EXCISE.

HC Deb 17 April 1890 vol 343 cc736-88

Motion made, and Question proposed, That, in addition to the Duty of Excise payable under the Act of the twenty-third and twenty-fourth years of Her Majesty's reign, chapter one hundred and twenty-nine, for and upon every Glallon computed at proof of Spirits distilled in the United Kingdom there shall be charged and paid the Duly of Six Pence, and so in proportion for any less quantity."—(Mr. Chancellor of the Exchequer.)

(7.15.) SIR W. HARCOURT (Derby)

I regret very much, as I am sure the right hon. Gentleman will regret, the inevitable absence of my right hon. Friend the Member for Mid Lothian, whose duty and pleasure it would have been to have congratulated the Chancellor of the Exchequer, not on the ability which he has shown—because that is a superfluous task in a matter of which he is a past-master—but on the favourable circumstances in which he finds himself, and upon the relief of various kinds which the right hon. Gentleman has been able to afford to the community. I am glad to find that the Chancellor of the Exchequer, at the beginning of his speech, did not put forward a surplus as being a matter to boast of on the part of a Chancellor of the Exchequer. I ventured last year to say—and I do not know whether the right hon. Gentleman in an observation he made was alluding to it—that a surplus is not always a feather in the cap of a Chancellor of the Exchequer. I am bound to say that the explanation the right hon. Gentleman has given to-night shows that that criticism is not applicable on the present occasion. In some preceding years there has been an excess in the estimate of Revenue or an excess in the estimate of Expenditure. I do not agree with the view of the First Lord of the Admiralty, who, I read this morning, anticipated the Budget, and declared that the increased Revenue is due to a Conservative Administration. The mode in which the Chancellor of the Exchequer has accounted for the increased Revenue does not seem to have any direct connection with a Conservative Administration, except that the great rush for drink which has taken place this year took place previously in the year 1875, under a Conservative Administration. But the Chancellor of the Exchequer said that the growth of the Revenue has been principally in respect of the article rum, and I suppose the First Lord of the Admiralty may, by his exertions, have contributed to that increase, and that that is the reason he takes credit to the Conservative Administration for the large surplus. I am not going — it would be extremely unwise in me — to enter to-night into the very important matters laid before the Committee by the Chancellor of the Exchequer. He has shown one very satisfactory thing—that the Revenue of this country is recovering the elasticity it once possessed. The figures he has given with regard to the Customs and Excise almost exactly reproduce the figures of 1875, which we were in the habit of looking to as the high-watermark of the Revenue of the country. We find that the Customs and Excise in 1876 yielded £47,646,000, and that this year they have yielded £47,580,000, nearly the same figure. Ever since 1875 we have been deploring the falling off both of Customs and Excise. We find now that the Stamp Revenue, which, in 1876, was £10,200,000, has risen to £15,275,000—an increase of £5,000,000. In the House Duty there has been an increase from £1,400,000 to £2,000,000; and in the Post Office Revenue there has been an increase of £1,000,000. The figures show that the general financial condition of the country is not only sound, but elastic. I refer to this only to show that we should not listen to any of the quack remedies which have been suggested in times of financial depression and commercial distress. We hear a great deal about Fair Trade, and are told the country is being ruined, and that the cause of the financial depression is the commercial system of the country. We have now proposed to us another remedy, and that is a dealing with the currency. These are ideas which enter into men's minds when they find there is a temporary depression of trade or of commerce, but in spite of Free Trade and of monometallism, we see that all that distress has disappeared, that trade is reviving, and that finance is returning to its former figure. Therefore, we should wisely come to the conclusion that it is not Free Trade that is the cause of the depression, and that it is not bimetallism that is required in order to restore the finances of the country. Then we were told that the foreigner would drive us from the markets of the world. ["Hear, hear."] Yes, the hon. Member for Sheffield holds that faith, I know. An interesting Report has been issued as to the trade of Germany for the first half of 1889, which is published in the Frankfurter Zeitung. That Report states that the imports into Germany have much declined in consequence of the protective tariff. It goes on to say that it is to Free Trade and her faithful ad- herence to it that Great Britain owes her quick recovery of prosperity, for it enables her to obtain her raw material without additional cost. The result is that, while the amount of German exports has fallen, the amount of English exports is increasing. I believe that the Germans are now beginning to recognise that that condition of things is due to the protective policy of Germany and the Free Trade policy of this country. In his former Budget speeches the Chancellor of the Exchequer has taken rather a desponding view of the recovery of the commercial prosperity of the country. Last year, and in preceding years, he pointed out that the Revenue from articles of consumption had fallen off. I am glad that the circumstances of the time have given the right hon. Gentleman confidence, and have cheered him up a little, and that the recovered condition of the country has induced him to propose the reduction of the duties upon tea and currants. One matter to which the Chancellor of the Exchequer alluded was the increased yield of the Income Tax, and a, very satisfactory increase that is. The increase in the receipts from the Death Duties is also satisfactory. One shows the great growth of the income of the country, and the other is evidence of the great increase in the accumulated wealth of the country, and I think we may safely draw the conclusion that both the commercial system of the country and its monetary system are sound when such results are produced. Talking of the increase of the Income Tax and its relation to the question of the National Debt, I took out some figures which I think are interesting. The figures show that in 1815 it would have required an Income Tax of 4s. 4d. in the £1 to meet the interest on the National Debt; while in 1842 it would have taken an Income Tax of 3s. in the £1 to do it. Now the interest on the National Debt would be met by an Income Tax of 9d. in the £1; and in the beginning of the next century it would probably be met by a tax of 6d. in the £1. That shows the enormous growth in the resources of the country, and we may rely upon its continuance if we do not tamper with the commercial principles upon which the wealth and prosperity of the country are founded. The proposals now made by the Chancellor of the Exchequer will require careful examination. Personally, I have always taken the greatest interest in the reduction of the duty on inhabited houses, and I believe that the proposal of the right hon. Gentleman in that matter will be a great boon to a large class of the community. I regret that the Chancellor of the Exchequer has not carried his proposal even somewhat further. If the right hon. Gentleman had remitted the duty upon all houses under £100 a year it would have amounted to a remission of £1,200,000. Out of a total of £2,000,000, the sum of £1,200,000 is paid by persons who live in houses under £100 a year. We shall, no doubt, go into the matter at greater length in the Bill to be brought in; but I would ask the right hon. Gentleman to consider the figures, with the view of going further than he has done with reference to the limit for Inhabited House Duty. There is another thing to be considered, and that is the great inequality of the House Duty with reference to houses at higher rentals, and the very unfair assessments made on them. Everyone will rejoice that the duty on tea is to be reduced, but no one supposes, I imagine, that the reduction of the duty on tea will stop at 2d. in the pound. This can only be looked upon as a commencement of dealing with the Tea Duty. And the same may be said of the duty upon dried fruit. With reference to the duty on beer and spirits, which it is proposed to increase, I have no sympathy with the beer and spirit interest which would induce me to oppose the increased duty, but I remember that, in the year 1885, a Government was attacked and turned out when they proposed a duty upon beer and spirits not accompanied by a duty upon wine. But I did not hear from the Chancellor of the Exchequer that any additional duty on wine is to accompany the additional duty on beer and spirits. There are some other matters less agreeable than those which are present by their reduction—namely, those which are conspicuous by their absence. The Opposition have always maintained that one of the first duties of the Chancellor of the Exchequer is to remedy the inequality between the taxation on real and personal property. That redress the Chan- cellor of the Exchequer might, and I think should, have found out of the resources of his Budget. The Chancellor of the Exchequer said, I think, last year, that this is a matter which requires time and consideration. So it does, but the Chancellor of the Exchequer has had time and consideration, and from a Minister of his great and known ability and experience the country had a right to expect there would be a serious attempt to redress the present injustice in our financial system. There is another question which appears to me of capital importance. The Chancellor of the Exchequer has a surplus of about £3,000,000, but he is not sanguine of any great increase in the Revenue, and, therefore, cannot calculate in future years upon surpluses of the same character. What is he going to do with the question of assisted education, to which the Government have pledged themselves? The Prime Minister said the question of assisted education would depend upon the surplus the Chancellor of the Exchequer had this year. Not a word has been heard on that subject to-night. The fund out of which education can be assisted has been given away. We had a right to expect that such a sum would have been reserved out of the surplus as would have enabled the Government to redeem the pledges they have given with respect to education. I hope that before we part with the surplus we shall hear something from the Chancellor of the Exchequer on that subject. I hope it was by an oversight the Chancellor of the Exchequer made no statement on the subject. I will not detain the Committee any longer than to ask one or two questions. First of all, with reference to the coinage. The plan of paying for the deterioration of the gold out of the profit on the silver is one which, by anticipation, I have approved. The Chancellor of the Exchequer has spoken on this subject on former occasions, and has always said that he regards it as connected with the question of the £1 note. I think it important that the Committee should have that subject fully discussed. I think the two questions are very closely connected, and we ought to have a statement from the Chancellor of the Exchequer on the subject. I know the great influence the Chancellor of the Exchequer possesses with the moneyed classes in the City, and I believe that a proposal on the subject of £1 notes coming from him would be very useful. With reference to the Floating Debt, the right hon. Gentleman has said truly that there has been a large reduction of the Funded Debt, which has been accompanied by a very sensible increase in the Floating Debt of somewhere about £18,000,000.

MR. GOSCHEN

The increase in the Floating Debt in the hands of the public has been £9,000,000.

SIR W. HARCOURT

I only desire to ask the Chancellor of the Exchequer whether he means to make any special proposal or provision with reference to the Floating Debt. In the variations of the Money Market the Chancellor of the Exchequer may be caught with the Floating Debt, and, indeed, I believe that for a few months in this year he was caught, and was paying more than 4 per cent. on the Floating Debt. There is only one other observation I desire to make, and that is with reference to the form of the Revenue Returns. They are greatly amended, but in some of the Returns of the Revenue which are published, especially the Quarterly Returns, the gross produce of the taxes is not given, but only the net produce which goes to the Government. That may be very well as a matter of account. It treats the taxes which go to the Local Authorities as if they had not been received at all. But the result is that in the case of the Excise it shows an apparent decrease, whereas, in point of fact, there has been a large increase. That misleads the public very much. I think the form which shows the gross produce and the amount transferred is the best. And now I have only to congratulate the Chancellor of the Exchequer and the country on the revival of prosperity which is shown in the condition of the Revenue, and the Chancellor of the Exchequer may be quite sure that there will be every disposition to deal in a spirit of candid criticism with the proposals he has made for dealing with the Revenue. After a period of depression we seem again to be rising on the crest of the wave. It is very difficult to explain what are the causes which have led, throughout all the countries of Europe, to a depression of trade. I do not think the causes have yet been ascer tained. In trade, as in harvests, there seems to be cycles—seven fat years and seven lean years—and none of those variations ought to disturb the determination of the people of this country to adhere to the general financial and economic policy of the country which has brought such benefits to it, and has placed its finance upon so sound and satisfactory a basis.

