COMMITTEE.

HC Deb 26 April 1888 vol 325 cc608-714

Bill considered in Committee.

(In the Committee.)

Clause 1 (Short title) agreed to.

PART I.

CUSTOMS.

Clause 2 (Import duties on tea).

MR. PICTON (Leicester) ,

in rising to move the omission of the clause, said, the other night the right hon. Gentleman the First Lord of the Treasury (Mr. W. H. Smith) was good enough to say that an opportunity would be afforded for discussing any point of the Customs and Inland Revenue Bill when the House was in Committee. He (Mr. Picton) did not consider that that was a convenient stage for raising any question such as that which he desired to bring before the Committee. It was not, however, his fault. His Notice in regard to the Tea Duties was placed on the Table before that of the right hon. Gentleman the Member for Mid Lothian (Mr. W. E. Gladstone) in reference to the Succession and Death Duties. Of course, when he found that the right hon. Gentleman had given such Notice he at once felt it his duty to accede to the prior claim of the right hon. Gentleman. Under the circumstances, he trusted that hon. Members would excuse him if he felt himself compelled to detain them for a short time on a point which would have been much better discussed earlier. He thought that the history of the consumption of tea in this country illustrated how financial reform might convert an article of luxury, and what had been an article even of extravagant luxury, into a necessary of life. If hon. Members would look back over the history of the consumption of tea in this country—a subject which had been too much forgotten of late years—they would find that the extension of the consumption of tea to the general mass of the people had been in almost steady proportion to the relaxation and diminution of the Customs Duties. At every successive step in the diminution of the Customs Duties there had been a large increase in the consumption, although after a while the consumption had shown a tendency to remain steady so long as a particular duty was levied. When another diminution came a fresh impulse was given to the consumption, and after a while that impulse died out. They had arrived at such a stage at the present moment. When the right hon. Member for Mid Lothian was Chancellor of the Exchequer in 1865 he reduced the Tea Duty to 6d., and at once an enormous impulse was given to the consumption; whereas the consumption between 1857 and 1863, with a duty of 1s. 5d. a-pound, was almost stationary, having been 77,000,000 lbs., rising to 77,437,000 lbs. As soon as the duty was lowered to 1s. the consumption sprung up to upwards of 96,000,000 lbs. When the duty was reduced to 6d. the consumption still further increased, until at the present moment it was from 178,000,000 lbs. to 180,000,000 lbs. per annum. On closer consideration, however, the increase in the consumption of tea was not quite so satisfactory as might be thought. He was not referring to the impulse given to consumption when the Duties were first lowered; but of late years the increase had done little more than keep pace with the growth of the population. It was shown by the Statistical Abstract of the imports and exports of the United Kingdom that during the last 14 years, from 1872 to 1886, the consumption of tea per head of the population had barely increased by one pound—in 1872 it was 4.01 per head, and it was 4.87 in 1886. Hon. Members might think that nearly 5 lbs. per head was a respectable consumption; but in New Zealand the consumption was 7.23 per head, and in the Australian Colonies it was 7.66. Therefore, the consumption at home was considerably less than it was in the Colonies, where the Tea Duties were, for the most part, less than those levied here. In most of the Colonies and in New Zealand the duty was only 3d. per pound. He thought these figures showed that the increase in the consumption had not been as healthy as might have been desired; and he was, therefore, not surprised to find the right hon. Gentleman the Chancellor of the Exchequer (Mr. Goschen), in the course of his remarks upon the Budget, informing the House that the Tea Duties "were fairly, though not remarkably, progressive." In 1856–7 the receipts from tea were £4,515,000, and in 1866–7, £4,618,000, or an increase of £103,000. The right hon. Gentleman pointed out that this was somewhat more than in proportion to the increase of population, but he could not say that it was a revenue which showed much elasticity. This was all the more remarkable when it was borne in mind that the price of tea had gone down very considerably within the last 15 years. The total amount of tea imported, including all which was brought into this country, whether exported or not, in 1872 was 180,000,000 lbs., the value being £12,933,000. In 1886 the total imports had increased to 230,000,000 lbs., including what was brought in for export; but the total value of that much larger amount decreased, and was only £11,317,000, so that prices had dropped very considerably. Nevertheless, not-withstanding the decrease of price, the consumption was not what might have been expected. It might be said that in moving the omission of the clause he did not show much concern for the Revenue. He, however, had no desire to cripple the Revenue; but he simply wished to see it derived from other items than the necessaries of life. He admitted that his reason for referring to the facts he had just detailed had nothing whatever to do with the growth or diminution of the Revenue. The facts tended to show that while a wise commercial policy had converted tea from an article of luxury into a necessary of life, the consumption of that article had become nearly stationary, and that the duty for a long time past had been out of all proportion to the value of the article. He would now proceed to establish the first main objection to the continuance of the Tea Duty—namely, that it was burdensome to the poor, inasmuch as it taxed the necessaries of life. He wished to emphasize this point as much as possible—namely, that tea had become a necessary of life. He presumed the people must drink something, and that they would not be content with water, or oven milk. They were told by the hon. Baronet the Member for the Cockermouth Division of Cumberland (Sir Wilfrid Lawson) that alcoholic drinks were not necessary; but surely tea and cocoa or coffee must be considered among the articles that were essential to the consumption of even the poorest man. In 1857, when the standard of wages among the wage earning class was distinctly lower than it was now, it was stated in the Parliamentary Paper No. 184 for that year that the consumption of tea had steadily and largely increased among the working classes. Indeed, it had increased to such an extent that tea and sugar, next to bread, had now become the prime necessaries of life. When he thought of the mode of life among the poor, and especially among the very poor in the present day, he felt that these words were emphatically true. How many were there now in this great Metropolis who had to be content for their mid-day meal with a few slices of bread and butter and a cup of tea? Surely when people had to live upon so little, and were so reduced that they were compelled to dine on tea and bread and butter, it became a positive cruelty to take 6d. for every pound of tea that they consumed. The Report to which he referred said that in London there were poor needlewomen whose miserable condition admitted neither the means or the time necessary to purchase butcher's meat, and who were compelled to sustain life on dry bread and tea, the latter affording a gentle stimulant to the exhausted frame. It must be conceded that to take 6d. for every pound of tea these poor creatures consumed was not only oppressive, but cruel, especially when they bore in mind the proportion of the duty to the cost of the article. That proportion would be found to be greatest in the case of the very poor. When the right hon. Gentleman the Member for Mid Lothian reduced the duty, the duty in proportion to the cost of the article was much less than it was now that prices had fallen. Sir Charles Dilke said in 1885 that it amounted to 50 per cent upon the cost of the article. The hon. Member for West Bradford (Mr. Illingworth) said in an earlier year it was as much as 75 per cent; but there were instances now where the duty amounted to very much more than 100 per cent upon the cost of the article imported. He (Mr. Picton) had learnt from a tea merchant in active business in the City of London that there was now tea in bond which had only cost 4½d. per pound, and some which cost only 3¾d. per pound without the duty; and yet upon such an article a duty of 6d. a pound had to be paid. In addition to these facts, he might say that very much more of the revenue derived from tea was paid by the labouring classes than was taken from other portions of the community. The Parliamentary Paper of 1857—to which he had already eferred—estimated that certainly more than one-half of the tea consumed by the country was used by the labouring classes, and probably two-thirds. He maintained that this was a rational argument to use against the continuation of the duty—namely, that the proportion between the duty and the actual cost of the article had very much increased, and it was now, more than ever it was before, a revenue derived from labour and not from the comfortable classes. Surely these were very serious arguments against the continuance; at any rate, they went to show that it was a tax on the necessaries of life. John Stuart Mill, in the second volume of his Political Economy, told us that taxes on necessaries must have one of two effects—they must either tend to depress the standard of comfort among the labouring classes, or they must lessen the profits on capital. In his (Mr. Picton's) opinion, taxes on the necessaries of life almost invariably tended to depress the standard of comfort among the poor, without materially lessening the profits on capital. He was sure the hon. Baronet the Member for Cockermouth would agree with him when he said that ho believed the tax on tea was, to a considerable extent, a hindrance to the progress of temperance. He did not deny that the law might do something indirectly to promote temperance, but he believed that general habits of decent comfort would do very much more, and whatever alterations in their financial arrangements tended to make the people comfortable would tend to promote temperance. People could not yet get a good cup of tea as cheaply and as easily as they ought to do. When he himself was a total abstainer—he was not so now—he had experienced much difficulty in getting temperance drinks as easily or as cheaply as other people could get a glass of ale. He knew that something had been done to remove this difficulty by the establishment of coffee and cocoa shops; but, apart from such efforts, it was found that in travelling to strange towns it was much cheaper to get a glass of beer, or other alcoholic drinks, than to get a good cup of tea. He could not but think that much of the difficulty arose from the excessive duty which was imposed. He further maintained that the continuance of the Tea Duty was a considerable hindrance to the expansion of our commerce. Where duties had to be paid, there were always difficulties with the Customs House, and where the transactions were extensive commerce was necessarily hampered. Of course, if the consumption of tea was kept down, as he contended it was, seeing that it was steady, or nearly so, it was manifest that commerce was hindered to that extent. There was one point in connection with this part of the subject to which he would ask the earnest attention of the Committee, and that was the bearing of the Tea Duty upon our trade with India. It was only within comparatively recent years that India had become a tea growing country or a tea exporting country. In 1836 the first pound of tea was brought from Assam to this country; in the next year about 5 lbs. were brought; but in 1872 upwards of 17,000,000 lbs. came in; and in 1887, 80,500,000 lbs. odd. In fact, India was in a fair way to out-rival China as far as the export of tea to this country and many others was concerned. Then, he would ask, were we treating India fairly when we imposed a duty of 6d. on every pound of a commodity which formed so large a part of the exports from that great Dependency? Not long ago we compelled India to do away with all duties on British manufactures, and we now insisted on sending our cotton goods free of all duty to India. Then was it fair or right that we should show such want of consideration in this matter as to continue a duty of 6d. a-pound on all the tea which India sent to this country? The same thing applied to Ceylon, only, of course, in a smaller degree. The exports from Ceylon had now risen to 8,000,000 lbs. per annum, and the Cingalese charged us with discouraging their commerce as much as we could by imposing upon tea a duty of 6d. a-pound. He (Mr. Picton) contended financially that the continuance of the duty was absolutely inconsistent with all sound principles of taxation; it was bleeding industry just when it needed strength. A wealthy nation such as this ought not in a time of peace to tax industry for the necessaries of life. The right hon. Member for Mid Lothian had referred the other day to a Return made to the House in 1885 of the amount of realty and personalty in this country which was subjected to taxation. The total amount at that time was £9,411,000,000 sterling, and it could not be doubted that at this time it had increased to £10,000,000,000 sterling. Then the amount of taxation on that tremendous wealth was just one-fifth per cent. Of course, he was aware that other taxes had to be paid both by realty and realized personalty, but he did not think that the taxation imposed upon it was as much as the realized wealth of the country could bear. At any rate, he did not think that in a time of peace we were at all justified in imposing such burdens upon labour. He should probably be told, as an audience was told the other day by the right hon. Gentleman the Chancellor of the Exchequer, that it would be a very unsafe thing to remove from the labouring classes all responsibility from the finances of the country, or the cost of carrying on the Government. That, however, was not a correct way of stating the case; the labouring classes must always pay a considerable sum towards the expenses of Government so long as they drank beer and smoked tobacco, and, notwithstanding the efforts of the hon, Baronet the Member for Cockermouth, he (Mr. Picton) expected that they would continue to do so for a very considerable period yet. What he maintained was that, apart from luxuries, the working classes should receive the necessaries of life without taxation. Then it might be asked—"What are you to do in a time of stress and danger? "Well, there was such a thing as a War Tax. In 1856 the Tea Duty was raised from 1s. 6d. to 1s. 9d. a-pound as a War Tax, and he did not think that anybody complained of it at the time. He was not going to enter into the question whether that war was justifiable; but, at any rate, the people were very willing to pay in order to satiate the savage passions of the time, and, whenever in such a mood of the country war taxes were imposed, nobody grumbled at them. That had been the case hitherto, and would be the case in future, and if people chose to go to war let them pay the cost of it. It would be placing a very good premium on peace to show the labouring classes that as long as peace was preserved labour would escape certain taxes. If they went to war, then let the imperious Chancellor of the Exchequer impose taxes on tea or anything else. He might be asked what substitute he would propose for the Tea Duty. That was not his business. It was the business of the right hon. Gentleman the Chancellor of the Exchequer, who had financial ability and sufficient ingenuity to devise some substitute for the Tea Duty if it were given up. He (Mr. Picton) would only name one which he was afraid had not been sufficiently thought of—that was retrenchment. He only wished that the people would compel the Government to retrench the expenditure of the country, or determine to refuse unreasonable taxes, so that the Government would be obliged to lessen the extravagant expenditure of the present day. If it could be shown that retrenchment was impossible, he hoped hon. Gentlemen opposite would bear with him if he ventured to suggest that the land did not bear its full quota of the expenses of Government—[Cries of "Oh, oh!"]—No; it certainly did not. When they remembered that land was the territory of the whole people, and the privileged possession of the few, they must be aware that it did not pay its fair proportion. Of course, he knew he should be out of Order in going into that matter, but he mentioned it as one means by which the burdens of the people might be reduced. Whatever might be the consequence at the present moment, he was quite sure that the time would come when the duty on tea would have to be abolished, and when the tax-gatherer would have to keep his hand from the pocket and breakfast table of the poor man, and from the tea-caddy of the poor widow. He begged to move the omission of Clause 2.

Amendment proposed, "To leave out Clause 2."—(Mr. Picton.)

Question proposed, "That the Clause stand part of the Bill."

MR. HOWARD VINCENT (Sheffield, Central)

said, he did not rise for the purpose of seconding the Motion. It would be in the recollection of the House that on the last occasion, when the motion for the renewal of the Tea Duty was before the Committee, he had entered an emphatic protest against the principle of a duty on a non-competing import, which had become almost a necessity to the great mass of the population, and an export of considerable importance to our only free market—British India. He had determined not to take further action in the matter in the present Session, and for this reason—that the right hon. Gentleman the Chancellor of the Exchequer (Mr. Goschen) had attempted so much in the present Budget for the reduction of both Imperial and local taxation, and much more might be confidently anticipated hereafter. He ventured to hope that in the coming year the encouragement which the right hon. Gentleman the Chancellor of the Exchequer had given to one branch of British industry—namely, the bottling trade, would be extended to other branches. He had been much edified by the speech of the hon. Member for Leicester (Mr. Picton), and he ventured to congratulate the hon. Member most heartily on his conversion to one of the principal points of what was generally known as the Fair Trade programme. He could not help thinking that that was due to some extent to a meeting which was held at Leicester on the 1st of February, and which was addressed with great ability by the hon. Member for the Malden Division of Essex (Mr. C. W. Gray). He maintained that any hon. Member who proposed that the right hon. Gentleman the Chancellor of the Exchequer should abolish the tax upon tea, coffee, and cocoa was absolutely bound to show from what source the right hon. Gentleman would obtain the revenue of £5,000,000 sterling a-year at present obtained from this source. The hon. Member had avoided that point by saying that it was the function of the Chancellor of the Exchequer, but he had pointed out that the land might be still further taxed. Upon that point he joined issue himself emphatically with the hon. Member. He had no intention of following the hon. Member at any great length on that point, for he had risen merely to congratulate him on his conversion to the principle of Fair Trade. He had intended, if an opportunity permitted, to have taken the sense of the Committee on the Tea Duties, but he thought the present opportunity was not favourable to such a course. The establishment of a free breakfast table Which the hon. Member for Leicester now advocated had been frequently brought before the House, and had been advocated upon many public platforms by hon. Members who sat on the Conservative side of the House. The remarks of the hon. Member for Leicester appeared to show that he was beginning to sympathize with the struggle which was being made in defence of the employment of labour at home, to prevent the further reduction of wages by the one-sided system of Free Trade under which we now laboured. The right hon. Gentleman the Chancellor of the Exchequer could, if he wished to do so, find ample resources from which to obtain the revenue now contributed by the Tea Duties. He (Mr. Vincent) trusted that the right hon. Gentleman would turn his attention in the coming year to the absolute necessity which lay upon the Govern- ment of giving to British labour that fair play which labour enjoyed in every other country, and that fair play which it had secured for itself within the United Kingdom by trades unionism and legislation. If the right hon. Gentleman would, as he hoped, turn his attention to this matter, he would soon be able to find not only an equivalent for the £5,000,000 now derived from tea, coffee, and cocoa, but an ample surplus which might enable him to relieve the duties on tobacco and many of the excise licenses which now pressed heavily upon many trades. By so doing, the right hon. Gentleman would give a stimulus to industry in every part of the United Kingdom, and that, in the present state of commercial depression, was what the country really wanted.

SIR GEORGE CAMPBELL (Kirkcaldy, &c.)

said, he did not intend to detain the House at any length. He was not sure that he had very great sympathy with the hon. Member for Leicester (Mr. Picton) in the proposal he had submitted to the House; but he desired to express sympathy with the general principle that some relief ought to be given to the taxation on labour as compared with the taxation upon property. The result of the changes now proposed was to make an adjustment of taxation with regard to different kinds of property by transferring several millions of taxes on property to the local authorities. Consequently, when they came to look to Imperial taxation, they would find that a large proportion of the Imperial taxation which had hitherto been charged on property was cut away, and that it would be in future less by several millions than it had been. In addition, there was some remission of Income Tax which, although not entirely taxation upon property, would give considerable relief to property. The result was, so far as Imperial taxation was concerned, that while almost the whole of the excise and the Customs Duties and a large portion of the Income Tax fall almost entirely as a tax on labour and industry, the Imperial taxes upon property would be comparatively small. A large slice of the Death Duties were to be cut away from the Imperial taxation, and also a considerable portion of the Licensing and other Duties. He therefore, quite agreed with his hon. Friend, that although up to the present time the taxes on property compared with those upon labour and industry had been inadequate, the inadequacy would now be increased and exaggerated. He was, therefore, of opinion that some adjustment should be made such as his hon. Friend the Member for Leicester had suggested. For his own part, he thought the first step towards an adjustment would be to abolish the taxes upon currants and raisins, so as to leave the poor man's plum pudding free. He would suggest this matter to the consideration of the right hon. Gentleman the Chancellor of the Exchequer.

MR. C. W. GRAY (Essex, Maldon)

said, he wished to say a word with reference to the somewhat bold proposal of the hon. Member for Leicester (Mr. Picton). He was quite in sympathy with the hon. Member as to the free breakfast table of the poor man, and he hoped the time would come when he would be able to get a cheaper breakfast than he got to-day, and when the duty upon tea would be reduced. H e failed, however, to understand why the Tea Duties should be reduced and additional taxation put upon the land. Until the hon. Member had some better material by which to fill up the financial void, which the reduction of the duty upon tea would cause, than increased contributions from the land, he should certainly be unable to support his proposal. At the same time, he hoped that as time went on, such a duty as the present Tea Duty would, at any rate, be reduced; but the remedy should be a very different one from that of increasing the taxation upon land.

MR. ILLINGWORTH (Bradford, W.)

said, he wished to give a hearty support to the principles of the proposal of the hon. Member for Leicester (Mr. Picton). The proposal to establish a free breakfast table was not a new one; but his right hon. Friend the Member for Central Birmingham (Mr. John Bright) had long been heartily in accord with it. He thought hon. Members should bear in mind how large a share the working classes contributed to the Imperial revenue. The right hon. Gentleman the Chancellor of the Exchequer (Mr. Goschen) told them that the increase upon the Excise Duties last year amounted w at least £300,000, and it must be admitted that the main part of that increase came directly from the working classes, and only a comparatively small share from the classes above. In addition to the sum they contributed upon the beer they consumed, the working classes consumed a large amount of spirits as well. These taxes were frequently in greater proportion to the cost of the article. So far as tobacco was concerned, it was now regarded by the working classes as a necessity. An enormous portion of the Imperial taxation upon tea, spirits, beer, and tobacco, articles of consumption that were necessary to the working classes of England, came from the working classes themselves, and he thought that his hon. Friend had hit a right item when he attempted first to assail the Tea Duty. The reasons his hon. Friend had given for the omission of this clause wore certainly sufficiently weighty to demand the attention of the right hon. Gentleman the Chancellor of the Exchequer. The experience of the country in reference to the taxation of articles of trade showed that every reduction of duty had a tendency to increase the trade between the home country and other countries. It was stated that trade was languishing; it was, therefore, necessary to give it a stimulus. The hon. Member for Central Sheffield (Mr. Howard Vincent) said that the hon. Member for Leicester had gone one step in the direction of Fair Trade; but his hon. Friend had only followed the policy of the soundest free traders in that House. They had removed the duties from hundreds of articles of consumption, but it was not to be assumed that by those removals they had taken a single step in the direction of Fair Trade. Parliament had for many years set its face firmly against anything in the direction of so-called Fair Trade. The right hon. Gentleman the Chancellor of the Exchequer would, no doubt, ask how it was proposed to recoup him for the enormous sum of £5,000,000 which would be got rid of by the abolition of the Tea Duty. He did not think the Chancellor of the Exchequer should be left altogether in the dark as to what was in the minds of the English people on this question. At this moment the right hon. Gentleman the Chancellor of the Exchequer was proposing to increase duties in a certain direction, mainly for the purpose of making. a present to the payers of Income Tax. If he might give a hint to the right hon. Gentleman he would advise him to leave the Income Tax as it stood, and, if necessary, to replace the 1d. which was taken off last year, in order that he might accomplish the object the hon. Member for Leicester had in view. The Government had complete control over the Income Tax, and an important machinery for its collection existed, and there was no reason why substantial use should not be made of it in order that taxation on the necessaries of life might be removed. The only excuse which the right hon. Gentleman had given for proposing a further reduction of the Income Tax was that he wished to see it exercised as a War Tax. Now, in his (Mr. Illingworth's) opinion, it was equally essential, and far more so, to let taxation lie lightly on the working classes, seeing that if ever a war did come upon us they would be the principal sufferers both directly and indirectly. The working classes had not yet sufficiently appreciated what was due to them in regard to this question of Imperial and local taxation. He maintained that there could not be a more inviting policy than to remove items of taxation that pressed on the general working classes of the country. Tea was a necessary of life among the working classes, and it would be an act of equity and true wisdom to abolish, or, at any rate, reduce the excessively high tax now placed upon it. If the habits of the working classes, as well as the other classes, were to be improved, especially in regard to excessive drinking, he did not see what better opportunity could be afforded than by making tea as cheap and as plentiful as possible. It had been suggested by the hon. Member for Kirkcaldy (Sir George Campbell) that some possible harm might come from the excessive drinking of tea; but if that were so the people would soon find it out for themselves. It was most unwise, he thought, to place excessive duties on articles that were necessary in order to secure the comfort of the working classes. It was absolutely essential, he thought, that all such burdens should be removed, especially when they remembered the enormous disproportion between the taxation and the cost of the article. To abolish or reduce the Tea Duty would bring the right hon. Gen- tleman the Chancellor of the Exchequer quite as much popularity as he could secure by reducing the Income Tax. It was true, however, that the payers of Income Tax were much more in touch with the right hon. Gentleman than the working classes, and were better able to make their feelings and views known. Unfortunately the working classes had not hitherto secured that attention to their reasonable demands and that alleviation of their burdens which other classes invariably did. The hon. Member for Leicester suggested as an alternative that there should be a further imposition of taxation upon the land. Now, he (Mr. Illingworth) was an owner of property himself, and he did not hesitate to say that he had no objection whatever to transfer a portion of the burdens on articles of consumption from the shoulders of the working classes to property, and he was prepared to pay his share of the transfer. His view was, that so long as these duties remained they had a tendency to affect the value of property, and that if they were removed the owners of property would receive advantage by the impetus which would be given to trade. In the large community with which he was connected he knew very well that the reduction of taxation, instead of being detrimental to property, would be the very reverse. Larger sums would at once be spent in the improvement of property and in making the conditions of life more tolerable. The continuance of taxes upon necessaries of life was a most unwise policy, and he should like to see the day come when neither Customs nor Excise Duties would be levied as a source of taxation upon the country. No doubt, that would be an enormous change, even a revolution; but he believed that in the end it would be the most economical as well as the most just system of taxation. For these reasons he heartily supported the proposal of his hon. Friend.

