of opinion that they ought to be compelled to redeem the tax in a certain time. He had so often brought that question of the House Tax before the House that it was not his intention to go into that question at any length now. He had hoped the right hon. Gentleman the Chancellor of the Exchequer would have seen his way to have proposed some reduction of the 534 tax. There were many people paying 9d. when, in reality, they ought not to be called upon to pay more than 6d. Hotels, for instance, were only required to pay 6d. But it must be remembered that there were a large number of private hotels and lodging-houses; and he could not understand for a moment why the keepers of the latter establishments should be required to pay more than 6d. if an hotel only paid 6d. Then, again, professional men—doctors, for instance, who had a small surgery adjoining their house—were called upon to pay 9d., while the shopkeeper only paid 6 d. Artists' studios and schools were charged 9d. It appeared to him that the keeping of a school was a business; and, therefore, the tax in respect of a school ought not to be larger than that paid by an ordinary shopkeeper. He was pleased that, on a former occasion, it was stated that when the question of the housing of the working classes came to be dealt with it would, no doubt, be found possible to propose some relief. There was a very important question, however, with respect to the House Tax which ought to be seriously taken into account. By a recent decision of the House of Lords, the Water Companies were only permitted to charge their rates upon the annual value of property. Now, he was unable to conceive why the principle of charging in respect to annual value should not apply to the House Tax. Of late years the House Tax had been worked up not upon the annual value, but upon the gross rental. This was a matter which ought to engage the serious attention of the Treasury; and he hoped that before long the right hon. Gentleman the Chancellor of the Exchequer and the Secretary to the Treasury would turn their attention to it.
§ MR. J. G. HUBBARD
said, the right hon. Gentleman the Chancellor of the Exchequer had presented the Committee with a very interesting and a very clearly stated Budget, and he had shown how accurately and carefully the Estimates of the Revenue had been made. Indeed, he (Mr. Hubbard) could hardly say that he found, in the course of the Budget proper, anything upon which he need comment except in way of approval, unless he were to express regret that the authorities of the Treasury had not yet seen their way to announce a re-adjustment of the operation of the 535 Income Tax. He would pass, however, to the new features which the right hon. Gentleman the Chancellor of the Exchequer had promulgated that day with regard to the coinage and the reduction of the National Debt. As far as his memory served him, he believed the right hon. Gentleman the Chancellor of the Exchequer was perfectly correct in his statement of the amount of coinage in circulation, and the proportion which might be lighter than the law allowed. The present condition of the Gold Coinage of the country arose from the effect of wear through a great series of years. The right hon. Gentleman had said that the state of the coinage had been almost neglected. Now, the law required that all Her Majesty's subjects should not only not re-issue gold coins which were light, but that they should deface by cutting them, so that they could not pass again. The right hon. Gentleman had explained that the requirements of the Act were impracticable; that no one could be supposed to carry about scissors to cut and scales to weigh any gold coins that he might receive. But all the coinage of the country within a not very long period passed through the hands of a very powerful and influential community called Bankers. There was the Bank of England at the head of banking affairs, and in the country there were established a very large number of Joint Stock Banks and Private Banks. Well, what had been the action of the different banking communities upon the gold which came into their hands? Both Mr. Martin and Mr. Palgrave, who were admitted authorities upon matters of currency, had stated that for a long time bankers had refrained from sending gold coins into the Bank of England, because they would be clipped and the bankers would be charged with the deficit. Now, the operation of that action upon the part of the bankers had, undoubtedly and inevitably, led to the result that they were overladen with light gold coin; and, being so, they now asked the Government to take it off their hands. The Committee would see that if every bank in the country had done what the Bank of England had done there would be now no accumulation of light gold at all. And he might remark, for the information of the right hon. Gentleman the Chancellor of the Exchequer, that if 536 all Her Majesty's officials had pursued the same course there would be less light gold coin in circulation than there was at the present time. The Postmasters in some very important towns in the North of England had absolutely removed their banking accounts from the Bank of England because the Bank of England was in the habit of clipping their gold; while country banks, to which those officials had removed their accounts, received the coin without debasement. Her Majesty's Government, therefore, must assume some portion of the blame for the consequences of the general neglect or disobedience of Her Majesty's Proclamation. He insisted upon this—that if Her Majesty's Proclamation had been carried out, not by every individual, but by those powerful and influential communities whose business it was to receive and issue coin, none of the difficulty which was now complained of would exist at all. That being the case, then came the question who was to bear the loss which accrued from light gold coin? In the first place, hon. Gentlemen must recollect that no one complained at the present moment except the bankers. There was no external difficulty or complaint at all. The difficulty was simply in the tills of the bankers, who had got more light gold coin than they knew what to do with. Let hon. Members consider what was to be done with light gold coin. He did not deny that it should be called in; but then, said the right hon. Gentleman the Chancellor of the Exchequer—" There are so many ways of dealing with it— who is to bear the loss?" and he (Mr. Hubbard) thought he heard the right hon. Gentleman say that he would not accept the entire loss upon the part of the Treasury.
§ MR. J. G. HUBBARD
said, that the taxpayer and the Treasury were one and the same thing; they all knew perfectly well that the Treasury, in matters of that kind, represented the taxpayer. He was very glad that the right hon. Gentleman disclaimed, on the part of the taxpayer or the Treasury, any intention to bear the entire loss which had accrued from the light gold coin in circulation. Then it came to be a question of degree. If the right hon. Gentleman would not 537 bear the entire loss, how was it to be divided? The right hon. Gentleman had enumerated several plans. He enumerated one which he said was inadmissible, and that was that the loss should be divided between the taxpayer or the Exchequer and the last holder, who, in most cases, would inevitably be the banker, because it was the banker who sent the coin in. He would like to know why the right hon. Gentleman considered that it would be inequitable to share the loss with the bankers? He (Mr. Hubbard) believed that it would be equitable and practicable, and he did so for this reason. If the right hon. Gentleman proposed to take upon himself a certain portion of loss he would exclude from his own acceptance the extremely light pieces; the very light pieces would not come in at all. The bankers would send in all coin which was just under legal weight; but they would not send in the very light pieces; these they would put again into circulation. Therefore, he (Mr. Hubbard) considered that the plan, which, he understood, the right hon. Gentleman would not adopt, was one which would clear the commercial regions of the light gold coin. He objected to the plan of throwing the loss wholly upon the last holder; but he thought that the plan of dividing the loss would be the best and most equitable. If the Exchequer were to say they would share the loss with the last holder of the light coin, then there would be no motive for keeping it back, particularly if the Exchequer attached to their Proclamation the condition that they would only receive the light coin up to a certain date, and that after that light coin would be treated as bullion. Now, as to the particular means which the right hon. Gentleman proposed, and which he (Mr. Hubbard) confessed filled his mind with apprehension. The right hon. Gentleman proposed to debase the currency. He had said that a gold sovereign was an international coin. Well, two half-sovereigns now made one sovereign; but under the proposal of the Chancellor of the Exchequer two half-sovereigns would make a whole sovereign no longer. A half-sovereign would be a half-sovereign no longer, but would be degraded into the position of a token. As a matter of fact, there was a point of interest in this matter of a Constitutional character. At the pre- 538 sent moment all gold coin was a legal tender, and the Bank of England were bound to accept gold coin. Let this proposition be carried out, and they would destroy the properties of the gold coin. He should be charmed and delighted to find he was mistaken. [The CHANCELLOR of the EXCHEQUER dissented.] The right hon. Gentleman shook his head in dissent; but he (Mr. J. G. Hubbard) ventured to say that hitherto the half-sovereign had been regarded as an integral part of the Gold Coinage of this country; but now it was proposed to depose it from its position, and to make it a mere token. They could not pay their debts in tokens. It was indispensable that the integrity of the Gold Coinage of the country, half-sovereigns as well as sovereigns, should be maintained. The proposal of the right hon. Gentleman was not an original one; it was proposed by Mr. Lowe, a highly inventive and imaginative person, so far as financial matters were concerned. Mr. Lowe proposed to take a grain of gold out of the sovereign, and to turn the half-sovereign into a mere token. He (Mr. Hubbard) would very much like the right hon. Gentleman to lay upon the Table of the House the Correspondence which passed on that occasion between the Bank of England and Mr. Lowe. He (Mr. J. G. Hubbard) was at that time a Director of the Bank; and if his memory served him, a decided disapproval was expressed on the part of the Bank of the proposal to turn the half-sovereign into a token. Only that morning he was looking over the Report and Evidence of the International Coinage Commission, and he happened to open the book at the evidence given by Sir John Herschell, who was then Master of the Mint. Sir John Herschell was asked— "Would you approve of converting the half-sovereign into a token?" to which he replied— "Certainly not; it would make the coinage a totally different thing." In fact, Sir John Herschell expressed the strongest disapproval of any attempt such as that which was now being proposed by the right hon. Gentleman. The right hon. Gentleman might by this action be able to realize £1,000,000 or £2,000,000; but it must be remembered that when they once began to tamper with the coinage there was no knowing where they would end. As he had said previously, it was merely a 539 matter of degree; and lie asked if they took 1s. out of 10s. now, why should they not, on some future occasion, take 2s. out? It must also be borne in mind that they would very likely create a new industry; for there was very little doubt that many men would be found, say in places like Birmingham, who would seek to obtain a living by the making of illegal half-sovereigns. On the different grounds which had been stated, he trusted that the Committee would be dissuaded from sanctioning the proposal made by the right hon. Gentleman. Why should this degradation of the coinage take place for the sake of £1,000,000 profit at once, and for the sake of the interest on that profit in future years paying the expenses of the deficiency in the coinage? He knew of no precedent in the world for debasing the Gold Coinage in the way suggested. He would pass from the gold currency to another very important subject, and that was the interest on the National Debt. The right hon. Gentleman had applied himself, with very great energy and success, to insuring a rapid redemption of the National Debt. He (Mr. J. G. Hubbard) thought the arrangement which the right hon. Gentleman proposed last year for the redemption of £7,000,000 or £8,000,000 of Debt went quite far enough. It must be remembered that when they had redeemed £10,000,000 of Debt they had also diminished the charge of the Debt by way of interest; and the operation adopted last year was one thoroughly sound in principle, for it involved a sacrifice on the part of the taxpayer. It was by economy in management, and by self-denial, that they ought to obtain a reduction of the national obligations; that was the legitimate way of reducing the interest on the National Debt. But as to the proposal which the right hon. Gentleman had made that day, he (Mr. J. G. Hubbard) was ashamed of it; and although the right hon. Gentleman said it would save this, and that, and the other, it would save nothing at all, and he trusted it would never pass. His right hon. Friend the Prime Minister tried a similar process in the year 1853; but with what result? The amount of the National Debt was something like £800,000,000; and his right hon. Friend made a proposal which would have given a quarter per cent less interest to those who ac- 540 cepted the Two-and-a-half per Cent Stock in exchange for Three per Cents. The loss was so obvious that no wonder the scheme, in its result, fell far short of what the Prime Minister had anticipated. As a matter of fact, out of £350,000,000 of Consols only £1,000,000 was exchanged for Two-and-a-half per Cents, and the whole amount of 2½per cent thus created only reached £3,000,000. He wondered so much was sent in. Who could have sent it in? Why, there were just three classes of people who could have done so. In the first place, trustees, who always seemed to consider themselves bound to save themselves from risk by complying with any demands of the Government. In the next place stood patriots, who did not mind throwing away their property, and lastly there were idiots, who did not know what they were doing. the £3,000,000 of Two-and-a-Half per Cents made by his right hon. Friend had increased, under different operations of the Treasury itself, to £10,000,000; and it was true that they stood at a comparatively high price. Now, then, the right hon. Gentleman the Chancellor of the Exchequer took the rise in value as evidence of success. At the time he did that, however, he played upon two strings. He told the Committee he had compulsory power to enforce it; and then, fearing that that might appear too despotic and harsh, he said—" Oh ! I am going to give them what will be a full equivalent." He (Mr. Hubbard) asked, in common honesty and honour, that the Government would not couple with their proposition the threat that they had compulsory power. It would be, in his opinion, a most unbecoming thing to do; and he did not think that the threat was one which was consistent with the rights of property, and certainly it was one which ought not to proceed from the Finance Minister of this country. Either the exchange proposed was one which would leave the Stockholders in as good a position as they were now, or it would not. If the former was the case, then the Exchequer could gain nothing; if the Stockholders were left in a worse position, then the Exchequer would gain at the expense of the public. The right hon. Gentleman alluded to the conditions under which the different Stock was raised. It was quite true that there were three main Stocks. There were 541 £395,000,000 of Consols, £140,000,000 of New Three per Cents, and £90,000,000 of Reduced. The Chancellor of the Exchequer would not meddle with the New Three per Cents, as they could only be dealt with in their entirety; but he proposed to deal with Consols and Reduced, and to pay them off in quarterly parcels of not less than £500,000. But the Act of Parliament, with regard to Consolidated Stock, distinctly stated that it should be subject to discharge upon 12 months notice, and that repayment of them should take place in sums of £500,000. He should be exceedingly surprised if the Chancellor of the Exchequer could find upon the Statute Book of this country any Act of Parliament under which he could make an individual take Two-and-a-half per Cent Stock for Three per Cent, or be obliged to receive cash in payment for the Stock which he owned, unless the Exchequer was prepared to give notice of redemption of the entire Joint Stock of Annuities of which he held a share. Such was the position in which the Committee were placed; and he ventured to believe that they would find that the offer which did not succeed when proposed by the Prime Minister would not succeed now, however ingenious the present Chancellor of the Exchequer might be. He (Mr. Hubbard) was sorry to have to express his disapproval of the propositions of the Chancellor of the Exchequer, because he was sure they were dictated by a desire to serve the best interests of the country. He believed that both of them were discreditable to the country; and he hoped, therefore, they would be rejected.
