COMMITEEE.

HC Deb 21 April 1891 vol 352 cc1031-72

Considered in Committee.

(In the Committee.)

Clause 2.

Amendment proposed, in page 2, line 32, to leave out from "Fund," to end of sub-section (3).—(Mr, Keay.)

Question again proposed, "That the words " Provided that where a sum is applicable out of the guarantee deposit for the discharge or reduction of an irrecoverable debt' stand part of the Clause.

(2.55.) MR. J.MORLEY (Newcastle-upon-Tyne)

I hope that the Government will give the Committee a reasonable -explanation of the operations which the Amendment deals with. The Chief Secretary and the Government seem to think that because the measure is one of the most complex Bills ever brought before the House, therefore the explanation to be vouchsafed ought to be as little as possible. The Bill itself contains the maximum of difficulties, and we have had a minimum of explanation and interpretation. I think the Committee are entitled to a full explanation of what the operation of this clause will be. We heard last night about irrecoverable debts which come into existence on the default of the tenant. A default takes place, and the Land Commissioners declare that it is an irrecoverable debt. Now, I am not sure what constitutes an irrecoverable debt. An irrecoverable debt was defined in the Act of 1889. I suppose we may take it that the first step in a case of default is to sell, the holding; then, having sold, the proceeds of the sale are to be paid into the Guarantee Fund. I want to know whether the tenants' insurance money is to be the first resort? There are no specific instructions in the Bill as to what is to be done with the tenants' purchase money, except that it is to be paid into the Sinking Fund. The Lord Lieutenant is then empowered to take it from the Sinking Fund, and to apply it as a set-off against a default; but unless the Lord Lieutenant is satisfied that there is a representation from the locality, I gather that the tenants' insurance money is not available. The holding being sold and the money being paid into the Guarantee Fund, then you proceed, in order to make good the default, to attack the Guarantee Fund, and I want to know what will happen when you attack that fund. Of what does the Guarantee Fund consist? It consists of the county percentage, the Exchequer contribution, and the Probate Duty grant, but there is nothing in the Bill to tell us when the landlord's deposits are to find their way into the Guarantee Fund; whether they are to go in at once or only in case of default. It is quite clear that a common Stock is not created out of all these contributions. These questions are quite vital, and they show the importance of the Amendment we are now discussing. It was suggested last night that the landlord would suffer a hardship in having to make these deposits. It is not so at all. The guarantee deposit is simply a compulsory investment of one-fifth of the purchase money in Government Stock, bearing 3 per cent., and the only drawback is that the landlord cannot sell out under 18 years. Surely that is not a position of very great hardship. Under the arrangement proposed, the landlord would be able to realise, which he would not be able to do but for the resort to British credit. It is only the resort to British credit which enables him to realise. In these circumstances I fail to understand why, when the tenant makes default, the landlord's fifth should not be liable for the whole, as is the case under the Ashbourne Act, instead of for half of the deficit. The answer of the Government is one of the most paradoxical of the many paradoxical answers which they have given about the Bill; namely, that you ought only to take one-half of the landlord's guarantee deposit, because the local ratepayers will now be compelled to become a collateral security. Why should the ratepayer, who gave no assent to the bargain, and who, for ought we know, may be altogether opposed to it, be compelled to become a co-guarantor with the landlord, who entered into the bargain with his eyes open? I can see no reason why the landlord should not incur the same liability under this Act that was imposed upon him by the Ashbourne Act. If the bargain entered into between the landlord and tenant falls through, both ought to be made to pay before the Guarantee Fund is called upon to make good the default. The proposal of the Government will confer a new and a special advantage upon the landlord. It is most unfair to place a burden upon the ratepayer until you have exhausted all the available resources of both parties to the bargain. I am not prepared to say that the tenants' holding ought b be sold before you come upon the guarantee deposit, but this I will say: that a bargain having been made between the landlord and tenant, and the State having lent money to carry that bargain out, if the bargain falls through both ought to pay forfeit before you come upon the State or the locality. As the Bill stands you are safeguarding the Imperial Exchequer at the expense of the localities, and you are doing so in order to confer a new and special advantage upon the landlord. I am perfectly willing to protect the guarantee deposit in which the landlord has placed one-fifth of the money, but I am not willing to protect it at the expense of the ratepayers who have never been consulted.

(3.10.) THE CHIEF SECRETARY FOR IRELAND (Mr. A. J. BALFOUR, Manchester, E.)