THE CHANCELLOR OF THE EXCHEQUER (Mr. GOSCHEN) (St. George's, Hanover Square)

I cannot complain for a moment of the tone in which this discussion has been conducted; but I wish to say, in reply to the remarks of the hon. Gentleman the Member for West Bradford (Mr. Illingworth), that no pressure has been brought to bear by the payers of Income Tax upon the Chancellor of the Exchequer, although they are, in fact, the most long suffering of all taxpayers. It ought always to be borne in mind, however, in reply to most of the arguments which come from the hon. Members opposite, in favour of the reduction of the Tea Duty and the augmentation of the Income Tax, that the Income Tax has been successfully raised for the purpose of meeting an emergency. Quite apart from any question of popularity, to which the hon. Member for West Bradford has referred, it semis to me only to be just that, if in times of emergency the Income Tax has been raised, when the emergency is passed it should have a fair claim to be lowered. I quite admit that if the question were merely one of popularity it would be more popular to reduce the duty on tea, and would have rendered the Government more popular in the country than the reduction of the Income Tax. I, therefore, hope it will be conceived that the Government, in the proposal they have made, have considered simply what was the best in the interests of the country, and that they have not been influenced by any of the considerations as to popularity which have been suggested by the hon. Member for West Bradford. The hon. Member for Leicester (Mr. Picton), who initiated the discussion, and who spoke in a most temperate manner, alluded with regret that the consumption of tea had not shown as much increase as might be desired, although it has increased more in proportion than the population. The hon. Member has correctly quoted a saying of my own on a former occasion—that the increase is fairly satisfactory, but not altogether satisfactory. I called attention to the fact that this was due, in some degree, to the supercession of China teas by Indian teas, and to the fact that Indian teas are much stronger. I am informed that one pound of Indian tea will go much further than a pound of China tea, and that a pound of Indian tea produces a larger number of cups of tea than a pound of Chinese tea would produce; and this has naturally had some effect in diminishing the quantity of tea used. The hon. Member also called attention to the consumption in the Colonies. I believe that tea is, to a much greater extent, an article of general beverage at all meals in many parts of the Australian Colonies than in this country. Hon. Members must also re-member that wages generally are higher in Australia than here, and that the people are consequently able to consume a larger number of pounds of tea. I do not wish for a single moment, in any remark I may make, to depreciate the importance of the suggestion which has been made by the hon. Member. I think it is extremely desirable that we should keep our eyes on the Tea Duty—if not on its total abolition, at all events upon its reduction. I should deprecate—and I hope that there I shall have the support of all those who have had any experience of finance—I should deprecate the cutting down of any of our present sources of revenue. For instance, if I had a certain number of millions to spare, I would sooner reduce the Tea Duty and take off a portion of the Tobacco Duty, than to abolish the Tea Duty altogether, because, when you once abolish a duty, the whole of the machinery for raising that duty on that article is gone. Therefore, I should prefer a reduction to a total abolition. If I have said that a preference ought to be given on this occasion to the payers of Income Tax, it was because the payers of Income Tax have been paying an additional burden for some time past. Perhaps it is convenient in this connection that I should allude to a suggestion which has been made by the hen. Member for Kirkcaldy (Sir George Campbell). The hon. Member spoke as if there were a growing tendency to throw taxation on the working classes, and to relieve property at the expense of the working classes. The hon. Member for West Bradford spoke in the same direction in reference to beer and spirits; but I will place figures before the Committee—not in a controvertial spirit, but in order that the facts may be known. The total taxes on consumable articles have fallen from about £43,300,000 in 1876–7 to £41,370,000 in 1887–8, or a fall of nearly £2,000,000. The taxation per head on consumable articles has fallen from £1 6s. to £1 2s. 3d. I rejoice in that fact; but I do not put it forward in order to raise any question. At the same time, I would call the attention of the Committee to the fact that the taxation on property—I mean the Death Duties, stamps on transfers, House Tax, and Income Tax —has increased from £17,400,000 to £29,500,000, showing an increase of £12,000,000, or 71 per cent.

SIR GEORGE CAMPBELL

Is that calculation made after allowing for the transfer of the Death Duties and other duties to local taxation?

MR. GOSCHEN

I will come to that presently. As I have pointed out, the taxation upon consumable articles has fallen from £29,500,000 to £17,500,000 between the year 1876–7 and the year 1877–8. That was after the reductions had been made on the Sugar Duties and other reductions. I am taking a time when the taxation on the working classes became law and had decreased by £2,000,000, whereas the taxation on property had increased by £12,000,000. At the same time there has been an increase in rates which fall to a great extent on the owners of property, and therefore swell the increase in the aggregate charge borne by the wealthy classes. I am glad to think that from that expenditure on rates the working classes have derived a very considerable advantage; for instance, in the matter of education the whole increase of taxation has gone to the advantage of the working classes. I have not used these arguments in order to lay down any proposition which would tend to prevent us from moving in the direction which has been indicated—namely, relieving the taxation of the working classes; but what I have been answering is the allegation that we have been going so far in the wrong direction. So far we have only to a slight extent been relieving the wealthy classes from some of the additional burdens which have been imposed during the last few years. It may be asked—"How do we stand now?" I make a proposal this year to relieve the Income taxpayers of £1,500,000, a large proportion of which will go to the benefit of persons with small incomes, but a portion will go to relieve the wealthy classes on whom additional taxation has been imposed. On the other hand, we impose duties on wine, on foreign securities, and other transactions, amounting to more than £500,000, which will fall exclusively upon the wealthy classes. Therefore, I may fairly contend that we have not been drawn in the direction of relieving the well-to-do at the expense of the working classes, which would be entirely contrary to the financial principles we profess. Looking at the large amount of additional burdens which has been placed upon the payers of Income Tax, we think that our proposals are just. I have used an argument to which I will adhere—namely, that the Income Tax is a valuable reserve in times of emergency, and there, I think, I shall have the assent of the right hon. Gentleman the Member for Mid Lothian (Mr. W. E. Gladstone). The position of my hon. Friend the Member for West Bradford is a different one. He says—"Rely on the Income Tax in times of peace, and, then, if necessary, put taxation on consumable articles as a preparation for war." There is this great difference between the two propositions—that Income Tax can be put on at a moment's notice; whereas, in the case of piling in additional duties on consumable articles, it is generally some time before you can reap the full effect of them. I think there is some force in that argument. The hon. Member for Leicester has received a compliment from my hon. Friend the Member for Central Sheffield (Mr. Howard Vincent), which I am afraid I must share, for the compliment also applies to me. I am not, however, able to accept it, because my hon. Friend has treated as an intentional act on my part that which was only incidental. There does not appear to be any agreement whatever between the hon. Member for Leicester (Mr. Picton) and the hon. Member for Central Sheffield. There exists the greatest difference of opinion as to the manner in which the gap left by taking off taxes on consumable articles should be met. One hon. Member suggests that additional taxation should be imposed on the land, and the hon. Member for Leicester himself suggested retrenchment. Now, the Government are only too anxious to economize, but they find great difficulty in resisting the demands which are made for increased expenditure from very influential quarters. Of course, a certain amount of expenditure is necessary in order to secure the efficient administration of the affairs of the State; but the Government will resist as much as any hon. Member of this Committee any extravagance beyond that point. But I imagine that even the most sanguine person can hardly believe that it is possible by any retrenchment to fill up the gap which would be pro- duced if the Amendment now before the House were adopted. The hon. Member for Leicester quoted some statistics as to consumption. It would be impossible, I fear, in taxing any article, to avoid some of the hardships which attention has been called to. The hon. Member used the argument, that—" In proportion as the duty has fallen, so the price has fallen also, and therefore you ought to abolish the duty altogether." Hard cases have been put where persons spend a portion of their trade earnings upon tea, but such cases occur under almost every duty. It appears to me that the consumer of tea has had a great advantage—an advantage in which we all rejoice—in finding his tea infinitely cheaper than it was formerly. If the consumer has to pay less for his tea he is not entitled to look upon it as a grievance that the duty has remained the same as before. He is certainly brought nearer to the cheap breakfast table which is desired. In fact, I showed last year, and I am able to show again, that with the duty at 6d. the working man can buy his tea cheaper than he could have done a few years ago, even if the duty had been removed altogether. The value of the article was then so great that it would more than compensate for the whole of the Duty. One hon. Member has informed the Committee that tea can be bought for 4½d. and even 3½d. a-pound, but I am afraid that a very few poor persons have the benefit of that extra cheapness. I know that in country districts the prices are proportionately very much higher than that, and I am afraid that a great portion of the cheapness in the wholesale price of tea goes into the pockets of the middle man, and does not reach the extreme poor. Having now answered the points which have been brought before the Committee by hon. Members who have taken part in the discussion, I may add that it will be satisfactory to me if it should happen that, during my tenure of the Office I now hold, I can make a reduction in the taxes upon consumable articles.

SIR WILLIAM HARCOURT (Derby)

Of course, it is impossible that a Committee can refuse the Tea Duty to the Government without undertaking to replace it by some substitute. At the same time, I think my hon. Friend the Member for Leicester (Mr. Picton) is quite entitled to emphasize the subject. We all feel that it is an unfortunate thing that there should be in the Budget a proposal of which the relief goes almost exclusively to the propertied classes—[Cries of "No, no!"] Hon. Members say "No, no;" but the right hon. Gentleman the Chancellor of the Exchequer (Mr. Goschen) has pointed out why it is inevitable. Has he denied the fact? Nobody denies it, and the right hon. Gentleman has given a reason of more or less cogency why it ought to be the case, and why there ought to be some relief. Unquestionably it is a circumstance in which this Budget is distinguished from former Budgets, where considerable surpluses have existed, and large reliefs of taxation have been made. As a rule such reliefs have been given in common to all classes of the community. The practice of my right hon. Friend the Member for Mid Lothian (Mr. W. E. Gladstone) was as far as possible to afford equal relief between the two classes; while relief was given on the one hand to the propertied class consideration was also given to the claims of the consuming class. The right hon. Gentleman the Chancellor of the Exchequer has referred to the increase of contribution of what may be called the wealthier classes of late years, and the diminution of the contribution on the part of the consuming classes; but it must be remembered what is the point from which we started. Some years ago the injustice between the contribution of the two classes was monstrous. The contribution of the wealthy classes was infinitely below what it ought to have been, while that of the consuming classes was much higher than was justifiable. No doubt, something has been done to redress that injustice and inequality. There is now a larger contribution made on the part of the classes who possess property, but no great reduction has been made in the contribution of the consuming classes. Some few years ago I called attention to a large reduction in alcoholic revenue. The people of this country had endeavoured to recoup themselves for the additional taxation imposed by consuming less spirits and increasing the consumption of beer as well as tobacco and tea. The right hon. Gentleman the Chancellor of the Exchequer does not controvert the view of the hon. Member for Leicester. He admits that the Tea Duty forms a proper subject of reduction, and I cannot admit that there is any force in his objection to removing the tax, because there may be some difficulty in reimposing it. If I might quote an authority, I would quote himself, because he is removing the tax upon hawkers without any thought of a difficulty in resuming it, if necessary. I believe that no greater social advantage has ever been conferred upon the community than the arrangements of the Tea Duties by my right hon. Friend the Member for Mid Lothian. I should be glad to see that work completed. I only rose to say that I entirely sympathize with the principle mentioned by the hon. Member for Leicester. We cannot, of course, vote for the refusal or the reduction of this Duty without making other arrangements; but I think that it is necessary, all the same, to enter our protest against the principle of the Budget, in which reduction of taxation appears not to be divided in the proportions adhered to by former financial arrangements.

MR. GOSCHEN

I hope I may be allowed to say one word. I waited until the right hon. Gentleman had completed his remarks, in order to point out that there is nothing unusual in the course which we have taken. Relief is given not only to the Income Tax payers, but to the ratepayers who may be considered to be a general and wide class of the community. If we have given relief mainly to the Income Tax payers, it is because of late years the old principle has not been followed of relieving the Income Tax from burdens imposed upon it in the time of emergency when we have a surplus in ordinary times. The Income Tax payer alone has been hit by the late increase of duty, and the reason of the expenditure we have now made is that we find ourselves in the extraordinary position of having to deal with the whole of local finance. Hon. Members will recollect that last year I afforded substantial relief to working classes.

MR. DIXON-HARTLAND (Middlesex, Uxbridge)

I wish to know what becomes of the tea which comes to England in a broken state, and is not allowed to be sold because it is considered unfit for consumption? I am informed it is sent to Germany, where a large business is carried on in making cafféine out of broken tea after it has been sprinkled with petroleum? I believe that the manufacturers of this country could make a great deal of money if this broken tea could be obtained without paying the 6d. duty.

MR. CHILDERS (Edinburgh, S.)

The right hon. Gentleman the Chancellor of the Exchequer has called attention to the fact that of recent years in times of emergency it has been the Income Tax that has been increased, and not the other taxes. Now, in 1885, the proposal of the Government was not only that the Income Tax should be increased, but that there should also be an increase in the duty on articles of consumption. That proposal, however, was rejected by the Party who now sit opposite. It must, therefore, not be charged upon us that when the occasion arose we proposed to add largely to the Income Tax without making any addition to the duties on articles of consumption. I do not blame the right hon. Gentleman the Chancellor of the Exchequer for what occurred then, for he was among our supporters in 1885, and approved the Budget which was then brought in. My right hon. Friend will remember that the arguments used for and against that Budget were exactly the same arguments which have been used now—that it is not proper to add solely to one kind of burden, but to treat direct and indirect taxation as two sisters alike. Unfortunately, althought I had then the support of the right hon. Gentleman the Chancellor of the Exchequer, I did not succeed in obtaining the support of those hon. Members who act and vote with him now.

MR. GOSCHEN

I am afraid I cannot answer the technical question which has been put to me by my hon. Friend the Member for the Uxbridge Division of Middlesex (Mr. Dixon-Hartland). All I understand is that some business is carried on in Germany of a complicated character which permits the use of bad tea.

MR. DIXON-HARTLAND

It is not a complicated business, and if the bad tea were left here a large trade would spring up. It is impossible, however, to establish that trade owing to the imposition of a duty of 6d. a-pound. The tea is sent abroad and sprinkled with petroleum before the cafféine is extracted.

MR. GOSCHEN

I do not think the tea of that nature would be very attractive to tea drinkers of this country. With regard to the observations of my right hon. Friend opposite, I would remind him that the only way in which it is possible for him or his Friends to propose a tax on consumable articles is to put themselves in alliance with the Temperance Party, and to propose an increase of the Beer Duty.

MR. PROVAND (Glasgow, Blackfriars, &c.)

said, that under the last Budget the working classes had contributed £40,000;000 out of £76,000,000 of the total taxation. He considered that proportion altogether too heavy upon the working classes of the country, and he was glad to hear that they might look forward to some relief in respect to the Tea Duty next year. He drew the attention of the Committee to an article which appeared in The Westminster Review a short time ago, and which showed that the working classes paid 4 per cent, the lower middle classes paid 3 per cent, the owners of shops and warehouses and. that class of the community, from 2½ to 10 per cent, and the very wealthy classes as low as ½ per cent, and rarely as much as 2 per cent, of the taxation of the country. That showed that the contribution of the working classes was out of all proportion, and he contended that, if taxation was to be imposed according to their means, the working classes must have some relief. He thought that the tax on Chinese tea was a most unjust one. Even at the risk of repeating what he had said a week ago in that House, he would point out that the tax, which amounted to 60 per cent on the export from China, was one which ought not to continue. It was only because China was a weak country that that system was in operation; it was a system which the Government dare not carry out with regard to any Continental Power or any Power that was strong. The effect of it acted prejudically on our own trade, and the reduction of the Tea Duty would, to a certain extent, benefit ourselves by increasing the purchasing power of China for our manufactures.

MR. FENWICK (Northumberland, Wansbeck)

said, he had hoped that even if the Chancellor of the Exchequer was not prepared to accept to its full extent the Amendment of the hon. Member for Leicester (Mr. Picton), he would have gone some distance to meet it, and made some suggestion, perhaps, that the hon. Member should have modified the form in which his Amendment stood on the Paper. The right hon. Gentleman had done something to meet the requirements of agriculture in the present Budget; he had also given a reduction of the Income Tax; but he had not taken a single step in the direction of lightening the burden which fell so heavily upon the working classes of the country. The only consolation they had received from the right hon. Gentleman was that tea was an article on which he admitted that he ought to keep his eye. He (Mr. Fenwick) would ask the right hon. Gentleman how long he intended to keep his eye upon it before he reduced the duty? Surely, the right hon. Gentleman must admit that 1d. in the Income Tax could be more easily paid by a man whose income was over £150 a-year, than 6d. a-pound duty could be paid on a staple article by the labouring classes of the country, whose wages did not average more than £50 or £60 per annum, and yet the latter class were those who bore the largest portion of the burden of taxation. However, although the right hon. Gentleman had not seen his way to accept even in a modified form the Amendment before the Committee, he was glad to hear that he could not accept the suggestion made by the hon. Gentleman the Member for Central Sheffield (Mr. Howard Vincent), whose courage on questions of this kind they always admired, even when they failed to discover the wisdom of his proposals. The hon. Gentleman would increase the comfort of the working classes by limiting the number of their comforts. He (Mr. Fenwick) pointed out that, heavy as the burden had been upon the Income Tax payers, they would have shared and been considerable gainers by the reduction of the duty on tea. He could have wished that the right hon. Gentleman had given them a more definite promise that they would in future see a reduction of duty upon the article in question. Under the circumstances, he certainly had no hesitation in supporting the Amendment of the hon. Member for Leicester (Mr. Picton).

MAJOR RASCH (Essex, S.E.)

said, the hon. Member for Leicester (Mr. Picton) had proposed to reduce the duty on tea, and to put it to a certain extent on land. During the time he (Major Rasch) had sat in the House of Commons he had never heard a more extraordinary suggestion. They were accustomed to abnormal statements with reference to agriculture from Gentlemen sitting on the opposite side of the House, and they had been informed by the hon. Member for Northampton (Mr. Labouchere) that, if they only knew it, land had gone up in value during the last 40 years, and that they ought to be paying £40,000,000 instead of £2,000,000 taxation. The argument of the hon. Member for Leicester being based on those lines, he (Major Rasch) as an agricultural Member, representing in that House not so much the squires as the agricultural labourers, should certainly vote against the Amendment.

MR. W. E. GLADSTONE (Edinburgh, Mid Lothian)

I wish to explain to my hon. Friend the Member for Leicester (Mr. Picton) that, although I agree with the views he has expressed, it will be impossible for me to accompany him into the Lobby in support of his Amendment. The question before us is purely a question of providing for the necessities of the Government, and I cannot think that it would be useful or desirable to take a Division on the question before the Committee for that reason. The Chancellor of the Exchequer brings forward these Resolutions not with the view of having changes made, but to maintain the Prerogative of the House. I have never given a vote which would reduce the income of the country below its expenditure, and I never will. I do not think my hon. Friend will do well to press his Amendment. I feel confident that there are a great number of hon. Members believing in the soundness of the principles underlying the Amendment, who would gladly join my hon. Friend in a Division, but who are unable to do so because it is absolutely necessary to find the means required by the Government.

MR. ILLINGWORTH (Bradford, W.)

said, that if the Committee determined to modify the Tea Duty, the gap in the Revenue which it would cause might be filled up by arresting reduction of the Income Tax. For his part, he did not hold the principle of direct taxation to be altogether sound. There had been two Budgets in which reduction of Income Tax had been made, but there had been no reduction of taxation on the working classes, and he thought hon. Members who represented them were entitled to raise their voice against the present opportunity for reducing the taxation of the working classes being lost. He would certainly prefer that a reduction should be made now rather than rely upon the glorious promises held out for the future. For his part, he had a very strong objection to the principle laid down by the Chancellor of the Exchequer—namely, that the Income Tax was an engine of taxation to be reserved for indefinite application in the future.

MR. PICTON

said, that while it went sorely against the grain with him to resist any suggestion from the right hon. Gentleman the Leader of the Liberal Party, yet he felt so deeply the importance of his Amendment that he was unable to give way. The right hon. Gentleman knew very well how it had come to pass that he (Mr. Picton) had been obliged to bring forward this question at the present stage of the Bill. He would have no other opportunity of making the proposal, and he felt that it would not be right to allow the Session to go by without ascertaining how many Members of the House were in favour of the Tea Duties and how many were opposed to them. With regard to the deficiency which might be created in the Budget by the adoption of his Amendment, he felt convinced that the right hon. Gentleman the Chancellor of the Exchequer would be able to replace it in other ways, even, if it were necessary, to reimpose the amount by which the Income Tax was proposed to be reduced, inasmuch as those who paid the Income Tax would feel that they effected an equivalent saving in the cost of their tea.