§ MR. FRANCIS BUXTON
congratulated his right hon. Friend the Chancellor of the Exchequer upon the clearness of his Financial Statement, and upon the marvellous accuracy with which the receipts of the year had met the Estimates of last year. His special object, however, in rising was to comment upon the remarks made by his right hon. Friend the Member for the City of London (Mr. Hubbard) on the proposed alterations of the Chancellor of the Exchequer with respect to the Gold Goinage. His right hon. Friend (Mr. Hubbard) had prophesied what the result would be of the proposed alteration, and he had depicted the evils which would result from what he called a debased coinage. But what was it but a very debased 542 coinage that they had now? The right hon. Gentleman the Chancellor of the Exchequer had told them that there were in circulation in the country 90,000,000 sovereigns and 20,000,000 half-sovereigns, and that of those 55 per cent were light in weight, and, therefore, not a legal tender. If by any alteration that could be counteracted, and the 90,000,000 sovereigns could be issued full weight, and the 20,000,000 half-sovereigns could be issued at a known value from the Treasury, it must be of the greatest benefit to the country. His right hon. Friend (Mr. Hubbard) had said that bankers, or the last holders, should be made to bear, at least, part of the loss which would accrue; and he spoke of the dislike of bankers, under present conditions, to pay into the Bank of England light gold. The result of this dislike was that light coin was reissued constantly, and was thereby constantly losing in weight. Now, under the proposed alterations, bankers would be able to go at any time to the Bank of England; and, of course, they would not hesitate to go, and pay in their light coin and receive the full weight of gold. Gold coin was very soon reduced in value. He (Mr. Francis Buxton) had the honour of being a partner in a bank in the City, situate not more than 80 yards from the Bank of England. His firm had got gold from the Bank of England, and carried it to their own bank, where they had kept it some months undisturbed; they had then taken it back to the Bank of England, and had been charged a certain amount for light gold. Now, there had only been one movement, yet the friction had caused the loss in weight. He hoped the Chancellor of the Exchequer might be enabled to carry out the proposals he had made, because he believed they would be of the greatest advantage to the country. His right hon. Friend (Mr. Hubbard) thought the bankers were those who were chiefly to blame in having broken through the letter of the law up to this time. He (Mr. Francis Buxton) thought everyone would admit that the present law was impracticable and quite impossible to carry out in practice. The 7th clause of the Coinage Act provided that where any gold coin was below the current weight a person should cut or deface any such coin tendered to him in payment, and the person tendering the 543 same should bear the loss. Now, as the Chancellor of the Exchequer had shown that night, such a system, if carried into practice, would altogether put an end to transactions of any kind in money. It would be quite impossible for everyone to carry with him a pair of scales to weigh any gold coin tendered to him. To begin with, a person would never find a gold coin of full weight, so that it would be easily seen that a complete stop would be put to the financial transactions of the country if the 7th clause were to be carried out in every instance. It was clear that bankers were not the only persons subject to blame. Every man in the country was equally blameable. After all, what the Chancellor of the Exchequer proposed to do with the half-sovereign was nothing more than was done already with other coins. The silver coinage of the country already contained very much less silver than it was supposed to contain. Sovereigns themselves had a certain amount of alloy in them. Indeed, every coin must contain a certain amount of alloy. As a matter of fact, silver coins were issued as tokens, and not as coins. The Chancellor of the Exchequer had proposed that half-sovereigns should, in future, be taken as tokens; that they should be conveyed from hand to hand as of the value of 10s.; but that they should only be a legal tender up to the amount of £5. Silver was now a legal tender to the amount of 40s., and bronze coins to the amount of 1s. He would like to know from the Chancellor of the Exchequer whether any difficulty would occur as to gold coined in the Mint of Calcutta or in any of the Colonies? A good deal of Australian gold was now in this country, and he was very anxious to know whether any difficulty would result on this account? As to the issue of Two-and-a-half per Cents, he very much hoped that the right hon. Gentleman might succeed in any step which would lead to so grand a result as the reduction of the interest of the National Debt of this country. He believed the credit of this country stood so high at that moment that no better moment could be chosen for such a step. He understood his right hon. Friend (Mr. J. G. Hubbard) to mention the amount of Two-and-a-half per Cents now in the Market as £ 10,000,000; but he was under the impression that the Chancellor of the Exchequer said they 544 stood at £13,300,000. Possibly the Chancellor of the Exchequer, when he replied, would inform the Committee how the present amount compared with the amount which was in the Market in 1878 and in 1881, in order to show how the Two-and-a-half per Cents had increased in the last five years. He (Mr. Francis Buxton) believed they would be found to have been largely increased, and that the present amount would show how very much the Market appreciated the value of that Stock. The Chancellor of the Exchequer referred to one item in his Revenue side as to which he would like to ask him one question. He understood the right hon. Gentleman to say that the amount estimated to be received from the Railway Passenger Duty before the alteration of last year was £800,000 in round figures. The actual amount estimated to be received last year after the proposed alteration was £665,000; but the right hon. Gentleman had actually £745,000. There was thus a very decided increase over the Estimate. He understood the right hon. Gentleman to say that this was partly caused by some one large sum; but perhaps the right hon. Gentleman would inform the Committee whether the increase had occurred from any diminution in the proposed alteration of last year—he meant any diminution of the number of exemptions claimed by the various Railway Companies? He believed that one of the proposals of last year was that fares of 1d. a-mile and less should be exempted altogether from the Passenger Duty; but that railway fares in what might be called urban districts should be subject to a tax of 2 per cent, instead of 5 per cent as hitherto. Perhaps the right hon. Gentleman would say whether the urban districts had been extended, or whether it was on account of such urban districts not having been defined that this large increase over the Estimate had occurred? He repeated his congratulations to the right hon. Gentleman the Chancellor of the Exchequer upon the result of the year; and he hoped that the Estimates of this year would prove as satisfactory as those of the financial year which had just closed.
said, he rose to make complaint about another part of the Budget, and to express disappointment and dissatisfaction, which he was sure everyone would feel, at the announcement made by the right hon. Gentleman 545 the chancellor of the Exchequer, that the boon of 6d. telegrams, which it was promised last year should be given this year, was not to be given to the public until 1885. This was another instance of the great regard Her Majesty's Government paid to the opinion of the House of Commons. They had had two or three instances that Session. Some people imagined that this peculiar idio-syncracy of the Government had only been exhibited that Session; but, as a matter of fact, it began last year. As long ago as the 29th of March last year the hon. Gentleman the Member for Glasgow (Dr. Cameron) gave expression to the feeling of the majority of the House in a Resolution which he succeeded in inducing the House to adopt, against the advice of Her Majesty's Government, upon the subject of 6 d. telegrams. At first the Chancellor of the Exchequer was disposed to bow to the views of the House. He exhibited some kind of deference towards the feeling of the House, because, in the course of the Budget Speech which he made on the 5th of April last year, less than one week after the Resolution of the House, the right hon. Gentleman said—After the Resolution of the 29th of March, I do not think it would he respectful on my part to put out of question the reduction in the minimum price of telegrams. As I promised, I have already commenced a careful inquiry into the estimates made by the Post Office as to the cost under several plans of the reduction to the minimum charge of 6d. I cannot, at this moment, anticipate the result of that inquiry; but I propose to set aside £170,000 out of my balance to enable me, if possible, to carry out the change in the course of the present year."—(3 Hansard,  1533.)Towards the end of last year, however, the anticipations of the House of Commons were very much damped by an answer given by the right hon. Gentleman the Postmaster General (Mr. Fawcett) to the effect that the reduction in the minimum charge for telegrams would come into operation in October, 1884. The public was far more interested in the reduction in the charge for telegrams than even in the reduction of the National Debt; and they had been confidentally expecting that the reduction would take place in the course of the present year, in accordance with the promise of the Chancellor of the Exchequer. Now, the right hon. Gentleman 546 threw a damper upon all their anticipations by coolly announcing to the House of Commons that the Government would not make the promised reduction. It was not because the Post Office could not afford to meet the reduction, but simply because the anticipations with, respect to the Parcel Post had not been fully realized; to make the loss on the institution of the Parcel Post less than it otherwise would be, the Government were going to confiscate the money set aside for the reduction in the price of telegrams. He was sure that when the announcement of the Chancellor of the Exchequer was read to-morrow by the people of the Three Kingdoms, they would feel a bitter disappointment and a considerable amount of indignation at the cool manner in which they had been treated by the Government. If the institution of the Parcel Post had not been as profitable an affair as it was expected, let the Government admit they made a miscalculation. Why the unfortunate people had to be robbed of 6d. telegrams in order to make good the deficiency in the Government calculations he could not imagine. The people would receive the statement of the Chancellor of the Exchequer with great disappointment. He (Mr. Gorst) could not help feeling that by the way the right hon. Gentleman had dealt with this matter he was guilty of trifling with the House of Commons.