There are two questions before the Committee — one is the character of the proposals in the Bill and the other is whether these proposals are justifiable or not. Last year the discussion was carried on, not so much in reference to the merits of the proposals as to their immensity. If hon. Members desire to have a clear perspective of the financial proposals of the Bill, the most convenient way will be for them to look upon the Guarantee Fund as relating to two different matters—one the temporary charges made upon it, and the other the permanent liabilities it will have to bear. The order in the two bases is quite different. In the temporary case the Imperial Exchequer stands absolutely first, while in the permanent order the Exchequer comes last. What we are now concerned in is not the temporary but the permanent order, in which the liability will have to be borne by the various parties. That, permanent order I take to be this: if the tenant makes default he will be sold up. The Insurance Fund which may have accumulated will not be taken as an Insurance Fund by the Government for the purpose of redeeming the debt. Nevertheless, the holding may be ,sold liable to the annuity, and, taken in conjunction with the fact that the Insurance Fund is part of the annuity, it will enable the holding to be sold for a larger sum than if there were no Insurance Fund. In that sense, and in that sense only, the Insurance Fund comes in on part of the tenants' assets. Let me now come to the position in which the landlord stands. It is undoubtedly true that it remains more or less in the discretion of the Land Commissioners as to the way in which proceedings are to be taken for the recovery of the debt, and it is true that the local contributions stand before the landlord in the temporary order of charge. They do not stand before it in the permanent order of charge but on an equal basis. In other words, if there be a default, and the sale of the holding is not sufficient to meet the liability, the Guarantee Fund undoubtedly becomes responsible. The landlord's fifth is there, and it cannot escape the grip of the Land Commissioners. The right hon. Member for Newcastle (Mr. J. Morley) says there is no hardship inflicted on the landlord in the retention of the fifth part of the purchase except that he is prevented from working it. The landlord's fifth and the Guarantee Fund would then have to make good the deficiency equally between them. The question is, ought the landlord who has no control over the tenant to be compelled to make good the whole of the default of the latter? Would it be just to make the seller of a business liable for the default of the purchaser for a period of 18 years? In any business in the world in which 1,000,000 persons were engaged there would always be a large number of cases in which, from incompetence, carelessness, idleness, or bad habits, failures would occur. Whether that is an argument against the Bill or not, at all events it is equally an argument against every conceivable form of land purchase. The present scheme has the merit of providing some species of insurance in cases of failure which may arise from undeserved misfortune. One of the most probable causes of default, it has been said by hon. Gentlemen opposite, is some species of conspiracy. That is the mainstay of the hon. Member for Northampton (Mr. Labouchere). The landlord for 18 years may not have set foot in Ireland. [Ironical sheers from the Irish benches]. Hon. Members cheer that because they think I am referring to absentee landlordism. [" No ! "] They could have cheered it for no other reason; but they seem to forget that, by the hypothesis, the landlord will have been bought out and will have no further interest in the locality. A conspiracy in that locality could only have force and effect if backed up by public opinion, and for that the landlord could have no responsibility. These arguments lead to the conclusion in the Bill that the risk should be shared equally by the landlord and the locality. I wholly fail to understand why, if there are two guarantors, they should not equally share the risk. I do not deny that in many parts of Ireland there is no general market for land, but I do not know that the landlord is to blame for that. Such an abnormal system is probably more due to the locality than to the landlord. The state of things with regard to land in Ireland is unprecedented, and some part of the blame for that state of things, as blame I think there must be, should be shared by the locality. I hope the Committee will be of opinion that I have clearly explained the provisions of the Bill, and that the reasons I have given are not unworthy of consideration.