MR. W. E. GDADSTONE

I understand the Motion before us is a Motion for the omission of the clause—that is to say, for the removal of the whole of the Tea Duty, and that there would be no means for us to fill up the chasm thereby made. If the hon. Gentleman were to raise the question as between reduction of Income Tax and the reduction of the duty on tea—if the question were to lower the duty on tea from 6d. to 4d. a-pound, my objection would be removed, and I should assert that the Tea Duty was entitled to preference over the Income Tax.

MR. GOSCELEN

I should wish to add this to my argument. When the right hon. Gentleman the Member for Derby (Sir William Harcourt) speaks of the injustice of the Tea Duties, I wish to know whether that view could have been anticipated as the general view of those who have been responsible for the finances of the country for so long a period? I am now called upon to reduce the Tea Duties, rather than reduce to 6d. the Income Tax, which was raised two years ago to 8d. The right hon. Gentleman the Member for Mid Lothian once proposed to abolish the Income Tax altogether [Mr. W. E. GLADSTONE: In 1874.]. But during the whole of the period in which the right hon. Gentleman held Office, he did not touch the Tea Duties in the slightest degree. Why we should be called upon to make this alteration, I, for my part, cannot understand. I submit, with all respect to the right hon. Gentleman, he is meting out somewhat hard measure to the Government on this question. He has never proposed a reduction of the Tea Duty during the whole of his career; while the Income Tax has remained.

MR. W. E. GLADSTONE

I beg to say that I reduced the Tea Duty to 6d. If I did not abolish it altogether, it was because I had not a surplus to enable me to do so; but the right hon. Gentleman has a surplus, and the question is how it is to be disposed of.

MR. GOSCHEN

The right hon. Gentleman had to raise the Income Tax in order to lower the Tea Duty, and but for that the disparity would not have been so great as it was with the Income Tax at 7d.

MR. PICTON (Leicester)

said, he was anxious to adopt the suggestion of the right hon. Gentleman the Member for Mid Lothian, if possible. He would ask if it was competent to him to withdraw his Amendment and afterwards substitute another to reduce the Tea Duty to 4d.? If so, he would ask permission to withdraw his Amendment.

THE CHAIRMAN

The Clause having been proposed from the Chair, it cannot be withdrawn; and it is therefore not competent to the hon. Member to do what he has proposed.

SIR WILFRID LAWSON (Cumberland, Cockermouth)

Can my hon. Friend move a reduction now?

THE CHAIRMAN

No, Sir,

Question put.

The Committee divided:—Ayes 259; Noes 98: Majority 161.—(Div. List, No. 80.)

Clause agreed to.

Clause 3 (Additional import duties on wines in bottles).

MR. W. E. GLADSTONE (Edinburgh, Mid Lothian)

As the reason which induced me to vote for the Government on the last Division does not exist in the present case, my hands are so far free, and I wish to make upon this clause one preliminary remark, which is, that I think that as far as we have gone we have kept any discussion upon the proposals of the Budget entirely apart from questions of Party politics, and I shall say nothing or do nothing on the present occasion which can give a character to this portion of the discussion different from that which has preceded it. I do not intend in this discussion to take the first place, because I am in a particular position with regard to the Liberal Party, but on the ground that I have been much more than any man in the House connected with Wine Duty legislation, and not only that, but with the whole of the French Treaty arrangements, which, I fear, are brought into prejudice and into danger by the proposal now made. I will look at this simply as a proposal of trade, and I remind the House that before 1860 there was no such thing as any pure or even any tolerable wine to be got in this country from one end of it to another at a cheap or moderate rate. A revolution was then made in the wine trade, and that revolution was so conducted as not to introduce into this important question anything of a protective element; but it was so framed as to allow the transactions of trade to follow as far as might be their natural course. The duties upon such wine as is the subject of the present proposal were reduced in almost all cases from 5s. 10d. a-gallon to 1s. a-gallon. That 1s. it is now proposed, in the case of bottled wine, to be raised to 3s. 6d. Now I have great fear, in the first place, that this will prove to be a prohibitive rate as regards lower quali- ties of wine. In the speech of my right hon. Friend this question was handled as if the tax about to be laid would be upon champagne alone. I have no doubt that the Chancellor of the Exchequer, if he could, would have put some such limitation, so as to prevent the tax falling upon low qualities of wine; but I am convinced that I speak the truth when I say that by far the larger proportion of gallons of wine which will be struck with this tax are of wines of low quality, and I am afraid on that account that it will tend to reintroduce the practice of adulteration. On that ground I object to the proposal; but I object still more strongly, considered as a mere trade proposal, on the ground of the protective element which it contains. Bottled wino of all descriptions, though large quantities of it are sold under 20s. a-dozen, and much of it at 15s., and even if not as low as 12s., will be liable to pay a tax of 5s. a-dozen or 2s. 6d. a-gallon. No doubt, the Chancellor of the Exchequer will say there will not be a corresponding increase in price; because wines brought in wood will be bottled in this country. But I think he is now proposing—at any rate, he has pointed out to us—that one effect of this will be to enable the trader in this country to charge a fictitious or fancy price for bottling. I do not know what the limit of that fictitious price will be within the 5s a-dozen. It appears to me that it may be somewhat lower than the cost of wine imported from abroad in bottles; probably about 4s. a-dozen will be the addition which the trader will be able to place on wines of lower quality. But all that, from a purely economical point of view, appears to me to be highly inexpedient, and so inexpedient that even wore it upon that ground alone it would be most unwise to attempt such an operation for the sake of the small sum of £125,000 a-year I may be told that there was a duty upon bottled wines in the early days after 1860. No doubt, at one period there was; but the truth is that after 1860, and with reference to the then undeveloped circumstances of the trade, the wines imported in bottle were all of them high-priced wines. There was no such thing as low-priced wines imported in bottles into this country; and if that had been the present state of the trade, no doubt a great deal might be said in favour of the duty now proposed. But, Sir, I regard the importance of the matter we have before us as rather beyond the scope of the observations I have been making. There is much, I believe, which may be said on the subject of Colonial wines. I am told that this proposal of the Government will be a heavy blow to the production of wine in Australia, and that it is of the utmost consequence with reference to that trade. I do not believe that at this moment it is a very large trade; I think it is probable that the high value of labour in Australia may for some time prevent any great development of that trade, but there is no doubt of this—that extremely fine wine can be grown and has been grown in Australia, and if that trade should be checked in its development by the incidence of this duty, it is certainly a misfortune, and upon that ground, the broad balance of expediency and policy appears to me to be decidedly against the proposal of the right hon. Gentleman. But the real question which opens to us a dark and formidable prospect, if we are to go forward in this rash attempt to obtain £125,000, is as to its effect upon our commercial relations with other countries. It will be borne in mind that before 1860, the commerce with France was high as to price and trivial in amount. But the augmentation of that commerce has been enormous. It has been augmented ten-fold, and that increase represented by figures is as 3,000 to 30,000 French tons. It is not only that a serious blow will be struck at an important trade, and a considerable alteration brought about in that trade; the really important question here to be considered is the bearing of the proposal upon the Free Trade policy of the country. Now, before the Treaty of 1860 there was hardly a Free Trade Party in France; there were individuals in France who were sound economists, and who were therefore Free Traders, but the ideas and doctrines of Free Trade had not taken an effective hold upon the French public, or upon any considerable or influential portion of the French public. When the Treaty was brought into operation it increased, I may say something like six-fold, the commerce between this country and France, and it led to the adoption of partial measures of Free Trade in other countries, even notwithstanding the reaction in favour of Protection which has more recently taken place. I believe that in consequence of the Treaty, and in consequence of that legislation, and of that alone, most of the tariffs of European countries are at this moment in a state considerably more favourable to us than they were before 1860. The progress we then made with France was the spring and centre of the whole of that movement. What was its subsequent history? That Treaty had not only the effect of extending our trade, which, I think, now stands at something like £20,000,000 a-year of exports, and £32,000,000 a-year imports; but it did mach to develop the Free Trade sentiment, or, as I should say, to enlighten the public mind of France. Free Trade became a powerful and important conviction in the minds of a large portion of the French people; and I think I may now, at this distance of time, remind the Committee of a circumstance which I do not think was of a confidential nature, but which I believe has never been brought before Parliament. It is well known that, when that most distinguished statesman, M. Thiers, came forward to a most prominent position in France, in the last years of his life, when unquestionably he rendered to his country illustrious services, notwithstanding that he was a resolute and extreme Protectionist, he endeavoured to turn to account the high position which he held in relation to this country. M. Thiers endeavoured to induce the English Government, of which I was the head, to consent to large modifications of the Treaty of 1860, in a Protective sense. He said to us—"What I am offering you is really for the benefit of Free Trade, for if you do not accept it, so strong is the Protectionist Party in this country, that your Treaty will disappear altogether, and enactments far stronger than I am asking for may and will be passed in France against you." Sir, we steadily resisted those proposals of M. Thiers; we would not consent to reinstate the French Treaty on a comparatively protective basis; we chose rather to trust to the sentiment of the French public and the convictions which had grown up in favour of Free Trade; and the result was that we ceased to negotiate with M. Thiers; the matter was negotiated with the French nation, and the French nation has allowed us from that day to this practically to enjoy "the Most Favoured Nation" Clause, and with that the arrangement which was in substance the arrangement of the Treaty of 1860. Those communications took place in 1871 and 1872, and they formed a most important chapter in the commercial history of this country. How does the matter stand now? Since that time unquestionably protective ideas have progressed in France as they have progressed in this country. They have made progress to my astonishment—such is the fatal habit which the human race, unfortunately, has to relapse into barbarism even after they have basked in the sunshine of civilization. Let me, however, point out that we have a good deal more light here still than there is in France—that is to say, I recognize with regret that the Protective Party in France are in such a position that it requires very little to give it the upper hand. I was in Paris at the end of December, and had the power of communication with high authorities on this subject; and from one in particular, who summed up in himself the pure Free Trade principle in France, I learned with dismay, though not with surprise, that the Protectionist Party there was as nearly as possible becoming triumphant. I learned that the best chance, and almost the only chance, of maintaining the substance of the system established in 1860 was the successful issue of the negotiations which were pending between France and Italy. Those negotiations have continued, and I am sorry to say they have come to no favourable issue. I do not know that they are hopeless, but unquestionably no progress has been made, and since last December ground has been lost. Now, my apprehension is that a retrograde step taken by this country will have a fatal effect upon the fiscal deliberations and policy of France. I have not the smallest doubt that this proposal has been hailed with joy by the Protectionist Party in France, and that it has struck terror and dismay into the minds of the Free Traders of the country. The wines which we import in bottles constitute a very large portion of the total import of wine from France—not a moiety, but not very far short of it, for they represented 135,000 hectolitres as against 205,000 hecto- litres, or about two-fifths of the whole quantity. But I do not stand upon this or that effect upon a particular trade. It is the effect upon the public mind of France and the public policy of France that I regard with apprehension. I have no disposition to take a hostile course individually, or in any other way with regard to these proposals; but the prospect is so dark and so dangerous, and the perils we are going to incur are so enormously out of proportion to the frivolous and insignificant amount to be obtained from this tax, that if I did not raise my voice in protestation against its imposition, I should feel that I had failed in a great, an obvious, and an imperative duty. It is quite unnecessary to detain the House at any length. I have said, I think, enough to open to the House the nature of the apprehensions with which my mind is filled. They have been confirmed by what has come from the Treasury Bench to-night. We have been told already that the French Government has made a representation to the British Government on the subject. What is the meaning of that representation? I gather from the statement of the Under Secretary of State that it was couched in terms studiously courteous and respectful, as I am quite certain that every representation of the Government of France would be, but it is a step of international comity and duty, and manifestly intended to lay the ground for future action, and that future action, if determined by the spirit existing in France, and foreign in no way to that which prevails in a certain section in this country—though not in the majority—will be action distinctly tending to retrogression; and, as the example of that country is of enormous consequence to the other countries of the Continent, I fear it will be the beginning of an unsound and regrettable course in the general commercial relations of Europe. I should be glad if the Government can remove these apprehensions of mine; but I doubt very much whether my right hon. Friend the Chancellor of the Exchequer will be able to use the language which I should like to hear from him. I should be glad to see him get up, and say—"My information is better than yours. I know more of what is going on in France than you know; I have better means of knowing. I tell you that your alarms are idle, and that there will be no retaliatory legislation in France, and that the commercial relations with France are not in a state of insecurity at the moment." I believe that such is the relation between France and this country, that, notwithstanding the protective tendency which prevails, that national amity would continue on our side, and preserve for us the present state of things for a long and, possibly, an indefinite period; but that the one thing wanted to make the Protectionist Party, now strong in France, becomes irresistible, was an act of England, who was a party to the arrangement of 1860, which constituted the first provocation to enter upon a different course. I have spoken of the insignificance of this sum of £125,000—it is a contemptible sum when it is put in contrast for one moment with the enormous considerations to which it leads. In the first place, I regard this as a retroactive step which is sure to leave an impress on our commercial policy; and, in the second place, I must say that nothing has done more to place the relations of England and France on a sound basis than the Treaty of 1860. The sentiments which prevail now between England and France are totally different from those which prevailed 40 or 50 years ago. They are the sentiments of thorough and cordial friendship, and reciprocal attachment, and the growth of these sentiments I do not scruple to say is mainly duo to the innumerable relations of private and personal intercourse, and of the interchange of beneficial offices through the operation of commerce in consequence of the legislation of 1860. It is not only upon the ground of the commercial disadvantage and mischief connected with this unfortunate proposal; it is not even only upon grounds connected with the retroactive character that it is likely to import into our future transactions; but it is also, if possible, still more upon the higher ground that Free Trade between the two countries has made friendship and affection between the two countries, that I can be no party to any step which tends to cool the friendship between the two nations, or relax the bonds which bind them together. Although I make no accusation against Her Majesty's Government, but simply have endeavoured to discuss this question on its merits, it appears to me I could not, without a violation of solemn duty, have refrained from the course I have taken. What did you do in relation to Spain? The question of the Spanish Market in comparison with that of France is trumpery; the influence of Spain, outside of Spain, upon the legislation of Europe generally is almost nil; the feeling of Spain had always been friendly—I mean apart from trade; I am not aware anything was to be done in respect of those feelings; but, notwithstanding that the Spanish Market was very limited, you consented to give, in order to obtain the privilege of the Most Favoured Nation Clause, and, I believe, nothing else but that—not all the favourable terms we obtained in the French Treaty—but in order to get admitted on the same terms as other nations into a highly restrictive and very limited market we sacrificed £160,000 a-year. That was done by the Government with which I was connected. I am not going to take any great credit to that Government for what it did, for I must say that, according to my recollection, it only acted in conformity with a strong public opinion in this country. Is it possible to conceive a more gross national inconsistency than first of all to give away £160,000 a-year, in order to obtain a limited access to a limited market, regulated by highly protective principles, and then, when you have got with France this comparatively open state of trade and the enormous extension with it of commercial relations and great and weighty moral and political consequences connected with it, to hazard, if not to sacrifice, all this for the sake of £125,000 a-year? Now, this is not a Party question—at least, I hope it is not. I know perfectly well, if it was a Party question, what would happen; nothing said by me—it does not signify what—would be of any avail. I know that in the opinion of some Gentlemen I cannot speak language of good sense in connection with Party. Now, I have made no reproach or insinuation of any sort against the Government; I do not believe that they have protective intentions; I do not believe that they are insensible—they cannot be insensible—to the enormous importance of our commercial relations with France, and of the moral consequences depending upon them. I believe my right hon. Friend (Mr. Goschen) has been driven into this proposal simply in his anxiety to find a means of keeping together a number of little taxes, representing, as it were, separate pebbles, which, piled together, will make a cairn sufficient in their collective import to satisfy his needs. I can find no fault with the Government on the subject. I entreat them to consider this protest on its merits; I entreat them to forget; I entreat Members who sit behind them, and to whom I appeal quite as much as to them—I entreat them to forget that I am in a political position in this country. I should not have found it necessary to open my mouth—I would gladly have left the argument upon this question to other persons—were it not for the fact that there is no man alive who knows what I know about the history of 1860, and about the enormous consequences, both moral and political as well as economical, which followed upon the adoption of the legislation of that year. You are now in a most critical position; the conflicting interests are trembling in the scale; the parties have been engaged in a hard-fought struggle, carried on thus far upon such terms, that Protection, strong as it is, has not been able to obtain a practical triumph against Free Trade; but it is holding its own, and possibly doing more, and just at this moment you are going to put into the mouth of every Protectionist in France the very plea and argument which will serve his purpose and most discomfit his antagonists. It is possible that such things shall be done for no vital interest of this country, under no pressing necessity of this country, but for a sum with which you can easily part without inconvenience, and which is a sum in itself, whatever the circumstances of our finances may be, totally insignificant with reference alike to your responsibilities and to your power.

THE CHANCELLOR OF THE EXCHEQUER (Mr. GOSCHEN) (St. George's, Hanover Square)

My right hon. Friend has said we are putting into the mouth of every Protectionist in France an argument with which to discomfit his antagonists; but it is not I who have put this argument into his mouth. I should deny, and I do deny, the protective character of the proposal of Her Majesty's Government. My right hon. Friend was perfectly correct in saying that he did not believe the proposal was devised in a protective sense; it is not a protective proposal, and I deeply regret that my right hon. Friend, with his great authority, should have used arguments which, I believe, I was going to say, are erroneous arguments, but, I will say, are certainly most exaggerated arguments, and which will have this effect—that from this day forth the French will be able to say this proposal has the character which is ascribed to it by the right hon. Gentleman, but which, I believe, it does not possess. I believe that there is a considerable responsibility in making this proposal, and that responsibility I admit at once, has been increased, and the difficulties of the situation have been enormously increased by the speech which my right hon. Friend has delivered. If he tells the French that that which we can prove is not Protection is Protection, if he puts this argument into their mouths, I admit there is some danger of it being believed to a much greater extent than it otherwise would. I had come down to the House hoping to prove to the French how exaggerated have been their fears. [Mr. GLADSTONE here entered into a conversation.] I gave my right hon. Friend full attention while he was speaking. I know he says it is sometimes necessary that conversation should be conducted during a reply, but I am anxious to have his attention. There is no person in this House who is so much entitled to speak—I admit it to the full—as the right hon. Gentleman upon questions of this kind. We all know—we all feel—the services which he rendered to the country in 1860; we know the services he rendered in connection with the wine trade at large, and I should be the last person who would wish to undervalue for one moment the moral and political advantages. which have resulted from the negotiations with which the name of the right hon. Gentleman will always be connected. But all his endeavours and the events of the last 27 years have, I am sorry to say, not brought about that which the right hon. Gentleman stated was Free Trade existing between the two countries. I think, perhaps, it was a slip of the tongue of my right hon. Friend opposite; he spoke as if we now enjoyed the benefits of Free Trade with France.

MR. W. E. GLADSTONE

I meant to say comparative free trade.