§ MR. ANDERSON
said, that after the admirable and clear statement they had had that night from the right hon. Gentleman the Chancellor of the Exchequer, he only wished to make a very few remarks upon the Budget proposals. It was unfortunate that the right hon. Gentleman could not do more for them than he expected to do; but with a surplus of £253,000 it was not possible to do a great deal. The right hon. Gentleman proposed a small relief in the shape of a reduction of the Carriage Duty. Unfortunately, the reduction was not large enough to do much good. The objection to the Carriage Duty was that it acted as a restraint of trade. There were a large number of artizans engaged in the making of carriages, and in making articles connected with carriages. There was, therefore, a large number of the industrial classes to whom the reduction of the duty would act as a very great boon. However, they must be content 547 with what they had got. He regretted the right hon. Gentleman did not see his way to do away with the duty on Marine Insurance, to which he had several times called attention. That also was a tax which acted in restraint of trade, and therefore they ought to got quit of it. He understood that in some kinds of insurance, such as bullion to and from the Continent, where the value was very high and the premium low, this tax threw the business entirely into the hands of foreign underwriters; and Lloyds had often vainly appealed for its abolition. The proposals with regard to the gold coinage were the distinguishing features of the Budget, and no doubt they would be most generally attacked. Many years ago they were told there was an estimated loss of £500,000 upon light gold coins, and now it turned out the loss was not less than £710,000. The question was, who was to pay for the loss? One of the courses which the right hon. Gentleman said was inadmissible was to put the loss on the taxpayer. In that opinion he entirely agreed, because the taxpayers included Scotland, and as Scotland did not contribute to the wearing of the gold in the pockets of the people it would be most unfair to take taxation from Scotland for such a purpose. On that ground he was very glad that the right hon Gentleman did not propose to throw the loss on the taxpayers of the country. The right hon. Gentleman had also said that he would not institute an issue of £l notes, and in that he thought the right hon. Gentleman was quite wrong, because that would be the easiest and simplest way of paying for it. He was not alone in England in advocating £l notes, for there had been at least two London bankers in that House who admitted that it would be expedient to have £1 notes. The hon. Baronet the Member for the University of London (Sir John Lubbock) had, on one occasion, said he thought it might be expedient to go to the length of £30,000,000 of notes to supersede gold. Supposing they took even 2 per cent of £30,000,000, that would give £600,000 a-year saved, and the loss on gold would be quickly paid for. Even half of that would be enough. All they advocated was that people should have the option of getting £1 notes if they wanted them. Nobody thought of 548 forcing them; but for 60 years past the people of England had not had an opportunity of getting these notes. Was it to be believed that the people of England would not take them if they could get them, when the people of Scotland and Ireland preferred them? It was only necessary to lay the offer before them, and before long they would take to the idea, and the system would become very remunerative. With regard to what the hon. Member for Andover (Mr. Francis Buxton) had said about the way in which gold coins were weighed, in Scotland the bankers generally obtained boxes of gold ready for issue at harvest time, that being the time when gold was expected to be wanted in Scotland. The bankers got the boxes of gold from the Bank of England, and kept it unpacked in their cellars. Then, perhaps, the need never came, and they were sent back to London, and though the boxes had never been opened at all, still a charge was made for light weight. Nobody supposed that the Bank of England was guilty of fraud in charging for that light gold; it simply meant that this article, gold, was so soft that it wore away in such a manner that it was not suitable for circulation at all. Now, the right hon. Gentleman, referring to the suggestion of a mintage charge on the gold, said he would not make a charge for mintage, but he thought a small charge for mintage would be proper and appropriate; and one reason he had was that their sovereigns were exported. Some authorities had spoken of that as a great advantage; but he thought they should put some check on this exportation, and that all such transactions ought to be in bullion. Why should they be at the expense of coining their gold for exportation? Why should they be put to that expense to export their sovereigns for foreign manufacturers to melt them down for manufacturing purposes? It was the same in this country. When their manufacturers wanted gold they took their sovereigns, and the Mint not only charged nothing for mintage, but gave them the alloy into the bargain. In his opinion, there should be more alloy used than 1–12th, so as to reduce the liability to friction; and there should also be a charge for mintage, to prevent the export of their gold, and in order that the Mint should not have so much needless work to do. 549 Then with regard to the reduction of the half-sovereign, that was a most important matter, for the half-sovereign was almost the only coin of gold used in Scotland. A considerable amount of half-sovereigns were used in Scotland as change; and he should not like to see them discredited, as they might be if it was supposed that they were only worth 9s. He would rather have an issue of a 10s. note, which should be entirely a symbolical currency to take the place of change, than a coin which pretended to be worth 10s. when it was only worth 9s. If it was to become a mere token, he did not see why it should not be just as well reduced to 8s., or 7s. or 6s., or 5s., or any other amount, as to 9s. Besides, the reduction would offer an immense premium to manufacturers, now that they knew it only cost 4d. a pound to coin gold; and there would be a profit of nearly 10 per cent on turning sovereigns into half-sovereigns. A new industry would spring up—he would not say in Birmingham, but abroad—of melting sovereigns down to half-sovereigns, and making a profit on the operation. That would be a very tempting trade, and he did not know of any trade in these hard times in which so much profit could be made; and unless the Chancellor of the Exchequer could see some mode by which he could check this recoinage of their sovereigns into half-sovereigns, with a profit of perhaps 1s. 6d. on each, he did not think this scheme would answer. As to the Death Duties, they could not say anything as to that subject until they saw what the Chancellor of the Exchequer's plan was; but he was very glad to see that the right hon. Gentleman looked forward to proposing a scheme in the direction at least of bringing up the Succession Duty to the Legacy Duty. The right hon. Gentleman spoke of a "final" scheme; but he did not think there would be a settlement of that matter till the one was put absolutely on a level with the other. He was also pleased with the proposal to put a tax on lands in mortmain, for he was strongly of opinion, as he had been always, and had advocated in that House for 10 years past, that it should be impossible for anyone to put property into a Trust or a Corporation in such a way that it should be beyond the reach of being made to pay its fair share of taxation. That 550 principle he was glad to see acknowledged by the Chancellor of the Exchequer. He very much approved also of the proposed issue of new Stocks, but he would have been content with increasing the Two-and-a-Half per Cent Stock, without being bothered by a Two-and-Three-Quarters per Cent Stock; for he did not think it was necessary to have the intermediate one at all. He thought the Two-and-a-Half per Cent Stock would become very attractive to Trustees and others who wished to invest; and the fact that so large an amount was now held by the country in deposits with the Post Office Savings Banks, which only gave 2½ per cent, ought to be very encouraging in the direction of having a conversion of Three per Cents into Two-and-a-Half per Cent Stock.
§ MR. PELL
said, he had listened with great attention to the debate; but the question of the debasement of the coinage was one upon which he did not feel himself competent to speak. But he knew that having one half-sovereign in his pocket when he entered the House he had disposed of that in the course of the evening, and had so had an opportunity of giving practical effect to the views of the Chancellor of the Exchequer. He got his change in silver, he admitted; but what he was going to say was that it was marvellous how much strict attention was given on nights when Financial Statements were made— which, after all, were of small importance—and how little opportunity during the remainder of the year Members had of discussing matters which, to his mind, were of far greater importance. He referred, he need hardly say, to the question of Local Taxation. He and others had not expected that much would come from the Budget in relief of local taxpayers; but there appeared to have been a passage interpolated in the speech of the Chancellor of the Exchequer which bore on the subject, and it was that particular passage in the speech to which he wished to draw the attention of the Committee, and which justified him in making some remarks. He understood the Chancellor of the Exchequer to say that he had in his mind an idea that at some future time—how far distant no man could tell—there might be an opportunity afforded of giving some relief to local 551 charges by a rearrangement of the Death Duties? [The CHANCELLOR of the EXCHEQUER dissented.] He saw that the Chancellor of the Exchequer shook his head; but that was what he understood the right hon. Gentleman to mean—of course, the right hon. Gentleman took care not to be very precise—namely, that there would be some re-arrangement, such as had long been suggested, by which they would be imposed—and very properly he thought—on lands in mortmain; and that out of the increased fund at the disposal of the Exchequer some relief might be afforded to local taxpayers. [The CHANCELLOR of the EXCHEQUER dissented.] The Chancellor of the Exchequer still shook his head at that interpretation of his statement.
§ THE CHANCELLOR OF THE EXCHEQUER (Mr. CHILDERS)
What I said was that I did not think the change I described in the Death Duties ought to be made until we had settled the question of the relief of local burdens; but I said nothing about the question of that relief being postponed for a long time, or at all.
§ MR. PELL
said, he thought the mention of the subject in that way meant a postponement for an indefinite period. The first postponement of relief was to be until the Local Government Bill was brought in; and now that Bill itself was to be postponed and complicated.
§ THE CHANCELLOR OF THE EXCHEQUER
I am trying to put the hon. Member right. I said just the opposite.
§ MR. PELL
accepted the correction; but now the two things were to be brought forward at the same time; and if they were to be made dependent on each other, then he thought the whole scheme became more complicated, and the Government measure would be further postponed. He was obliged to take what little opportunity he could get of calling the attention of the Committee to this matter. Then the Chancellor of the Exchequer had referred to an increased charge on the Exchequer by way of subventions, and he stated that within 10 years there had been an increase of £2,950,000, or something of that kind; and when he gave utterance to his proposition it was received with murmurs from the other side of the House, as if hon. Gentlemen thought these subventions a terrible thing. Nobody had ever argued out boldly the 552 question whether these subventions were extravagant or not; and he must say that, for his own part, he did not approve of that bye-way of casting a censure on a system which, after all, had not been, proved to be productive of extravagance; and he should have been better pleased if, instead of hearing hon. Members expressing dissatisfaction, they had expressed satisfaction at the postponement of the reduction in the charge for telegrams. He agreed with hon. Members in expressing dissatisfaction with the Government for not keeping their promise; but nothing had gratified him more than the assurance that that torment, the 6d. telegram, would be kept off for some time. It was all very well for hon. Members in town communities; but a countryman who had indolent friends richer than himself would be continually getting 6rf. telegrams which might cost him 3s. 6d. He was very glad, indeed, that that scheme was postponed. He would not now raise a debate on local taxation; but he should do so at some future time that Session, because he did not think the House of Commons had been fairly treated on that subject. But as they were now debating the Financial Statement, and as he had been systematically deprived of the promised Local Budget which was expected to be presented about the same time as the Chancellor of the Exchequer's Statement, he must take this opportunity of saying that, however unpalateable it might have been to the right hon. Gentleman to do it, he ought to have made some proposition which would have relieved the owners and occupiers of real property in towns even more than in the country from the injustice which admittedly was done to them. Whether that might be done by means of subventions he could not say; he did not think it could; but he should have been very pleased to hear the Chancellor of the Exchequer say he would accept the whole charge of the police and pauper lunatics, because he was perfectly certain that that would result in absolute economy.