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

The right hon. Gentleman says that an unprecedented state of things exists in Ireland in regard to land. The unprecedented state of things to which the right hon. Gentleman refers is due to the unsuitable system of land law imposed upon Ireland, and to the abuse by the landlords of the powers intrusted to them. The system you are now trying to reform is, in the first instance, responsible, and, next, the misconduct of the landlords themselves. As to conspiracy, the Government have a very easy and effective means of preventing it. They have only to give instructions to the Land Commissioners to see that the bargains between landlord and tenant are fair, and the desire of the tenant to possess his holding will make conspiracy impossible. No one knows better than the Chief Secretary that there is an intense desire for the - possession of land in Ireland. People who have the land have a passionate desire to keep it, and the desire will become still more intensified when the tenant is made the owner. The effect of the proposition contained in the Bill, as compared with the Ashbourne Act, will be that whereas under the Bill a tenant purchasing a holding at 20 years' purchase would have to make default for ten years before the guarantee deposit fund would become exhausted, under the Ashbourne Act the fund will become exhausted in five years. A tenant at £5 a year rental buys a farm for £100. For that £100 he owes the State £4 a year, and he pays the annuity at the rate of £2 half yearly. In that transaction the landlord makes a deposit of £20. If the tenant failed to pay one of the instalments, under the Ashbourne Act, he might be proceeded against by civil process, or £2 might be taken from the guarantee deposit. A failure to pay the half-yearly sums for five years would exhaust the guarantee deposit. Now, however, if the tenant fails to pay you say, for no earthly reason, " There is £2 due, but although we have £20 in the guarantee deposit we will only take £1 and take the other £1 from the local rates contributed by persons who derive no benefit whatever from this transaction." The difference is simply this: Under the Ashbourne Act the landlords' guarantee deposit would be exhausted if the tenant failed to pay in five years, whereas under this Bill the tenant would have to fail to pay for 10 years before the guarantee deposit was exhausted. The right hon. Gentleman opposite said " We treat the two guarantors alike," meaning first the landlord and, secondly, the locality. But there are other guarantors, and do you treat them alike? There are the landlord and the tenant, nominally, parties to a free contract in which they are the individuals concerned, and you ought to treat them alike. The right hon. Gentleman drew a distinction between the temporary and permanent order of guarantees, but I attach little importance to it. His argument as to the permanent order did not improve his own case, for he said— When you sell the holding which you should do before you come on the guarantee deposit, you not only sell the holding which is the guarantee of the tenant corresponding to the guarantee deposit, but you actually realise by the Act the value of the tenant's insurance fund. You compel the tenant for the first five years to pay at the rate of 20 years' purchase of a farm, even though he may have bought at 10 years' purchase. You lodge that insurance money in your funds to lower the amount of the annuity on the farm in future years, and then when you sell the farm the new purchaser buys it, subject to the fact that the annuity paid to the State in future years will be less than it would have been if the tenant had not 'been obliged to find that insurance money. Does it not follow, then, that you realise the whole of the value of the insurance money you have taken on the sale; and applying the axiom of the right hon. Gentleman that the guarantors should be treated alike, why do you exhaust the land and cash of the tenant and then take only half the guarantee of the landlord? If you drain out the tenant when he comes to default, the landlord ought also to be drained out. And this is more especially the case when you consider that the Bill is brought in for the benefit of the landlord. [" Oh, oh."] Yes; object of the Bill is to make saleale that which is unsaleable at present. By incumbrances and rent reductions by the Court, the landlords are not in a solvent condition, and this Bill is the only avenue by which their position can be made tolerable, and for this only way of escape they ought to run the risk with regard to this one-fifth. I say the tenants can better afford to wait for this Bill than the landlords, and if that is so, I hold that the landlords should stand the risk you judged they should in 1885 and 1888. That is one argument for equal treatment for the landlord and the tenant. Then I come -to the other aspect of equal treatment as between the landlord and the locality. Why should they be put on a footing of equal responsibility in an affair of this kind? The landlord is a party to the transaction, a willing party and a profiting party. He is the party who has put the funds of the British Empire into his pocket by a transaction which would not have been possible except for this Bill. On every ground, therefore, the landlord should be held responsible for keeping up the guarantee deposit. .But as to the locality, that is an unwilling party. [" No, no !"] Who says that the localities are willing to be fined for defaulting tenants?

MR. MACARTNEY (Antrim, S.)

I say that the whole country is in favour of the Bill.