*(7.42.) MR. HOWARD VINCENT (Sheffield, Central)

I will not now follow the right hon. Gentleman the Member for Derby (Sir W. Harcourt) in his references to the question of Fair Trade, some better opportunity will soon occur. Before making one or two observations upon the Budget laid before the Committee by the Chancellor of the Exchequer, I should like respectfully to congratulate the right hon. Gentleman and the Government upon the two great concessions which they have made. The first is the effect, the generous effect, they have given to the recent Resolution proposed to the House by my hon. and gallant Friend the Member for Birkenhead (Sir E. Hamley), and which I had the honour of seconding. The effect given to that Resolution will, I am sure, be heartily welcomed, not only by the public at large, but by every officer and man in the Volunteer Force. I can only express the hope that the greater control which the Government propose to take over the Volunteer Force by reason of this increased liberality will not take the form of harrassing and trivial regulations. I also thank the Government for what they propose to do as regards the superannuation of the Police Force. The Police Force have waited long and patiently for a great many years, and I am sure it is gratifying to those who admire their services that those services are at length appreciated by the House of Commons. I am sorry to learn from the speech of the Chancellor of the Exchequer that, in spite of the earnest protests of all the leading firms in the silver trade, he has decided to take off the duty which was at once a source of Revenue and a great preventative, I am assured on all hands, of fraud upon the purchaser. I very much doubt if anyone will thank him except one well-known dealer, who has agitated this question for a great many years, and, possibly some Indian exporters of silver.

MR. GOSCHEN

I made one great omission in my speech, which I regret. I ought to have spoken upon the subject of hall marking, which is mixed up with the Silver Duty. When I come to reply I will deal with the matter, but I may inform my hon. and gallant Friend and the Committee that we do not propose to abolish the compulsory system of hall-marking.

*MR. HOWARDVINCENT

If the right hon. Gentleman assures the Committee that the matter of compulsory hall-marking, to which the trade attaches enormous importance, and upon the maintenance of which it is unanimous, will not be dealt with, I will not proceed further into that question. But, as regards the duty, I should like to say a few words. I do not hesitate to once more call the attention of the House to the fact that every prominent manufacturer in the country is, so far as I have been able to learn, against the abolition of the duty. The silver trade is a flourishing industry. The statistics regarding it prove this, and a recent Parliamentary Return shows that there is a vast increase in the quantity of silver upon which duty was paid in 1886–8, as compared with the year 1879–80. In London the increase was from 442,000 ounces to 535,000 ounces. In Birmingham the increase was from 75,000 ounces to 122,000 ounces. In, Sheffield the increase was from 73,598 ounces to 162,852 ounces, or more than double. There has also been an increase in the quantity of silver exported, and upon which drawback has been allowed in London, from 73,000 ounces in 1879–80, to 101,000 ounces in 1886–87. In value, the increase has been over 75 per cent. The only thing which has held the trade back in recent years has been the perpetual agitation in favour of an upheaval of the system which has worked well, an agitation which has disorganised trade to a very large extent. Let me mention what the duties are. First of all, there is the duty upon gold plate, which is not compulsory, of 17s. 6d. per ounce, and that, I understand from my right hon. Friend, is not to be touched. Secondly, there is a duty of 1s. 6d. an ounce upon silver plate, which is compulsory. Thirdly, there is a countervailing duty upon gold and silver plate imported into the United Kingdom, equal to the Excise Duty, and lastly, there are the licences to sell gold and silver plate. My right hon. Friend has not stated whether he proposes to do away with these licences. I trust he intends to do so; the trade confidently expect he will do so if the duty upon silver plate is abolished. These sources of Revenue have produced to the Ex chequer, on an average, as I gather, upwards of £130,000 a year, or, in round figures, £72,000 Excise Duty, £10,000 Import Duty, and £48,000 from licences. Will anybody thank the Chancellor of the Exchequer for taking away this considerable source of national income? Mr. Edward Watherston may do so, but there are, indeed, few others. In 1883 the right hon. Gentleman the Member for South Edinburgh (Mr. Childers) was Chancellor of the Exchequer, and he thought he would abolish these duties, but so strong was the opposition of the trade that, on the 17th of April, 1883, my right hon. Friend and Colleague, the Member for the Brightside Division of Sheffield (Mr. Mundella), wrote to us— The Government definitely abandon the proposal to repeal the duties upon silver plate. Upon this subject 19 of the largest firms in the country addressed to the Chancellor of the Exchequer, on the 18th of December, 1888, a Memorial, in which they said: The agitation for the remission of these duties does not proceed from the public or the trade at large, but from a very unimportant minority, who have next to no interest at stake, and we, the representatives of firms who pay more than four-fifths of the whole duty, desire to protest against the representations constantly made by these agitators as being far from true. Similarly, the Sheffield traders last year memorialised the Chancellor of the Exchequer to the effect that— The majority decline to believe that the repeal of the duties on silver will stimulate the purchase of silver plate; that the tax falls almost entirely upon a class well able to bear it, and from which no urgent demand for its repeal has arisen. There is also the question of drawback. I understand that the Chancellor of the Exchequer proposes that only two years' drawback should be paid to the trade, estimated at about, I think he said, £120,000 or £130,000. I feel convinced of this, that two years' drawback will by no means satisfy the trade. There are considerable stocks on hand upon which it is only fair that, if the duty is abolished, drawback should be paid in full. To give only two years' drawback would be impolitic and unfair to the trade. I need not press further upon the arguments. I have already detailed them, and they have appeared in the Press, and been endorsed by 54 of the leading manufacturers of silver plate in Sheffield and London, and by the principal firm in Birmingham. These firms pay seven eighths of the duty which is now to be remitted, and they beg the House to leave the Silver Duty and the compulsory hall-marking unaltered. I am glad to hear from the Chancellor of the Exchequer that he does not propose to touch the compulsory hall-marking, to which the silver trade throughout the country attach the very utmost importance; but I fear that now the duty is abolished, the apprehensions of some, that it will be exceedingly difficult to retain compulsory hall-marking, will be realised. In conclusion, I will only say that, despite the brilliant and popular Budget laid before the Committee by the right hon. Gentleman, I cannot help saying that I hope the time will come when he, or succeeding Chancellors of the Exchequer, will lay before the British House of Commons Budgets which will deal, to use the right hon. Gentleman's own phrase, with British interests alone, and seek alone to encourage British manufacturer and production.

*(7.55.) Mr. MONTAGU (Tower Hamlets, Whitechapel)

I am pleased the Chancellor of the Exchequer proposes to deal, in a comprehensive manner, with the question of light gold, but I must join the right hon. Gentleman the Member for Derby (Sir W. Harcourt) in the hope that the Chancellor of the Exchequer will see his way to give the public the boon of £1 notes. In past times we exported a great many old Dragon sovereigns to Ceylon, where they were used for ornaments, and in Europe and America large quantities of our gold have been melted down. At the time of the Paris Exhibition English heavy gold was melted down, and only the light gold coins returned. The cause of all the trouble is, as I have already explained in the House, that we coin our gold absolutely free of charge, whereas other countries make a moderate charge for minting. If we charged a small amount, even ¼ per cent. it would preserve our sovereigns, and we should not again be called upon to spend the £600,000 as proposed. I do not advise that we should alter the value of the coin, but I should like to have increased weight, using gold 9–10ths fine, which would make the coin more durable. I would also suggest that the Bank of England should be authorised to receive fairly worn gold coins, and melt them down at the cost of the State. I am very glad to hear that the right hon. Gentleman proposes to abolish the duty on silver plate. A portion of the present duty is absolutely protective, because 1s. 6d. per oz. is charged on all foreign imported silver plate, while only 1s. 3d. per. oz. is charged on plate of British manufacture. I am glad, too, to find that the compulsory hall-marking is to be retained, because the charge is exceedingly small, and it prevents unscrupulous dealers from deceiving the public, and so injuring the whole trade. That is a kind of dealing which was practised when hall-marking of gold chains was not made compulsory, and it was said, I remember, that a copper coal scuttle and half a sovereign would make a goldsmith's stock of gold chains. But the tendency of modern legislation is in favour of protecting the public from adulteration, either in food or in the material of the goods they buy. On the other hand, I do not see why there should not be some modification in the hallmarking of silver plate. It is done in the marking of gold. You can hall-mark gold at 22, 18, 15, 12, and even 9 carats; why should not manufacturers be allowed to hall-mark different qualities of silver? Why not have in addition to our present standard of hall-marking at 925 the Indian standard of 916, the French standard of 900, the German of 800, for it is found that the lower qualities are more durable in wear? An arrangement of this kind would remove a great hardship. It sometimes happens that a work of art in silver of high artistic merit is sent to be hall-marked, and if it does not happen to come up to the standard of 925 this beautiful piece of workmanship is liable to be broken up; whereas if a modification were allowed, it could be marked at a lower standard. Passing from the silver plate question, I should like to direct the attention of the Chancellor of the Exchequer to another subject. He has made a great reduction—a grand reduction—in the Debt of the country by his conversion scheme; but he might make another considerable saving by converting, or better still by re-paying, the Turkish Four per Cent. Guaranteed Loan. There is now a favourable opportunity, for the Turkish Government have agreed to convert their outstanding Debt, and it might be a favourable opportunity to get France to assent to the conversion or re-payment of these Bonds. It would be a saving of over £20,000 a year in respect to£2,000,000 of these Bonds that have been drawn fur payment, yet by some extraordinary circumstances have not been paid off. If no other means are adopted this country can borrow for the purpose at 2¾ per cent., and France at 3½ and there is no reason why we should keep this outstanding Debt at 4 per cent. At any rate, the Chancellor of the Exchequer could arrange that the Treasury should hold these Bonds. A short time since the Chancellor of the Exchequer refused to state the amount received from transfer stamps on Stocks and Shares to bearer, not wishing to anticipate his Budget Statement. He has not now indicated the amount, but in his long speech it is excusable if he omitted some minor details. But perhaps he will tell us now what the amount is, and will consider whether the time has now arrived to change this very obnoxious tax. Irksome and obnoxious it undoubtedly is to everybody concerned. I know for a fact that people come to a broker's office on settling day with a mass of small bonds, and it is practically impossible for them to affix the adhesive stamp in time for settlement. Indeed, I have been told the Chancellor of the Exchequer's life would scarcely be safe if he ventured within the precincts of the Stock Exchange, so great is the irritation caused by this transfer stamp. There is no objection to the payment of the money if only some other means could be found for exacting it; but the manner in which the tax is paid by affixing adhesive stamps, which will in time cover the bonds, is the cause of general complaint.

(8.5.) MAJOR RASCH (Essex, S.E.)