§ MR. MONK
said, the Committee had received a most interesting and able Financial Statement from the Chancellor of the Exchequer, some of the features of which had commended themselves to the acceptance of the Committee. He referred especially to the Death 553 Duties being extended to property in mortmain, and to the proposal to reduce the interest on the National Debt; though he must say, with regard to the latter, that it seemed to him a debatable question whether the Two-and-Three-Quarters per Cent Stock, which it was proposed to issue, should be liable to redemption so soon as 1905. That, however, was a question which would be discussed at a future stage, when the Bill for that purpose was brought forward; but he rose principally to put a question to the Chancellor of the Exchequer. He must express his regret and surprise that the right hon. Gentleman, in his Financial Statement, had not alluded in any way to a probable prospective reduction of the Wine Duties. He was astonished at that omission, because, a few months ago, he and other hon. Members were led to congratulate themselves on an Agreement or Protocol having been entered into between our Minister at Madrid and the Spanish Government, to the effect that Her Majesty's Government would propose to the House of Commons a reduction of the Wine Duties on certain conditions—namely, that a Treaty of Commerce granting the most-favoured-nation treatment to this country should be also proposed for the acceptance of the Córtes. He was aware that since that time there had been a change of the Government in Spain; and we could not, perhaps, now tell whether the present Government would propose the adoption of such a measure to the Cortes when it met in June next; but the question he wished to put to his right hon. Friend was this. The right hon. Gentleman was perfectly well aware that in 1880 the Prime Minister, as Chancellor of the Exchequer, proposed that the Crown should have power, by Order in Council, to propose a reduction in the Wine Duties, contingent upon certain conditions being acceded to by the wine-growing countries. Certainly, the present state of the Wine Duties did cause great disturbance in that trade, and caused certain material loss to wine merchants; and he wished to put it to the right hon. Gentleman whether it was not desirable that he should take some such step as that which was taken by the Prime Minister in 1880? He could assure the right hon. Gentleman that this was a matter upon which the whole commercial community felt very 554 strongly; and he hoped the right hon. Gentleman would be able to give some assurance that the matter was under consideration, and would not be neglected during the present financial year.
§ MR. W. H. SMITH
I hope I may be allowed to express my strong sense of the extreme fairness and clearness of the speech of the right hon. Gentleman, the Chancellor of the Exchequer. It was entirely free from Party spirit; and it is always pleasant to be able to reciprocate that spirit. The right hon. Gentleman referred to the present condition, of the country, and said the increase in the accumulations of the country was the ground upon which his Estimates of the Revenue of the year were founded. He remarked that the condition of trade in many parts of the country was, undoubtedly, unsatisfactory; that profits were small; and that the Railway Re-turns, which are very accurate as an indication of the condition of the manufactures and productions of the country, had shown symptoms of weakness in the last few months, and certainly had indicated a lessened volume of trade; while, at the same time, there was a considerable diminution of profits. I should be extremely sorry to express any very grave doubts as to the realization of the Estimates which the right hon. Gentleman has made; but it does appear to me that both in Customs and in Excise he has gone at least as far as the conditions of trade, which certainly influence Customs and Excise, would warrant or justify. The right hon. Gentleman, in his allusions to the burden which is imposed on the country by the Budget, referred to the Expenditure in the year 1873–4, as compared with the present Expenditure. I do not wish to go back as far as 1873–4, but I will go back to 1880-1; and I wish to place before the Committee some figures which show, at least, that the condition of taxation in this country is very serious —it may be necessary taxation—having regard to the stagnation, to say no less, in the trade of the country at large. In 1880 the Imperial charge was, roughly speaking, £82,000,000, and the local charge was £26,000,000. I prefer to put the two things together, because if the local charge falls upon property it falls on the individuals who are concerned in the trade of the country to a large extent, and who also pay the Im- 555 perial taxes; and it is a charge on the resources of the country. That would give a total, in 1880, of £108,000,000. In 1883 that had grown to £ 115,000,000, being an Imperial charge of £86,000,000, and a local charge of £29,000.000. This year, according to the best estimate I can make, the Imperial charge is £85,250,000; and you have to add to that £2,000,000 of Exchequer receipts, which are now taken in reduction of Expenditure, and which were Revenue in 1880, and that makes the total £87,250,000. You have also a local expenditure, if it has gone on increasing since 1882—when the last Return was laid on the Table—at the same rate as it increased during the preceding five years, of £30,000,000. Thus, then, you find that in four years the Expenditure of the country for the purposes of Government—and you cannot separate the local expenditure from, the Imperial— has increased £9,250,000. I think that is a very serious condition of things indeed, and one requiring from the Government—from any Government, because I do not say this in any Party spirit—the most grave consideration. I say that an Expenditure which is growing year by year at the rate of £2,000,000 annually requires the gravest consideration from any Government, I do not care what Government it is. But I have not said all that I have to say with respect to our financial condition. If we are paying off the Imperial Debt we are piling up the local debt. It would be a delusion on our part to suppose that the Chancellor of the Exchequer has been able to reduce the total indebtedness of the country by £8,000,000 during the past year. He has done nothing of the sort. If the rates have gone up the debt has increased in even greater proportion—that is to say, the local debt of the country. In 1879–80 the local rates were £26,000,000; but the new loans were £14,000,000, and the total expenditure for local taxation was £52,750,000. In 1882 the rates had gone up, as I have said, to £28,000,000; and the debt had increased from £137,000,000, in 1880, to £151,750,000. In two years we had put on £14,750,000 of debt. I have no doubt that that debt has been increasing in the same proportion, and that instead of being £151,750,000, it is now £165,000,000. That is a condition of affairs which I commend to the con- 556 sideration of Her Majesty's Government. What is our ability to bear this taxation? The Chancellor of the Exchequer told us that the accumulations of the country were going on, and based that statement upon the Income Tax. He went on to show that the Income Tax now yields something more than £2,000,000 on the 1d., whilst a year or two ago it only yielded £1,950,000, and a year or two before that only £1,900,000. That may be due, probably, to the increased efficiency of the officers engaged in the collection. I have no doubt that those acquainted with the state of affairs in the City will bear out the statement to which I have referred, and have no personal knowledge of—namely, that there is a great deal more energy and care exercised in the collection of the Income Tax, and in tracing its sources, than was formerly the case. With reference to this assumption, that the accumulations of the country are going on rapidly, I think, some years ago, they were estimated to be something like £235,000,000 a-year. I have had a calculation made for me under the direction of an extremely intelligent officer, Mr. Burdett, the Secretary of the Share and Loan Department of the Stock Exchange, of the value of the securities quoted in The London Daily Stock and Share List on the 1st of March, 1883, and of the same securities on the 1st of March, 1884, adding, of course, in every case, any new issue of Stock which may have been made in the interval. The object I had in view was to compare like with like, and, at the same time, not to confine myself to any estimate I might form of a particular Stock, or a particular class of Stock, for I conceived that the result that would be obtained in that way would be fallacious, and open to the charge that the statistics had been collected with more or less partiality. I took, therefore, the whole of the Stocks quoted in The London Daily Stock and Share List, and dealt with on the London Stock Exchange. The result was that I found that on the 1st of March, 1883, the nominal or part value of these securities was £5,056,000,000; and on the 1st of March, 1884, it was £5,211,000,000, showing that during the year there had been an issue, or additional capital invested in Stocks, shares, and bonds, of £155,000,000, as- 557 suming in every case par as the basis. The market value of this £5,056,000,000 on the 1st of March, 1883, was £4,907,000,000; and the market value of the £5,211,000,000 on the 1st of March, 1884, including the addition of the £155,000,000, was only £4,901,000,000, showing a decrease in the value of the whole property of £6,000,000, or an apparent loss in the year of £161,000,000. Now, there were 31 classes of securities in the official list, and the only exceptions to the general loss in value were gas securities, which improved nearly 9 per cent in the year, and English Railway Guaranteed Stocks and foreign railway obligations, which show a slightly increased value. These figures, therefore, show that the whole of the issue, the new issue during the year, appears to have been lost, and something like 0.27 in addition. I do not wish to lay too much stress upon these facts; but they are an illustration of what has been going on during the past year. They certainly seem to show that a great many people were poorer than they were last year; that there was less capital seeking investment; and that, in consequence of that fact, the investments themselves tended to become less valuable; and the fact which I have stated here, that the loss is spread over the whole of the property that is dealt with on the Stock Exchange, with a very few easily explained exceptions, goes far, indeed, to disprove the view of the Chancellor of the Exchequer with regard to accumulations. There is another class of property in the country on which there has been a great loss. Everybody who is acquainted with the North of England knows that shipbuilding yards are idle, and that ships have greatly depreciated in value. The woollen trade is prosperous; the steam coal trade in the West of England is prosperous, I believe; but, taking trade all round, the complaint in connection with all businesses is that there never was a period when profits were so small, and in which there was so much difficulty to keep things going. But the point of this statement which I have made is the bad omen, it affords, in one respect, as to the future. If it is a fact that investments and industrial undertakings during the past year have, to a very large degree, resulted in a loss of capital embarked in them, and if they have not 558 increased in value to the amount of the capital embarked in them, then there will be a very great indisposition, during the coming year, to embark in enter-prizes that involve a certain amount of speculation and a certain amount of risk. I think, therefore, that profits having been, small, and trade having been depressed, the tendency and danger which we have to fear is that employment will become less, and that, therefore, the interests of the country may be much more seriously affected than we suppose at this moment. I trust that may not be the case. I agree with the right hon. Gentleman that for workmen and labourers—for the working classes generally—times are good, because prices are low; but if we are reaching that period when work will become scarce, or when the inducements to offer work will disappear, then, we are reaching a period which may be one of considerable anxiety. But, Sir, there is another interest to which the right hon. Gentleman referred at some length, and with some hopefulness. I wish, myself, I could be as hopeful as he is. He spoke of the agricultural interests of the landlords and of the farmers.
§ THE CHANCELLOR OF THE EXCHEQUER (Mr. CHILDERS)
I did not speak hopefully by any means of the farming interest. On the contrary, I said that the state of agriculture was unsatisfactory both for landowners and farmers.