MR. GOSCHEN

Yes; very comparative Free Trade. But I do not wish to enter into that matter, because I am most anxious not to treat this in a controversial sense as beween ourselves and France. If we were to examine the amount of duty which is charged upon British manufactures by France, and compare that with the duty—with the increased duty—we are proposing, we could not say that the present state of things is so entirely satisfactory as the right hon. Gentleman would indicate. I do not wish to pursue that course of argument; the course of argument I wish to pursue is this—that there has been from the first an enormous exaggeration with regard to the effects of this proposal upon French trade. One might have thought from the observations of the right hon. Gentleman the Member for Mid Lothian that this was a proposal to put a heavy tax upon French wine, an almost prohibitive tax; and I admit it is in that way that the matter has been treated at the first blush by the French interest which is mainly struck by this proposal. Now, what is this proposal? It is a proposal to put a different duty on bottled wine to that imposed upon wine in cask. The House is aware, from the manner in which I introduced the proposal, that the object is, in the absence of the possibility of putting an ad valorem duty upon the higher and the lower classes of wine, to impose on the higher class of wine a somewhat higher duty than on the lower class; and I think the right hon. Gentleman would not object to that principle apart from the foreign aspect of the question. I do not think he would object, if we could establish roughly a distinction between the higher classes of wine and the lower classes, to the imposition of a higher duty upon the more expensive wines, which are generally consumed by the wealthier section of the community. Well, now, it was difficult to establish an ad valorem scale; but there is one method by which we can draw a broad distinction, and that is to make a difference between bottled wines and other wines. Now, is this system in itself a bad one? Does my right hon. Friend only object to the system because it is objected to by France, and may affect French interests to a slight degree, or does he think it a retrograde movement in itself? Is it wrong to put a different tax upon the higher class of wines? If not, you effect your object to a very large extent by the system of taxing bottled wines. It is a system which prevails in France itself. In France itself, higher municipal duties are levied upon bottled wines than upon wines in cask; and the objection which is now being made by the French is to a system which they themselves maintain in their own country. Well, but is that distinction not made elsewhere? In Germany—[Mr. GLAD-STONE was here again engaged in conversation.]—I wish I could hear the arguments of my right hon. Friend, because I could then answer them at once; if I could only enjoy the running commentary of my right hon. Friend, I should be prepared to meet it. In Germany there is this distinction between wine in casks and wine in bottles—there is a duty of 24 marks per 100 kilos on wine in casks, and 80 marks upon sparkling wines, and 48 marks upon other wines which are in bottles. In Italy wine in casks pays 20 lire per hectolitre, and 60 lire per 100 bottles of one litre. In Sweden wine in casks pays about 4d. per litre, and wine in bottles about 8d. per litre. In the United States sparkling wines pay seven dollars per dozen quarts, still wines in casks pay 50 cents per gallon, and wine in bottles pays one dollar 60 cents per dozen quarts, which in practice makes a slight difference against wine in bottles. In Austria sparkling wines pay 50fl. per 100 kilos, and other wines 20fl. It is not quite certain what is the present practice in Russia; but there seems to be a difference between the duty on sparkling and other wines. It will be seen, therefore, that this is no new proposal, but that it is one known to France and to most European countries, and yet the adoption of this proposal with regard to this country is described by the right hon. Gentleman the Member for Mid Lothian as a step of such a grave character as to shake the political and the social relations between the two countries. We retain but a slight degree of our fiscal liberty if a proposal of this kind cannot be made and be treated by our neighbours with moderation, and with a real examine- tion of the facts of the case. But the French have argued as if this increased duty, this duty of 5s. a dozen bottles, will be paid on wines which are imported in bottles now, some of which are offered for sale at 24s. per dozen. The obvious answer to that—and it has been foreseen by my right hon. Friend—is that a great portion of this wine will be imported as before into this country, but that it will not pay the increased duty, because it will be imported in casks. So far as the bottling trade is concerned, there is some force in the observation of the right hon. Gentleman, and I will deal with that in a moment. But the calculation of the French, that this duty is going to be placed on inferior wines, is a calculation which breaks down entirely, because it is well known that the inferior wines can be and will be imported in casks. Therefore it is surely a totally erroneous calculation to assume that cheap bottled wines will bear this duty, which, I admit, would be too high a duty to impose upon them. The French complain of losing the bottling trade, and, at the same time, of having to pay an increased duty on the lower class of wines. Now, it is quite certain that it is only one of these two results that can happen. Either they will lose the bottling trade, in which case there will be but the present duty of 1s. per gallon paid on the cheaper class of wines, or else the wines will continue to be imported in bottle. It is quite plain which of the two will happen—that is, that cheap wines will be imported in casks into this country. Now, is it an offence against Free Trade to say we will put a different duty upon bottled wines and upon wines in casks? I ask any Free Trader is that, in itself, a breach of Free Trade? No one in the House can say it is; and, therefore, the question arises, is it a breach of Free Trade if incidentally the effect of this proposal is that a portion of the wine which is now bottled in France will have to be bottled in this country? I am desirous of re-assuring the French that there is no intention of imposing a protective duty at all. As regards wine, there cannot be an idea of Protection, and we are simply carrying out the system which the French carry out—namely, the putting of a higher duty on wine in bottles, not because it is in bottles, and not because we wish the consumption of it to be checked, but because the transporting of wine in casks, instead of in bottles, affords a test of the value of the wine. The higher class of wine must continue to be bottled in France, and this will have to pay the higher duty; the lower class of wine will be bottled in this country, and the French will not have to pay the higher duty upon it. I have calculated that the increased duty will yield £125,000 a-year; the French have erroneously calculated that the extra duty will yield £400,000 a-year, and it is against this that they are rising in arms. They think the duty will be a large and important amount; but that is on the assumption that the cheaper wine will continue to be brought to us in bottles. I say again that that will not be the case, and consequently the increased duty which the French fear will be paid on only a moderate proportion of the wine now imported in bottle. Then the right hon. Gentleman says this proposal has a protective character on account of the fact that the wine will have to be bottled in this country. No one will believe that it was for the sake of the bottling in England that such a change as this has been proposed; the change is proposed in order to strike at the higher class of wines. That is the simple object for which it is proposed, and it is a legitimate object. The argument must be pushed to this point—that it is on account of the difference in bottling; it is because the bottling trade will, to a certain extent, be conducted in this country instead of in France; it is on that account we are to abandon that which would otherwise be a perfectly legitimate fiscal proposal. I will reduce the matter to its proper proportions. I admit the French are startled by the proposal; but then, in the first place, they have not had these explanations, and, in the next place, of course they would have preferred that matters should stand as they are. I can quite understand that; but I ask again, are we to forego our fiscal rights in this matter, not from any fear that we should strike a real blow at France, but upon the insignificant question of transferring the bottling of Bordeaux wines from Bor- deaux to London? My right hon. Friend has spoken of the effect this will have upon the wines from our Colonies. As regards Australia, I made inquiries before I made this proposal, and the result of my inquiries was that I found that Australian wines are quite capable of being imported in cask. I thought it essentially important to make these inquiries, and my information is diametrically opposite to that of the right hon. Gentleman. As I said, it is to the effect that the greater proportion of Australian wine is now imported in cask, and that it is of that alcoholic strength that freely admits of its importation in cask. [Mr. MUNDELLA (Sheffield, Brightside): White wine?] Australian wines generally. The right hon. Gentleman asks about white wine. There is a fallacy about white wine that it cannot be imported in cask. I was asked a question on the subject the other day; but I dare say a great many Members of the House have already received circulars from their wine merchants, if they have ever had wine from abroad, in which the wine merchants say they are in a position to supply the same Hocks as heretofore at the same prices, because arrangements will be made for bottling them in England. The view that white wine cannot be brought in cask is, I believe, an entirely erroneous one. I admit there are a few kinds of cheap wine, the very cheap champagnes, which cannot be bottled in England, and which, therefore, will be heavily struck by this mode of taxation; but in every case in which you levy a tax you create some grievance. There is a line where the inferior or commoner article has to bear the same taxation as the higher or more valuable article. At present, common clarets and the cheapest wines of France are taxed the same as the more valuable Lafittes and valuable champagnes; that is a grievance which exists at the present moment. For the future, most cheap wines will stand on a favourable footing as compared with the highher class of wines, and the grievance of inequality of taxation will be greatly reduced. The hon. Member for Leicester (Mr. Picton), earlier in the evening, called attention to the fact that cheap teas were taxed higher than they ought to be in proportion to their value. Now, if my proposal is accepted, the cheaper champagnes—the cheapest you can find, which, although they are called cheap champagnes, fast become dear champagnes when they come to this country—will not bear nearly so high a taxation in proportion to their value as the pound of cheap tea to which the hon. Member for Leicester alluded. I regret there is a certain class of wine on which the taxation will fall heavily; but, on the whole, I believe this will not be the case, because the trade will adjust itself to altered conditions. I do sincerely hope that this matter will not cause that excitement in France which has been feared by my right hon. Friend; and I hope it will not do so, notwithstanding the speech which my right hon. Friend has made, and which, I am bound to say, as endorsed by the cheers of his followers, has aggravated the difficulties with which the Government had to deal. He said he did not know whether we had got different information from what he had in regard to the feeling in France. His information is most valuable, and I admit to the full the fact that there is a strong Protectionist Party in France, and that the Free Trade cause has gone back? If this were a Protectionist proposal there would be force in his fears, but the proposal is not a Protectionist proposal, and it cannot be so regarded. Let me call attention to the letter from the Bordeaux Chamber of Commerce to the French Ministry, complaining of this tax, but drawing certain conclusions from it. What is the conclusion which the parties most interested, the Bordeaux Chamber of Commerce, draw? Do they say they ought to regard our action as a blow at Free Trade, and that they ought to resort to reprisals? The very opposite moral is what they draw; the moral they draw is, that there ought to be a Commercial Treaty with this country; that their own system is unsatisfactory, and leaves them open to a country like ours exercising its right, which they do not dispute. I will not detain the Committee any longer upon the matter; but, if they will allow me, I will give them a translation—a very halting translation I fear—of the communication of the Bordeaux Chamber of Commerce. The Bordeaux Chamber of Commerce say that it "would be repugnant to them to call for a system of reprisals," the first effect of which would be to raise the price of coal in France, of iron, and of all that was necessary for their industry. The Chamber "asserts its confidence in the necessity of exchange being facilitated between the two countries by reciprocally moderate tariffs, and thus bringing about the prosperity of their agriculture, their commerce, and their industry." They certainly do not think the occasion ought to be taken advantage of for resorting to a system of reprisals or of Protection. They consider that England is "perfectly at liberty to take the action she has taken; but it would have been impossible to have done so had a Commercial Treaty existed between the two countries." The Bordeaux Chamber of Commerce are Free Traders—[Mr. MUNDELLA: Always have been.]—and they did not take the view which other Free Traders had addressed to us to-night, that the result of our action would be to bring about reprisals. On the contrary, they think it is a proof of the necessity for settling questions which may be pending between the two countries in a manner which will be satisfactory to both. I venture to say that the discussion has assumed dimensions which our proposal does not justify; it is a small matter, and I think the principle at stake is not large. We have simply made proposals similar to the fiscal proposals of other countries, not with the desire for Protection, but simply with the object of putting upon a more satisfactory footing the relative duties paid upon the dearer and cheaper wines. I confess I do not see in this proposal that monstrous danger which has been pointed out by my right hon. Friend. I trust we shall be able to convince the French, by friendly argument, when the matter comes to be thrashed out, that they have enormously exaggerated the consequences of this new tax. We shall certainly meet all remonstrances they may make in the most friendly spirit, and I trust that nothing said this even-in the House, and nothing said in France or in this country, will tend for one moment to disturb the good feeling existing between the two countries, a good feeling to which every Party in the House, and every Party in the country, attaches the very highest importance.

MR. MUNDELLA (Sheffield, Brightside)

said, he was sure every Member of the Committee would gladly re-echo the sentiment which had just been expressed by the right hon. Gentleman the Chancellor of the Exchequer—namely, that nothing should be done or said in the House that would in any way tend to ruffle or disturb the good feeling which existed. between France and this country at the present moment. Let him (Mr. Mundella) remind the right hon. Gentleman that there would be no danger of this disturbance if there had not been a departure from the status quo. What was deplored was that the right hon. Gentleman could not let well alone. In his speech the Chancellor of the Exchequer referred to the opinion of the Bordeaux Chamber of Commerce; but the reference was not quite â propos. The Bordeaux Chamber of Commerce had always been a Free Trade Chamber. Bordeaux and Lyons had been the centre of the Free Trade agitation in France. But it was not from Bordeaux that we got our champagne; it was the cheap claret which Bordeaux sent us, and the Bordeaux people were interested in the importation of a cheap coal, and that accounted for what had always been the feeling of Bordeaux on this question.

MR. GOSCHEN

said, the Bordeaux Chamber of Commerce protested against the increased duty; but they drew a different conclusion from it than hon. Gentlemen opposite.

MR. MUNDELLA

said, he quite understood the Chamber protested. against the change, but urged the French Government not to be driven into any course of retaliation, or, in other words, into a war of tariffs. In that he thought the Bordeaux Chamber took a very wise view. Now, the right hon. Gentleman based his argument throughout the whole of his speech that France always discriminated between wine in bottle and wine in cask in the duty she imposed. That was perfectly true; but let him ask the right hon. Gentleman why that was done in France? It was because the wine that France imported. to such an enormous extent was the raw material.

MR. GOSCHEN

It is not an import duty at all; it is the octroi.

MR. MUNDELLA

said, he would admit that there was a great difference between material coming from the exterior and material coming from the country, into Paris, for instance. There were differential duties between the higher class and the lower class wines. Nearly every Frenchman was accustomed to his bottle. There was another reason. Everyone knew the enormous growth of the trade beween France and Spain and France and Italy, which very largely consisted of the importation of wine into France for the purpose of French manufacture. [Mr. GOSCHEN dissented.] The right hon. Gentleman shook his head; but had he ever been in Italy during the vintage? If he had, he would have seen enormous quantities of wine being carried across the passes of the Mont Cenis and St. Gothard, and, again, from Piedmont and Central Italy, into France. Wine was carried from Italy to France just as coals were carried from Newcastle to London. There was an enormous import of wine from Italy to France. The same was the case with regard to Spain. He believed the trade between France and Spain had doubled within the last 10 years, simply through the enormous interchange from the importation of wine. But what was to be so much regretted was that the right hon. Gentleman, for so small an amount, should have disturbed the whole settlement of the wine question of this country. £125,000 a-year was probably the outside sum which would be realized. He (Mr. Mundella) quite agreed with the right hon. Gentleman that we should get the cheap clarets just as now. They would come in casks, and would be bottled in this country, as they had been to a large extent already; but there were certain wines which would be practically excluded from this country by the imposition of this 5s. duty. Would the Italian wines come into this country at all? Could the Tuscan wines come into this country under this regulation?

MR. GOSCHEN

If they do, they will pay a somewhat higher duty, and I have already shown the Committee that there will be similar hardships precisely as in the case of tobacco and tea.

MR. MUNDELLA

said, that was a confession on the part of the right hon. Gentleman. The Tuscan wines which had been coming into this country for the last few years, and increasing in quantity, would be practically excluded. They would have to compete with the French wines which came in at 1s. a-gallon, and very little chance they would have. By this extra duty of 5s. dozen bottles, they would strike a very heavy blow at Italian wines, and at many of the light wines of France. If the Chancellor of the Exchequer could deal exclusively with champagne and high-class wine, there would not be so much objection to the tax, but he could not do that. He would exclude light wines, such as Saumur, which were now sold in the clubs as low as 2s. 6d, a bottle. The right hon. Gentleman put an additional duty on these articles of something like 20 per cent. Was it to be wondered at that French equanimity was therefore disturbed? The Chancellor of the Exchequer said the speech of the right hon. Gentleman the Member for Mid Lothian (Mr. W. E. Gladstone) had very much tended to aggravate the disturbance. The Chancellor of the Exchequer must remember that Mons. Goblet had already pronounced upon this question in the Chamber of Deputies. The feeling in France was independent of anything expressed in the House of Commons. Hon. Members had carefully refrained up to the present from expressing any opinion upon the subject, because they had no desire to aggravate the feeling; but Mons. Goblet, in answer to Mons. Faure, said France would have to take retaliatory steps if this measure were carried. Was it not the fact that some of the cheap hocks would have to bear this heavy duty? What about Moselle and Chablis? Italian and Tuscany wines the right hon. Gentleman admits—

MR. GOSCHEN

Not all Italian wines.

MR. MUNDELLA

said, that, of course, the Sicilian wines, the stronger wines, would come in just as they did now. But the lighter wines which were coming into consumption in this country would be heavily hit. Certainly the wines from Queensland would be hardly effected unless they were specially exempted. The tendency of all this legislation was to disturb trade and to produce adulteration. There was no doubt there would be a large manufacture of champagne in London, which would be taken away and then brought again to this country. There would also be a large manufacture of adulterated and speculative wines. That was sincerely to be regretted. He was sure the right hon. Gentleman knew that they had hitherto respected him as a financier, but they could not approve a change which involved an interference with the most Favoured Nation Clause, which had been the sheet anchor of our commercial success. If they disturbed that clause, they would strike a blow at our commerce. All the gains they would reap by a paltry tax like this were insignificant and infinitesimal. His right hon. Friend had referred to the fact that in 1886, they, who now sat on the Opposition Benches, settled the Spanish wine trade by a concession, which cost the country £160,000 a-year. The arguments in favour of the course they took were overwhelming. He (Mr. Mundella), had no idea, until he went to the Board of Trade, that there was so much to be said for that concession. What was the fact? They found our trade in Spain had dwindled down from £10,000,000 or £11,000,000 sterling to £6,000,000 sterling, while in the same time the Germans had increased their trade eight or ten-fold, and the French had increased theirs 100 per cent, and all because we had maintained a high tariff against Spanish wines. They diminished that tariff, and the result was an increase of business with Spain. It would take some time, no doubt, to place us in our former position of supremacy in Spain; but he believed we should retain it if we did not let out the water, as it were, by levying this small tax. It was really much to be regretted that the right hon. Gentleman should have taken this departure from the status quo, and he jeopardised, as he (Mr. Mundella) believed the right hon. Gentleman had done, English trade by the course he had adopted. He sincerely hoped that even now it was not too late to abandon this tax; that no false pride or the fear of a confession of failure would restrain the Chancellor of the Exchequer from taking a step which was very much to be regretted, and which he would, upon reflection, feel was a mistake, and which in former years he would not have allowed any Conservative Government to take without a protest on his part. He (Mr. Mundella) knew the right hon. Gentleman thought that he would impose a heavy duty on the rich man's wine. That was a mistake. They were going to put a heavier tax on light wines than they put on the valuable and strong wines of Portugal, Spain and Madeira. Not one of these light wines ever did or ever would come to this country in barrel, but the fine high class ports and sherries and Madeira came in casks and were bottled in this country. The right hon. Gentleman is striking a blow at the higher light wines coming from Greece, Italy, Austria, Hungary, and from France. The right hon. Gentleman was striking a blow at that trade which might be very small in the beginning. He did not think that seven years ago a dozen bottles of Chiante or Boroglio or of the light Tuscan wines were brought to this country; but our trade with Italy was increasing. It was very necessary it should, and it was deplorable that anything should be done that should disturb in any way the trade we were doing with Italy or with France or with any other Continental country. He was afraid the right hon. Gentleman had put in the thin edge of a very dangerous principle, which would lead to very serious results. He appealed to the House of Commons to help the Chancellor of the Exchequer to retrace the step he had taken.

MR. HOWARD VINCENT (Sheffield, Central)

expressed the earnest hope that the Chancellor of the Exchequer would maintain this tax in its integrity with one exception, which he would presently submit to the Committee. He did not think that we had any cause whatever to be afraid of France in this matter. Of course, it was the wish of every Member of the Committee that we should live on the best possible terms of goodwill with France; but hon. Members had to bear in mind this one most important fact that Free Trade meant free exchange, and that the Free Trade which the right hon. Gentleman the Member for Mid Lothian (Mr. W. E. Gladstone) referred to as that which we now possessed was entirely a one-sided Free Trade, and was in no sense whatever a free exchange. We admitted the goods of France absolutely free, with the one exception of wine, whereas there was hardly a single import of British production that was not heavily taxed upon entering a French port. The right hon. Gentleman the Member for Mid Lothian dwelt upon the figures as to the imports and exports to and from France. Those figures brought out the fact most clearly, that the exports from France to the United Kingdom nearly doubled the exports of British goods to France. The right hon. Gentleman showed that we exported to France goods to the value of £20,000,000 sterling, while we imported from France goods valued at £32,000,000 sterling.[Mr. MUNDELLA: Not double.] He said, "nearly double." He did not think that the figure £20,000,000 was exactly right; the exports of British goods to France were considerably less than £20,000,000 sterling in value, and much nearer £15,000,000, when Colonial produce was deducted. The right hon. Gentleman the Member for the Brightside Division of Sheffield (Mr. Mundella) had referred to the case of Spain. He (Mr. Howard Vincent) was sure the right hon. Gentleman would remember the action of Germany a few years ago in regard to the Spanish trade. Spain put duties on the imports from Germany on a higher scale than those upon the goods of other countries. What did Germany do? She said at once that the imports from Spain should be more heavily taxed, unless the new duties as regarded German goods entering Spain were removed. What was the result? The prohibition was at once removed. He noticed that his right hon. Colleague (Mr. Mundella) in the representation of Sheffield assented to that view. They had heard that night from the lips of the hon. Gentleman the Member for Leicester (Mr. Picton) the first whisper of reciprocity from the Benches opposite, and he (Mr. Howard Vincent) felt certain that we had nothing whatever to be afraid of when we bore in mind the figures of the importation of foreign goods into this country and the exportation of British production to foreign states. He would not detain the Committee, but the suggestion he was anxious to make to the Chancellor of the Exchequer had reference to Colonial wines. He was sure the Committee heard with great satisfaction that before deciding upon this duty the Chancellor of the Exchequer made particular inquiries as to the effect the proposal would have upon the Australian wine trade. The Committee had no other desire than to do everything it possibly could to develope and improve our commercial relations with Australia and the other great British Colonies. The importation of wine from Australia was undoubtedly small at present, but he hoped it was growing, and as the Chancellor of the Exchequer had said, the importation of Australian wine in bottle was conducted on a still smaller scale, therefore the suggestion he had to make would not materially interfere with the revenue the right hon. Gentleman expected to derive from the tax. He wished to suggest to the Chancellor of the Exchequer that he should add at the end of the clause some such words as these— All wines produced in any British colony or possession shall be exempted from this additional duty on wine in bottle.

MR. BRADLAUGH (Northampton)

said, that the Chancellor of the Exchequer in dealing with this matter in his Budget speech anticipated the very remonstrances which had come from abroad. If he (Mr. Bradlaugh) gathered the right hon. Gentleman's words rightly, he expressed the view that our remonstrances with Foreign Powers on the subject of fiscal imposts had very little effect, therefore, we need to pay very little attention to remonstrances from them. That was not quite a correct repetition of the words he listened to, but he thought it was a correct repetition of the sense of what he listened to.

MR. GOSCHEN

I think I put it in a much more conciliatory form.

MR. BRADLAUGH

said, he would read the right hon. Gentleman's words—" It is very possible that the extra tax imposed on these high-class wines may lead to some remonstrances from Foreign Powers, but I am bound to say that remonstrances of ours to Foreign Powers with regard to the imposition of duties on British goods have not been so entirely successful as to make it necessary for us, beyond what is compatible with our interest, to look beyond the fiscal merits of the question. He thought he also heard the right hon. Gentleman say that reprisals were to be avoided if possible, but what he (Mr. Bradlaugh) rose for was to call attention to a much narrower question, one involving pure matter of fact. Although his experience was very limited upon the point, it was very conclusive. German wines at 12 marks a-dozen bottles he had bought for many years. He had read in a paper conducted by his very able Colleague (Mr. Labouchere) that those wines were sour and bad; but they were good enough for him to drink. He had occasionally seen wines in hotels priced at 8s. the bottle which had not been nearly as good as the wines he spoke of. In France he had bought wine at 1f. 25c. and at 1f. 80c. the bottle. He was now speaking of the price at the place of purchase, and was not reckoning any carriage and duty. Ho did not think it was true that these wines would be brought here in wood. When wines as good as these he spoke of were brought in wood the dealers would take care they became higher priced wines before they reached the purchaser, or they would cook them—that was hardly the word to use; they would transform them in a fashion injurious to those who consumed them. He urged on the Chancellor of the Exchequer that, if imposed on such wines as the German wines, and on such wines as the French wines, and on some of the Italian wines—wines which he never saw in wood at all in this country—this duty would be absolutely prohibitive. The Chancellor of the Exchequer said the higher class wines would pay a higher duty than the lower class wines. That was not correct so far as the wines he (Mr. Bradlaugh) had mentioned were concerned. The right hon. Gentleman admitted that the duty he was imposing would be too heavy a duty to impose on wines to which he (Mr. Bradlaugh) alluded. The Chancellor of the Exchequer might say, and say truly, that the trade in bottled wine of the class he (Mr. Bradlaugh) spoke of had been a comparatively small trade. The right hon. Gentleman might say the Wine Trade here agreed with him in his proposal. He admitted they did; but they agreed with the right hon. Gentleman because when they got decent wine of the price he spoke of, they converted them into dearer wines to the English consumer. He (Mr. Bradlaugh) did not know he would do wisely to detain the Committee with more than the point he had put, but he was bound to say that what had been urged by the right hon. Gentleman the Member for Mid Lothian (Mr. Gladstone) was being urged in a very strong fashion in France, and not as the result of any sort of provocation coming from the right hon. Gentleman. It had been impossible to take up a French newspaper during the last fortnight without finding the feeling against this proposal expressed in very strong language, and the Chancellor of the Exchequer could not ignore the fact that there had been a great feeling of irritability and suspicion towards England during the last 12 or 18 months in France. A feeling of irritation and suspicion had sprung up which had been specially marked within the last 8 or 10 months. He did not think there was any real foundation for it, but he thought we, in this country, ought to avoid giving anything in the shape of excuse for it. He thought that was an unfortunate duty, especially as the result to us was only to put a small amount into the pocket of the Chancellor of the Exchequer, and that without touching the luxuries of the rich, of which the right hon. Gentleman had spoken, and only affecting an article consumed by the class to which he (Mr. Bradlaugh) had called attention.