An agricultural Representative is not expected to be a financial expert, and I am the last man to lay claim to such a character; but the Chancellor of the Exchequer has devoted a considerable portion of his speech to the subject of local taxation, and has granted an amount of £400,000 to reinforce the resources of County Councils, for which we are by no means ungrateful; and I hope I shall not be considered presumptuous if I suggest a method by which, without increasing taxation, he might increase his sources of revenue and give still further aid to the agricultural interest. As the right, hon. Gentleman and every Member of the Committee knows, the law is continually evaded in connection with the transfer of shares. The amount of the share is constantly put at 10s., whereas the money absolutely passing amounts, perhaps, to £1. If the right hon. Gentleman would introduce a Bill to provide that the nominal amount of the money paid for the transfer of Stocks and Shares shall be printed on the stamp, and that if this is not done the transfer shall be null and void, the right hon. Gentleman might get a considerable increase of revenue. Then, again, the Chancellor of the Exchequer is not particularly tender-hearted when he attacks a big interest. He has very properly taxed champagne, and put a ¼ per cent. on gin distilling, but I should like to ask him on what possible consideration is it that a beverage which has 15 per cent. more alcoholic strength in it than good port, sherry, or hock, should absolutely escape all duty whatever—I allude to British wines. If the right hon. Gentleman will take these two matters into consideration I think he might raise sufficient revenue to give us an extra £500,000 a year. I hope he will not think me presumptuous in calling attention to these matters. I only do so as a Representative of a section of that hard-working, uncomplaining class—the agriculturalists.

(8.10.) MR. RATHBONE (Carnarvonshire, Arfon)

I just wish to ask one important question arising out of the latter part of the right hon. Gentleman's speech. I am sure that he, with his commercial experience, will realise the fact that when he proposes to buy up a number of these licences and at the same time to restrict the issue of further licences, that will have the effect of adding enormously to the value of existing licences, and I would ask him if he has taken any precaution that this enormously enhanced value shall not be brought in as a charge for compensation when this great question of licensing comes up for settlement.

*(8.11.) MR. BROADHDRST (Nottingham, W.)

I have only one question to put, and in doing this I must express my regret that out of his large surplus the right hon. Gentleman has not seen his way to deal with the appeal made by Trades Union to two or three Chancellors of the Exchequer that the Income Tax charged on the incomes of Trades Unions derived from investments in real property should be remitted as I believe it is in the case of Friendly Societies. It is a very small item in the National Revenue, but it would give very great satisfaction to those Unions who have so invested their savings, and it would very much encourage further investment in the same direction, a policy which I think everyone will commend. I do not know whether it is too late for the right hon. Gentleman to consider this question, and if it is not I hope he will do so. The amount of revenue derived from this source is but a few thousands a year, and not at all considerable as compared with the great pleasure it will give to those concerned. Then I have only one other word to address to the Chancellor of the Exchequer. He referred, in that portion of his speech in which he spoke of the prosperity of the country during the last few years, to the great caution with which we must regard the prospects of the trade and industries of the country in the next few years; and then, in that portion of his speech he seemed to declaim somewhat strongly against the institution of strikes, speaking with strong emphasis as to their discouragement. Well, of course, we all discourage strikes where we find it possible to do so; but I would beg the Chancellor of the Exchequer to remember that in periods of great prosperity it is the only means labour possesses of enforcing its claim to a share in the general prosperity of the community. I do not say the right hon. Gentleman intended his remarks to be so interpreted as a severe censure of strikes, but I do say that will be the interpretation placed upon his words by those who speak and write a great deal against labour combination. I am giving my own impression, but I think it is an impression that will be created outside that the Chancellor of the Exchequer was unduly severe on the extreme action taken by many Labour Associations to enforce their claims to a greater share in commercial prosperity. One of the most notable strikes daring the past financial year, the Chancellor of the Exchequer will remember had the support of all classes of society, rich and poor, at home and in our colonies. In every direction it seemed to meet approval from Bishops, philosophers, and political economists. It would almost seem, from his language, that the Chancellor of the Exchequer wished to revive obsolete theories of political economy which events of recent years have done so much to destroy. I hope he will avail himself of the opportunity at a later stage of qualifying, if not his language, at least the impression his language may convey. This with the reference to the claim of Trade Unions for exception from tax on their real property is the only observation I have to offer now, though I do not say there are not other portions of the Budget open to criticism and adverse comment.

*(8.15.) SIR R. FOWLER (London)

I think the Committee must have listened with great pleasure to the very clear Statement we have had, and there are many subjects in it that will have the greatest interest for the country. It is to be regretted that it was not made earlier in the year. Much in it will be keenly criticised both in the great centres of this country and in foreign capitals. I am glad my right hon. Friend proposes to deal with the coinage, and I thank him for his action; and, so far as I understand his scheme, it is a satisfactory method of dealing with the subject. And now I am going to give utterance to what I am afraid will be an unpopular sentiment. I certainly listened with great regret to one part of the Budget, and that was in relation to the duty on tea. I cannot but feel it is a very serious thing to take away a permanent source of revenue. The Tea Duty is not a heavy burden; it is a revenue that comes in very easily. Of course, the expenses of collecting the duty will remain the same, whether the tax is 4d. or 6d., and I do not suppose the right hon. Gentleman anticipates any increase in consumption. I must say that I think that to reduce a source of revenue that brought in a large amount with little trouble is an important step, and a step which I—though I know not many will agree with me—regard with regret. I should have liked that with this considerable surplus—the Chancellor of the Exchequer said it is not large, but he admitted it is considerable—I should have been very glad if he had seen his way to remitting a penny from the Income Tax. The Income Tax presses very heavily on the middle classes. Of course, if a man has an income of £20,000 a year, he can without inconvenience pay a 6d., or even a 1s., Income Tax; but the present rate of the tax does press heavily upon a large and important class. The right hon. Gentleman alluded to what I have always thought would be a very great advantage to the country. He said he had considered the question of remitting the tax on incomes less than £400, but he found that the loss resulting to the Revenue would be too great. I recollect saying in 1873, when the right hon. Gentleman the Member for Mid Lothian went to the country with a promise of the abolition of the Income Tax, that I was not prepared for that, but that I did think that incomes up to £400 might be excepted. However, the right hon. Gentleman did not find his panacea accepted by the country, and he did not return to power; and when, after six years, he again came into office he had changed his view of the tax. I do not know what view he may hold now; but I think it is a principle of hon. Gentlemen opposite to put all that is possible on the Income Tax, and to cut down other sources of revenue. Of course, we all recognise how valuable this tax is in a time of national exigency, but in a time of prosperity like this the classes who pay the Income Tax are justified in expecting some relief, and I should have been glad had the Chancellor of the Exchequer seen his way to afford that relief. However, he has taken a different course, and I must say many of the remissions he proposes will be very welcome to the country. I am particu- larly glad he has made the remission in the House Duty; it will be most acceptable to a large and deserving class. I congratulate him also on his proposal for reducing the postage to India and the Colonies. I was glad also to hoar his remarks in reference to the trade in alcoholic liquors, and his attitude in this respect must commend itself to a large class in the country. I do not think the hon. Baronet (Sir W. Lawson), who may be taken as the apostle of the view that publicans are entitled to no compensation, was present during the speech; but in anticipation of the objections that may be raised by this section of Members I may say that I hold the view that publicans carrying on legitimate business under the sanction of the State deserve that their interests shall be considered in any changes that are made. It would be a gross injustice to deprive a man of his means of livelihood without offering any compensation. Although I think the Budget has those defects to which I have alluded in reference to the Tea Duty and the Income Tax, I congratulate the right hon. Gentleman on the approval with which his able Statement will, I think, be generally received.

(8.22.) MR.OCTAVIUS V.MORGAN (Battersea)

Perhaps the hon. Baronet will be surprised to hear a Member from this side sharing in his regret that there is to be no alteration in the Income Tax. I have no wish to see any reduction made in respect to larger incomes, but I am exceedingly sorry to find myself disappointed in the hope that the amount of deduction allowed would have been increased from £120 to £150, and the tax imposed on incomes of £500 instead of £400. I am sure a proposal of that kind would give great satisfaction. I speak with knowledge, for I have been an Income Tax Commissioner for 17 years. In Committee of Supply, the hon. Member for North Camberwell (Mr. Kelly) drew the attention of the Chancellor of the Exchequer to the House Tax on tenements, and I, following him, drew attention to the large number of houses now built with separate entrances for two or three families. I desire on my own behalf, and on behalf of my hon. and learned Friend, to tender grateful thanks to the right hon. Gentleman for his concession made in this matter. No part of the Budget will give more satisfaction to a large number of struggling families in London than this concession. In regard to the reduction of the duty on currants the right hon. Gentleman has told us of arrangements with the Greek Government, by which they undertake to make reductions on imports from this country. I am most anxious to see closer commercial relations with Greece, and have no doubt these arrangements will conduce to that result. But the Chancellor of the Exchequer did not tell us if the Greek Government will make any change or reduction in the Export Duty on currants.

MR. GOSCHEN

I am obliged to the hon. Gentleman for mentioning the matter. We have an engagement from the Greek Government that they will not increase the Export Duty on currants, or in any way take advantage of our concession.

MR. OCTAVIUS V. MORGAN

I was in hopes they would abolish the Export Duty on currants. However, they give us advantage in another way by making large reductions in their Import Duties on English manufactures. The right hon. Gentleman is to be congratulated on a very successful arrangement. I am exceedingly glad also that the question of police superannuation is to be settled. There has been for some years a considerable feeling of dissatisfaction among the Metropolitan Police on this ground, and this deserving body of men are fully entitled to what is proposed on their behalf.