§ MR. W. H. SMITH
I am sorry I misrepresented the right hon. Gentleman. I can confirm the view he now expresses. In connection with this industry there has been a considerable and a serious loss of capital. No doubt there are a great many persons who rather rejoice at the losses that are sustained by landlords and farmers. ["No, no!"] Well, I hope I do not misrepresent the persons to whom I allude. I do not wish to do so. But I look on it as a distinct loss of capital and property to the country, for if a person who may possess, say, £10,000 invested in land finds that land depreciated to the extent of a quarter, a third, or half its value, as is frequently the case in many parts of England, his capacity for offering employment and entering into industrial enterprizes is diminished. He was in many cases, probably, a mortgagee, and had not recovered the amount due to him on his property. The right hon. 559 Gentleman says he sees nothing at present to cheer the farmer or the landowner. I am very much inclined to agree with him. I fear that those who are on heavy lands in England have a very sad prospect before them. We must, I am afraid, accept a very large diminution, indeed, in the property of the country, as having been realized, and write off, instead of an accumulation, a considerable reduction of the available resources of the country. [The CHANCELLOR of the EXCHEQUER dissented.] The right hon. Gentleman, I see, does not entirely agree with me. During the past few weeks I have had an opportunity of conferring with a great many gentlemen who have had large experience in dealing with, and in the management of, land; and I must say that, from all I have been able to gather, I believe what I have stated, to be the case. We have here a condition of things which, in connection with a private enterprize, would be very serious indeed. If a gentleman were dealing with his own affairs, and he were threatened with serious loss in this or in that direction, he would naturally look around him to see how he could effect economies; and I want to know how, in this national affair, the Government are going to effect economies which appear to me to be essential and necessary? I consider these economies as essential in connection with local taxation as they are in connection with Imperial taxation. Some hon. Gentlemen complain that local taxation is relied upon on every occasion; but I speak as a city and a town Member, and I say that local taxation is more oppressive in the towns than in the country. I know a case in my own constituency in which lodgings provided for working men, of which the gross rental is £400, are subjected to local taxation to the amount of £62 a-year. There has been an increase in that local taxation of 15 per cent within the last two years; and the result is that the persons who are now carrying on this enterprize, without any profit or advantage to themselves, will be compelled to raise the rents in one of the poorest parts of the Metropolis in order to secure 3 per cent on their capital. These are very serious points. They must be met by a deliberate resolve to deal with the question. But it is not a political matter; and therefore, unfortunately, it is al- 560 lowed to slip by. It is a very easy, and frequently a very popular thing, to increase expenditure. Hon. Gentlemen go down to the Treasury or Local Government Board and say this or that is necessary, and by dint of pressure they get what they want. The Treasury, rather than offend the supporters of Her Majesty's Government—and, as I said before, I am not speaking of the present Government especially, but of all Governments—give way to the theories of doctors, lawyers, and engineers, who force on expenditure for local or Imperial purposes. Thus, year by year, the charges become vastly in excess of the capacity of the country to pay. There is one point to which I wish to draw attention, because it is a very difficult case of expenditure. The Chancellor of the Exchequer spoke in terms evidently of sorrowing apology of the practical financial failure of the Parcel Post system. Let me point out the figures to him. In 1881-2 the Estimate for the Post Office was £5,400,000, and the yield was £8,400,000, leaving a profit of £3,000,000. In the next year, 1882–3, the expenditure was £5,700,000, and the yield £8,800,000, or a profit of £3,100,000. In 1883–4 the estimated expenditure was £6,348,000, and the Revenue £8,980,000, so that the profit has sunk to £2,632,000. For the coming year the Estimate of expenditure is £7,200,000, and the Revenue £9,700,000, so that we are still going down. We are spending more money and are getting less profit. I have said it before, and I say it again, that the Government is the worst possible instrument by which you can carry on business. A Government must operate more expensively than anyone else, as they are subject to pressure and influences, and all sorts of difficulties which Corporations and private individuals have not to face in the conduct of their business. I do hope these figures will be a warning to Her Majesty's Government to embark as little as possible in business, and to hold as tight a hand as they can on these things. The right hon. Gentleman claims credit for the manner in which he has dealt with the Civil Service Estimates this year. Well, I think they show evidence this year that they have not been allowed to mount up; and in this matter I consider full credit is due to the Secretary to the Treasury for the 561 assistance he has rendered. I have watched his exertions from this side of the Table, and I cannot but commend them, knowing myself how hard it is to resist the pressure brought to bear by hon. Members. The Government, after all, are responsible for the Expenditure of the country, and it is their duty to see that the whole of the cost of carrying on the affairs of the State are brought within such reasonable limit as the trade and commerce of the country justifies. We are now in a condition of considerable trial in the country; and it should be met as similar circumstances are met in connection with other concerns and in other places, by the exercise of the strictest economy and disregard of all pressure, and by a firm resolve that no right hon. or hon. Gentlemen, whether responsible or irresponsible, shall force them to incur charges which bring no adequate return to the country, and inflict unnecessary burdens on the taxpayers.
§ MR. ARTHUR ARNOLD
said, that in regard to a matter in which he took considerable interest, he wished to make the strongest protest against an observation which had fallen from the right hon. Gentleman the Chancellor of the Exchequer. He (Mr. Arnold) gathered from the cheers of the House, when the right hon. Gentleman made a statement in reply to the hon. Gentleman the Member for South Leicestershire (Mr. Pell) on the subject of the taxation of lands held in mortmain, that the whole House was anxious that such taxation should be imposed. But he demurred to the expression used by the Chancellor of the Exchequer when he said that the proper time for carrying out this necessary reform was when it pleased Her Majesty's Government to introduce a measure dealing with local government. The words of the right hon. Gentleman on the subject were really a condemnation of the most illustrious of financiers, who had been sitting beside him during the greater part of the evening (Mr. W. E. Gladstone.) For what was the fact? Why, the Prime Minister proposed dealing with the subject in 1853, again in 1859, again in 1863, and again in the year 1881. When the right hon. Gentleman was Chancellor of the Exchequer he protested, in the strongest manner, against the exemption from taxation of lands held in. mortmain, and 562 declared that the exemption must be held as a grant. To whom was this grant made? Why, to wealthy Corporations, holding nearly 2,500,000 acres of the best property in the country— land worth not less than £12,000,000 sterling a-year. The tax that these Corporations ought to pay was in part levied from those wretched people, inhabiting the poorest houses, which the right hon. Gentleman the Member for Westminster (Mr. W. H. Smith) had referred to as existing in his constituency, and in other crowded towns. This exemption was a tax levied upon the poorest and all sorts of taxpayers in the country; therefore, the proper time to carry out the reform was not when other measures were going to be introduced, but on the earliest possible opportunity. The right hon. Gentleman said, forsooth, that he proposed to deal with the subject when he dealt with the Death Duties as a whole. He (Mr. Arnold) could only tell the right hon. Gentleman that he would find it to be the fact that if he did not deal with the subject until he dealt with the Death Duties it would not be when the Government introduced a measure on local taxation. That was plain, for the reason given by the Prime Minister —which could not be answered—when he said that, owing to the fact that the great estates of this country were all settled estates, they could not fairly deal with the Succession Duty until they had reformed the tenure of land in reference to settled estates. He hoped the Government would propose a measure dealing with local taxation next year. This exemption was so unfair to the landed gentry of the country, who had to pay the taxes which these wealthy Corporations were exempt from, that it should not be allowed to exist a day longer; and he must express his very great regret that the right hon. Gentleman the Chancellor of the Exchequer had not the boldness to propose this year the small but useful reform of taxing lands held in mortmain. Such a tax would produce him a sum sufficient to satisfy several of the claims they had heard of that night. Instead of dealing piecemeal with the Carriage Duty, for instance, such a tax would have enabled him to clear it off entirely, or it would have enabled him to get rid of the tax on silver plate, which the hon. Member for Manchester (Mr. Slagg) was so much 563 interested in. At any rate, this exemption ought not to be continued one moment longer. Every moment it was continued the House was making a most unjust grant to a class of people in the country who were the least deserving of such consideration.
§ MR. CLARE READ
said, he thought the Committee would entirely agree with the right hon. Gentleman the Member for Westminster (Mr. W. H. Smith) when he said that the middle classes of the country were passing through a period of great depression. But of all the middle classes, as the right hon. Gentleman had justly said, that connected with agriculture had suffered the most and longest. That class had found it necessary, in consequence of the reduction which had taken place in their incomes, to reduce their expenditure. It had been hoped and believed, when the present Government came into Office, that after their declarations of economy, they would have taken measures to reduce the Expenditure of the country. Instead of doing that, however, whilst they had made no remission of taxation, the usual enormous Revenue, or even a more enormous Revenue, was to be raised. The agriculturists had originally very small hopes of any assistance from the Government, and what little hope they had entertained had of late become sadly dimmed. They had no promise whatever of any further subsidy in aid of local taxation. He saw that the hon. Member for Wolverhampton (Mr. H. H. Fowler) had given Notice of his intention to move the rejection of the Vote of £259,000 paid to Local Authorities in aid of repairs of disturnpiked roads. He hoped the Chancellor of the Exchequer would not agree to that; but, at the same time, he wished to put one proposal before the right hon. Gentleman—namely, that, in those counties where the parochial system prevailed, instead of insisting that the Government grant should be given to the parishes, the whole sum apportioned to the county should be applied to the reduction of the county rate. He had mentioned this subject the other day, and he again referred to it in order to show the amount of injustice which prevailed in connection with the present system. Half the parishes in his county had main roads, and the other half had not; and, consequently, the parishes 564 which had no main roads had, first of all, to contribute half the expenses of the main roads belonging to the other parishes, and then to contribute one-fourth in the shape of taxes allowed by the Government. In that way, the parishes having main roads received three-fourths of the cost, while the others had to pay this proportion and received nothing whatever. The burden was, therefore, augmented instead of equalized, and a considerable injustice done to those parishes which had no main roads. The other point he desired to refer to was that of the very large amount of Revenue derived from the Beer Duty. That matter, he thought, had entirely gone out of sight since the Prime Minister, some four years ago, was good enough to transfer the tax from malt to beer, which transfer was considered at the time to be a repeal of the Malt Tax. ["No, no !"] He repeated, that it was so considered; and it had been referred to very often as the greatest possible boon given by the Government to the farmers of the country. The farmers certainly did ask for a transference of the tax from raw to manufactured articles; but they certainly did not ask for any increase of the duty on beer. What had been the result? By the last Report of the Inland Revenue Commissioners, the net Revenue derived in 1872 from brewers' licences, maltsters' licences, and others, amounted to £7,213,000; in 1882 the present Beer Duty amounted to £8,530,000, the increase being £1,317,000. But that was not all. In the year 1872 there were brewed 28,000,000 barrels of beer, as against only 27,000,000 barrels brewed in 1882; so that the tax upon a gallon of beer which in 1872 was 1.79d. was 2.14d. in 1882, the increase being ¼d. a-gallon— a very considerable increase—which really meant that the farmers, instead of paying, as they did formerly, 21s. 8d. per quarter Malt Duty, had to pay much more. The Beer Duty was equivalent to a tax of something like 24s. or 25s. upon a quarter of barley. There was another point also which he asked the Chancellor of the Exchequer to take into consideration, and that related to the licences paid by labourers for brewing. When that proposal was made by the Prime Minister he (Mr. Clare Read) had not the honour of a seat in the House; but he had written to the right hon. 565 Gentleman asking him whether it was not possible that the tax of 6s. should be collected in half-yearly instalments of 3s.; and he was told, in the most courteous terms, that although he had wished it to be done, he found that the Inland Revenue Commissioners were against him on that point. But the Chancellor of the Exchequer had tried the experiment with regard to game licences; why, then, should he not try it with regard to the licences which the labourers had to pay for brewing? The right hon Gentleman had said that evening that in consequence of his reducing the game licence, so that by the payment of 20s. a man might have 14 days' sport, the result was that there had been no loss of revenue, but rather, as he (Mr. Read) believed, a small increase. And if a similar alteration were made in favour of the labourers, he apprehended that a greater number of them would brew than did so at present, and that would be a considerable boon to them. As a rule, they did not want to brew, except in haysel and harvest-time, and the cost of the licence was a considerable amount for a man to pay before he could brew at all. Before the labourer could touch a drop of beer brewed in his own cottage, he had to pay 6s. for a licence, 5s. for a bushel of malt, Is. for hops, besides the cost of firing and the use of casks; in all about 13s., or about a week's wages, before he could brew any beer whatever. This was a heavy tax upon the labourer. Although this cottage brewing was considered by some as a trifling matter, it was a very general custom in the Eastern Counties, and he thought it had much in it to commend it to those Gentlemen who advocated temperance principles, for most of the labourers who brewed at home hardly ever entered a public-house.