MR. GOSCHEN

In order that there may be no mistake on this subject, I wish to say that I do not charge the right hon. Gentleman the Member for Mid Lothian with having provoked the feeling in France to which the hon. Gentleman opposite has just referred, because I know that it had previously existed, and it would have been unjust to have done that. My point was this. I came to the House prepared to prove that there was not an atom of Protection in our proposals, that they were not designed with that intention. I contend that the French people will now quote the argument of the right hon. Gentleman as conclusively showing that the proposals are based upon the principles of Protection, and will, therefore, render it more difficult for me to succeed in my object.

MR. MUNDELLA

The right hon. Gentleman the Chancellor of the Exchequer surely would not have desired that my right hon. Friend the Member for Mid Lothian who has taken so important a part in promoting the importation of French wines into this country should have sat silent while this debate was taking place. [Mr. GOSCHEN: I desired no such thing.] I hold that he could not have done less than make the protest which he has made.

SIR JOHN SIMON (Dewsbury)

said, he rose with some hesitation after the powerful and comprehensive speech delivered in the earlier part of the discussion by the right hon. Gentleman the Member for Mid Lothian (Mr. W. E. Gladstone.) The right hon. Gentleman had spoken with all the authority of one who was perfectly familiar with this question; more so, perhaps, as he himself had said, than any living man. The right hon. Gentleman had taken the wide, broad ground of national policy, and had shown the terrible effects which this proposed increase of duty on foreign wine was likely to produce as between France and this country. He (Sir John Simon) at an earlier stage of this discussion had called attention to what took place in the Chamber of Deputies in France last week. Therefore, it could not be said that anything which had fallen from the right hon. Gentleman the Member for Mid Lothian to-night could put any complaint into the mouths of Protectionists in France, or could induce them in any way to resort to retaliative measures. The Protectionist note in France was struck as soon as this proposal was made known. Day after day the French newspapers had teemed with threats of retaliation and accounts of the excitement and agitation which this new proposal had created in that country, and last Saturday the matter was brought before the Chamber of Deputies. Questions were put to the Prime Minister of France, and every one was familiar with the answers which he had given. Therefore, it was clear that this note was struck long before the right hon. Gentleman the Member for Mid Lothian had addressed the House on the subject. From the moment he (Sir John Simon) had read this proposal in the papers, and had heard it in the Budget speech of the Chancellor of the Exchequer (Mr. Goschen) he had been struck with its impolicy. He had feared that it would breed a spirit of retaliation in France, and that it would lessen the commercial relations between the two countries, and considerably damage the friendly attitude of France towards us. He took no sentimental view of the question when he said that, because he knew that nations in their intercourse did not proceed on sentiment, but on policy, upon what suited their interests. He viewed the matter solely from that point. As a matter between the two nations it had seemed to him a most unwise and impolitic proposal, and one, too, made at a time of all others most unfavourable for it, for we had been for years past representing to France and other countries the injury being done to commerce and our sugar industry by the sugar bounties. By dint of great effort the present Government, to their credit be it said, had induced these foreign nations to meet here in conference with a view to the abolition of the sugar bounties, and it now appeared that at the very time we were succeeding in getting France, Germany, and other nations to put an end to the bounty system, we were putting a duty, which amounted to a protective duty, on one of the principal products of one of those countries. He held in his hand a letter which he had received from one of the greatest wine producers in France, and he would quote from it, as it was well that the sentiment of France, so far as its interests in the wine growing trade were concerned, should be known. This wine grower stated that he sincerely hoped this proposal would be withdrawn as a tariff war was certain to follow its adoption. Such a war would be insisted upon by Deputies, friends of his, which gentlemen were, in fact, taking steps in that direction. This gentleman stated further on that his business was by far the largest which would be affected by the proposed duty on bottled wines. He declared that his firm shipped to this country 55,000 dozens annually, the bulk of which. was invoiced at from 13s. to 15s. a-dozen, so that the tax in his case would bring about almost entire ruin. At this moment 3,000,000 bottles were being shipped, when it appeared that the market was to be suddenly shut against them. This gentleman also stated that this duty would fall most unpleasantly upon the middle class, by whom his wines were mostly consumed. He (Sir John Simon) had on this subject made an observation which seemed to excite almost the contempt of the right hon. Gentleman the Chancellor of the Exchequer. He had said that this new impost would affect chiefly the middle classes. The right hon. Gentleman had contended, on the other hand, that the impost would be a tax on luxuries. Under that plea, it was supposed that the country at large would approve the tax; but, as a matter of fact, the impost was one which would not affect the rich. Who were the rich? Why, your men of £20,000 or £30,000 a-year. These people would not feel 5s.,more or less, on a dozen of their champagne. It was your middle class, your respectable middle class, who were not so fortunate as to possess such large incomes—persons of moderate means—who ought to enjoy these small luxuries, if luxuries they were, without undue taxation. This class were the largest contributors to the Revenue, and this gentleman, who wrote to him from France upon the proposed duties, declared that they were the largest consumers of French wines. This gentleman stated that, to say nothing of very cheap sparkling wines, over 100,000 dozens of pure sparkling Saumur was exported by his firm, and that the trade was steadily increasing owing to the recognized genuineness, exhilarating quality, and moderate price of these wines; and yet the trade suddenly found itself face to face with ruin. The right hon. Gentleman the Chancellor of the Exchequer had declared that the tax would not affect the middle class, because in the future they would import their wines in bulk. Well, he was sure the right hon. Gentleman did not mean to say that people were going to import champagne in bulk. But, putting aside the question of champagne, he would take the moderately-priced clarets, which persons of the position of life of Members of that House were in the habit of drinking. Supposing that they did import their clarets and other wines in bulk, then what became of the right hon. Gentleman's argument as to the increase of the Revenue? This additional impost on bottled wines was to supply a contribution of £125,000 towards the Revenue; but what became of the argument based on that, if it were anticipated that the impost was going to be largely evaded? If a large proportion of the wines imported in bottles would in future be imported in bulk, how would the Chancellor of the Exchequer get the contribution to the Revenue which he expected by laying these duties on foreign wines? He (Sir John Simon) confessed he did not see how the right hon. Gentleman could get out of the dilemma, But, after all, the great point was not whether they would be able to get cheap wines, but it was the effect it would have on trade and the mercantile relations between this country and France, and the effect it would have upon that great system of Free Trade which had been contended for for so many years, but which was being as- sailed morn and more in this country. If this system of increasing imposts was adopted by the Chancellor of the Exchequer, France, Italy, Germany, and every other country would avail themselves of the system; but he would not go further into the question. He was intensely opposed to this tax. He thought the new duty would be a serious impediment to trade and to a continuance of friendly relations between ourselves and France. It would strike a deadly blow to the principles of Free Trade, which were being assailed by a few misguided Gentlemen opposite. He thought, moreover, that this was the worst time for such a proposal to have been made. The right hon. Gentleman the Under Secretary of State for Foreign Affairs (Sir James Fergusson) had told them that not only through the Chamber of Deputies, but through the Executive Government of France, representations had been made to us against this new impost. He maintained that that was an appeal which could not be neglected, and when the right hon. Gentleman the Chancellor of the Exchequer told them that this system of a differential duty on wine in bulk and in bottle existed in France and Germany and other places, he said that that was no answer to the objection he had raised to the proposal. What other Governments did amongst themselves, they did with the consent of those amongst whom they lived. Unfortunately, most of the nations of Europe were Protectionists; therefore, it did not shock them when their Governments amongst themselves carried out that policy, but it would shock them when they saw England, which professed Free Trade principles, putting on protective duties in the manner proposed by the Chancellor of the Exchequer.

MR. STAVELEY HILL (Staffordshire, Kingswinford)

said, he had great pleasure in following the hon. and learned Gentleman the Member for Dewsbury (Sir John Simon), for the reason that he had entirely disagreed with every single proposition he had laid down. In the first place, as to the effect this proposal of the right hon. Gentleman the Chancellor of the Exchequer (Mr. Goschen) would have upon the relations of the two countries, he (Mr. Staveley Hill) had first come into this House in 1868 on the ground of being strongly opposed to the French Treaty of 1860; and it was, therefore, with thorough pleasure that he found this policy taken up by Her Majesty's Government, as it was the first step towards setting aside the policy of that Treaty of 1860. Under that Treaty, the industry of the town he then represented—namely, Coventry—was absolutely ruined. The whole silk trade of this country, in Spitalfields as well as Coventry and other places, was simply destroyed, and it was clearly shown in those days that nothing was given to England in return for the enormous privileges conceded to France. France had the opportunity of sending into England all her goods duty free; and what did she give us in return? Why, she put a prohibitive duty upon many of our importations, and a 30 per cent duty upon everything imported into France. Now, when we were able to take a line of our own, and proposed a small Import Duty upon certain French goods, it came with a very bad grace from France when they cried out—"You are ruining us." They had not the slightest objection to ruining our English trade, but now that they themselves were affected they came on their bended knees, declaring that we were bringing utter destruction on their bottling interest. That was the state of the case with regard to the introduction of these wines from France. "But," said the hon. and learned Gentleman, "you are ruining the interests of our own people; the middle classes of England will not be able to drink their champagne if it is put under an extra charge of 6d. a bottle more than they have hitherto been accustomed to pay." What utter nonsense. How could the middle classes of England, who were able to drink their quart bottle or their pint bottle of champagne, be so dreadfully ruined because they had to pay 6d. a bottle more for it now than they were used to. It was absurd on the face of it, and would not bear argument. There was one point, however, that he would direct the attention of the House, and he hoped also the country too. They on the Ministerial side of the House, who were those to whom his hon. and learned Friend had referred as misguided politicians, were told that these duties on manufactured goods pressed not upon the producer, but upon the consumer. They were told that if a duty were put upon lace the ladies of England would be ruined, and that if a duty were put upon watches, those who had to buy watches would feel the impost hardly, and that the adoption of such taxes would be a shameful thing to do. But in the iron trade, in the cotton trade, in the china and glass trade, they knew perfectly well that the manufacturers who dealt with the United States, with Germany, and with France, said, when they had to pay Import Duties—"You must remember this is a duty I have to pay when my goods go in." They all knew that that duty fell not on the consumer as much as on the producer. They had an illustration of the fact in this very case under discussion. In the matter of these duties on manufactured articles, those persons cried out when the shoe pinched. Who were the persons who were crying out now? Not the wine merchants of England, not the champagne drinkers—the right hon. Gentleman had not had a single complaint from champagne drinkers. Who was it then who were crying out? It was the producers. It was found out in this case that the blunt of the taxation would fall not upon the consumer but upon the producer.

MR. PROVAND

said, he wished to ask if the hon. and learned Gentleman would give a specific case in illustration of his views? [Cries of "Order! "]

MR. STAVELEY HILL

said, he hoped he was not out of Order. At any rate, if he was his attention would be called to the fact by the Chairman. He wished to say now one word as to our Colonial wines. We produced in our Colonies a very considerable amount of wine which he was not sorry to see was being brought more and more into competition with foreign wines. The great object they had in view—cand this proposal was the first step towards it—was that we should put a tax not on necessaries but upon luxuries, which our people consumed, which were manufactured abroad. Let them put a duty on this wine, and he should be glad if the effect of so doing would be to encourage the production and sale in this country of Colonial wines. MR. SLAGG (Burnley) said, the hon. and learned Member for the Kingswinford Division of Staffordshire (Mr. Staveley Hill) had neglected to take in the real issue in regard to this question. It would no longer remain to them, if they were to apply the line of argument of the hon. and learned Gentleman, to discuss merely the new duties on bottled wines, but they would have to take into consideration the whole fiscal system of this country. He (Mr. Slagg) must decline to embark upon a question so large; but he would just refer to the hon. and learned Gentleman's arguments, and make one or two answers to his inquiries. The hon. and learned Gentleman asked what had we got in exchange for the destruction of our silk trade from France, and for the destruction of some of our other industries? Well, he (Mr. Slagg) thought it was pretty well understood by almost everyone who professed to have even the most elementary knowledge of economic science that they did not legislate in this House, and did not arrange their Customs affairs with special regard to Coventry or any one single town or district in the country, but in view of the prosperity and welfare of the country at large; and though local misfortunes, such as the hon. and learned Member had referred to, were very much to be regretted, he must confess that the country was amply repaid for any sacrifice of that kind which it made by the return we received in the general advantage and prosperity of the community. When the hon. and learned Gentleman asked him what return such places as Macclesfield had received for the loss of her manufactures, he replied that they still retained the right of producing their silk goods at as good a price as they could be produced for anywhere else; and if they failed to do that it showed that their skill, their enterprize, science, and appliances were not equal to the effort. He would ask the hon. and learned Gentleman why he thought other sections of the community should have the hat sent round to them in order to support an industry on crutches which could not support itself? It was obvious that those industries which could not support themselves required very greatly to improve their processes to enable them to compete successfully with foreign countries. He could not conceive any more wholesome lesson applied to these businesses than the keen edge of foreign competition. While on the subject of the silk trade, he would beg leave to say that the town of Macclesfield, to which he had referred, was a striking example of the effect of the wholesome lessons taught by foreign competition. The manufacturing processes of Macclesfield received a very useful stimulus, because, although she was at one time adversely affected by the French Treaty, she was now not only able to keep pace with her foreign rivals, but was actually able to send certain manufactured silk goods to France, which she could not do before this wholesome discipline was applied to her. However, he would leave this subject in order to offer a few remarks on the question immediately before the Committee, and he ventured to do so on the ground that he had been associated with his revered Friend (Mr. Cobden) in very much that took place in relation to the Treaty negotiations in 1859, and it so happened that he had been concerned, more or less, in all the steps which had been taken between this country and France in relation to the modifications of that Treaty. If there was one lesson more than another which Mr. Cobden tried to impress upon the French people by his Treaty arrangement, and if there was any idea he endeavoured to impress on the minds of French economists, it was this—that it was good for us and to our advantage to take off import duties, because we thereby supplied ourselves with the commodities of foreign countries at the lowest possible rate, which enabled us in return to supply the foreign consumer with English goods at the lowest possible price. This was a lesson Mr. Cobden endeavoured to teach the French, and, in a manner, he was successful in showing them that it was to their interest to reduce their duties in order that they might supply their consumers at the lowest possible price. But what was the doctrine taught by the right hon. Gentleman the Chancellor of the Exchequer? It was simply the reversal of that advocated by Mr. Cobden; and the amount of duty involved, and the sum the right hon. Gentleman was securing to the Revenue by his plan, was a mere bagatelle in comparison with the importance of the principle involved. As the right hon. Gentleman the Member for Mid Lothian (Mr. W. E. Gladstone) had said, it was as dust and balance. But the principle involved was very great and important and he (Mr. Slagg) ventured to say that the consequences of this act, small as it might appear from a financial point of view, might be very far-reaching and serious. It was his duty to go to France very frequently on matters of a semipublic character, and he had opportunities during those visits of exchanging ideas with prominent public men and with persons versed in public affairs, and he could tell hon. Gentlemen what the impression was upon the minds of competent financiers in France. It was this—that by advocating this new policy we were abandoning the Free Trade principles taught by Mr. Cobden; we were changing our minds on this important question of fiscal policy, throwing to the winds the principles and lessons which we endeavoured to teach in 1860, and taking the first step on the road towards retaliation. Retaliation was as clearly indicated as underlying this act of the right hon. Gentleman the Chancellor of the Exchequer as anything could possibly be, for the right hon. Gentleman advanced this duty with this extreme and almost incredible statement. He said, in effect, that the French were not so very willing to accept our commodities that we should hesitate very much before putting a duty upon imports from that country. What was that but retaliation? It was an absolute declaration to this effect―"If you will not take our goods, we will proceed to prohibit yours." He (Mr. Slagg) thought it was an exceedingly sorrowful thing that the Chancellor of the Exchequer, even of a Conservative Government, had descended to such an argument as that. He could only regard it as one step in the direction of accepting the doctrines of the hon. Gentleman the Member for Central Sheffield (Mr. Howard Vincent). It was perfectly clear that the arguments of the school of that hon. Member were making a deep impression on the financial policy of the Government, and that they might presently see a return not only to the policy of retaliation, but possibly to the old system of taxing corn. But the assumption of the hon. and learned Member opposite (Mr. Staveley Hill) that the producer paid the taxes was the most extraordinary misconception of the position which he had ever heard emanate even from the merest tyro in economic science. Arguments seemed altogether lost on the hon. and learned Gentleman, therefore he (Mr. Slagg) would forego using them, and endeavour to illustrate his meaning by a little story, which would be perhaps more likely to carry conviction to the minds of hon. Gentlemen opposite than all the economics he could preach. His little anecdote was this. Some time ago he was conversing with a gentleman in Lancashire very largely engaged in the trade of calico printing, and he was in the habit of importing, for the purpose of his business, large quantities of certain dyes manufactured in Germany. Well, he had a contract for the delivery of a quantity of this material to his works in Lancashire, and just about the period when this contract was going to be fulfilled there was an agitation in this country—as there very often was—one of the agitations got up by the hon. Member for Central Sheffield in favour of imposing import duties on foreign manufactured articles. When the German dealer who had to deliver this material heard of it, he wrote to my friend in Lancashire to this effect—"I see that there is an attempt being made to impose duties on the importation of articles of Continental manufacture, and I wish to point out to you that in case, during the currency of this contract, a duty is placed upon this material, you, the buyer, must pay the duty, and not I, the producer." Well, that was to him (Mr. Slagg) a most convincing argument that not the producer but the consumer paid the tax, and they could apply this special instance to all such transactions. What happened? His friend, of course, had to agree to pay the duty, and if the commodity in question had been increased in price by, say, a duty of 20 per cent, he would have lost his order altogether, and his very large operations would have had to be transferred to another country; so that instance showed what the effect of these precious duties really amounted. to. And now he should like to say one word before resuming his seat on the question of political economy involved in this matter. The right hon. Gentleman the Chancellor of the Exchequer assured them that the plea upon which he advanced this unhappy impost was that it only fell upon the rich. He altogether denied that. It fell upon the industry of the country at large. He must have to go to school again with regard to political economy if he had yet to learn the lesson that we could pay for our imports by any other process than through our exports; and to the extent to which our producing power for France or any other market was limited exactly to the same degree did they limit our exports. He did not suppose that we had any gold mines—unless those Welsh discoveries became greatly profitable—by which we could expect to pay for our imports into this country; and if that was so, surely all that we bought from France or any other country was paid for by the labour of our own people and by no other process in the world. Therefore, these taxes finally fell on the industry of this country. It was the fashion to say in this House, as the preface to almost every speech made from that (the Opposition) side, that the matter was approached in no Party spirit, and he could honestly say that he had no Party feeling in this question, and that in all matters, in fact, his Party feeling was not of a very vicious nature. But he looked with extreme sorrow and regret at this proposal of the right hon. Gentleman the Chancellor of the Exchequer. As he said, it was not the amount of the tax proposed, but the principle involved. We beckoned France to follow a very bad example. We undid a great deal of the good done by the immortal Treaty Arrangement effected by Mr. Cobden; and when he referred to this arrangement as being valuable both in a commercial and political sense, he did not limit his admiration with regard to that Treaty to its operation on our trade with France, because, as the right hon. Gentleman the Member for Mid Lothian had pointed out, the Treaty of 1860 had produced a network of Treaties throughout the whole Continent, not only increasing our trade with France, but largely affecting and increasing our trade with many other countries. It introduced, in the first place, that precious principle of the favoured nation treatment, so that throughout the whole of Europe We enjoyed the best treatment that it was possible for any country to obtain. Now, he asked what would be the effect on this delicate adjustment of International Treaties of the breach which we had made by this small act in the principles that we had laid down? We had shown a thankless spirit in relation to this most favoured nation treatment. We had virtually told the Continent of Europe that we cared very little for their good offices in relation to imports and exports, and we had invited them to embark on a system of retaliation the end of which it was impossible to foresee. The other objectionable tax in the right hon. Gentleman's Budget—namely, the Wheel Tax, was comparatively a small affair. It was a domestic matter, and affected only our own selves at home, but this tax on wine was of international significance, involving a very great principle, and he, for one, as a commercial Member, most respectfully protested against its application.

SIR GEORGE BADEN-POWELL (Liverpool, Kirkdale)

said, he wished to submit that the hon. Member for Burnley (Mr. Slagg) had in his speech succeeded not only in answering himself, but also in answering the right hon. Gentleman the Member for Mid Lothian (Mr. W. E. Gladstone). He had proved, or rather endeavoured to prove, conclusively that the consumer paid the duty and not the producer. Others argued that it was not the consumer who paid the duty, but the producer. If it was the fact that the consumer paid, how was it that this imposition raised the wrath of the producer?

MR. MUNDELLA

It lessens trade, it lessens the consumption.

SIR GEORGE BADEN-POWELL

said, they should look at the remarks made in the French Assembly. He was not aware on what authority the hon. Gentleman opposite said that all economical authorities contended that it was the consumer and not the producer who paid these taxes. John Stuart Mill, in whom he should have thought the hon. Gentleman would have had some faith, laid it down distinctly that it all depended upon the nature of the trade whether the consumer paid or the producer. If the consumer was going to pay it in this case, why did the producer complain? But, supposing the producer paid the tax, what was the harm done to the middle classes in this country that they had heard so much about tonight? As a matter of fact, where the debate to-night had not been altogether beside the point, it had been a mass of self-evident contradictions. Again, there seemed to be a strong idea on the part of hon. Gentlemen on both sides of the House that this tax was a Protectionist duty, and it was viewed on the other side of the House in a hostile spirit. He took it to be a first principle in considering the tax, when they accused it of being a retaliatory or protective tax, that they should understand what was the motive for winch it was imposed. The motive of the right hon. Gentleman the Chancellor of the Exchequer was purely a revenue motive. It was neither a retaliatory motive nor a protective motive, and the right hon. Gentleman had clearly proved such to be the case. He (Sir George Baden-Powell) considered that this debate had lasted almost long enough to show that there was no valid argument to be advanced against the proposal of the right hon. Gentleman the Chancellor of the Exchequer.