*(8.25.) MR. PROVAND (Glasgow, Blackfriars)

I think the Chancellor of the Exchequer is fully entitled to congratulation upon the main features of his Budget. It has been urged against his previous Budgets that the consumers' interest had not been protected as it ought to be, but I think that on this occasion the right hon. Gentleman has saved himself from any charge of that kind. The right hon. Gentleman has told us that he did take duty off tobacco for the general consumer; and it might be called a taking off of duty, but it might just as accurately be called the correction of a mistake made by a previous Chancellor of the Exchequer. Of course on this side, and I hope by many on the other side, the reduction of 2d. on tea will be accepted as at least something on account. But I know on this side it will not be considered sufficient. I think the right hon. Gentleman may make up his mind that he will hear more of it, and I think a Division will be taken. I am pleased to hear of the reduction in the duty on currants; but the remarks of the hon. Member who has just spoken reminds me that when I was in Athens some two months ago this matter came up in conversation with a man who, above all others in Athens, was able to give an assurance, and he assured me that if we took the duty off currants they would at once take off the Export Duty. It is but a small duty, a sixth or a seventh, of our Import Duty, but, however, my informant said nothing in respect to reductions of duties on English imports; and it may prove to be the case that the concessions obtained on these will be of more advantage to us than the abolition of the Export Duty on currants. With regard to the change in the House Duty, I may call attention to the fact that it will add to the number of existing anomalies in respect to this duty. The principle on which the duty is charged, that is on the rental value, is a fair one; but, unfortunately, that principle is only carried out in reference to small houses, it is not carried out in respect to largo country houses, mansions, and castles, which are rated far below their actual letting value. On one point Scotch Members are naturally much interested, the £144,000 to be granted to Scotland. Our share of the Probate Duty was applied to freeing, so far as we could, the first five of the educational standards. The amount was hardly sufficient; and I hope, in the allocation he makes, the right hon. Gentleman will remember that we still require something to free all the standards in every school in Scotland. On account of the sum formerly given being insufficient, we have what are very much disliked—graded schools, schools where fees are charged, but which also receive a share of the Probate Duty. Therefore, I hope the right hon. Gentleman will consult. Scotch Members as to the application of the £144,000, and I am sure he will find the general desire will be to free all the standards in every school, and also to apply part of the money to evening or continuation schools. The feeling upon this point among the Scotch Members will be practically unanimous. When it was proposed last year to apply our share of the Probate Duty entirely to freeing education, there was not a single dissentient voice against the proposal, and we all feel that the Chancellor of the Exchequer could not do better than apply part of his surplus to freeing the standards in those schools which still charge fees, and in assisting evening and continuation schools. (8.31.)

*(9.4.) MR. HUGH WATT (Glasgow, Camlachie)

I congratulate myself on having been present this evening to listen to one of the most able, exhaustive, and practical addresses ever made by any Chancellor of the Exchequer during the present century, and I may add that in my opinion, when the political history of this country comes to be written, the right hon. Gentleman will be entitled to a place, as one of the most successful as well as the most able financiers the country has ever known. I should like, without unnecessarily occupying the time of the House, to call attention to a subject of great interest, magnitude, and importance, in connection with the operations of a body of men who are practically an irresponsible body, who are called upon to deal with transactions representing many thousands of millions per annum. I allude to the Stock Exchange. On this subject I might remind the House of the recommendations made by the Royal Commission of 1878, a Commission which was composed, for the most part, of exceedingly able and practical men. Since the Commission conducted its investigations the Brokers' Relief Act of 1884 was passed—an Act which destroyed all public control over the operations of the Stock Exchange. The hon. and gallant Member for Essex and the hon. Member for Whitechapel have referred to stamps in transfers and Foreign Bonds. I am convinced that the only effective way to prevent the Revenue being defrauded is by carrying out the recommendations of the Royal Commission, and granting a Charter to the Stock Exchange.

THE CHAIRMAN

Order, order! I beg to remind the hon. Gentleman that he is travelling somewhat beyond the question which is at present before the Committee.

*MR. WATT

I thank the hon. Gentleman for the intimation he has given, my excuse for seizing the present oppor- tunity being that as the Government have appropriated private Members' nights another will not be afforded during the present Session. I will not pursue the subject further. There is, however, one matter with regard to which I should like to offer an observation. I refer to sparkling wines, in regard to which I maintain that no advantage is at present derived by the consumer. The tax on those wines is one which is a very slight advantage to the country at large, while it certainly has an injurious operation upon the trade, and I trust that the right hon. Gentleman the Chancellor of the Exchequer will take the matter into his careful consideration. I am authorised to state that the trade would much prefer a 3s.or even 4s. rate to a differential tax as at present. With regard to another subject, I must confess that I should have liked to have seen a penny taken off the Income Tax; but as that seems to be an impossibility at the present moment, and in the present stage of the financial condition of the country, I trust that by-and-bye he will be able to see his way to the wiping out of that imposition in its entirety. I would only remind him and the House that that tax was originally imposed as a War Tax, and was never intended to be a permanent burden on the people of this country, nor do I think it should be allowed to become a permanent tax, because in the event of war or any other great and pressing emergency, it would be very difficult, should that burden be continued in its present form, to find the ways and means of meeting the demands thus created. In conclusion, I have only to repeat my congratulations on the able and satisfactory Financial Statement which has been presented by the right hon. Gentleman, and to express my opinion that it will meet with the general approval of the country.

*(9.9.) SIR R. LETHBRIDGE (Kensington, N.)

I desire, Sir, as one who has some claim to speak on behalf of our fellow-subjects in India to express to the right hon Gentleman the Chancellor of the Exchequer my deep satisfaction at the announcement ho has made of the intended abolition of the duties on silver plate, an announcement which I am sure will be received with much gratification throughout the length and breadth of that country. I am quite certain that the action of the Government with regard to this matter will be hailed by the people of India as a distinct mark of the sympathy felt in this country for its greatest Dependency. Like the quality of mercy, this remission will be twice blessed—it will be blessed to the country that gives it, and also to the country that receives it. On the one hand it will undoubtedly quicken the silver export trade of India, while it will encourage the art manufacture of silver in that country; but, on the other hand, beyond this it will multiply for us in this country those beautiful objects of art which are manufactured in India, and which, in the present state of metallic art in this country, cannot be produced here, and which, in fact, can only be manufactured by the Indian artificer. Furthermore, it will tend pro tanto to re-habilitate silver, at least to a certain extent, and thus will tend to afford relief to the agricultural and other interests of this country which are naturally affected by the appreciation of gold. The right hon. Gentleman the Chancellor of the Exchequer has alluded to the opposition which has been offered in anticipation of this remission of taxation by the traders of Sheffield, and some other centres of the silversmiths' art in England. These manufacturers fear to meet the competition of the Indian artificers in their own trade, but I venture to submit that their fear is based on an entire misapprehension. The silver manufacture of India is entirely unique, being mainly composed of filagree work, grotesque and otherwise, requiring very laborious hand labour, of a kind certainly not likely to be carried on to any large extent by the silversmiths of this country. Having said this I should like to pass to another part of the right hon. Gentleman's Statement, which deals with a subject of vital importance to the people of India, and that is the proposed remission of the duty on tea. I feel bound to say, as being myself a proprietor of tea gardens in Ceylon, that the Indian and Ceylon tea industry will not gain, but will rather lose, by the proposed remission of duty, because it is probably not understood in England that the remission of duty will act, to a certain extent, as a bounty or premium on the low-priced China teas, and to that extent we should be discouraging the growth of the superior and higher priced Indian and Ceylon teas. But my right hon. Friend foreshadows that the Empire will gain by the proposed remission of taxation. He puts it that the consumers may possibly gain 2d. per pound by the remission. I hope they may; but I doubt whether they will gain anything like that amount. I am afraid that a good deal of it will stick to the middleman on the way. Nevertheless, that the consumer may possibly gain something I am free to confess, and I would sooner see my working-class friends giving up their gin and other alcoholic drinks, and taking to tea, oven if they took to the low-priced and inferior brands of China. I consider the Budget of my right hon. Friend is distinctly a temperance Budget, and as such I had it most heartily. The provision which is made by the right hon. Gentleman under which the County Councils will be able to control the supply of temptations to drink is, in my opinion, a most statesmanlike provision. The local veto has hitherto, as we all know, generally been hampered by this dilemma, that it involved a heavy local expenditure, in order, in the exercise of that veto, to stop the supply of temptations to intemperance; or, on the other hand, it meant the distinct robbing of the licensed victuallers, by depriving them of their licences without any compensation whatever. Well, Sir, the right hon. Gentleman's proposals clearly postulate the principle of compensation to those whose licences are to be taken away from them. That, in my opinion, is the only principle which is compatible with national honesty. It is the principle which was laid down in the most emphatic manner by the right hon. Gentleman the Member for Newcastle, in the published letter which he addressed some years ago to a licensed victualler in my own constituency of North Kennington, and it is a principle that I trust this House will maintain. The proposals of the right hon. Gentleman will at once, and perceptibly, reduce the number of licensed houses. It may be said, in fact, that this Budget of my right hon. Friend greases the wheels of temperance, whilst it acts honourably and justly by the licensed victuallers, and to every other class of the com- munity, and as such, Sir, I hail it with the utmost enthusiasm.

(9.20.) MR. CALDWELL (Glasgow, St. Rollox)

Mr. Courtney, the surplus at the disposal of the Chancellor of the Exchequer is £3,500,000, and that surplus is brought about by the increased consumption of spirits and beer. The question is in what way is that surplus to be disposed of. I venture to say that the Chancellor of the Exchequer makes a very great mistake in not availing himself of this opportunity of giving Free Education to England, equally with Scotland. A contest will arise at the next election with regard to this question of Free Education, and then the country will be told that there is no surplus for the purpose.

MR. GOSCHEN

What election?

MR. CALDWELL

The General Election. For Free Education in the three countries £2,250,000 would be required. That would absorb so much of the surplus. Then, as to the Inhabited House Duty. That would take £540,000, which still leaves £750,000 to be disposed of in any way the Chancellor of the Exchequer might think fit. As to the reduction of the Tea Duty, it is a question how far the consumer will reap the benefit of it. We know that in the case of the London Coal Dues, the consumers have not reaped the benefit yet. Therefore, we should take care that the surplus really confers benefit when benefit is intended. The reduction of the Tea Duty will benefit the family man, not the workman who has to attend a coffee shop to get his meals. But if you abolished the School Fees the family would thus directly get the benefit of the money. And there is great reason why the surplus should be applied in this way. The consumption of spirits may be taken to have remained stationary among those above the rank of the working classes, and the increased revenue from the consumption of spirits has been derived from the working classes. If the House is really to look to the proper application of the money, I would contend that the families which have been impoverished by this increased contribution to the Revenue, for alcohol, should be benefited by the application of part of the surplus to Free Education. It is evident that the system of the Conservative Government is to give grants in aid to local taxation, of which the landlords get one-half of the benefit. I contend that this money having come from the working men should go back to them, to benefit their families, and not to the pockets of the landlords. We have got the Chancellor of the Exchequer in a difficulty. In dealing with the distribution of the Probate Duty between England, Scotland, and Ireland he proceeded on the basis of population. It has, curiously enough, been left to a Conservative Government to deal with the three Kingdoms separately. The result has been that the richer country got the larger grant, and Ireland, the poorer, got the least. You are going now to deal with a surplus raised from Excise. Is it not a notorious fact that Scotland pays more for exciseable liquors than England? Yet what does the Chancellor of the Exchequer propose to do? To give Scotland less than her share. In this case the Chancellor of the Exchequer has told us that the money is to be divided between the three countries, according to the precedent of the Probate Duty distribution.

MR. GOSCHEN

The hon. Gentleman is not correct. The amount of the Probate Duty paid by England is far larger in proportion than that paid by Ireland and Scotland, but the Probate Duty was distributed according to the total contribution of Revenue from each country. Though England paid by far the larger share, we arranged that it should be changed in the direction of easing Ireland and Scotland by distributing the duty in a manner more satisfactory.