said, he objected to the postponement of the arrangement under which the minimum charge for inland telegrams would be 6d., instead of 1s., as at present. After the Resolution embodying that proposal was carried last year, the right hon. Gentleman the Postmaster General would recollect that he (Dr. Cameron) had not taken the smallest step—he had asked no Question, nor in any way urged the right hon. Gentleman to deal precipitately in the matter. On the contrary, he had given the right hon. Gentleman 566 and the Treasury full credit for wishing to introduce a system, of 6d. telegrams in the most satisfactory manner, and thought it was better to let them take their own time for dealing with the matter in the best way. Having taken that course, he felt himself the more free to express his dissatisfaction at the postponement which had been announced. What reason had been given for that postponement? Why, that the Parcel Post had not paid. If the right hon. Gentleman the Chancellor of the Exchequer had last year said— "The Post Office is engaged with the Parcel Post. We shall occupy ourselves with the arrangement with respect to the 6d. telegrams next year; but at present we shall confine ourselves to the Parcel Post." If he had said that, he should not have complained. The amount received on account of the Parcel Post had been, during the last year, £155,000; but what was the loss spoken of? The right hon. Gentleman had told the Committee that his estimated receipts under that head were £340,000 for the eight months during which the Parcel Post had been in operation, and that it had only produced £155,000, the deficiency being £185,000. But the right hon. Gentleman had also told the Committee that of that £185,000 the sum of £150,000 was in the shape of capital expended; preliminary expenses, as he (Dr. Cameron) presumed, of horses, carts, and other requisites. But would any man in that Assembly look upon that expenditure as loss? It was simply capital invested. He believed the right hon. Gentleman was incorrect in treating it as loss; and if that amount of £150,000 were deducted, there remained the bagatelle of £35,000 as representing the loss for eight months. His chief objection, then, lay to the extraordinary ground on which the postponement was to take place. Anyone accustomed to business must perceive that this result for the first eight months during which the Parcel Post had been in operation showed a very good beginning. The right hon. Gentleman, however, was frightened at that loss, and that, too, while he was making out of the Post Office a profit of £2,600,000 a-year. Of course, he had no objection to this large profit being derived from the Post Office; but he thought it was bad policy to postpone the arrangement for cheap 567 telegrams simply because during the first eight months the trifling loss of £35,000 had been incurred in connection with the Parcel Post. All the departments of the Post Office ought, in his opinion, to be worked together; and it was as unfair to take the loss on the Parcel Post separately, and make it a reason for postponing the reduction in the cost of telegrams, as it would be to deal simply with the cost of the Money Order Department, and make it a reason for withdrawing Postal Orders because the Money Orders did not pay. The Department should be regarded as a whole; and it must be borne in mind that an increased number of telegrams must result in an increased number of letters, which would increase the Revenue of the Post Office. But there was another argument against postponement -which deserved consideration from an economical point of view. The telegraph poles and wires were set up, and that involved as much expense, and the deterioration was as great, as if they were in full work. Then, there were the learners of telegraphy to be considered. The right hon. Gentleman had said he could not state how many learners were to be kept on; but, whatever the number might be, their wages would have to be paid for the nine months which were to elapse after next October before the system in question was to come into operation. How the right hon. Gentleman the Chancellor of the Exchequer could make out that the cost in this year's Budget, if the cheap telegrams commenced on the first of October next, would amount to between £250,000 and £300,000 he was utterly at a loss to understand. But if he included the sum expended on capital account, he emphatically protested against such a proceeding. The investments in plant and machinery, whether on account of the Parcel Post, or on account of the Postal system generally, were judicious investments; they were money sunk, from which profits was expected to be realized; and they were not to be put in the same category with money wasted on the Duke of Wellington's Statue, for instance, or money spent on the Egyptian War. The reduction in the price of telegrams would, of course, not show a profit at first; but it would do so in a very few years. The longer, then, the experiment was deferred the longer would it 568 be before their telegraph system became remunerative. The Committee which considered the question of telegrams, seven years ago, was constituted on account of a movement on the part of the Treasury. It was proposed to increase the charge for telegrams sent from railway stations, for telegrams sent on Sundays, and for Press telegrams. But the Committee pointed out that the wires and the staff were only doing half work; that the superannuation allowances were going on, whether the staff did full work or not; and they said that the real way to make the Telegraph Service pay the country was to increase the facilities offered to the public; to extend the business of the Department by, at the proper time, reducing the charge for telegrams. That was the view taken of the matter by the Committee, and it was upon that recommendation that he (Dr. Cameron) brought in the Resolution of last year, which was agreed to by the House. It was then stated by the Postmaster General that there were 5,700 telegraph offices in the Kingdom, through which only 80,000 telegrams were transmitted daily, the average being 14 or 15 for each office. Now, a second class clerk would transmit twice that number of telegrams in an hour; so that throughout the whole Kingdom only one half hour's work was done in the course of the day. As a matter of fact, they had increased the staff of learners and the wires and poles to the tune of £180,000, and yet they found themselves with this beggarly lack of business. Having regard to the extent to which the telegraph system was worked, it was obviously important to take some measures that would stimulate it. During the earlier years, when the system was in the hands of the Post Office, the business went forward by leaps and bounds. It might be said that in 1872 the business was in fairly good working order. There were 15,000,000 telegrams sent per annum, and in 1882–3 the number had gone up to 33,000,000. But in 1882 the increase on the previous year was only 746,000, or less than half the increase of that year, while in 1883–4 it had fallen to 640,000 That showed that, having reached the limit of progress, the advance in the Department was getting less and less, and that if the existing staff were to be employed, the charges must be cut 569 down—in other words, the step recommended by the House of Commons must be taken. He made these remarks, not because he found fault with the Treasury for wishing the experiment postponed; had they made up their minds to postpone it originally, he should have acquiesced in the arrangement; but he strongly dissented from the course which had been taken of going so far, and then stopping short; about as unsatisfactory a course as could be pursued—as unsatisfactory as that book in Hudibras, in whichThe story of the Cat and Fiddle Is told, and breaks off in the middle.As, however, the step was to be postponed, he trusted the Government would make up their minds as to which system they would adopt, and that they would proceed in a more business-like manner than had been the case during the last eight months.
§ MR. FAWCETT
Sir, after the speeches which have been delivered by the right hon. Gentleman the Member for Westminster (Mr. W, H. Smith) and the hon. Member who has just sat down, I trust the Committee will allow me to make a few remarks in reply. I feel it somewhat difficult to steer a middle course between the two speeches to which I have referred, because the one takes just as gloomy a view as the other takes a rosy view of the Post Office business. My hon. Friend the Member for Glasgow (Dr. Cameron) not unnaturally expresses disappointment at the postponement of cheap telegrams until August next year. I can assure him that I should have been extremely glad if the position of the Post Office and the general finance of the country had allowed the introduction of the system at the date originally fixed—namely, the 1st of October in the present year; but anyone who listened to the Statement of my right hon. Friend the Chancellor of the Exchequer must, I think, have come to the conclusion that, unless we are prepared to say that his estimate of the Revenue is unduly gloomy, he certainly has no margin available for the purpose. The only criticism I have heard on that estimate of Revenue is the suggestion thrown out that it erred on the side of being somewhat over-sanguine. That was the opinion which, although not actually expressed, was thrown out by the right hon. Gentleman the Member 570 for Westminster. The Chancellor of the Exchequer is left with a balance of £270,000; and if you reduced the price of telegrams on the 1st of October next, the consequent loss of Revenue would have taken absolutely the whole of that balance, and left my right hon. Friend with no balance at all. No doubt, my hon. Friend the Member for Glasgow is correct in saying that, so far as mere Revenue is concerned, the introduction of 6d. telegrams would not have involved such a loss as that which has been described. The loss would have been probably not more than £50,000 or £60,000; but it has always been the principle on which the Post Office is administered that improvements should be carried on out of income, and that we have no such thing as a capital account. If the 6d. telegrams were introduced on the 1st of October next, instead of on the 1st of August next year, the Chancellor of the Exchequer would have been compelled to spend during the current financial year the whole amount required, instead of spreading it over two years. Now, my hon. Friend, by some of the remarks which he made, seemed to think that this delay would be the cause of great waste. I do not think the waste will be anything of importance, because the works are not suspended, and all that we have done is to spread their completion over 14 instead of six months. With regard to the telegraph learners, no possible disadvantage, but a real advantage, will result from the postponement, because it is well known that it takes two years to become a skilled telegraphist. If we had introduced the cheap telegrams on the 1st of October next, there would have been the disadvantage which has always presented itself to me—that we should have had to meet the increased work with a staff not so skilled as it might have been; but having 10 months longer in which to complete the work, we shall have a better trained staff, and there will be less chance of the general telegraph business of the country being in any way dislocated. With regard to the remarks of the right hon. Gentleman the Member for Westminster on the decline of the revenue of the Post Office, I think the fact that we have no capital account will, to a certain extent, explain that decline, because every improvement has to be paid for out of 571 income; and although the Post Office is to be regarded as furnishing an important part of the Revenue, yielding, as it does, nearly £3,000,000 annually to the Exchequer, yet, in the interest of the commerce of the country and of the public convenience, I can conceive no greater mistake than that the Post Office should be administered merely as a Department of Revenue; because there is something, to my mind, deeper and of more importance to keep in view, and that is, that the Post Office, in various ways, may be administered so as to conduce to the commercial prosperity and general convenience of the country. I can conceive no money so badly spent as if, for the sake of saving a few thousand pounds, the public were deprived of the introduction of the Parcel Post, or of a plan such as that of Postal Orders, which have greatly facilitated the transmission of small sums of money. If we look at the Post Office somewhat more narrowly than has been done by the right hon. Member for Westminster (Mr. W. H. Smith), we shall be able to arrive at some very satisfactory conclusions; and I venture to bring these figures before the Committee, not so much in the defence of the Department which I have the honour to administer, as to show some set-off to the gloomy things that have been said this evening, and that there are certain things occurring in this country which may make us hope for its prosperity. I will compare the profits of the Post Office in periods of 10 and five years. I take 10 years ago, 1873–4, because that was the period selected by my right hon. Friend the Chancellor of the Exchequer to show the growth of the Civil Service Expenditure. He mentioned that the Post Office expenditure had increased in that period by £2,600,000. Yes; but seldom has there been an expenditure which has yielded a richer harvest. We have increased our expenditure; but we are paying, at the present time, nearly £1,000,000 a - year more profit to the Exchequer than at that time. But I will take a period of five years, and I will compare the profit which is now yielded by the Post Office and Telegraph Service with the profit yielded five years ago, and I will endeavour briefly to show what has been done in that time. Compared with five years ago we are now making nearly £200,000 a - year more profit, and what 572 has been done in those five years? £150,000 a-year has been spent in improving the position of the telegraphists and sorters, and I say there never was an expenditure of public money which was more justifiable than that. If we had yielded to mere popular demands and thrown away this money we should deserve the severest censure; but I believe that if an increase of wages had not been conceded it would have been impossible to carry on the administration of the Department; and I think there is no economy so unwise as refusing to increase remuneration when you are convinced that the circumstances of the case demand that that increase of remuneration should be given. £150,000 a-year has been spent in that way; and now I come to another item of expenditure to which I will particularly call the attention of the right hon. Gentleman the Member for Westminster. In addition to the £150,000 spent three years ago in improving the condition of the telegraphists and sorters, we have spent about £100,000 in improving the condition of the letter carriers, both town and country, in England, Scotland, and Ireland; and if the increase of expenditure on the telegraphists and sorters was justifiable, this increased expenditure in improving the condition of the letter carriers was still more justifiable; and in proof of this I may call to witness the right hon. Member for Westminster. Ten years ago there was a most serious agitation among the letter carriers, who demanded that their position should be improved and their scale of wages should be increased. They received much support from many hon. Gentlemen on both sides of the House; but the most influential and the most important support they received was an, earnest letter from the right hon. Member for Westminster, saying that the Government ought at once to concede their demands. In spite of that authoritative declaration, although the right hon. Gentleman occupied the position of Secretary to the Treasury, where he had far more control over the wages of the letter carriers than the Postmaster General, nothing was done to meet those demands, which in 1873 were considered so just, until the year 1882.