MR. HENRY H. FOWLER (Wolverhampton, E.)

said, he should like to say, with reference to the point just made by the hon. Baronet the Member for the Kirkdale Division of Liverpool (Sir George Baden-Powell), that he apprehended there could be no dispute that a tax of this description was paid by the consumer. The hon. Gentleman had used the words "producer" and "consumer" interchangeably, and it was not easy to understand the force of his argument

SIR GEORGE BADEN-POWELL

said, he should like to explain the matter. He had been alluding to what had been said by an hon. Member when the right hon. Gentleman opposite (Mr. Henry H. Fowler) was not in the House.

MR. HENRY H. FOWLER

said, he would take as an illustration in this part of the case what they had heard at an earlier period of the evening as to the Tea Duty. Supposing the House had made the duty upon tea 1s. instead of 6d., who would have paid the extra 6d.—the Chinese or the people of this country? The increased duty upon every pound of tea would have been paid by the people of this country who consumed the article. It was absurd to say that the Chinese would pay it, and to deny that it would be paid by the English consumer was simply to deny that two and two made four. If anyone could show that the Chinese would pay the increased tax on tea introduced into this country, they would be equal to squaring the circle, or the solving of any other problem supposed to be impossible of solution. He did not understand the right hon. Gentleman the Member for Mid Lothian to contend that this was in itself a protective duty. They admitted that it would be paid by those who drank the wines, and not by the French importer; but what he understood the right hon. Gentleman to say was this—that at a critical period in the history of France, and in the relations between France and this country when the question of Free Trade was trembling in the balance, the practical effect of its operation would be to encourage the Protectionist party and depress the Free Trade party, and possibly lead to retaliatory reprisals. Now, he saw the right hon. Gentleman the Under Secretary of State for Foreign Affairs (Sir James Fergusson) in his place. The right hon. Gentleman had given a very cautious and candid answer to a Question upon these matters at Question time, and had intimated that he would give a full and more complete answer in the course of this debate. He (Mr. Henry H. Fowler) would like to ask him whether there was any accuracy, any correctness in the statement which had appeared in the foreign newspapers two or three days ago, that the French Prime Minister had stated to the Chamber of Deputies that the French Government had instructed the French Ambassador, Monsieur Waddington, to inform the English Government that in the event of this Act being definitely passed, the most Favoured Nation Clause would be withdrawn?

MR. MUNDELLA

In jeopardy.

MR. HENRY H. FOWLER

Yes; he thought that was the more correct word. They were entitled to know from the right hon. Gentleman the Under Secretary of State what was the state of this question. They were entitled to know what the strain and stress of this question was in regard to our relationship with France. He had no doubt that the hon. Member for Sheffield (Mr. Howard Vincent) thought that this was a fair raising of his theory of Free Trade policy. There was no one who would repudiate that more completely than the right hon. Gentleman the Chancellor of the Exchequer, and who would more emphatically declare that there was not a shadow of a shade of Protection in the whole of this matter. ["Oh, oh!"] Well, he would appeal to the right hon. Gentleman himself. He was there in his place, and could repudiate this assertion if he chose. The right hon. Gentleman altogether denied that there was any approach to Protection in any shape or form in this proposal. The right hon. Gentleman utterly repudiated Protection in every shape as connected with the imposition of this tax, and all that the House was called on to look to was with reference to the practical bearing of the question upon the relationship between this country and France, and upon our commercial intercourse generally. This was said not to be the inauguration of a new system of prohibitory duties. He thought the right hon. Gentleman the Chancellor of the Exchequer had looked upon the matter from a Revenue point of view exclusively. He might differ from the right hon. Gentleman—he did differ from him—but, whether right or wrong, it was a Revenue proposal, and on that side of the House they opposed it from that point of view, believing that it would not be worth the risk that it involved. They appreciated the desire of the right hon. Gentleman the Chancellor of the Exchequer that those who were able to sell these wines should have the benefit of them, and they would be sorry to raise any false issue, as had been raised by the hon. Baronet the Member for the Kirkdale Division of Liverpool.

SIR GEORGE BADEN-POWELL

said, he was explaining that hon. Gentlemen had been fighting on different issues, and he had said that it depended on the character of the trade between the two countries whether the consumer paid or the producer. He had quoted in support of his contention from John Stuart Mill.

MR. HENRY H. FOWLER

said, that the hon. Member had not given them the passage from John Stuart Mill with all its qualifications, and the hon. Member had contradicted him when he said that the 6d. duty upon tea, if converted into 1s. duty, would be absolutely paid by the consumer. The hon. Gentleman had contradicted that, and many of his Friends contradicted it still. ["Hear, hear!"] Yes; his Friends cheered him, and that he (Mr. Henry H. Fowler) contended was a false issue, and there was no one who would demolish that view more remorselessly than the right hon. Gentleman the Chancellor of the Exchequer himself. What he (Mr. Henry H. Fowler) wished to put before the right hon. Gentleman the Chancellor of the Exchequer was whether it was worth while for the sake of a paltry sum of £125,000 a-year—which he could very well afford to pay out of his surplus, as his Estimates were moderate and prudent—whether it was worth while to propose a tax which would run the risk of producing such a bad effect upon our relations with France? He believed the right hon. Gentleman would find, in 12 months' time, that he had a much larger surplus than he at present contemplated, and he had no doubt that the financial condition of the country would be much better if this tax were not imposed than it would be otherwise.

MR. NORRIS (Tower Hamlets, Limehouse)

said, he did not know that he should have addressed the Committee this evening if it had not been for the extraordinary doctrine enunciated by the hon. Member for Burnley (Mr. Slagg). The hon. Member had said that when our working classes were suffering in a certain town the hat was sent round for relief. As representing a large Metropolitan constituency, which was very largely affected by these foreign duties, he (Mr. Norris) entirely repudiated the notion that they wished to fall back on the country for charity. All they desired was justice, and he thought they had a right to demand it for them. On looking at this tax, it was evident, as former speakers had pointed out, that it was not a tax, in any form, of Protection. He must say, from the broad grounds on which the right hon. Gentleman the Chancellor of the Exchequer had brought the Motion forward, he had the greatest pleasure in supporting him; and not only so, but he believed the remark made by the hon. Member for Central Sheffield (Mr. Howard Vincent) was in the right direction as encouraging home trade. He hoped the right hon. Gentleman the Chancellor of the Exchequer (Mr. Goschen) would make some statement in favour of the Colonies. He had been much struck with the speech of the right hon. Gentleman the Member for Mid Lothian (Mr. W. E. Gladstone), and more so by that part of his remarks to the effect that he had had it in his power to confer with certain French Members of Parliament in December last. They had not heard from him, however, that he had conferred with those gentlemen. If he had done so, he would have learned from them, in all probability, that Protection was not only an inherent principle in that country, but was spreading. They heard that in the United States and Germany the Protection system was producing effects which in this country would unquestionably be to the benefit of the working classes. As the right hon. Gentleman the Member for Mid Lothian had stated, the question was rising, and was making immense progress amongst the people. Agriculture was suffering; and, as had been pointed out by the hon. and learned Member for the Kingswinford Division of Staffordshire (Mr. Staveley Hill), in his own part of the country, the iron trade was suffering immense distress, and, therefore, even if this step proposed by the right hon. Gentleman the Chancellor of the Exchequer was a step in the direction of Protection, hon. Members were fully justified in supporting it. However, he (Mr. Norris) repudiated that doctrine. He believed that it was mainly with a view to preventing a deficit in the Revenue that the proposal had been made. He trusted that in the Division hon. Members would show that they believed this to be a necessary tax, and that to their minds it was not one upon the poor, but upon the rich, who could well afford to pay it.

MR. PROVAND (Glasgow, Blackfriars)

said, he thought they had had a very interesting discussion on this question, but there were still one or two things to be said. The hon. and learned Gentleman who formerly sat for Coventry (Mr. Staveley Hill) in this House had deplored the fact that we had taken the duty off French ribbons, and declared that it had brought about the ruin of a large community. That was not the fact. As a matter of fact, the alteration effected by the Treaty of 1860 had been the making of Coventry. No doubt, the town had suffered a great deal temporarily; but it had recovered, and it had never been better off than it was at the present time. It gave up making these articles in which it could not com- pete with other countries, and took to making articles which it could manufacture better than others. Coventry now had a larger population, a larger rateable value, and was in every way more satisfactorily situated than it ever was at any previous period of its history. When he had risen just now to interrupt the hon. and learned Member opposite (Mr. Staveley Hill), he had done so in order to ask him to put before the House a specific case that be might have it answered.

MR. STAVELEY HILL

said, he had misunderstood the hon. Member. If he had understood, he should have said that the duty was taken off cotton in Lancashire not to benefit the consumer, but the producer.

MR. PROVAND

said, that that would not prove that the duty was paid by the producer, and not by the consumer. A specific case was all that was required to prove the argument he was advancing. Take an article made in Lancashire—cotton velvet. The duty upon that article throughout the world varied from nothing up to 100 per cent. Well, if the producer paid that duty, or any part of it, why was it that he got the same price for the goods, neither more nor less, no matter to which market it went? Some of the velvet made in Lancashire was used in this country, where there was no duty. Some was used in Central America, where the duty was 100 per cent; and some in other places, where, as he said, the duty ranged between nothing and 100 per cent. If the producer paid the duty, how could he get the same price from these different places? There was a very large question involved in this, and those who believed so must show who paid the duty on the £250,000,000 sterling of manufactured goods which were exported from this country every year to various markets all over the world? Did the producers pay? [Cries of "Yes!"] Well, let the hon. Members who said "Yes" produce a single instance in proof of the assertion; let them show a single case of any article; let them put their finger on any manufacturer who paid the duty as a producer. It was simply impossible to do so. [An hon. MEMBER: Steel rails.] The producer paid no duty whatever on steel rails. It was the consumer and the consuming country who paid the duty on steel rails exported from this country, just as the right hon. Gentleman the Member for East Wolverhampton (Mr. Henry H. Fowler) had shown that the consumer in this country paid the duty on tea. This was spoken of as a Protective Duty, but it was not of that kind. If we made wine it would be a Protective Duty, but as we did not, the duty was not protective, and the right hon. Gentleman the Member for Mid Lothian simply spoke of it as being likely to be regarded on the Continent as a duty of a protective character. He also said it would be looked upon as of a retaliatory character, and so it would be. It was only a protective Duty to this extent—that it would artificially extend the bottling trade in this country. The right hon. Gentleman the Chancellor of the Exchequer stated that he was going to satisfy the French people that there was nothing Protective in the duty, because they had done the same thing themselves by putting a heavier Duty on bottled wines than on wines in wood. But notwithstanding this, it would be impossible for him to satisfy bottlers and also manufacturers in France that they ought not to have Protective Duties, which would be the same thing as trying to convince them that they ought not to put money into their own pockets. Returning to the particular question before the Committee, he (Mr. Provand) said that the taxation of what were considered luxuries generally met with approval, and to say that an article was a luxury was quite sufficient reason in the minds of some persons for taxing it. But he would point out, first of all, that there was much difficulty in saying what was and what was not a luxury, for that which to one person was an article of luxury was to another an article of necessity. To tax some things that were called luxuries would simply be to damage the industries that produced them, and many of our industries produced nothing but luxuries; on the other hand, there were some luxuries the taxation of which would do no material injury to the people—for instance, the taxation of coats of arms would affect only to a small extent coach-painters and engravers. Every tax of this kind depended on the degree to which it might affect labour in our own country or our commerce with other countries. There were many objections to this tax, and, in the first place, it was not uniform in its incidence. They were all agreed that champagne was a luxury, but one-third of the champagne that was imported into this country cost less than 20s. a-dozen. Although the right hon. and learned Lord Advocate (Mr. J. H. A. Macdonald) smiled at this statement, he ventured to think that he was no authority upon the subject.

THE LORD ADVOCATE (Mr. J. H. A. MACDONALD) (Edinburgh and St. Andrew's Universities)

said, he smiled because he thought that if champagne was imported at 20s. a-dozen, it was the best reason in the world for keeping it out.

MR. PROVAND

said, he had made inquiries from the best authorities, and he repeated that about one-third of the champagne imported cost less than 20s. a-dozen, and a letter had been read that evening from an exporter, who said that he exported 160,000 dozens of champagne at prices from 18s. to 20s. a-dozen. He (Mr. Provand) pointed out while the tax would amount to 25 or 30 per cent on this class of wine, it would only amount to 5 or 6 per cent upon wine of a higher character that was consumed by the wealthy classes. The heavy tax, then, would fall upon the middle class, who could ill afford it, and the lighter tax upon those who cared little about it. Then it was said that the tax would stimulate the bottling trade in this country. The hon. Member for Central Sheffield (Mr. Howard Vincent) would, no doubt, like that; but some day the tax would have to be taken off, and then there would be the cry that this particular industry had been ruined; and the hon. Member for Burnley (Mr. Slagg) had clearly shown the folly of putting on taxes to assist a trade that could not stand by itself. Another reason against the tax was that it was diametrically opposed to those Free Trade principles which had dominated every Chancellor of the Exchequer in this country for the last 45 years. The hon. Member for Burnley had alluded to that also, and it was axiomatically true that there could be no buying if there was no selling. Almost the whole of our exports represented labour and industry, and to tax imports was to limit our exports, and therefore simply to punish ourselves. He (Mr. Provand) did not wish unduly to occupy the time of the House, or he might read extracts from almost every treatise on political economy which would condemn the present proposal, and he might even put the right hon. Gentleman the Chancellor of the Exchequer himself under contribution. There was one short extract, however, that he should like to read, and he asked the Committee to listen to what the Fair Traders themselves had said on this subject. Even they had been compelled to admit the conditions which governed international commercial relations. Four gentlemen who were known as Fair Traders sat upon the Commission which inquired into the question of the depression of trade; they printed and circulated a Supplementary Report, in which they used these words— The conditions of international exchange are inflexible. We can only in the long run buy as largely as we can sell. No advocate of Free Trade could say more, nor had it ever been better ex-pressed. He had stated that the incidence of this tax was not fair at home; and he would say, further, that foreign Producers, particularly the French, would argue that it was not fair abroad. Firstly, it would not affect Spanish or Portuguese wines, which all came in wood, nor would it affect Australian wines nor Italian to any appreciable extent. Even in the case of Germany—as all hocks could be brought into this country in casks—there were only some qualities and descriptions, chiefly sparkling wines, which could only be imported in bottles, but these would not exceed 40,000 or 50,000 dozens, paying of the new Duty, say, £10,000 or £15,000, therefore 85 or 90 per cent of the whole £125,000 which the right hon. Gentleman the Chancellor of the Exchequer expected to get from this source would be paid by French wines. France would, therefore, interpret this Budget as a blow directly aimed at herself, and there would, no doubt, be a long-continued agitation in that country with the object of putting extra duties upon our goods, or of withdrawing from us the enjoyment of the "Most Favoured Nation" Clause under which we traded with France at the present time. It was only natural that the French people should object to sit down quietly and see this interference with their commerce. Could there be a time more inopportune than the present for the imposition of this tax? The extra Duty on bottled wines had been withdrawn in 1866 in consequence of the representations of Powers with whom we were then engaged in some very delicate commercial negotiations; but surely that reason applied with great force to the present moment, because we had on hand several subjects of delicate negotiation with Foreign Powers. He need only refer to the question of sugar bounties, which we were seeking to get withdrawn; and at the same moment we were going to impose a tax which France would regard as directed against herself. The right hon. Gentleman the Member for Mid Lothian, in introducing one of his Budgets some years ago, gave an admirable exposition of the conditions on which any change in the Wine Duties, if any change were made, should rest. First, he said that the system should be equitable in itself; secondly, that it should neither overweight nor favour any particular wine; thirdly, that it should favour the consumer; and, fourthly, that it should be suitable to the requirements of the Revenue; and, lastly, that it should have promise of endurance. This tax on bottled wines outraged every one of these wise conditions, except perhaps the second last; and it was for the right hon. Gentleman the Chancellor of the Exchequer, of course, to satisfy his own mind as to the tax being suitable for the purposes of Re-venue; but he (Mr. Provand) thought that it would not eventually be found to meet its requirements, and he was convinced that if the right hon. Gentleman believed that he must raise the amount of the tax he could have levied the £120,000 in some less objectionable way. If the country were at war, or if it were necessary to make up a large deficit, he could understand the tax being imposed; but we were, and, as he hoped, would remain for a long time, at peace, and he contended that a tax of this kind, whether judged from the point of view of political economy or of political contingency, was a mistake. He did not think the right hon. Gentleman the Chancellor of the Exchequer ought to expose them to the terrible risks which had been pointed out by the right hon. Gentleman the Member for Mid Lothian, to whose speech and arguments the right hon. Gentleman had made no reply. For the reasons given he would move the rejection of the clause.

Amendment proposed, to leave out Clause 3.—(Mr. Provand.)

Question proposed, "That the Clause stand part of the Bill."

THE UNDER SECRETARY OF STATE FOR FOREIGN AFFAIRS (Sir JAMES FERGUSSON) (Manchester, N.E.)