MR. CALDWELL

The population of England is seven times that of Scotland, and the amount granted to England exceeds that granted to Scotland in proportion to the population. It may not exceed the actual amount of Probate Duty paid, but that it, in point of fact, exceeds the amount paid in proportion to population is undeniable. With regard to this new surplus, Scotland will pay an inordinate share, yet she will not get a proportion equal even to her population. I do not suppose the Chancellor of the Exchequer means to do the slightest injustice to Scotland, but, by giving Local Government to Scotland a year in advance, he did us out of £80,000. I do not suppose he will take anything from us this year. I think the Budget, so far as regards two points, at any rate, will not meet the expectations of the country. I had hoped that when the Local Government Bill for England was before the country, and the Government were compelled to withdraw the compensation clauses, we had, once for all, heard the last of compensation to publicans. I do not know why the Government should have entered on a case of this kind at this moment. I do not suppose that the cause of temperance is weaker now than at other periods, and I think that this, like the Van and Wheel Tax, will militate very much against the Government. As to police superannuation there may be a considerable difference of opinion in the country on the matter, and I think it is a pity that the Chancellor of the Exchequer should have mixed up his Imperial Budget with an attempt to manage and control Local Bodies who are to receive grants in aid. He would have saved himself a great deal of trouble, if, having money to hand over, he had given it to the Local Authorities, without instructions as to how they were to dispose of it.

*(9.33.) MR. BARTLEY (Islington, N.)

I congratulate the Chancellor of the Exchequer on his Budget from the point, of view I indicated last year, namely, that it. is a step towards making the incidence of taxation fairer between the richer and poorer classes, of the community. [Laughter.] The hon. Member for Northampton laughs, but there is no doubt it does do that. I have always held that, under the present incidence of taxation, the richer classes pay a smaller proportion than the poorer classes, and I think, when the figures are gone into, it is impossible to deny that. I do not say the Budget equalises the incidence, but it goes a long way towards it. The Chancellor of the Exchequer seems to have relieved in all directions those persons who pay a larger amount in the £1, on their incomes than they are entitled to pay according to the general incidence of taxation. The relief on the Inhabited House Duty, and the reduction of the Tea Duty, will sensibly affect the poor. As to Free Education, it is very easy when a Budget is produced to say, "If something had been done in this direction it would have been better." Of course we should all like to have everything relieved. I suppose every sort of taxpayer would like, out of the surplus, to get the whole of his taxation remitted, but, as we know, that is impossible, and it seems to me that the right principle to adopt is to do our best to so adjust taxation that all classes shall pay according to their means. I have worked it out, and I find that if the whole Revenue were raised by Income Tax, the rate would be about 1s. 2d. in the £1, but capital only pays 6d. in the £1, and whatever tends to diminish this inequality, is hailed with satisfaction. Something has been said about the licensing question. Well, I must say I commend the courage of the Government in tackling that question. I always regretted that the President of the Local Government Board did not stick to the provisions on the subject contained in his great Bill. If the right hon. Gentleman had done so, he would have deserved a greater monument from the advocates of temperance than even the hon. Baronet opposite (Sir W. Lawson.) I believe the only way to successfully deal with this subject is to go into it boldly. It is quite impossible to deal with public-houses without the principle of compensation, and it is absolutely necessary to grapple with the excessive temptations to drunkenness. The licensing question is one which, though troublesome, must be faced by some Government, and I doubt if our Friends opposite, when they come in to Office, will care to touch it. The Chancellor of the Exchequer, by introducing the system of raising the money out of the drinking habits of the people to pay out a number of the licensed houses, is doing a wise and proper thing. I believe the scheme will lead to the promotion of temperance; and, though I am aware that in my constituency, as elsewhere, our opponents will placard the walks with the declaration that we are going to buy out the publicans, at any rate these provisions will tend to make the people more sober. The superannuation of the police and the reduction of postage are, no doubt, matters of great importance; but the great feature of the Budget, as I have said, is the reduction of the taxation of the poor.

(9.38.) MR. MUNDELLA (Sheffield, Brightside)

I must take exception to a statement made by the last speaker that this Budget goes a long way to redress the inequalities of taxation which press upon the poor. There never was a more unwarranted statement. Whence comes the fund from which the Chancellor of the Exchequer is able to make these reductions? It is almost exclusively from the working classes; but the remissions of taxation which this surplus enables the Chancellor of the Exchequer to make will benefit rather the classes above them. I am not complaining of the reductions which the Chancellor of the Exchequer proposes. It is true that the working classes will be benefited by the reduction of the duty on tea, but is that not a remission that affects the rich in greater proportion? I believe the reduction in postage will affect our merchants and trading classes very much more than the working classes. Every mercantile house in the City of London will send a hundred letters for every one sent by a member of the working classes. The idea is excellent in itself, and although the Chancellor of the Exchequer is making provision for a deficit which may arise from the reduction, there can be no doubt that, in a very short time, that reduction, instead of diminishing the amount of Revenue, will tend to increase it. I do not at all despair of seeing a penny ocean postage, although I know that every Treasury is opposed to Postal reductions. The contributions from that Service are getting almost beyond reasonable bounds, and more should be done to develop cheap postage. I rose mainly to say a few words as to the abolition of the Silver Duty. I congratulate the Chancellor of the Exchequer on having the courage to abolish that duty and deal with that subject, and I hope and trust that his effort will not be abortive. I trust that this time we shall get rid of the Silver Duty. My hon. Friend and Colleague the Member for the Central Division of Sheffield (Mr. Howard Vincent) is anxious to maintain the duty in the interest of the British manufacturer, as he believes. The idea is, that to impose a duty of 40 per cant. on the manufactured article is to encourage home manufacture. Nothing can be more absurd. It is the old idea the paper-makers and others entertained, but the very reverse of that which they feared has always been found to be the case. We have always found that when the Protective Duties have been swept away the home manufactures have extended year by year. I congratulate the right hon. Gentleman on the course he has taken, but I do not know what he is going to do as to compulsory hallmarking. He advanced as one of the reasons for the abolition of the duty, that he was only doing justice to the fair claims of India. In that I quite agree, but you cannot have one uniform standard of compulsory hall-marking. You must allow some kind of elasticity, so that the standard adopted by India or any other country that may import silver will allow for the admission of manufactured silver into this country. I am sure the right hon. Gentleman recognises that something must be done in that direction, so as to admit the articles he contemplates admitting by the abolition of the Silver Duties. I am glad the right hon. Gentleman has reduced the Tea Duty, although he has been criticised on his own side for doing so. One of his supporters deprecated the "abandonment" of so important a source of Revenue. I do not think the right hon. Gentleman is abandoning a source of Revenue at all; on the contrary, I think he is taking means to increase it. I have always felt that the reduction of duty has, within a certain time, compensated for itself by an increase in the consumption. I think we all agree that the price at which tea is sold to the poorer classes is most excessive. When the duties on sugar were reduced, it was found that the taking of a penny off meant a great deal more than the penny itself in the reduction of the price at which the article was sold. The public get better acquainted with the net value of the article, which is dealt in with much more freedom as soon as reduction takes place. I believe, therefore, that this is the first step towards a very considerable reduction in the cost of it to the people. I do not believe it is the last step by any means. Having reduced the duty by 2d., I think the Chancellor of the Exchequer will not remain there, but that he will have to go further, and the duty will probably be entirely swept away. We all regret that the surplus should have been derived almost exclusively from an increased consumption of intoxicating liquors. That increased consumption, however, has not been confined to one class. I notice that the increased duty on wine amounts to more than £120,000, which represents a selling value of between £1,500,000 and £2,000,000. It is also only fair to suppose that the middle and poorer classes have consumed their increased share of beer and spirits. It would be much to be regretted if there was any indication of an increased consumption of drink in the country, because we all believe, with the Chancellor of the Exchequer, that the greatest curse of the country after all is drink. I wish to invite the Chancellor of the Exchequer to touch upon another question. I refer to the question of Free Education. When an hon. Gentleman suggested that this must stand over until the next election, the Chancellor of the Exchequer seemed anxious to repudiate the assertion. I am glad ho should have done so. There never was a year in which the prospects of the Budget were so falsified as in the present instance. A short time ago nothing could be more explicit than the statement of the Prime Minister that we should have a free system of education if there was a surplus. The right hon. Gentleman himself (Mr. Goschen) also said that the moment Free Education was established in Scotland a great grievance and hardship was established in England and Ireland. Certainly, therefore, we had ample justification for thinking the right hon. Gentleman would have given us Free Education in this Budget. I certainly trust the time is not far distant when we shall have Free Education, for no greater boon could be conferred upon the working classes of the country. All that the right hon. Gentleman has done to-night, however we may appreciate it, falls far short of the great service he would have rendered to the country if he had given Free Education to the children of the people. Nothing can do so much to stop the tide of intemperance, and nothing has done so much hitherto to arrest that tide, as education. With regard to the question of licences, I would point out that the suspension of licences means making existing licences very much more valuable. That is a question that will have to be very carefully dealt with before we go much farther. I am sure we shall all be glad to pass the necessary Resolution to increase the price of spirits, and I am glad of what the right hon. Gentleman has done with regard to the Silver Duty and some other matters.

(9.53.) MR. SALT (Stafford)

The right hon. Gentleman who has just sat down complained that we have not got Free Education. I am afraid that if we had Free Education the right hon. Gentleman would have complained that we had not got the Tea Duty reduced. We cannot have both things at once. We are told that we are to have a considerable sum of money given to the County Councils, in order to deal with the difficult question of Police Superannuation. I presume that the object of that grant is to make up a fund for Police Superannuation in various cases where the existing funds have proved to be insufficient. I wish to know how my right hon. Friend (Mr. Goschen) is going to deal with those counties in which the funds are sound and sufficient. It would not be very fair to make grants in cases where the funds are insufficient and to do nothing for the few counties in which the funds are sound. A question with regard to sparkling wines has been brought to my attention. I am told that a great grievance exists respecting-the surtax on sparkling wines being charged as an ad valorem duty, and it is said to give rise to fraud. I have no personal interest in the question, but I trust the Chancellor of the Exchequer will see his way to give it his attention. The proposal respecting the purchase of licences has my sympathy and support. I only wish that the suggestion made in this respect years ago by Lord Aberdare had been carried out. Had it been, very many difficulties in connection with the liquor trade would now have been cleared away. Very great difficulty will probably be experienced in applying the funds to the purchase of licences. The value of public house licences has, in the last few years, enormously increased—in many respects to quite an artificial value. The whole of the beer trade has drifted into quite a different class of business altogether during the last 10 or 15 years. Instead of being in the hands of a great number of small people, the trade is now in the hands of largo brewers and capitalists, who are buying up retail houses at very much more than market value. The transfer of licences from one place to another is a matter which, no doubt, will also have consideration. The reason I mention this is, that if it has to be dealt with by the Local Bodies in the counties, they will, I think, require some rather distinct directions from Parliament as to the lines on which they ought to proceed, I must venture to warn hon. Members not to expect very great results from diminishing the number of public houses, as regards the amount of beer and spirits consumed in the country. I expect some good, however, from my right hon. Friend's proposal, and I think some of the worst public houses will be cleared away, to the great benefit of the community. Observation has naturally been made on the very large amount received from the Alcoholic Duties in the past year, but I think we are rather apt to get on the high horse and talk about how the poor people drink. What has happened is simply this: During the last few months working men, who, a little while ago were earning some 16s., or 18s., or £1 a week, have had their wages increased in some cases to 6s., 7s., or 10s. a day. These men, when they were receiving very low wages, lived upon tea. Now they are earning good wages they live upon beer.