MR. SEXTON

How has the hon. Gentleman obtained that view of the opinion of the country? Has he taken in a vision the plebiscite which the Chief Secretary is unwilling to give us? I should require some evidence before I took the hon. Gentleman's view as to the opinion of Ireland, and in the meantime I hold myself quite as capable of forming a judgment as to the opinion of Ireland as the hon. Member. The landlord is a profiting party, and the locality is not. The landlord comes into the matter by a contract of his own, and you bring the locality into it by a breach of contract, for by an Imperial contract the money you propose to hypothecate to this purpose is the inalienable property of the people of Ireland. I protest against the theory that there is any parity between the responsibility of the individual who comes into this matter on the strength of a contract that is entered into voluntarily, and the locality that is dragged into it by a breach of contract. I believe that the whole secret of this monstrous proposal of cash and contingent guarantees is to be found in that system. The whole thing is due to your desire to safeguard the deposit of the landlords. I have not heard why the system which has been considered satisfactory and sufficient during the past six years is not satisfactory and sufficient now. If you were willing to make the whole guarantee deposit liable, there would be no reason to resort to this cash and contingent system, and no reason for our opposition to the Bill. What is good security for advances under the Ashbourne Act should be good security under this Bill. If the guarantee deposit is good security for thousands of persons under the Ashbourne Act, it is equally good security for the thousands of persons who will enter into similar transactions under this Bill. The effect of taking only half the guarantee deposit will be a local levy. In reference to the cash fund it will mean an increase of rates, and as to the contingent portion it will mean the dislocation of the Local Government arrangements in Ireland. There will be sullen and stern resistance to the levy, and this contingent portion of the guarantee will, therefore, prove to be illusory. You will make this levy on three classes of Irish farmers. First, when the guarantee deposit is not sufficient' you will levy, or try to levy, on men who have failed to pay their annuities to the State. That is absurd on the face of it. If they have not been able to pay their annuities to the State, they certainly will not be able to pay a special levy. Secondly, you will levy on the men who have paid their annuities, and to say to a man who has paid every penny he owes, " You have paid all you owe, but some other man has not and you must make good his default," is a negation of justice. In the third place, you will levy on the farmers of the country, who have not been able to purchase their holdings at all—and they will be the vast majority. Only one fourth of the farmers of Ireland will be able to buy, either because the landlords are unwilling to sell, or because there is no money to advance. Well, if the man who has bought fails to pay, you go to the other three and say, " You have not been allowed to purchase your holdings; you have to pay the old rents without reduction, nevertheless, because this man who has been allowed to use the credit of the State and secure a reduction is in default, you must make good that default." There is a point at which the public opinion of a country, even of a small country like Ireland, will become too strong even for a strong Government; and I maintain that this point is reached when you make this monstrous claim upon us. We shall hold it to be our duty to offer this unjust proposal the most strenuous resistance in our power.

(4.43.) MR. SHAW LEFEVRE (Bradford, Central)

The Chief Secretary has exaggerated and misstated the arguments which I brought forward last night in speaking upon this Amendment. The Chief Secretary represented me as stating that the only cause of default that could be was excessive price. I never said anything of the kind. I was not dealing with the period of 49 years, because the period during which the defalcations are likely to occur is during the time the landlord's one-fifth is demanded on deposit, namely, 15 years. But I did state that experience of the Ashbourne Acts has shown us that in by far the greater number of cases excessive price is shown to be the cause of the defalcations. That statement I now emphatically affirm. The Chief Secretary maintains that neither experience of the administration of the Acts nor reason justify us in arriving at that conclusion. I will undertake to prove by figures which have been laid before the House in the form of a Return that my contention is indisputable. There are 34 cases of defalcation mentioned, and I venture to say that no one who goes through that list and compares the rents with the valuation and looks at the number of years purchase paid can fail to arrive at any other conclusion than that in the great majority of cases the defalcations were due to the excessive price paid and not to the neglect of the tenants. There were eight cases that I would call attention to especially, where not only have there been defalcations, but in which, when the properties were put up for sale, there was actually no price bid for the holdings. In these cases the aggregate purchase money was £15,800, the previous rental was £816, the valuation was £500, the price paid was 20 years' purchase, the landlord's one-fifth remaining in the hands of the Commission amounted to £3,160, the rent was, therefore, 45 per cent. above the valuation. In a year and a half the tenants were unable to pay, the Land. Commissioners put up the holdings for sale, and they fetched nothing in the market. I can only say in these cases the prices paid were evidently excessive and the Land Commissioners should not have consented to the transaction. It is quite evident that in the cases alluded. to the Land Commissioners have been deluded and have sanctioned these proposals without having the proper facts before them. I think that it is only fair in such cases that the landlord's one-fifth should bear the whole of the defalcations, and that the localities should not be saddled with the debt.

(3.50.) MR. T. W. RUSSELL (Tyrone, S.)