§ MR. W. H. SMITH
I am sure the right hon. Gentleman does not wish to 573 make any misrepresentation. A considerable addition was made to the pay of the letter carriers in London in 1874.
§ MR. FAWCETT
Yes; but this letter of the right hon. Gentleman referred not only to the letter carriers in London, but to the letter carriers throughout the Provincial towns; and I believe it will be found that between 1873 and 1882 nothing whatever was done to improve the condition of the letter carriers in the Provincial towns of England, Scotland, and Ireland.
§ MR. FAWCETT
At any rate, in 1872, before the meeting to which this letter was addressed was held, the system of good-conduct stripes existed in London; but there was no letter carrier out' of London, in England, Scotland, or Ireland, who, until two years ago, had the privilege of wearing a good-conduct stripe. Now, these two improvements in the position of the Post Office staff have involved an expenditure of about £260,000 a-year; but there has been, I am glad to say, another improvement in the position of that staff. I do not think there is any body of public servants in this country who have been so miserably paid as the small sub-postmasters. I looked into their case, and their position has been improved at a cost of about £35,000 a-year; and all these improvements have involved an outlay of about £300,000 a-year. If this money has not been required the expenditure has been an act of extravagance, for which I am prepared to bear the full responsibility; but I can only say that I did not, and I would not, recommend that of this money should be spent until I had made a careful investigation of the whole subject—until, as far as I could, I had exhausted every means of investigation. Having come to the conclusion that this improvement in the position of these men was required in the interests of the Public Service, I can only say that I am perfectly willing to bear the entire responsibility of having recommended the Government to agree to this outlay to improve the position of these hardworking public servants. But that is not the only increased expenditure within the last year or two. We have spent at least £150,000 in capital expenditure 574 on the Parcel Post; £180,000 have been spent in preparing for cheap telegrams; and, consequently, we had last year an expenditure of over £600,000, which was not in operation five years ago; and yet, in spite of all this, so great is the progress of the country, and so general is the diffusion of education, and so great has been the use of the Post Office, that we are actually making £200,000 a-year more than was made five years ago. I am free to admit that some of our calculations as to the Parcel Post have not turned out as we hoped they would. I am prepared to take the responsibility of the estimates; and I am sure the Committee will see that, at any rate, we had very slender data to go upon. I always felt that it was little more than guess-work; but, after all, our estimate of the number of parcels to be carried has not been very far out. We estimated that we should have to carry 27,000,000 parcels a-year, and we are carrying at the rate of 21,000,000 a-year; so that we were not so very far out. But what has prejudicially affected the revenue is that the weightier parcels, and consequently the postage on them, have not come as we estimated they would, and that has affected our revenue. If we had known beforehand the number of parcels we should have to carry, and if we had known how the parcels would be distributed, and what would have been their weight, we need not have made such great preparations as we did make; but before the Parcel Post was introduced, as far as I was able to ascertain, the opinion was almost unanimous that our preparations, instead of being excessive, were not sufficient to meet the business we ought to anticipate. The thing I was most anxious to ensure was that there should be not the slightest risk of dislocating the Letter Service by the introduction of the Parcel Post, for in a commercial country like this it would be impossible to put a pecuniary value on the loss and the inconvenience that would have been caused if the Letter Service had been dislocated for a single day. I can only say this— and not in the slightest degree to take credit to myself, for the credit is due to the permanent officials of the Post Office —that although our preparations were, perhaps, somewhat more costly than they might have boon if we bad known all the circumstances, yet everything 575 was so carefully prepared that, as far as I have been able to ascertain, this great change in the Postal Service was introduced without a single letter being delayed or disturbed in its course. This, I think, is a most important fact. Although we found that we had, perhaps, made somewhat too large preparations for the amount of business to be done, I trust the Committee will allow me to point out this. We shall be able, without any increase of staff, and with scarcely any increase of expenditure, to make arrangements also for an International Parcel Post. Reductions of expenditure are every day taking place; and whether the Parcel Post business is great or small, I feel perfectly certain that we can adjust expenditure to the amount of business, whatever it may be, and that soon we shall have a balance between revenue and expenditure. I think also that this is to be borne in mind—that if there has been some loss on the Parcel Post the public have gained an advantage; because instead of destroying private agencies and enterprizes for carrying parcels, the Parcel Post has acted as a stimulus to a better and cheaper private service. I am sure it would be a great mistake to estimate the effect of any postal improvement by the financial results of one year. The Penny Post, when it was first introduced, involved a certain sacrifice; and that, I believe, must be the case in regard to every postal improvement. I believe— and I express this opinion with the greatest confidence—that, in the course of a year or two, the profits from the Post Office will be as large as they have ever been; and I do not think it is a very bad business at the present time, considering that we are making a profit of £2,800,000; while great improvements will have been introduced into the Service, and improvements will have been effected in the position of the staff. This is not simply a question which concerns the interests of the staff, but which concerns the interests of the public; and I do not know that I can better describe, in my concluding remarks, the advantage which the public derives, or may derive, from this improvement in the position of the letter carriers, sorters, and telegraphists, than by quoting the opinion of a provincial postmaster, who the other day said that before the recent revision of the letter carriers' pay it was 576 often difficult to get such a class of men as the correspondence of the country could properly be entrusted to. He said—We shall now be able to draw men from an improved class; and I believe there is no expenditure which has ever been sanctioned with regard to Post Office administration more important than this, which will confer not only greater advantage on the Post Office staff, but also on the public, whose correspondence that staff has to deal with.I am sure the right hon. Member for Westminster would be the last to wish not correctly to state the facts; but there is one thing I ought to point out, the bearing of which he will see in a moment. That is, that within the last two years the cost of manufacturing Post Office stamps has been transferred from the Inland Revenue to the Post Office itself, and that means no less than £135,000 a-year. Consequently, the Post Office expenditure has been apparently increased by that amount.
§ SIR STAFFORD NORTHCOTE
Everyone in the House, I am sure, feels that the right hon. Gentleman has done the work belonging to his Department in a manner which deserves the greatest credit. We have listened with great interest to what he has just said; but I cannot help thinking that we are sometimes led into some error with regard to the Post Office revenue by the distinction, of which the Chancellor of the Exchequer is so fond, between that portion of the Revenue which arises from taxes and that drawn from other sources, and by his sometimes reckoning the Post Office as a source of Revenue which is not to be called a tax. In a certain sense that is true; but the repetition of that view rather leads the public to believe that we do not look on the Post Office as a source of Revenue, and that we ought not to look upon it as a source of Revenue. We have always been in the habit of so considering it; and I think it would be a great mistake if we were to consider that we have nothing to look to but that the Post Office paid its expenses, did its work properly, and left an ordinary margin of profit. We ought to look upon it as a fair and legitimate source of Revenue to the State; and when the Chancellor of the Exchequer makes his proposals for any financial year, he always takes into account the Revenue which he can 577 rely upon from the Post Office. Therefore, there is naturally and properly an amicable contest between the Postmaster General and the Secretary to the Treasury and the Chancellor of the Exchequer as to what is to be allowed, on the one hand, from the improved efficiency of the Department, and the greater convenience of the public; and, on the other hand, as to maintaining a fair and reasonable balance of Revenue. We have an instance of that in what has been done to-night. An increase which is admitted to be desirable, which has been promised, and to which a great deal of interest is attached, is to be laid aside, because it is necessary to maintain a balance of Revenue. Now, with regard to the proposals of the right hon. Gentleman the Chancellor of the Exchequer, I do not know that I have very much to say with regard to what may be called the Budget proper. In point of fact, the right hon. Gentleman has produced a Statement which shows so close a balance between Revenue and Expenditure that he does not find himself in a position to make proposals with regard to the alteration, or reduction, or remission, of taxation. On the other hand, he does not seem to consider the time favourable for proposing any great change in our system of taxation. I am not sure whether, under the circumstances, it would not have been as well if he had postponed what he said with regard to the Death Duties, as he was not prepared to deal with them now. With regard to the Statement itself, it is, undoubtedly, one which, if not too sanguine, is not one to be called gloomy. I think the very interesting statistics given by my right hon. Friend the Member for Westminster (Mr. W. H. Smith) may induce the Committee to consider that the Chancellor of the Exchequer has taken by no means an unfavourable view of the position of the country at the present time. We hope that the Estimates he has prepared may be justified by the results on all accounts; but I would also point out that while the right hon. Gentleman has been careful to take a sufficiently full view of the Income Tax, he has not, perhaps, been quite so ready to make allowance for the possible exigencies of expenditure. I shall rejoice if we find that the provision he has made for expenditure 578 is not exceeded; but looking to the state of things in regard to foreign policy, and other matters to which I need not refer now, I fear no margin is left for possible exigencies. With regard to the other interesting points to which the right hon. Gentleman has directed attention, which lie outside the Budget proper, we have the proposal as to dealing with light gold. Observations have been made by some hon. Members dealing with the subject, and it has been considered by some of the authorities in this House. I myself was not aware what the proposal was to be, although I had heard a report upon it. I cannot say that, at the first blush, I like the proposal for turning the half-sovereign, into a token. It is introducing a principle into our Gold Coinage which we ought to be shy of. Not having considered the question, I do not wish to express a positive opinion upon it; but I hope we shall have a good opportunity of discussing this subject. The right hon. Gentleman will, perhaps, tell the Committee what course he intends to pursue with regard to that and other proposals in the Budget; when he intends to bring them forward and to take the Votes upon them; and whether they will be embodied in one measure, or in separate measures? With regard to the proposal as to a reduction of the Interest on the National Debt, that is also a matter upon which we ought to have time for consideration; and I hope the right hon. Gentleman will lay on the Table a Statement showing what the working of his proposal will be. I am not quite sure that I understand the observations of the right hon. Gentleman with regard to a portion of the relief that will be given by a reduction of the rate of interest—that portion of the relief to be given at once to the taxpayers. Does the right hon. Gentleman mean that the relief is to be given from year to year if the rate of interest is diminished, or is the amount now appropriated, £28,000,000 a-year for the reduction of the Debt, to be applied subject to annual reductions and fluctuations according to the reduction of the amount to be paid as interest on the Debt? Will they be changes made from year to year, or will the £28,000,000 a-year be reduced once for all, or at long periods? If this is to be done by re- 579 ducing the £28,000,000 year by year according to the reduction in the interest, that will be a strong blow against the principle upon which the £28,000,000 rests. I do not know that there are any other points which, at the present moment, claim attention; but I must congratulate the right hon. Gentleman on having brought his financial operations of the year to a satisfactory conclusion; and we must also congratulate him upon his clear and able Statement.