MR. LABOUCHERE (Northampton)

On brandy.

MR. SALT

Well, brandy. At all events, there is no reason why this increase in the consumption should be attributed to excessive drinking. I deplore excessive drinking just as much as hon. Gentlemen on the other side of the House, but I cannot say that I deplore the fact that working men are receiving such good wages that they are able to live well and comfortably, and as English working men ought to live.

(10.5.) DR. CAMERON (Glasgow, College)

I wish to draw the Chancellor of the Exchequer's attention to a blot en an otherwise excellent Budget. I have always been a very strong advocate of temperance Ever since I entered Parliament I have supported extreme temperance legislation, and I have myself secured the passing of Bills which have much diminished drinking hours in public houses. I have no friend among the publicans. I have been constantly and persistently opposed by the publicans, and so long as I remain in Parliament am likely to be opposed by them. But, Sir, I am a friend of fair play. When my right hon. Friend the Member for Edinburgh (Mr. Childers) was Chancellor of the Exchequer, he proposed to put a small tax on beer and a large tax on whisky. I opposed that as grossly unfair, and I regard the present proposal of the Chancellor of the Exchequer with regard to the whisky duty as grossly unfair in the same way. I am in favour of taxing alcohol to the utmost extent of taxation it will bear without encouraging illicit distillation, but as regards whisky the Commissioners of Inland Revenue said it would be dangerous to add any taxation for fear of increasing illicit distillation. It is notorious that alcohol is chiefly consumed in England in the form of beer, while in Scotland it is consumed in the form of whisky. In the form of beer alcohol pays about 1s. 5d. a gallon of proof spirit, at present, whereas in the form of whisky a tax is imposed to the extent of about 10s. per gallon of proof spirit. You propose now to add 3d. per cask upon beer and to add 6d. per gallon on whisky. Is not this making people in Scotland through their favourite tipple pay enormously more than people in England through their favourite tipple? What makes the grievance more serious in the ease of Scotland is, that we recognise no vested right in licences, and do not want you to assist us to purchase licences. In every step we have taken in the way of curtailing the trade of licensed houses, we have given no compensation. The law with us stands on quite a different basis from that which it occupies in England. The Magistrates who represent the people in Scotland have absolute control in the matter of new licences. If I thought you could diminish the consumption of whisky by any extra taxation, I should overlook a great deal in the way of unfairness in any proposal to achieve such an object; but I do not believe this proposal will have that result. We have a great deal of illicit distillation, as it is, and if you increase the tax you run a great danger of increasing this illicit distillation. When the right hon. Gentleman the Member for South Edinburgh (Mr. Childers) brought forward his proposal it created so great an outcry that he was obliged to abandon it, and I shall be very much surprised if the present Chancellor of the Exchequer does not find himself in a similar position. It will not improve the feeling with which the people of Scotland will receive these repeated attacks upon their favourite beverage—a beverage which has been described as almost synonymous with freedom—when they remember that of the two Chancellors of the Exchequer who have made them, one was a Member, and the other an ex-Member, for the City of Edinburgh. I should like to ask the Chancellor of the Exchequer what he proposes to do with the £144,000 he intends to allocate to Scotland. The Probate Duty grant given last year aided the remission of school fees to a certain extent, but it has been insufficient, and I trust the right hon. Gentleman will see his way to follow precedent in this matter, and complete the work then commenced. There can be no difficulty in the matter. The work has been half done, and Local Authorities have been led into extravagancies which will compel them either to impose heavy local taxation, or to retract the benefits which have already been conferred, and this £144,000 would be a most acceptable sum for the crowning of the edifice that has been raised.

*(10.15.) MR. CHANNING (Northampton, E.)

It is perhaps well, before this debate closes, that one or two remarks should be offered by a County Member on this side of the House, in as much as the right hon. Gentleman the Chancellor of the Exchequer has dealt very generously—some people may think almost too generously—with County Finance. I understand that the Probate Duty has amounted to more than the right hon. Gentleman anticipated, and yet he is proposing to hand us over the proceeds of the Beer Duty. I would add one word of protest to what has fallen from my right hon. Friend the Member for Sheffield (Mr. Mundella), and other Members, on the question of Free Education. After the very distinct announcements of the Prime Minister in the autumn, the words in which the Chancellor of the Exchequer referred to Assisted Education struck me as singular. He put the question of Free Education on a par with buying pictures for the National Gallery. He went on to say that if he yielded to such demands—if he did not sit tight on the lid of the chest—he would have the whole of his mighty surplus scattered, and still the burdens of the people would not be lightened. I am sure the country will take note of the position to which Free Education has been relegated by the right hon. Gentleman. On one subject I am sure the proposals of the right hon. Gentleman will meet with universal acceptance. I refer to the Inhabited House Duty. Those acquainted with Town Holdings might possibly object that this remission is only too likely to go in London, not into the pockets of the poor occupiers of small houses, but rather into the hands of house-jobbers and owners of small property. The class the right hon. Gentleman wishes to relieve is substantially the class whose incomes vary from £150 to £400, and a little over. We all wish to relieve them, but I venture to say it is time to consider this question of the taxation of small and precarious in conies on a somewhat wider principle than is contained in the Budget. I do think that when we have a surplus of £3,250,000 in one year, to be followed by a surplus of £3,500,000 in the next, a great opportunity has been afforded to a financier who has brilliantly distinguished his tenure of his present office of dealing with this question of small and precarious incomes. I hope that next year the question may come more to the fore, and that some relief from direct taxation will be afforded to small incomes. With regard to the temperance question, we must all feel some pleasure at seeing the right hon. Gentleman so conspicuously and so obviously running off with the Bill of the noble Lord the Member for Paddington (Lord R. Churchill) under his arm. The right hon. Gentleman has, as far as I can judge, adopted all its principles and provisions. As to the compensation question, I was rather surprised that the hon. Member for Glasgow (Dr. Cameron) did not protest more vigorously against the gross injustice of the Scotch having to pay for buying out English public houses According to the proposals of the Government in the Local Government Bill two years ago, the compensation was to come first from the county ratepayers, and secondly from a fund raised by an increase, limited to 20 per cent. increase on the present licence duty. In the discussion on the Local Government Bill, if my memory serves me right, the right hon. Gentleman, or some defender of his proposals, went so far as to say that the increase of the duty would by itself form a sufficient fund for dealing with the question of compensation. The Government then sought to place the burden on the trade, but now they propose to place it upon the unfortunate consumer, and to tax the tempted instead of the tempter. I cannot help expressing my satisfaction at the lowering of tariffs obtained by the arrangement which has been made with Greece. I noticed that Gentlemen opposite cheered his announcement on that point, as if it was a grand victory of the principles of reciprocity. I venture to say it is just the other way. It is a victory of Free Trade, and an application of Mr. Cobden's principle of obtaining reductions of tariff in other countries by reducing the tariffs here. I welcome many of the proposals in the Budget. Everyone must con- sider it an advanced Budget; at the same time, I think we have great reason to protest against the total failure of the Government to redeem its promises in respect of Free Education.