I think, perhaps, it might not be without advantage to recall the attention of the Committee, from the very high platform on which the discussion has been placed by recent speakers, to the somewhat narrow issue before us. I do not think it necessary to go into the whole range of political economy from the philosophical point of view of the bon. Member for Burnley (Mr. Slagg), nor to anticipate very considerable changes in our fiscal system because of this item in the Budget of the Chancellor of the Exchequer. Certainly the right hon. Gentleman the Member for Mid Lothian had treated this question from a very serious point of view, and it was natural for him to do so, because it seemed to him to trench upon one of the great measures of his life; and he has been supported in his view by several hon. Members, and lastly by the hon. Member for Glasgow (Mr. Provand), who not only professed to follow but to interpret the right hon. Gentleman. The hon. Member for Glasgow has, however, truly represented the particular direction, if any, in which the wine trade will be affected by the tax proposed by the Chancellor of the Exchequer. He said that, for the most part, it is likely to affect French wines; and that was what my right hon. Friend told us when he introduced his Budget, his statement being that champagne and the more expensive wines would be those most affected by the tax, but that still wines could as well be imported in casks as in bottles. I may, with reference to the statement of the right hon. Gentleman the Member for Mid Lothian, also remark, that when he said that 135,000 hectolitres of French wine were exported in bottles, he did not mention the fact that of this quantity there were more than 90,000 hectolitres of champagne. The amount of French wine which can be disturbed at all by this duty is insignificant. I have the last Report of our Consul at Bor- deaux, which gives the particulars of the exportation of wine from that port, and he states that the total export is 26,814,000 gallons in wood and 1,838,000 in bottles; and it is remarkable that of this quantity the export in wood to the United Kingdom is 3,362,000 gallons in wood and 702,000 gallons in bottles—that is to say, the exportation in bottles is something like one-fifth of the exportation in wood. It cannot be alleged, then, with justice, that we are going to ruin Bordeaux, even if the quantity exported to us in bottles should be less, seeing that all the rest of the world import nearly the whole of their French wine in wood. It seems to me that it is the present rate of duty that has caused so much more wine to be imported in casks than in bottles. But if it be so injurious to put a higher tax upon the latter than the former, how is it that this system does not injuriously affect the interior trade of France—because the Chancellor of the Exchequer has told the Committee that there is in France a higher Excise and a higher octroi duty levied upon wine in bottles than upon wine in wood? The hon. Member for Glasgow, following the steps of those who preceded him, has warned us of that bad impression that would be produced in France by the Chancellor of the Exchequer's proposal, and the right hon. Gentleman the Member for Mid Lothian, as well as the right hon. Gentleman the Member for Sheffield (Mr. Mundella), have also warned us that agitation may follow, and that possibly retaliatory duties may be placed on our imports and exports. The right hon. Gentleman the Member for Wolverhampton (Mr. Henry H. Fowler) has asked me to state what attitude has been taken up with regard to this subject by the Foreign Minister of France. I have here a translation of the words used by the Foreign Minister in the French Chamber on the 22nd of April. He said that he had instructed the French Ambassador in London to make representations, showing the great injury which would be done by this measure. If their representations were not listened to, France would have the right, not indeed to make reprisals, but to use reciprocity, and the Government would have to determine what proposals it would be proper to present to the Chamber for the protection of French interests. I state that with perfect candour. It is already before the world. Of course it is very desirable that we should examine and weigh the effect which this proposal has had upon friendly nations; but it does not follow that we should subscribe to the very erroneous conclusions that may be drawn from it, or that we should give up that which we consider useful for our own Revenue and just in itself. The Committee will understand that these representations used by the Minister for Foreign Affairs in France had reference to representations made to the Chamber by one particular trade at Bordeaux and Beaune. It was very natural that upon such representations as had been made by an important trade in France, the French Minister should undertake to make representations to the Government of this country, and to endeavour to procure the withdrawal of this proposal. The Committee ought to remember that similar representations have been made to Her Majesty's Government from the trades of this country who conceive themselves to be injured, and find themselves injured by the tariffs of foreign countries, and Her Majesty's Government have made, in consequence, many representations to foreign countries as to the injury which was likely to be done to our industries. It is well known that during the last few months we have been making such representations to the Government of Italy as to the bad effect upon some of our industries and exports of their new tariff; and we have had much reason to complain of the injury to some of our industries and interests by the tariffs of France. We have made representations to the Government of France as we were in duty bound, and we have been met there, and elsewhere, by the reply that these imposts were founded on the necessities of those countries, that they were based on a fiscal system, and that they were imposed with no feeling of animosity to this country or with any desire to injure its interests, and that the different Governments would greatly regret if the imposts had that effect. In such cases we did not often procure redress of the grievances of which we complained, but we have not quarrelled with any foreign Government on that account; we have recognized that other Governments have a perfect right to levy such Customs duties as they consider best for their own interests. It is upon that footing all Governments proceed, and if we find that some of their fiscal systems press hardly on our interests, we must recognize that their duty is to govern their own country in the manner which they consider best for their own interests, and that we have no right to complain of them on that account. Well, Sir, I apprehend that is really the position in which we stand towards the Government of France at the present time. We have proposed a slight readjustment of the Wine Duties, a thing in itself small, and I think it will be found still smaller when it comes to be examined, because, although there may be at present a much larger quantity of wine imported in bottles than in wood, it is most likely that a much greater proportion will find its way into this country in wood in the future than hitherto. With the altered circumstances shippers will find it better and more convenient to export wine in wood than in bottle. Although it is put to us so strongly by a man of the great eminence of the right hon. Gentleman the Member for Mid Lothian (Mr. W. E. Gladstone) that we are shaking the system of trade which he did so much to establish between France and England, that we are inaugurating a course tending to upset the Free Trace which was founded by the Treaty of 1860, I think we cannot accept that statement as absolutely well founded. Certainly the right hon. Gentleman had reason to congratulate himself on having gained certain improvements in 1860; but I regret to say that that improvement has not been sustained; the duties, which were lowered in 1860, have been raised since then. No doubt we have, under what is called the Conventional Tariff of 1882, the benefit of the Most Favoured Nation Clause, but what does that Most Favoured Nation Clause amount to? High duties are now levied in France on almost every article imported from England; whereas in this country we practically tax only two French articles—namely, spirits and wine, the latter not being an English production at all, and the former being subject to an equivalent Excise duty. These duties in France now amount on the average of all articles and all duties, including articles duty free, to about 6.9 per cent. But this gives only a faint idea of the weight of the duties on English products. On cotton yarns the French duty ranges from 6s. 1d. to £6 1s. 11d. per cwt.; and on the higher counts this duty is equal to from 100 to nearly 300 per cent on the value of the raw material from which the yarn is manufactured. On single combed woollen yarns, the duty ranges from 8s. 2d. to £1 12s. 6d. per cwt., with higher duties for most other kinds—a rate of duty on the raw material, valued on the average of 1s. per pound, ranging from about 7 to 30 per cent as the minimum, and in most cases much higher. On cotton tissues the range is from £1 0s. 4d. to £10 19s. 6d. per cwt., and to even higher figures. A duty of £2 16s. 0d. per cwt. would be equal to one of 100 per cent on the raw material used, and the higher duty mentioned is about 400 per cent. On manufactures of wool the range is equally high and wide, though, as the value of the raw material is greater, the proportion of the duty to the value of the raw material used may be put at from 50 to 200 per cent. On iron and iron manufactures the duties are of infinite variety, but articles like cutlery pay from £2 0s. 8d. to £9 15s. 1d. per cwt., which is from 100 to 500 per cent on the value of the raw material used. Generally, according to the French statistics of imports and exports, the iron and iron manufactures actually imported from England into France bear a charge of 25 per cent ad valorem on import. The same with many other articles. The duties are excessive in proportion to the value. The proportion of duties levied to the values imported does not show the full effect of the tariff, because the articles on which high duties are imposed are kept out altogether, whereas the statistics relate only to articles actually imported, including duty free goods. Taking the statistics as they are, the duties in France have been steadily increasing in weight on the value of the articles imported—from about 3.3 per cent in 1866 to 6.9 per cent in 1886. This is partly due to the substitution of specific for ad valorem duties in 1882, and to the increasing weight of all specific duties in proportion to the value of the articles in consequence of the fall of prices in recent years. As regards coal, the effect is shown in an increase in the percentage of the duties levied to the value of the article imported from about 6 per cent to 9 per cent between 1866 and 1886. Similarly, the proportion levied on the following articles increased as follows between 1866 and 1886:—Cotton velveteens, which formerly ranged from 60 to 100 francs per 100 kilos, were raised to from 80 to 140 francs; plain cotton tissues, if weighing 3 to 5 kilos per 100 square metres, formerly ranging between 80 and 300 francs, were raised to from 110 to 403 francs; bottles, per 100 kilos, from 1 franc 30 centimes to 3 francs; cow hides from 10 francs to 20 francs; gun, barrels from 20 francs to 60 francs; beer, per hectolitre of 22 gallons, from 5 francs 75 centimes to 7 francs 75 centimes; and spirits, per hectolitre of 22 gallons, from 15 francs to 30 francs. The principal change effected by the tariff of 1882, which was a substitution of specific for ad valorem duties, has thus been to increase the charge on English goods. This was intended at the time, as regards the inferior manufactures, as pointed out in Mr. Kennedy's memorandum; but the effect has been aggravated by the fall of prices which has been going on so long. Even if the specific duties substituted in 1882 had been as the fair equivalents of the ad valorem duties at the time, the course of events since 1882 has made them heavier than if the former ad valorem charge had since been continued. The French internal duties on wines and spirits, which are the only articles of theirs we tax, are very heavy, especially in the large towns, which not only levy an octroi for local use, but a duty for the State. It is almost certain that a Parisian pays a higher charge on wines and spirits of France, at least on spirits, than people in the United Kingdom pay on wines and spirits imported from France. The exports of coal from the United Kingdom are now about 24,000,000 tons per annum, of which 4,000,000 tons are exported to France—that is, about a sixth part of our exports. One of the great advantages of the Treaty of 1861 with France was the engagement not to impose an export duty on coal. The restoration of it might injure French trade a good deal; and we have not much to fear from an increased French import duty, which would tend to have the same effect. That duty, which in 1861 was 17½d. a-ton, has ever since been 11¾d. I have only mentioned these facts to show the Committee that, whereas in this case so much has been said about the alteration of a duty even to a small extent, and affecting only one French trade, our manufactured articles are taxed to such an extent when they enter France as to render the expression Free Trade, in my humble opinion singularly inapplicable. The burden on British importers is rendered greater in the application of Customs regulations, for the decisions of the officers and experts in disputed cases is almost invariably upheld, and little attention is given to the evidence adduced in support of the contentions of British Traders. In Fishery matters, the French Government have refused persistently to give effect to the stipulation in the Treaty of 1867, by which British fishing boats were to be allowed to sell in French ports the fish caught by their crews. This is a question of great importance to the fishing industry of this country. Then there is the ship-brokerage grievance, the fact that masters of vessels are not allowed to employ their own agents, but must have recourse to the services of a small privileged class of brokers, who make excessive charges for the discharge of very trifling services. When the master possesses sufficient knowledge of French to perform himself Custom House business, the Customs officers require witnesses to support him, and by selecting men of the crew who do not know French as witnesses—the choice rests with the Customs and not with the Master—they oblige the Master in this way to employ a broker to act as sworn interpreter, and lie is thus enabled to make his whole charge. Frequently the charge amounts to £14, £20, and even £30 for a service which does not occupy more than a few minutes. I do not mention these things as reproaches against the French, but only as showing that the French Government and the French Parliament are Conservative and Protectionist, and that these measures are, in their opinion, necessary for the protection of French industry, and they are in no sense unfriendly towards British trade and British industry. I venture to think that on reflection it will be thought by the French Government and people that in proposing this alteration of the Wine Duties we are not doing anything unfriendly to their interests, or doing anything which they ought to take objection to. It would be, indeed, a grave charge, if it were made with any justice against us, that we have commenced, as some Gentlemen have said, a new departure which is untrue to the system which has been established in this country for so many years. I venture to think that there is nothing in the proposal with regard to the Wine Duties which will for a moment justify such an assumption. There has been a good deal said about the incidence of protective or revenue duties; but I certainly thought it was settled long ago that if a duty were put upon wine entering this country it would be by the people of this country that the duty would have to be paid. It is altogether untrue that in this altered tax there will be any fresh burden put upon the poor of this country. On the contrary, this is a tax laid on the rich and luxurious which they have made no objection to pay. It in no sense imposes a fresh burden on the poor and struggling as those who are always ready to pose as the friends of the people would fain make out.

MR. CHILDERS (Edinburgh, S.)

I think it is very fortunate that the right hon. Gentleman the Under Secretary for Foreign Affairs (Sir James Fergusson) has spoken, because he has unwillingly put the question on the right ground. This comes before us as a question of reprisals. We have heard to-night a string of complaints against the French Government; and we are told we must accept the French Government's excuse for the acts of which we complain, because, as the right hon. Gentleman said, the French Government and the French Parliament are Conservative and Protectionist. I hope the House will remember what it is that we shall be doing when we become Conservative and Protectionist. Our trade with foreign nations will be hampered and made disagreeable to them, but the system of Protection will be a sufficient justification.

SIR JAMES FERGUSSON

I trust the right hon. Gentleman will pardon me. He will recognize that I ought not to be misunderstood. I certainly did not intend to say, and I am sure I did not say, anything approaching to a statement that this step had been taken by way of reprisal.

MR. CHILDERS

I am sure the House will accept any disclaimer coming from the right hon. Gentleman, but how disappointed some Members opposite must be who have been talking about reprisals all the evening, who heard the long list of complaints which my right hon. Friend set forth, and who cheered every word he said. However, we are bound to accept the explanation of the right hon. Gentleman as to what he meant by those so loudly cheered expressions in the latter part of his speech. I am glad my right hon. Friend has put the case from the point of view of the Foreign Office, which will have to deal with this question with the French Government, and possibly with other Governments. There can be now no mistake in the matter, but I am about to call attention to one or two remarks of my right hon. Friend which, I must confess, I did not understand. He spoke of the increase of duty as a small increase, I think his words were "small and slight." An addition of 250 per cent to a rate of duty he calls "small." The present duty is 2s. per dozen on the wine which is under consideration, and it is proposed to make it 7s. a dozen bottles. Five shillings is an addition of 250 per cent of the former duty. I do not call an addition of 250 per cent a small addition to a duty at all. I must also call attention to another expression of the right hon. Gentleman. He spoke at great length of the way in which the Chamber of Commerce of Bordeaux received the intimation which had been made here as to this additional duty, and he gave some very interesting statistics of the amount of wine exported from Bordeaux in cask and in bottle. How much champagne is exported from Bordeaux? It is only claret that we receive from Bordeaux. I know Bordeaux well; and it is within my knowledge that the amount of sparkling wines shipped from Bordeaux is extremely small. The opinion of Bordeaux, therefore, does not go for much on a champagne question, and it is as a champagne question that this comes before the House. Furthermore, let me remind the Committee that whereas a good many of the manufacturing towns of France were strongly opposed to us in the matter of Commercial Treaties in 1860, and were opposed to us also in 1881, when the matter was again negotiated here and in Paris, Bordeaux always was in favour of a Commercial Treaty. So far as Bordeaux is concerned we are dealing with friends, so that the friendly resolution of the Chamber of Commerce of Bordeaux is not in point at all. What has come to the Minister from other parts of France in relation to this question? I shall have in a minute to expand a little what the right hon. Gentleman has said, for he left out the most important part of the French Minister's statement, which I have read myself in more than one French paper. I do not propose to touch upon the general question of Fair Trade. During the dinner hour, while the right hon. Gentleman the Chancellor of the Exchequer was not in the House, there was a good deal praise of Fair Trade from the opposite Benches, and the support of the proposal of the right hon. Gentleman was by the Member for Central Sheffield (Mr. Howard Vincent), and the hon. and learned Member for the Kingswinford Division of Staffordshire (Mr. Staveley Hill), and by other Gentlemen, put expressly upon the ground that this was the first step in the course of Fair Trade. My right hon. Friend the Chancellor of the Exchequer did not hear that. In fact the whole tenour of the speeches coming from that quarter of the House was that support should be given to him, not on the ground of his being a Free Trader, which he is, and we know he is, although we think that in this matter he has made a mistake; but because he is taking the first step towards Fair Trade. [An hon. MEMBER: Oh, oh!] An hon. Gentleman opposite says "Oh, oh!" I do not know whether he was in the House, but I appeal to those who were, whether what I have stated was not the tenour of the series of speeches of hon. Gentlemen opposite. As I said, I will not go into the general question of Fair Trade or Free Trade, nor will I touch upon certain minor matters which are the fringe of the present question. For instance, I will not go into the question how far other nations besides France are affected by this proposal. There is something to be said upon that point, but I do not think it is worth while to go into it at the present moment. What I want the Committee to understand, and I will put it before them in a very few words, is what was the effect upon our trade with France of the Commercial Treaty of 1860; what the trade with France was before that time; what was the enormous improvement of our relations with France in consequence of that Treaty; and what we are risking by the course we are now taking; and I venture to ask the Committee to give me their attention for a moment while I put before them a few figures. The year before the Commercial Treaty with France our exports to France were of the value of £9,500,000, and our imports from France were nearly £16,000,000. Ten years later, in 1869, our exports were of the value of £23,000,000, and our imports of the value of £33,000,000; in the year 1879, our exports were £26,500,000, and our imports were £38,000,000; and in the year 1883, our exports £29,000,000, and our imports from France £38,000,000. Therefore, what has been the effect of that Commercial Treaty? It has increased our trades to that our exports to France are more than three times what they were before the Treaty, and our imports from France are more than doubled. Therefore, we are risking in this matter a trade amounting altogether at the present time to something between £65,000,000 and £70,000,000. That is not a small matter to be risked for the trifling increase of duty which will result from this new impost. Now, what has been our trade with other countries, especially countries in the North of Europe with which we have not made Commercial treaties or understanding. Our exports to Russia have only increased in value during the last 25 years by £1,000,000—namely, from £6,500,000 to £7,500,000; our imports from Russia have only increased from £13,000,000 to £21,000,000. With Germany our trade has less than doubled. Therefore, what I wish to point out is, that we are risking by this tax a trade which has expanded of late years far more than that with any other neighbour. And now, let me remind the House what is our position with respect to the former French Treaty. There has been to-night some great misapprehension. It is perfectly true that the Commercial Treaty of 1860 has come to an end; but it is also true that we have not been thrown back into the position we formerly occupied as to French trade. In consequence, not of the Treaty, but of the maintenance of the Fiscal system as to the import of wine and export of coal, formerly stipulated by the Treaty, we have got a satisfactory understanding with her; in fact, the Most Favoured Nation Clause with respect to our whole trade. The right hon. Gentleman the Under Secre- tary of State quoted certain isolated instances of high duties in France, each under Most Favoured Nation treatment. Most Favoured Nation Clauses, but how much higher are they under the customary tariff of France. Many are, in fact, absolutely prohibitory, whereas now nothing can come into France at less duty than from England. Therefore, as I said, we are risking a great deal in provoking France to put us in the list of Nations not having Most Favoured Nation treatment. No doubt the right hon. Gentleman intended to give the House a fair idea of what passed the other day in the French Chamber on this matter, but he has not quoted fully what occurred when an interpellation was addressed to the French Minister. The Under Secretary of State quoted only part of the French Minister's reply. I have seen, I think, three different French newspapers containing reports of the French Minister's reply, and I find that the most important part of the reply the right hon. Gentleman did not quote at all. What did the French Minister say? He used almost the words the right hon. Gentleman had quoted, that the French Ambassador in this country would be instructed to make representations to the English Government; but the right hon. Gentleman opposite did not add that the French Minister stated that that Ambassador would remember that it was in the power of the French Government to denounce the Most Favoured Nation Clause, and that he was to represent this to the British Government. Now, it may be the wish of the Under Secretary to minimize that statement, but it is a most important one, and if the Ambassador here has acted upon these instructions—we are within a measurable distance of having, not the treaty, because, as I have said, there is no formal treaty, but the arrangement that followed the negotiations of 1881 denounced, when this country would have to fall back on the ordinary tariff which France imposes on the imports from other countries. What does this mean? Probably the loss of half our trade with France. It is within the power of the French Government, if they quarrel with us, practically to destroy our trade with her, and that is a far more serious matter than what up to the present time the Government have represented to us as the position of this question. The right hon. Gentleman said, and said very truly, that we have no right to complain. No, we have no legal right to complain, because this matter is not subject to a treaty; but the commercial community would have a very great right to complain of this House and this Government if, for the sake of this small addition to the Revenue, suddenly, we found half our French trade imperilled—if we found our large trade of £70,000,000 a-year, now carried on between this country and France, reduced to anything like what it was before 1860. Therefore it is a very serious question, and I put it to the Government, are they aware of the dangers of the present position, and are they prepared to accept them with a light heart? There is another important thing to bear in mind. We are negotiating with Foreign Powers on the subject of the Sugar Bounties. The negotiation at this moment is in a highly critical position. No power has as yet finally accepted any arrangement. The French are the most important power in connection with this negotiation. It is not a political question; everyone in this House was anxious that the Sugar Bounty question should be settled in accordance with the view which has been for the last 10 years expressed on both sides of the House. Well, if we come to a breach with France on a fiscal question of this kind, you may rely upon it the Sugar Bounty question will not be settled at the present time. Therefore, it is of the utmost importance that we should not put in the way of our negotiations with France so great a difficulty as the present proposal of the Chancellor of the Exchequer has put in our way. Of the duties themselves I will not say much; but I will observe this, that in 1885 we were threatened with a Motion the effect of which would be to defeat the Budget and throw the Government out of Office, because whilst we proposed in the Budget to raise the duties on spirits and beer we did not propose to raise the duties on wine. Nothing would have been easier than for us to comply with the prevalent wish and to have amended the Budget by raising the duty on wine. The Spanish treaty was then out of the way, and we might have made an addition to the Wine Duties which would have put out of Court the Motion of the right hon. Gentleman the Member for Bristol (Sir Michael Hicks-Beach). After careful consideration of the effect of raising the Wine Duties on our trade in France and other countries with whom we had commercial relations, we distinctly determined to leave the Wine Duties alone. The effect was that we were defeated. ["Hear, hear!"] Yes, we were defeated when we might, with the greatest of ease, have avoided defeat by a moderate increase in the Wine Duties. If that is so, I think the House will see that in 1885 we looked upon this question as a most serious one. We looked upon it as one which was not to be dealt with as a means of avoiding a Ministerial defeat, but as of vital importance to the trade of the country, and I must again express my great regret that on the present occasion, for the sake of so small an amount of revenue, the Government have not the courage to do what we did in 1885 and refuse to alter the Wine Duties, and thus to avoid what may become a very serious and difficult question.

MR. GOSCHEN

If I have to address the House more often than I should like upon these matters, I trust the Committee will excuse it and will bear in mind that it is almost an unprecedented circumstance for the Chancellor of the Exchequer to be placed in the position which I now occupy, that of being confronted by three ex-Chancellors of the Exchequer sitting opposite to me, a position which, of course, increases the dangers and difficulties of the occupant of the Office I hold. Now, the right hon. Gentleman who has just sat down spoke in a tone with regard to our commerce with France, against which I must enter my respectful protest. In the first place, I must say that I think he, of course unintentionally, misrepresented the speech of my right hon. Friend the Under Secretary for Foreign Affairs. ["No, no!"] Then he intentionally misrepresented my right hon. Friend? I do not think so. I think the misrepresentation was unintentional. He rose with some unusual warmth and animation, and said—"Now we know that this is a system of reprisals." Yes; but did he not remember what I said before, that this was no proposal of reprisals? Did he discredit what I said, coming forward as the proposer of this tax, that no such idea as that of a policy of reprisals had in the remotest manner entered into our heads? I do not think the right hon. Gentleman will, on reflection, believe that in the face of that declaration it was a fair interpretation of the speech of my right hon. Friend to say that he saw in that speech a system of reprisals. The whole argument of the right hon. Gentleman the Under Secretary was directed to this—to point out that the French Government were not in a particularly good position to argue against the nature of this tax. He stated, and I think he stated accurately—"When you look on the enormous amount of duty raised on English products and manufactures in France, a slight increase of duty on French produce such as this is not calculated to sustain a just and equitable complaint on the part of France." It was to this that his observations were limited; and whatever may be said in any part of the House, I declare again, on behalf of my Colleagues, as well as for myself, that in this proposal there is not the slightest idea of Protection of any kind, and not the slightest idea of reprisal of any kind, and not the slightest idea of anything that would be disagreeable to the French Government; and I protest against the importation into this debate of insinuations and suggestions of that character. They are mischievous in the last degree. We have to deal with the fears of the French people; and now the right hon. Gentleman the Member for Mid Lothian himself, and a second ex-Chancellor of the Exchequer, are bringing their authority to bear in a manner calculated to enhance these fears; and I am not quite sure that we shall not have a third ex- Chancellor of the Exchequer dealing with the matter in the same spirit before the discussion terminates. The suggestion is that we, the Government, have intended this as a measure directed against France. Now, I am sure that hon. Gentlemen opposite would wish as much as hon. Gentlemen on this side of the House that I should enter my protest against that suggestion if it is untrue. You would not wish that we should really be challenging the French Government to a war of tariffs—that we have had any such mad idea as that. I, therefore, think that hon. Gentlemen opposite will think me perfectly justified in rising again, though I have troubled the Committee on the subject before, to say that we have had no idea in the proposal we are making of inflicting any blow on the French Government or the French people, in order to get in that way a handle for dealing with other grievances which we have against them. Any such interpretation would be entirely erroneous. I must also enter my protest against another suggestion that has fallen from the right hon. Gentleman the Member for Edinburgh (Mr. Childers). I say that his speech was not worthy of one of the Representatives of the greatest commercial nation in the world. It is not worthy of our commercial greatness that we should stand shivering and say—"Look at our great trade of £60,000,000 with France; if we touch a single item of their imports, the whole of that will tumble to the ground." Does our trade with France indeed rest upon so slender a basis that if we introduce any change in the tariff we are to be immediately threatened that the whole edifice of our trade with France is to tumble to the ground? Are we to be threatened that a trade of £60,000,000 is to be reduced to one-half? If we have a trade of £60,000,000 with France—and I rejoice at the magnitude of that trade—it is because it is agreeable to the interests of both countries that it should exist. Such a trade is not one which depends for its existence either upon the favour of the French Government or the humour of the French people; but it is obviously on the interests of the two nations that this exchange is based. I think it is entirely against every reasonable expectation that it should be thought that these vast relations, which are beneficial to both nations, should break down because we impose a tax upon one branch of French trade which will amount to about £125,000 in the whole. I have more faith in the stability of the commercial relations between the two countries than to believe any such thing. But if there is any such danger, you cannot think that it is to be averted by non-insistence on this proposal. Can we expect that this commerce will continue unless it is to the interest of the French themselves? I deny that this commerce exists for the advantage of England alone. We know that it is of equal advantage to France itself. We send them our products because they wish to buy them as much as because we wish to sell them. I should fancy that it would be a very short-sighted Government in France which would take any such step as that suggested from the other side of the House, and which would endeavour to trade upon the fears of the English Parliament. It would be a very short-sighted Government that would think of trading upon the fear on our part that some favour, which they of their goodness or kindness had afforded to us, might be withdrawn. No doubt, if they did trade upon such fears, the French Government would have recourse to measures which would cause some inconvenience to the English Government; but I have more confidence and faith in the interests of the two countries, and in the good sense of the two countries; and I do not believe that, simply in order, as it were, to punish this House for having put an additional duty upon bottled wine as compared with wine in casks, the French people will wish to destroy the commerce which has grown to such enormous proportions, and which has been so much to the advantage of both countries.