§ THE CHANCELLOR OF THE EXCHEQUER (Mr. CHILDERS)
said, that at that hour of the night (12.30 A.M.) bethought the time had arrived for him to reply to the remarks which had fallen from hon. and right hon. Gentlemen in reference to the Financial Statement he had made earlier in the evening. First of all, however, he wished to thank the Committee for the manner in which they had been good enough to receive the very long Statement it had been his duty to make. He had tried to make it as clear as he could; but he was afraid, looking at the questions he had had to deal with, it had been impossible for him to meet by anticipation every point that might be raised. He had been asked by the right hon. Gentleman (Sir Stafford Northcote) whether the House would have an opportunity of fully discussing the plan for converting Three per Cent Stock, and whether there would be a separate Bill dealing with the Gold Coinage. There would be many opportunities of discussing the proposal as to the Gold Coinage, for it would be the duty of the Government to bring in a Bill for carrying out in detail the plan he had explained to the House; and on the different stages of that Bill there would be full opportunity for discussing the scheme. The right hon. Gentleman also asked him whether, under the conversion plan, the relief to the taxpayer would be varied from year to year, or would be once for all. The proposal was entirely in harmony with the Act of 1876, and the automatic arrangement of last year would not be altered in the slightest degree. The hon. Member for Andover (Mr. F. W. Buxton) had asked him, in the first instance, how Australian gold would be dealt with under the new plan affecting the Gold Coinage. Australian gold would be dealt with under the new plan as it was dealt with now—that 580 was to say, it would still be a legal tender. Light Australian gold found in the country would be treated in the same way as light English gold; but light Australian gold coming in after the adoption of the new system would be subject to the same rule as any other coin coming in and found light—that was to say, it would be sent to the Bank to be dealt with under the present law. Then his hon. Friend the Member for Glasgow (Mr. Anderson) had enlarged a good deal upon the plan for creating new 10s. gold pieces, and had pointed out that great danger would arise from a new trade springing up at Birmingham and places abroad, for the manufacture of illegal 10s. pieces, in order to gain the 1s. in 10s. which would be secured in consequence of the amount of gold in the new coin not being worth its nominal value. The hon. Member had spoken of that as a very probable evil, and as one in regard to which they might derive warning from what had happened up to the present time. But his hon. Friend had entirely forgotten that if that trade was likely to be established for the sake of the small 10 per cent gain upon gold coin, how was it that it had not been established for the sake of the much larger gain—20 per cent—which might be made in connection with the silver coinage, or for the sake of the even larger gain on the bronze coinage? A 2s. 6d. silver coin contained less than 2s. worth of silver; and though there had always been a certain amount of false coinage—that was to say, of spurious money—in the country, there had never yet been to any appreciable extent an illegal coinage of money, silver or copper, of the same value as the current coin. That was a trade which, if it were likely to spring up in the case of gold coin, he should have thought would have been much more likely to spring up in the case of silver coin. The hon. Member for Gloucester (Mr. Monk) had complained that he had made no allusion to the Wine Duties. Well, there was a saying that "Speech is silver and silence is gold." He had used a few words with reference to the Wine Duties last year; and the Committee was aware that the Government had laid upon the Table full information as to the negotiations which had been carried on with certain wine-producing countries on this 581 subject. Having full knowledge of the present position of the question, he had intentionally refrained from saying anything about the Wine Duties that evening. The right hon. Gentleman the Member for Westminster (Mr. W. H. Smith) had given them some very useful, and no doubt accurate, information as to the trade of the country; and they were all of them very much obliged to him for it. The right hon. Gentleman had said that he (the Chancellor of the Exchequer) was not justified in attributing the increase of the Income Tax to the extent that he had done to the accumulation of capital in the country. That was a subject upon which it was his duty to be in constant communication with the Heads of the Inland Revenue Department; and whilst he recognized to the full the valuable work and increasing energy of many of the officers in connection with that Department, and the consequent benefit to the Revenue, these authorities concurred in the opinion that the increase which had taken place in the Income Tax was mainly due to an increase of capital in the country. The right hon. Gentleman had given them a case which was not altogether to the point. He had quoted a Return as to the value of Stocks dealt with on the Stock Exchange on the 1st of March, 1883, and the value of the same Stocks on the 1st of March of the present year. The period covered was 12 months, and it showed that the value of certain securities had shrunk, although their nominal value had increased by £150,000,000. Well, but the shrinking of the value of Stocks was no evidence of falling-off in accumulation in the course of 12 months; but the increase of the accumulations was measured by the additional amount of Stocks bought. The increase and decrease in the nominal value of these securities was owing to different considerations from those referred to by the right hon. Gentleman; and he (the Chancellor of the Exchequer) had no doubt there was a very large amount of capital accumulating every year in the country. Where it came from there was not time just at present to discuss; but there was no doubt a steady accumulation of capital going on in the country, and though some was not invested, a large quantity was added to the property-paying Income Tax. Touching 582 upon the question, of local taxation, it was said by the right hon. Gentleman that when they thought they had done so much in diminishing the Imperial Debt they must set against that diminution the increase of Local Debt. Now, no doubt the increase of Local Debt was a very important question; but those two kinds of Debt were totally different. When they increased Local Debt they intended to make a judicious remunerative investment. Whether it was really judicious and remunerative would depend upon the wisdom shown by the Local Authority; but the investment was one, as a rule, earning interest. He did not say that was so in every small case; but a great mass of Local Debt was raised for remunerative purposes; whereas Imperial Debt had been incurred for wars, and was not of a remunerative character at all; therefore, although it was, of course, very important to check any undue increase of Local Debt, it was mathematically wrong to set the Imperial Debt and the Local Debt against each other, as if they were of like nature. The hon. Member for Salford (Mr. Arthur Arnold) had said that the words he had used about the taxation of the lands in mortmain were a condemnation of the First Lord of the Treasury; but he had no idea in what this supposed condemnation consisted. The hon. Member for West Norfolk (Mr. Clare Read) had asked him to consider the question of brewing licences, and to try to make them fall a little less onerously on the cottagers. The hon. Member knew that he (the Chancellor of the Exchequer) had been making some inquiries in reference to this subject; but there had not been anytime to consider the question fully before the present Budget. He would not reply to the hon. Gentleman the Member for Glasgow (Dr. Cameron) on the subject of the Post Office and the Telegraphs, because he had already been answered most fully by the Postmaster General. He believed he had now answered all the questions that had been put to him; and once more he thanked the Committee for the indulgence they had extended to him.
§ SIR BALDWYN LEIGHTON
said, that another opportunity would arise to call attention to the great omission from, the Budget of any relief to local taxation; but he wished to call attention 583 now to the remarks of the right hon. Gentleman with regard to subventions. Did the right hon. Gentleman include prisons and the Irish Police?
§ SIR BALDWYN LEIGHTON
said that arguments against the policy of subventions was hurled at the heads of hon. Members by the right hon. Gentleman and his Colleagues; and when they challenged him he and his Friends were silent. In the debate on local taxation he had challenged the President of the Local Government Board as to what he had said last year, and he quoted his own words and figures. He proved to the right hon. Baronet (Sir Charles W. Dilke) that the lunatics and police Lad decreased in proportion to the subventions; and now the Chancellor of the Exchequer came forward and lumped together the prisons and the Irish Police. There at once went £1,000,000 out of the £2,900,000. That was the way in which the policy of subvention was attacked; and when they came to grapple with the figures they entirely broke down.
§ THE CHANCELLOR OF THE EXCHEQUER, (Mr. CHILDERS)
said, he had followed the Return which bore the signature of the Secretary to the Treasury of the late Government. The distinction between the payments made for Imperial purposes and the payments made for local purposes was made by the late Government; and he (the Chancellor of the Exchequer) had simply followed their Return. If he remembered rightly, the Return commenced in 1875 or 1876.
§ MR. ASHMEAD-BARTLETT
said, he should like to make a protest against the extremely narrow view which the right hon. Gentleman the Chancellor of the Exchequer had enunciated to the Committee with regard to the Imperial and the Local Debt. He understood the right hon. Gentleman to say that the Imperial Debt was a Debt contracted through the operations of war, and therefore had been mere waste.
§ THE CHANCELLOR OF THE EXCHEQUER (Mr. CHILDERS)
said, he had not said anything of the kind. What he had said was that the Imperial Debt had been mostly incurred for objects which were not pecuniarily remunerative; and therefore it was not fair to put it side by side, as the right hon. Gentleman (Mr. 584 W. H. Smith) had done, with Debt incurred for local purposes.
§ MR. ASHMEAD - BARTLETT
said, he had understood the right hon. Gentleman to say that expenditure on war was not a useful expenditure. He had certainly stated that Imperial Debt was incurred for wars, and was not of a remunerative character at all. Would the Chancellor of the Exchequer state that the money spent upon the construction of a Town Hall at Birmingham was more beneficial and more remunerative than the money spent in the Imperial efforts which saved England and Europe from the universal domination of the First Napoleon, or which guaranteed the security of 250,000,000 people in India? [Mr. WILLIS: Certainly.] That was just what he should have expected to hear from the hon. and learned Member for Colchester. No doubt the hon. and learned Member would like to be a down-trodden worm under some French or Russian despot. He could quite understand that; but what he should like to know was, whether this Local Debt was incurred for objects which were more remunerative and valuable than the military operations which had saved India? There were three striking features in this Budget. There was, first, the substitution for the ancient and time honoured Three per Cents, of the New Two-and-a-Half, and the New Two-and-Three-Quarter per Cents. There was then the issue of these bad half-sovereigns—which would remind them of the worst days of the Plantagenets; and there was, last of all, this miserable surplus of £200,000, which he sincerely hoped would not prove to have been the price of the lives of General Gordon and those depending upon him. He should remind the right hon. Gentleman, when the proper time came, that he had promised them that these Bills, which were to deal with changes in taxation and Revenue, should be brought in at a reasonable hour. He had promised them that they should be brought in at a time which would give them ample opportunity for full discussion—that the measures would not be hurried through the House at 3 o'clock on an August morning, as was the National Debt Bill last Session. He could not offer the right hon. Gentleman his congratulations upon the Budget Statement he had made. He (Mr. Ashmead-Bartlett) had 585 not been so fortunate as to hear that Statement; but he had read it since. He had no doubt it was delivered with all the right hon. Gentleman's characteristic lucidity and eloquence. The right hon. Gentleman had made some very important admissions. He had told them that trade was bad; that profits were low; and that incomes derived from land were still unsatisfactory. It was to be hoped that the right hon. Gentleman would, therefore, induce the Government to reconsider their fiscal policy, and to give up the present futile system of so-called Free Trade, which was ruining the country, and which was causing the accumulated capital of centuries—certainly of generations—rapidly to disappear, and which was giving other countries every possible advantage over us in the race for prosperity, and even for existence. He believed that a more judicious policy of encouraging our Colonies by turning our emigration and our trade into Colonial channels, rather than into foreign channels, would largely remedy the evils which at present existed.
§ Question put, and agreed to.
Resolved, That, towards raising the Supply granted to Her Majesty, there shall be charged, collected, and paid for the year commencing on the sixth day of April, one thousand eight hundred and eighty-four, 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):
§ Resolution to be reported To-morrow, at Two of the clock.
§ Committee to sit again To-morrow.