*(10.24.) MR. GOSCHEN

There are a great many points on which I am asked to reply, and I will try to do so as briefly as possible. The hon. Gentleman who has just sat down referred to the very important matter of assisted education, to which the right hon. Member for Derby (Sir W. Harcourt) alluded in his remarks on the Budget. I am obliged to the right hon. Gentleman for the spirit in which he has discussed it. The hon. Gentleman who has just spoken said that I put free education on the same footing as the buying of pictures. That is drawing an inference which is scarcely warranted from remarks which were intended to be somewhat jocular. My right hon. Friend the Leader of the House (Mr. W. H. Smith), in the early part of the Session, said he reserved the question for next Session. It is not merely a question of giving money for assisted education, for enormous importance must attach to the conditions upon which the money was given. An hon. Member has spoken of the matter as being reserved for the next General Election. I do not know when the hon. Member thinks the next General Election will take place, unless he imagines it will be between now and next Session. I do not think that will be the case. Of course we are liable to the changes and chances of this mortal state, and the hon. Member for Northampton (Mr. Labouchere), who does not seem to share my opinion, may be in possession of secrets with which I am not acquainted, but I do not think we need speak of postponing free education until after the next General Election. As far as I can calculate the chances of politics, it will fall to our lot to deal with the question, and we look forward to dealing with it next year. The right hon. Member for Derby thought we should have exhausted all our resources. I believe I see £500,000 which will be available next year, and which is not available this year. This year we spend £300,000 on barracks. Again, we have this year a drawback of £120,000 for silver plate, and that will not fall to be paid next year, and there is £100,000 for the Volunteers, not a recurring item. I can assure the Committee I have carefully considered our liability with regard to assisted education in framing my Budget this year. Supposing we do not realise greater advantage from articles of consumption than I have estimated, there is generally now a progressive increase from the Death Duties, which is almost automatic. I am bound to say that we consider ourselves committed to the question of assisted education, and I am afraid that the liability of finding the necessary funds will fall upon me. I trust I shall be able to meet that liability, which, in fact, I must meet. I hope now the Committee will consider I have made a categorical declaration with respect to assisted education. The hon. Member for West Nottingham spoke in terms of reproach and condemnation as to what I said about employers and employed, and went out of his way to draw an inference from the remarks I made. I repudiate the inference which the hon. Member draws from my words. I said, in language which I believe will be accepted and appreciated by almost every Member of the House, that I trusted the relations between employers and employed would be harmonious during the present year, and I pointed out that the internecine struggles between the employers and the employed are a drag on the prosperity of the country, and might till us sometimes with alarm. No word fell from my lips in criticism or condemnation of either party in the struggle. I spoke with absolute neutrality, but surely I am entitled to say, as having an interest in the prosperity of the country, that we desire to continue and increase the harmony between capital and labour, between employers and employed. The hon. Member spoke with perfect courtesy, but I cannot accept the interpretation he put upon my declaration, and I would not have what I did say misinterpreted in any degree. The hon. Member also spoke about the exemption and nonpayment of Income Tax on property which is held by Trade Unions. It is not a question as to the amount of money which the Exchequer would lose which would in any way induce me to oppose such a wish; but the question must be considered with the general principles which attach to Income Tax on land. I am not able to enter into the subject minutely this evening, but I promise again to look into it. I strongly hold that every person not getting an income of £150 should not be called upon to pay, but, on the other hand, I do not think as Trade Unionists they should receive exceptional treatment to other citizens as to the funds they possess; they must, with all other classes, be justly treated. The right hon. Member said something with regard to the currency, and hoped that the Government might undertake some measures with regard to £1 notes and the currency generally in connection with the Coinage Bill to be introduced. I have been studying the question of reforms in the currency, and I should be very glad if before we leave office it should be in our power to deal with the question. I do not despair of it. I do not say of the question of £1 notes more than that I must reserve myself, but there are questions connected with the currency I should be glad to deal with while I have the power to do so. I omitted to refer earlier in the evening to my statement last year that the cost of restoring light gold coinage should not be put on the taxpayer at large, but that the remedy should be looked for in banking directions. We have now been saved from the necessity of further legislation at the present moment on that subject by the large profit which we have realised on one form of banking transaction—namely, on the issue of silver. The right hon. Gentleman also complained that the Revenue Returns did not show the aggregate amount which is realised by different forms of taxation. I admit the inconvenience, but I think it is a temporary one. Comparisons have been complicated and difficult during the past few years, but as soon as the new system has been inaugurated I think that the complexity and difficulty will cease to exist. I attach great importance, however, to this point. Sums which are raised for local purposes should not be considered as raised for Imperial purposes, and they should not figure twice in the national accounts. I promise to see whether we can keep the local finance separate from the Imperial finance, in order to meet the legitimate wish of the right hon. Gentleman, and to present Returns in a form which will admit of a convenient comparison. The right hon. Gentleman spoke of the Floating Debt. I do not know that any special measures will be necessary for dealing with the Floating Debt, because I believe by the funds in the hands of the National Debt Commissioners we shall, within a reasonable time, be able to bring the Floating Debt back almost to the point at which it stood before. A large Floating Debt exposes us to fluctuations of interest which might be extremely inconvenient. The right hon. Gentleman said, but not with perfect accuracy, that there was a time when this country had to pay more than 4 per cent. on the Floating Debt. That was not the case, because it was only on £1,500,000 of the Floating Debt that we were obliged to pay four per cent. But the general rate at which we have raised funds under the Floating Debt has been, I think, £2 14s. The fact is that our Floating Debt securities are extremely popular in the whole banking world. I agree with the right hon. Gentleman, however, in not desiring to have a too large Floating Debt, because three or four years out of five we may be able to make considerable money upon it, but we might be caught in one year, and the loss might wipe off the profits of preceding years. There is something that grates on the national feeling in having to pay, even temporarily and on a small amount, a rate above the rate paid in the funds. Therefore, although we have done extremely well as regards the Unfunded Debt, having been continually able to borrow at 2 per cent., and sometimes at 1½, under this form of securities. Still it undoubtedly is not our wish to multiply them, or even to maintain them at their present amount. I trust I have explained myself sufficiently to the right hon. Gentleman. I feel very strongly the necessity of keeping the Floating Debt within moderate limits, Then I turn for a moment to the Tea Duty, upon which much has been said. One hon. Member objects to the reduction of the Tea Duty, and would rather, ho says, have had assisted education. But if the reduction of the Tea Duty should be followed by assisted education, I think he would have no cause to complain, for then he would have the advantage of a reduction of the Tea Duty one year and the advantage of assisted education would be realised in the next year. But my hon. friend behind me (Sir R. Fowler) complains of the manner in which the Tea Duty has been dealt with, on the ground that we are parting with a permanent source of Revenue. But we have not parted with it, and we do not intend to do so. By putting the duty at 4d. there will be a chance, if we should ever have to make a special effort, of calling upon the consumers to contribute something to that special effort. If we treat it, on the one hand, as a permanent source of Revenue, but at the same time put it, if I may say so, on a peace footing by reducing it considerably, we retain it as a source of Imperial Revenue, as I, for one, desire to retain it. Here is a short letter which I have received on the subject, which amused and interested me very much, and which I think is genuine:— Sir,—Being a non-drinker and a non-drinker, not eligible for Income or Property Tax, not able to stand coffee drinking, but withal a patriot though a Radical,? would like to know how I am going to stand my 'corner' in regard to the expenses of my country if I do not pay something through my teacup, if you take off the Tea Duty. I call that a sensible letter. I have not but not inconsequence of that letter—taken off the whole of the Tea Duty. I place it at 4d. I keep it as a source of Revenue, a national reserve, and though some hon. Members may wish to abolish it altogether, I protest earnestly against diminishing too much the number of our sources of Revenue. My theory is that having reached a certain point, though we may remit when we can in order to lighten the general burden, we should keep what I may call the skeletons of our regiments intact, so that, to quote the writer of the letter, every man should be able to stand his "corner." The right hon. Member for Derby regretted that we had not seen our way to deal with the Death Duties. I may remind the Committee that last year the right hon. Gentleman the Member for Mid Lothian declared that a real adjustment of the whole of the Death Duties would require almost a Session to itself. But this question does not stand alone. The re-construction of the Income Tax in certain respects would have to go in any case hand in hand with a re-construction of the Death Duties, and that is a task which we think the dimensions of the present Session forbid us to undertake, especially looking to the warning we have received. With regard to one of the most important proposals of the Budget—namely, the increase in the duty upon Spirits—I am not surprised that a protest has come from Scotland based on the assertion that whiskey is the favourite tipple of that country, and that the Scotch people drank more whiskey in proportion than the English people do, and that, therefore, they will have to pay more in proportion in consequence of the increase of the Spirit Duties than the English people will have to pay. A large portion of the money so raised, however, will be applied to various local purposes, and I am glad to find that the hon. Member for Glasgow is already looking forward with great pleasure and content to the manner in which a part of the extra duty is to be applied in Scotland. It must also be remembered that the extra duty is in some degree compensated for by the large proportionate share which Scotland obtained two years ago in the distribution of the Probate Duties, the greater portion of which are paid by England, while Scotland and Ireland largely participate in them.

COLONEL NOLAN (Galway, N.)

Not according to population.

*MR. GOSCHEN

I repeat that while England pays the larger share of those duties, Scotland and Ireland are allowed to have the advantage of their distribution. In these circumstances I do not think that either Scotland or Ireland have any reasonable cause of complaint. Ireland especially, as being the poorer country, has always received the utmost consideration, and she has always received the benefit of the doubt when there was a question as to which way the scale inclined.

COLONEL NOLAN

On what figures does the right hon. Gentleman found that statement?

*MR. GOSCHEN

I am afraid the hon. and gallant Gentleman will not accept my assurance, but I can assure him that my statement is founded on thoroughly impartial calculations.

COLONEL NOLAN

By whom?

*MR. GOSCHEN

By those who collect the Revenue, and the impartiality of whose statistics are above suspicion, and who have been consulted on these subjects by the right hon. Member for Mid Lothian.

COLONEL NOLAN

Have they put these calculations above my Returns?

*MR. GOSCHEN

I am afraid I cannot accept the figures of the hon. and gallant Gentleman, who is undoubtedly a partial man and evidently holds strong views upon the subject. I, however, believe in the impartiality of the calculations before me, and in the position in which I am placed I have felt bound to look very carefully into the figures. With regard to the disposal of the fund in Scotland, that is a matter that is not yet finally concluded, and it will receive the most careful consideration in connection with the whole circumstances in the case of both Ireland and Scotland. It is not proposed to deal with Ireland and Scotland in precisely the same way as England, and separate arrangements will have to be made with regard to each country, which I hope to be able to place before the House at a very early time. With regard to the application of this new tax, observations were made by the hon. Member for Stafford, who referred to the question of police superannuation. The hon. Member's observations were very pertinent, and we had clearly before us the point to which he has called attention—namely, what would be the just way of securing the distribution of the money among counties some of which have already taxed themselves, while others have not. It is a difficult problem which the Government will endeavour to solve with equity. In reply to the hon. Member for Essex, I may say that the County Councils will get £393,000, besides £300,000 for the police; together £693,000. Then there is £160,000 for pleuro-pneumonia, which will lieve the ratepayers in the Three Kingdoms to a very considerable extent. If those figures are added together it will be found that, irrespective of the advantage to be derived from the sum set apart for licences, there is a sum of about £850,000 applied to the Local Taxation purposes. The hon. Member will admit that that is an ample redemption of the pledge given by the Government. Mention has been made of the arrangements with Greece, and here let me take the opportunity of stating that much credit is due in the management of these affairs to my right hon. Friend the Under Secretary for Foreign Affairs, who has given great attention to questions of tariff, and also to the talented representative of the Greek Government in this country. The matter stands thus: the Octroi Duty on currants is still levied by the Greek Government, but that Government have very fairly met us by reductions on imports of English manufactured goods, so I do not think we have a right to press them any further. There is one point I have to mention in connection with the change in the duty on silver plate. I omitted to state that while we shall leave the law as to hall-marking practically in the state in which it now stands, we shall make special arrangements in regard to India. India exports to this country her manufactured silver, and, generally, I think, that silver is of the same standard as her rupee, and somewhat below the standard adopted in this country. We propose that the Indian goods shall be specially hall-marked and shall be allowed to be imported at the Indian standard. We propose also that the Indian Government shall be allowed to establish assay offices for this purpose, and certified by Indian authority that they are up to standard, Indian silver goods will be allowed to be imported here. In this way I hope we shall satisfy India. In other respects we do not propose to interfere with arrangements under the existing law, or change the practice as to hall-marking. One important matter I must not omit to mention, and I am glad to be reminded of it. The Committee will bear in mind the proposal that a certain sum should be placed at the disposal of the Local Authorities for the purchase of licences; and it has been pointed out, though it was a matter which had not escaped us, that it would be no legitimate consequence of that arrangement, but, on the contrary, a consequence we should deplore if the value of public houses should be raised by the very measure we are introducing to give the power of purchasing these licences. We acknowledge it would be perfectly right to introduce some limitation by which any increased value which is given to public houses owing to the enactment of the measure which we shall have the honour to introduce, shall not be taken into account in any future compensation that may be given. With regard to the ad valorem duty on wines, I have been asked as to the result of the change made last year, which was exactly equivalent to the imposition of an ad valorem duty in some repects. We were anxious that the change should not operate against the importation of the cheaper sparkling wines from Germany and from the Saumur country, and I am glad to say that, although there have been some objections raised, our plan has, on the whole, worked with great smoothness. I know that all wine merchants will not be ready to admit that; but it is the fact that the anticipated importation of wine paying the 2s. 6d. duty has not diminished with a corresponding increase of the wines under the 1s. duty. It was thought that higher class wines would he introduced under the 1s. duty; but the watchfulness of the Customs and the bona fides of the trade have prevented that result, and the proportion remains practically as heretofore. With regard to the Tea Duty, it was proposed that the reduction should come into operation on an alter May 1. Sometimes a longer period has been given; but I am led to believe that stocks have been rather exhausted, and the date I mention I think will be convenient to all concerned. I appeal to the Committee to allow the Resolution to be passed. ["No, no" from Colonel NOLAN.] It would be according to precedent on previous and similar occasions. The right hon. Gentleman the Member for Edinburgh, when he proposed an increase of the Spirit Duty, though it was subsequently rejected by the House, was allowed to take it on the first day. Great inconvenience would result from the uncertainty to the trade if the Resolutions are not passed to-day.