MR. ILLINGWORTH (Bradford, W.)

said, he thought that the commercial relationship of Great Britain and France was not safe in the hands of the present Chancellor of the Exchequer. The right hon. Gentleman asked whether the enormous trade between the two countries could by any possibility be jeopardized by such a small proposal as that he had made in his Budget. Well, he (Mr. Illingworth) would ask the right hon. Gentleman this question—Was it worth while for Great Britain to run the risk of jeopardizing the trade between the two countries for such a paltry result as he would obtain? He (Mr. Illingworth) demurred to the contention that the position the right hon. Gentleman had taken up was a necessity. Where was the necessity for interfering with the fiscal arrangements between England and France for this paltry sum of £125,000? Supposing the right hon. Gentleman were to entertain the objection taken by that—the Opposition—side of the House, where would be the financial difficulty? The right hon. Gentleman could spare this sum, and still his Budget would remain intact. He would only lessen to a very small degree the surplus he would be in possession of. The right hon. Gentleman had given no consideration whatever to the arguments used and the pleas urged from the Opposition side of the House in regard to the difficulties of the Free Traders in France, and he would ask the right hon. Gentleman this question—Was he not aware that in France there was a very powerful body which sought in the interests of Protection to upset the present arrangement between Great Britain and France, and that a very small cast into the scale would put it into the power of the Protectionists to carry their point? He would also ask the consideration of the Committee to this view of political and financial matters. It would appear to the French people, to the Free Traders, and especially to those who had to deal with the wine trade, that this was a blow aimed directly at them. The right hon. Gentleman opposite (Sir James Fergusson) had quoted the opinions and views of the Bordeaux Chamber of Commerce. Well, the wine people of France were the Free Traders of France. These were the men we largely relied upon for keeping up the best possible commercial relationship between the two countries, and the Chancellor of the Exchequer was gratuitously hitting them a blow in the face by hitting the one article in which they dealt and through which they were struggling to maintain the best political and commercial relationship with Great Britain. He made an appeal again to the Committee on a stronger ground. We in this country were in no financial embarrassment. We had neither a war on our hands nor the financial and political consequences of a war to struggle with. Franco had both. France was almost at her wit's ends for means of raising the necessary amount to meet her financial obligations, and was this the time when we should put into the power of those who sought to lessen the commercial relationship between the two countries this weapon, to force forward a measure of Protection, and furnish them with the most powerful weapon with which they could possibly be armed? He made an appeal to the right hon. Gentleman the Chancellor of the Exchequer himself on the lowest possible ground, for he regarded him as utterly incapable, after the appeals which had been made to him, to regard the matter in its highest aspect. He would put it on the simple ground that the small sum which would be obtained by this tax was not necessary to the right hon. Gentle- man's Budget. It was not necessary that £125,000 should be secured by means of an increased duty on bottled wines. We were reminded by the action of the French Chamber that the course Her Majesty's Government had taken might be the means of damaging the existing satisfactory relationship between the two countries, and would be putting a weapon into the hands of the Protectionist Party in France, and he asked the right hon. Gentleman, therefore, whether it was worth his while to do this thing? He would ask the right hon. Gentleman not to stand pedantically in his position, assuming that it was necessary for him to make the slightest change in his financial proposals in response to an appeal from the Opposition side of the House. In regard to this small question, he would ask the right hon. Gentleman to forego the risk which was inseparable from the proposal he had made, and that this country and the Free Traders of France should be saved from the risk and danger involved in this gratuitous proposal to interfere with the financial arrangements existing between the two countries.

MR. CONYBEARE (Cornwall, Camborne)

said, that the debate had proceeded almost entirely on the lines of the relations existing between this country and France, which might possibly be disturbed by the action taken by the right hon. Gentleman the Chancellor of the Exchequer. He (Mr. Conybeare) wished for a moment to call the attention of the right hon. Gentleman to the possible effect his proposition might have upon one of our own Colonies. He (Mr. Conybeare) did not himself say that the danger which he would ask the right hon. Gentleman to consider, existed, as the right hon. Gentleman would be in a far better position than he was to say whether it was so or not. But he was anxious to be assured by the right hon. Gentleman as to whether these proposals of taxing wine would not have the effect of destroying the gradually increasing growth of the export trade in wine which came to us from South Africa? South Africa was a part of our Colonial Empire not previously mentioned this evening, and if he ventured for one moment to trespass on the attention of the Committee, it was because he did not think they ought to leave out of view the struggling attempts in the face of great difficulties which the Colonies of South Africa generally had been making to develop the export trade in their wines. Ho held in his hands the latest Returns as to the wines exported from South Africa according to the Trade and Navigation Account, and he found that the quantities given were for the month ending the 31st March in the three years 1886, 1887, and 1888,—in 1886, 2,238 gallons, in 1887, 5,258 gallons, and in 1888, 6,095 gallons; and for 13 months ending the 31st March he found the quantities were in 1886, 4,261 gallons, in 1887, 12,859 gallons, and in 1888, 12,881 gallons. Now, he would argue from that that it was quite evident that this export trade in South African wine was gradually climbing upward. He knew from information he had received during his visit to that part of the world that there had been great difficulties in the way of the Colony developing its trade. He was anxious to ask the right hon. Gentleman opposite if he had considered whether the effect of his proposal might not be to crush out this struggling industry of our Colonists in South Africa? From the figures he had quoted it was clear that this was an industry which was gradually finding its way to the front. The Colonists were taking every opportunity and using every method they knew of to improve their wines and fit them for export, to enable them to survive the long sea voyage from South Africa to this country, and he contended that it would be exceedingly hard upon our own Colonies, without reference to any international difficulties with France or any other country, were a proposal such as that the right hon. Gentleman had made to interfere with the growth of this export trade. This was not a fanciful supposition when it was recollected that the Chancellor of the Exchequer admitted that his proposals would tell not only against the high priced sparkling wines of France, but also against cheaper wines from the Rhine, the Moselle, and Italy. If his proposals affected those wines injuriously, it was quite possible they would affect, with equal injury, those wines on whose behalf he was now pleading. Into the large question of Fair Trade and Free Trade, which had been discussed ad nauseum, he would not enter, though he might make one divergent remark. An angry spirit was displayed by hon. Gentlemen opposite at remarks that fell from the Opposition side of the House; but it was a little difficult to understand the attitude of right hon. Gentlemen opposite and their supporters, for while one got up and declared that this impost would fall entirely on the producer in France, another would get up and say it would fall entirely on the consumer in this country. The Under Secretary for Foreign Affairs (Sir James Fergusson) assured the Committee that the tax would fall on the consumers, but several others explained that it would fall on the French producers, adducing the fact of the remonstrance from the French Government as the best proof of their theory that it must, would, and ought to fall on the producers, not the consumers. The Chancellor of the Exchequer had expostulated with those who ventured to suggest that this was the commencement of a war of reprisal on the part of Her Majesty's Government, and, for his part, he accepted in the fullest manner the repudiation of that charge. He did not for a moment think of charging the right hon. Gentleman and his Colleagues with introducing these proposals to do injury to our friends in France; but what he did say was that the right hon. Gentleman and his Friends must be taken to be liable for it, even if they did not foresee the results of their own action. If this action was regarded as a reprisal and followed by other reprisals from France, then Her Majesty's Government must be held accountable for those events. It had been so regarded in the French Chamber, and a Deputy there had stated that if this proposal were carried the present arrangement with France and the Most Favoured Nation treatment would be denounced and repudiated. The Protectionist Party in France was strong, and the French Government susceptible to Protectionist views. It was all very well for the right hon. Gentleman to talk about our fiscal liberty, and that it would be a terrible thing if we were not allowed to put on a small tax of this kind; but what was the use of occupying a political pinnacle of this kind when it could be distinctly proved that it was not to our interest to do so, and when it had been specifically declared that it was clear from the action of the French Government that the result would almost certainly be that some- thing like a war of reprisals would be entered upon? That in itself was quite a sufficient argument to show the inexpediency of these proposals, however desirable it might be from a political point of view that we should reserve the right of taxing imports. But he had risen to bring the position of the South African wine trade to the notice of the Chancellor of the Exchequer, and hoped it would not trouble the right hon. Gentleman too much to make a reply.

MR. GOSCHEN

said, that in the earlier part of the evening he informed the Committee that he had taken pains to inquire how far this tax would affect our Colonial wine trade, and he had been assured by numerous authorities on the trade that the wine could and would be imported in cask. The point had been very carefully considered, and he did not think that the Colonies would suffer from the duty in the slightest degree. He could not accept the suggestion of the hon. Member for Central Sheffield (Mr. Howard Vincent) to exempt tile Colonies, for then there would be ground for a complaint from Foreign Governments that they were not in the Most Favoured Nation position, and there would be some colour for this charge of Protection.

MR. CONYBEARE

said, he understood that the right hon. Gentleman referred to the Australian Colonies; but he spoke particularly of South Africa. Had the right hon. Gentleman extended his inquiries to the wine trade there?

MR. GOSCHEN

said, he had. Cape sherry could undoubtedly be imported in cask, and was well adapted to that mode of conveyance.

SIR FREDERICK MAPPIN (York, W.R., Hallamshire)

said, the hon. Gentleman the Member for Central Sheffield (Mr. Howard Vincent) stated, among many other things, that the manufacturers and merchants paid the duties themselves, not the consumers. But the hon. Member had plenty of opportunities of satisfying himself that that was an utter fallacy. He had only to go among his constituents and ask any of the manufacturers and merchants, and they would show him at once that there was no foundation whatever for such a statement. He would advise the hon. Member, before he repeated the statement, to satisfy him- self what foundation there was for it. Though the statement might deceive very few Members in the House, its repetition out-of-doors might have a prejudicial effect on public opinion.

MR. WADDY (Lincolnshire, Brigg)

rose in his place, and claimed to move, "That the Question be now put."

THE CHAIRMAN

did not put the Question.

SIR WILFRID LAWSON (Cumberland, Cockermouth)

said, he should like to give a reason for the vote he intended to give. Before he went away to dine he heard a good deal of the debate, and he heard the right hon. Gentleman the Member for Mid Lothian (Mr. W. E. Gladstone) say this was not a Party question. But when he returned to the House he found the Committee conducting the discussion with a heat he never saw exceeded in a Party debate. It did not, however, seem to him to be a matter of such extreme importance whether an extra sixpence should be paid for a bottle of champagne or not. He could assure the Committee it had no personal interest for himself. Having, then, no personal interest, and this being no Party question, he would give an impartial vote, first weighing the arguments pro and con. A reason against the tax was that it might affront the French people. He thought that might very likely be one effect; but if it was a measure essential to the national financial arrangements of the year, he should not much care whether it did affront France or not; he should consider a good deal more what would be the effect upon the people of Great Britain. Then another argument on the same side was that it was against Free Trade, and of course it was, as all indirect taxation was. Then an argument for the tax was that it fell upon the rich man. Well, but he knew quite well that this was merely said for the purpose of making an Election cry. Still, as a matter of fact, the consumer paid the tax; that was a first axiom of political economy, and the rich man—the rich fool—who drank champagne, would have to pay this tax. For his part, in regard to taxation, he liked to get at the rich man, and make him pay as much as possible. Another argument for the tax was that it made it more difficult for certain classes to get hold of the alcohol in champagne. On Tuesday last the House spent three hours in discussing the desirability of preventing Native races from taking alcohol, and surely there would be no harm in his trying by his vote to prevent his fellow-countrymen from using it. He could not say this was a good plan, this fiscal medium of putting a stop to drinking habits. He had heard the right hon. Gentleman the Member for Mid Lothian show how imperfect the method was. But it was the only way before him at the present moment; therefore, with great reluctance, he should vote against the right hon. Gentleman the Member for Mid Lothian, and against champagne, just as the right hon. Gentleman voted against him and against tea earlier in the evening. Question put.

The Committee divided:—Ayes 246; Noes 121: Majority 125.—(Div. List, No. 81.)

Clause agreed to.

Clause 4 (Alteration of duties on carriages).

MR. ANDERSON (Elgin and Nairn)

said, he would not occupy much time in moving his Amendment to this clause, which was to omit the words in line 28—"If such carriages shall have less than four wheels, 15s., and for every hackney carriage 15s." There was a very general agreement that this tax upon vehicles was very obnoxious in character. Carriages were used by many persons, farmers and persons of small means, and were almost necessary means of existence. These might very fairly be exempt from this taxation. Equally obnoxious as a tax on locomotion was the duty of 15s. on hackney carriages, and it would fall heavily on those persons who let out carriages for hire.

Amendment proposed, in page 2, line 28, leave out the words—

	£	s.	d.
"If such carriages shall have less than four wheels	0	15
"For every hackney carriage, as hereinafter defined	0	15	0."

—(Mr. Anderson.)

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

THE CHANCELLOR OF THE EXCHEQUER (Mr. GOSCHEN) (St. George's, 709 Hanover Square)

said, he was quite unable to assent to the proposal. The matter had been very carefully considered, and had, he believed, given general satisfaction. Very important concessions had been made, and he could not see his way to make any further exemptions. He reminded hon. Members that there was no increase in the Carriage Duty by the clause.

SIR EDWARD GREY (Northumberland, Berwick)

said, he quite admitted that, as the right hon. Gentleman the Chancellor of the Exchequer had said, the Government had made certain very important concessions on this subject, and that those who were interested in the matter on the part of the trade regarded those concessions as of much value. He thought, however, that the proposal which was made with respect to hackney carriages should be made to apply to omnibuses and tramcars, as well as to hackney carriages. If the right hon. Gentleman saw his way to adopt this suggestion, he (Sir Edward Grey) would not support the Amendment.

MR. GOSCHEN

said, he was not prepared to make any alteration in the taxes on omnibuses and tramcars, which were really outside the changes proposed by the Bill.

Question put.

The Committee divided:—Ayes 229; Noes 72: Majority 157.—(Div. List, No. 82.)

Motion made, and Question proposed, "That the Clause stand part of the Bill."

MR. J. W. BARCLAY (Forfarshire)

said, he desired to invite the attention of the right hon. Gentleman the Chancellor of the Exchequer to the case of hotel keepers in rural districts. Such people frequently required vehicles for three months only in the year. The tax would prove to be a heavy burden in such cases, and would have the effect of restricting the number of vehicles which hotel keepers kept, and, consequently, the convenience of the public. He should be glad if the right hon. Gentleman would devise some means whereby hotel keepers in this position could be included under the provisions of Sub-section 2, so that they might be able to take out licences for a limited period. He would suggest that they should be able to take out four months' licences. If such a proposal were carried out, he thought it would result in an increase of the Revenue, as it would cause an addition to the number of vehicles which would be kept by hotel proprietors during the holiday season.

MR. GOSCHEN

said, he was afraid he could not do anything at present in the direction suggested by the hon. Member, as a concession had already been made to the owners of flies.

Question put, and agreed to.

Clause 5 (Power to Treasury to prohibit the use of certain substances in excisable goods).

MR. JOHN MORLEY (Newcastle-upon-Tyne)

said, he would appeal to the right hon. Gentleman the First Lord of the Treasury (Mr. W. H. Smith) to allow Progress to be reported. A great many hon. Gentlemen had left the House since 12 o'clock, and he (Mr. John Morley) thought that there would be a considerable number of Members on both sides who would desire to speak on Clause 5.

THE FIRST LORD OF THE TREASURY (Mr. W. H. SMITH) (Strand, Westminster)

said, he had hoped that it would have been agreeable to the Committee to finish the Bill that evening. He would not, however, resist the appeal that had been made to him, if it was understood that the Committee should be resumed at 2 o'clock tomorrow. [Cries of "No!"] He was afraid that if there was any objection to a Morning Sitting to-morrow he must ask the Committee to continue sitting that evening for some time afterwards. Hon. Gentlemen must realize the fact that the Government were compelled to make progress with an important financial measure of that character. The Government would not be justified in allowing it to stand over from day to day.

MR. JOHN MORLEY

said, he really did not think the Committee could assent to the proposal of the right hon. Gentleman the First Lord of the Treasury. He believed he was right in saying that the Government, whilst they had not given a pledge, had entered into a very distinct understanding that private Members' rights should not be interfered with tomorrow. There was on the Paper for to-morrow evening a very important Notice of Motion on the subject of education, in which great interest was taken by various Members. If the right hon. Gentleman the First Lord of the Treasury insisted upon having a Morning Sitting, there would certainly be disappointment at the infraction by the Government of the understanding which had been arrived at.

THE CHANCELLOR OF THE EXCHEQUER (Mr. GOSCHEN) (St. George's, Hanover Square)

said, he trusted that, under the circumstances, the Committee would continue its sitting for some time longer, not for the convenience of the Government, but for the sake of the Revenue. It was most important that some of the provisions of the Bill should come into operation as soon as possible. Every week, every day that the passage of the Bill was delayed there was a loss to the Revenue. There was no very important point, although there were some interesting points still to be considered by the Committee, and he therefore hoped that hon. Members would continue to sit for a short time longer.

MR. HENRY H. FOWLER (Wolverhampton, E.)

asked the right hon. Gentleman the Chancellor of the Exchequer whether he ever remembered a Budget Bill which was so far advanced on the 26th of April as that now under consideration? There had been no delay in the discussion of the measure. The next clause was one of a controversial character, and raised an important scientific question, upon which some hon. Members wished to speak at great length, and it must be remembered that there were some Members who were serving on Select Committees, and who had been in the House since 12 o'clock. He moved to report Progress.

Motion made, and Question proposed, "That the Chairman do report Progress, and ask leave to sit again."—(Mr. Henry H. Fowler.)

MR. W. H. SMITH

said, he was extremely sorry to do anything that would be disagreeable to hon. Gentlemen opposite; but it must be obvious that the Government were bound to make progress with Business. If there was a Morning Sitting to-morrow, the Government would consider themselves bound to make a House at 9 o'clock.

MR. MUNDELLA (Sheffield, Brightside)

said, he would rather sit there for another hour than have a Morning Sitting to-morrow, although he had been in the House since 3 o'clock. He thought that no Government was ever so favoured by an Opposition as the present Government. They were quite as anxious as was the right hon. Gentleman the First Lord of the Treasury to forward Business; but really there was some reasonable limit. The Chairman had already been in the Chair for eight hours. There would be no objection to meeting at 2 o'clock to-morrow, but for the fact that the adoption of such a course would probably interfere with the proper discussion of the two important Motions which were on the Paper for to-morrow. It was not fair for the Government, night after night, to take away the time of private Members. He appealed to the right hon. Gentleman the First Lord of the Treasury to have some consideration for the rights of private Members.

MR. ILLINGWORTH (Bradford, W.)

said, it was, no doubt, very important that the Revenue should be collected, but it was the duty of every Member of the House to examine with care the proposals of the right hon. Gentleman the Chancellor of the Exchequer with regard to Revenue. The right hon. Gentleman (Mr. Goschen) must feel that the discussion that evening had been of a most business-like character, and that, in view of the very weighty proposals that had been under consideration, considerable progress had been made. He thought he might tell the right hon. Gentleman the First Lord of the Treasury (Mr. W. H. Smith) that he need not be very anxious about what he called the business of the country. They were all interested in the country's business; but it had become the custom to observe reasonable hours in that House, and to close all discussions at 12 o'clock, unless it was absolutely necessary to go beyond that hour. There had not been any unreasonable delay with regard to the Budget, and there had been no obstruction whatever. [Cries of "Oh, oh!"] He knew that in some dark quarters of the House there was a disposition to enable the Government to transact Business without any discussion whatever; but he was sure that such was not the wish of the House, and he hoped that his right hon. Friend would persevere with his Motion. The Government must feel that there was a strong wish on the Opposition side of the House to have time for the consideration of the next clause, and that it would be very unfair, after the promise given by the right hon. Gentleman the First Lord of the Treasury a short time ago, to attempt to filch away another private Member's night so soon after the last was taken. He hoped that hon. Members on the Opposition side of the House would stand firm, and would refuse to sanction further proceedings upon an important measure at close upon half-past 12 o'clock.

MR. GOSCHEN

said, he would suggest that Clauses 5 and 6 should be discussed upon Report, so that the Committee stage of the Bill might be finished that evening. He knew there was an earnest desire on the part of hon. Members opposite to discuss the 5th clause, and he quite understood the objection that was felt to taking it at so late an hour, He thought, however, that the debate might very well take place upon the Report stage. After all, they were all refreshed by the fact that they had been keeping such good hours recently, and he thought they might devote another hour to the less controversial portion of the Bill. He trusted that hon. Members opposite would appreciate the spirit in which he made this suggestion.

MR. JOHN MORLEY

said, he did full justice to the spirit of the right hon. Gentleman's remarks; but the right hon. Gentleman must be aware that a discussion upon the Report stage would be subject to restrictions, such as inability to speak more than once, which did not exist in the case of the Committee stage. The right hon. Gentleman had stated his notion of a compromise. He (Mr. John Morley) would now offer his, which was that the right hon. Gentleman the First Lord of the Treasury, in consideration of the ready assent of the Opposition to a Morning sitting to-morrow, should promise to grant facilities on an early day for the discussion of the Motion on Education fixed for to-morrow evening.

MR. W. H. SMITH

said, he would endeavour to keep a House for to-morrow evening; but he could not assent to the proposal to give what would be practically a Government day for the discussion of the Motion at a time when the House was in the midst of very pressing Government Business. The right hon. Gentleman (Mr. John Morley) was very well aware that the House could go on to-morrow night until 1 o'clock, and they all desired that the Motion which had been referred to should be discussed as fully as possible.

SIR LYON PLAYFAIR (Leeds, S.)

said, the compromise which had been offered by the right hon. Gentleman the First Lord of the Treasury would certainly not be agreeable to those who objected to the 5th clause. He did not think there were 50 men in the House who knew what that clause really amounted to. There was not the word "beer" in it, and yet it was a beer clause. If the discussion of the clause were postponed until the Report stage, it would not be possible to instruct the public as to the nature of the proposal. Perhaps if the clause were properly explained in Committee to the right hon. Gentleman the Chancellor of the Exchequer and the public, it would be very materially altered before the Report stage.

MR. CONYBEARE (Cornwall, Camborne)

said, before the Committee sacrificed its right of division against this clause, he should like to know exactly what the position was, for he had had some experience of Government tactics. The right hon. Gentleman the First Lord of the Treasury spoke in a gay and airy fashion of going through the Bill to-night; but if a Division was not taken, he wished to have it distinctly understood how long the Committee would be expected to continue the discussion.

Question put, and agreed to.

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