(11.1.) MR. LABOUCHERE

I do not know any precedent for the Budget Resolutions being taken exactly at 11 o'clock. The right hon. Gentleman has spoken as if he occupies a freehold of his seat on the Treasury Bench, and the cheers of his friends show that they think so, although he may be too modest to say so. He has been explaining what he is going to do next Session; but while he was doing so I ventured to interject a remark as to the possibility of a General Election before then. The right hon. Gentleman said that I might possess some secrets unknown to the Government. Sir, I possess no secrets; but I do know that the constituencies are anxious to pronounce a verdict on the conduct of the Government. Now, Sir, I am bound to say that I think this is a peddling Budget: it tries to satisfy everybody, and it satisfies nobody. I could understand it if it proposed to abolish the Tea Duty altogether; but, instead of doing that, it only takes away one-third; it takes off 2d. per lb., and nobody will profit by it. This is a middleman's and a capitalist's Budget. The right hon. Gentleman said he would have abolished the Tea Duty entirely, but that he had not a sufficient surplus to do it. But, Sir, he would have had a sufficient surplus to make the abolition of the Tea Duty an easy thing, had it not been for the enormous expenditure of the Government in preparations for war and war armaments. This year, and for several subsequent years, the country will have to pay £1,430,000 for the increase of the Navy, and to spend further money in erecting new barracks for our soldiers. A considerable sum is to be given to the County Councils for the superannuation of the police and other general purposes. Nothing could be more objectionable, in my opinion, than giving large sums from the Imperial Treasury to the County Councils, because the money is collected principally from the inhabitants of the towns, and it will be expended chiefly in making roads and generally improving the property of the landowners. Then a large sum of money was to be given in order to compensate the publicans. I object to this insidious way of dealing with that question. Let the right hon. Gentleman bring in a specific Bill saying that the publicans have a, freehold, and that they are to be compensated out of Imperial taxation, and then the country will know what it means. I am astonished that more notice has not been taken of the Chancellor of the Exchequer's little bargain with Greece in relation to cur- rants, because the statements of the right hon. Gentleman in that connection amount to the enunciation of a new fiscal policy. I very much regret that the Chancellor of the Exchequer has not made alterations in the Income Tax, a tax which operates very unjustly upon professional men and those engaged in trade; and I urge the Chancellor to consider whether he cannot, as they do in America, make some distinctions between income derived from investments and casual income derived from professions and trades. I think that this is a Tory Budget. I have done my best to protest against the excessive expenditure of the Government in civil matters and in preparations for war. The right hon. Gentleman the Chancellor of the Exchequer has pointed out that ho has reduced the National Debt to a considerable extent; but I am one of those who consider that it may be reduced too much. I do not possess so very great an interest in my grandchildren as to save them from paying all these debts. The right hon. Gentleman has not pointed out that he is going to increase the National Debt by a sum of £30,000,000, should the Government be able to carry a certain Bill now before the House.

(11.20.) COLONEL NOLAN

I think the proposals of the Chancellor of the Exchequer show not only that the right hon. Gentleman has a knowledge of finance, but that he is also an accomplished electioneer. I admit that it is not a bad electioneering Budget. I hail with pleasure the redaction on tea, but I do not understand why the duty on raisins should not be reduced as well as that on currants; they are both made from grapes, and I do not see how a distinction is to be made; the result will be endless confusion. Then the right hon. Gentleman has taken off these duties at the expense of Scotch and Irish whisky. I consider that the tax is put most unequally upon spirits as compared with beer. I object also to the system of creating fictitious surpluses followed by the Chancellor of the Exchequer. Why should only 1s. duty be paid on claret and 9s. 6d. be paid on spirits, seeing that it is the poor who drink spirits? You have got a majority in England and a minority in Ireland, and the Chancellor of the Exchequer, in bringing forward his Budget, is simply going with the majority. Why should poor people have to pay 10s. instead of 9s. 6d. per gallon, while the claret drinker is not taxed so heavily? Then as to the distribution. Could you have any more iniquitous distribution? I will leave out the case of Scotland, which is similar to that of Ireland, only that the case of Ireland is much stronger than that of Scotland. The origin of this distribution is to be found in what the Chancellor of the Exchequer did two years ago in the division of the Probate Duty between the three countries in relief of local taxation. I contended that it would be fair in allotting the duty to divide it according to the amount paid on Probate Duty by each country, for Ireland in proportion paid far more than the other two countries. The Chancellor of the Exchequer, in reply, said that the division would be made, not in proportion to the amount paid in Probate Duty but according to population. But in this instance nearly double the amount is given to England in proportion to population, compared with what is given to Ireland. England gets something over £1,000,000, and Ireland gets only £118,000. Though England has by far the larger population, yet the difference does not warrant such a discrepancy as lies between giving over £1,000,000 to one country and only £118,000 to the other. Though Ireland is not a great country like England, yet, when you come to deal with spirits, Ireland consumes a very much larger quantity of spirits in proportion to population than does England. But you are going to give her the least share. Ireland will pay much more than England in consumption of spirits, and will get very much less. Ireland not only consumes, but she exports whisky, and her chief customer is England. You are not only taxing whisky in Ireland, but you are checking the consumption of Irish whisky in England. I suppose the Chancellor of the Exchequer expects the people of Ireland to be grateful to him for this contribution to local needs by putting a tax of 6d. per gallon on whisky. I think they will be the reverse. Nineteen-twentieths of the taxation go to England; and every Irishman, when he drinks his glass of whisky, will think of the extreme unfairness of the Chancellor of the Exchequer in taxing Irish resources for the English majority. The Irish Members have had no opportunity of consulting about this matter, and I speak simply for myself personally. I do not oppose the Tea Tax; I take what is good in the Budget; but I oppose all the bad parts, such as that relating to silver. People have got up in this House and talked as if drink was a frightful iniquity. It is perfect hypocrisy. Why, in Sweden, where you have the best educated people, and in North Russia, where you have not the best educated people, they drink more than we do. I believe the consumption of alcohol is simply a question of latitude. It was proved by an eminent statistician lately that wherever alcohol is drunk you have very much less crime. You will never make very much difference in the consumption of alcohol. I would draw the attention of the Chancellor of the Exchequer to one matter. Ten years ago I obtained a Return, signed by Mr. Courtney, and I have no doubt it was correct, which showed that Ireland contributed a larger share to the Imperial Revenue than the Chancellor of the Exchequer has stated. Subsequently, a Return was made by the Treasury. It was compiled at the time of the Home Rule Bill of the right hon. Gentleman the Member for Mid Lothian (Mr. Gladstone) a time of heat and conflict, and when the right hon. Gentleman was anxious to make a good bargain with Ireland. Every Irishman who understood the subject knew that the right hon. Gentleman in his Home Rule Bill was driving a terribly hard bargain with Ireland. What I wish the Chancellor of the Exchequer to do is to compare the two Returns and see where they vary from each other, and ascertain what is conveyed by the one and the other as to the proportion which Ireland contributes to the Imperial Revenue compared with England.

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

Sir, I wish to make an appeal to the House. Unless these Resolutions are carried forthwith great inconvenience will result. Hon. Gentlemen will have a full opportunity of discussing every question on the Bill which will be based on the Resolutions, and I trust, therefore, the House will allow the Resolutions themselves to pass.

*(11.41.) MR. H. H. FOWLER (Wolverhampton)

Sir, I will not detain the House more than a couple of minutes. I am not going in any way to criticise the Budget of the Chancellor of the Exchequer. I think it right to say, inasmuch as he alluded to my criticism on the disposal of a previous surplus that it favoured the direct rather than the indirect taxpayer, that the right hon. Gentleman has tonight done very fair justice to indirect taxation. Sir, you are going to put a Motion from the Chair for adding 6d. per gallon to spirits, and 3d. per barrel to beer, and I want the House and the Committee to understand that we are this evening imposing an additional Imperial alcoholic taxation. We reserve to ourselves the absolute right to discuss the appropriation of that taxation. Look at it in any way you like, the proposal of the Chancellor of the Exchequer is simply a subsidy from Imperial funds for certain local purposes, among others, compensation to publicans for the purchase of their licences. In voting to-night for the addition to this duty, I want it to be distinctly understood that we are voting for an Imperial duty, and if alcohol will hear it, I shall be only too happy to put it on alcohol. It will be for the House, hereafter, to decide whether this increased taxation, amounting to a million and a-quarter, which, added to the surplus of 3¼ millions, gives a surplus of 4½ millions, is to be applied as a subsidy to local purposes. The other remark I wish to make is in consequence-of the ironical cheers with which the remarks of the hon. Member (Mr. Labouchere) were received with respect to the Naval and Military expenditure. It is all very well for the Chancellor of the Exchequer to justify, in powerful and eloquent language, his disposition with reference to those items. When Lord Beaconsfield was in the height of his power the ordinary expenditure on our Army and Navy was £25,000,000. When Lord Beacons-field left Office in 1880 it was only £25,250,000; but this year the House is going to vote £33,000,000, making, together with the £20,000,000 for the Indian Army, a normal annual expenditure of £53,300,000 in a time of peace. There may be reasons why we should endure that expenditure, and no doubt hon. Members opposite think there are; but when you have a normal military expenditure of £53,000,000 in a time of peace I defy any hon. Member to furnish a parallel to it from the Expenditure of any country in the world. I think that this is a fact that ought not to escape the attention of the House and the country.

*(11.46.) MR. PICTON (Leicester)

I shall wish, at the proper time, to take a Division on the question of the Tea Duty.

(11.46.) MR. SEXTON (Belfast, W.)

I think that in some respects the proposals of the right hon. Gentleman manifest injustice to Ireland, and though I do not propose to divide the Committee against the Resolution before it, I desire it to be understood that the Irish Members reserve to themselves the right of taking such steps as they may hereafter deem desirable in defence of the interests of their country.

MR. SHAW LEFEVRE (Bradford, Central)

I presume that the Government do not propose to take the Report of Supply to-night?

*MR. W. H. SMITH

We propose to take Report of Supply, but not to go into matters of a controversial character.

Question put, and agreed to.