There are two parties on this side of the House; the first Party are those led by the hon. Member for Northampton (Mr. Labouchere), who maintain that there should be no risk to the Imperial taxpayer; and the second Party are those led by the hon. Member for West Belfast (Mr. Sexton), who maintain that there should be no risk to the Irish taxpayer. Hon. Gentlemen below the Gangway from Ireland want this £30,000,000 without security at all. Now, I put it, if the Imperial taxpayer is to have no risk, according to the hon. Member for Northampton, and if the Irish taxpayer is to run no risk, according to the hon. Member for West Belfast, how are the £30,000,000 to be had?

MR. J. E. ELLIS (Nottingham, Rushcliffe)

Drop the Bill.

MR. T. W. RUSSELL

Exactly. Now I want the attention of hon. Members below the Gangway to that statement. They have been posing as friends of the Bill, but here is the hon. Member for the Rushcliffe Division who, when I put the inquiry to him, says "drop the Bill." Is that what hon. Members below the Gangway want?

MR. SEXTON

; Not at all. Our position is well known. We desire the Bill, and will have it on safe conditions, and we are not responsible for the opinions of the hon. Member for the Rushcliffe Division.

MR. T. W. RUSSELL

Well, it is something to have elicited that the hon. Gentleman and those who sit beside him are willing to help hon. Members below the Gangway, although their object is to defeat the Bill, whilst hon. Members below the Gangway will not take that responsibility at present.

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

The hon. Gentleman makes that assertion generally as applicable to Members sitting above the Gangway on this side of the House. For my own part, I must point out that what he says is totally contrary to every declaration made from this Bench and from elsewhere on these Benches.

MR. T. W. RUSSELL

There are so many leaders on this side of the House that I must drop that part of the subject.

MR. W. E. GLADSTONE

Hear, hear!

MR. T. W. RUSSELL

When the Debate occurred last night the position taken up by the right hon. Gentleman the Member for Newcastle, and the position taken up by the hon. Member for West Belfast were somewhat different. As far as I can gather, the hon. Member for West Belfast objected to the tenants and landlords not being placed on the same footing as to liability. As far as I can get at the arguments of the right hon. Member for Newcastle, I think he was in a difficulty as to the order in which payments should be made in case of default more than anything else. Now, I never heard it stated clearly, and I want to know why the tenant who purchases and the landlord who sells should be placed in the same position. I have never heard that completely stated yet. What takes place? In the first place, the tenant is not forced to buy. If he buys at all, he buys at a rate which enables an immediate reduction in his rent of at least 20 per cent. What happens in addition to that? The landlord cannot sell unless the Land Commission approves of the terms of the bargain. Let us imagine a case. A tenant agrees to buy on terms advantageous to himself, involving the right to the freehold after 49 years, and, in addition to that, easiness of terms. That sale is agreed to by the landlord, and by the Land Commission on behalf of the State. Now, what is the proposal? The landlord has to leave his. guarantee deposit, one-fifth of the purchase money, and, up to the present, under the Ashbourne Act, he has been liable to default to a certain point. The contention is, that he ought to be liable now in the same way. I hold that it is. too much to assume, as the right hon. Gentleman the Member for Bradford does, that every default in Ireland must be due to the fact that the terms of the purchase are too high. One would. imagine, to hear hon. Members talk in this House, that every Irish tenant was a saint, and every Irish landlord was a scoundrel. That is not the case. There are good landlords and very bad ones; but there are good tenants, and there are also bad tenants; and there is just as much liability of default from want of thrift, want of knowledge of farming, want of sobriety, and want of all the virtues which men require to have in this life, as there is liability to default from the extortion of the landlords. Take a case where the tenant is responsible for such default. Well, the landlord is not responsible; he has sold his land upon terms agreed upon; the transac tion has been ratified by the Land Commissioners. Why should he be placed in the position of the man who is responsible for the default, and but for whom the default could never have occurred? I think that hon. Members below the Gangway, though they hate landlordism, should, at all events, try to be fair in dealing with men who are parting with their property at a great sacrifice.

An hon. MEMBER

It is a voluntary act.

MR. T. W. RUSSELL

Yes; it is a voluntary act in the face of the conspiracy in the South and West of Ireland. There is one difficulty. The hon. Member for the Rushcliffe Division has absolutely fallen into the trap again. The difficulty will not be to get the tenant to buy, but to get the landlord to sell. If there is to be any further difficulty placed in the way of landlords these sales in Ulster will become more and more improbable. I think the Attorney General for Ireland, in what he has said, has satisfied the right hon. Gentleman the Member for Newcastle as to the order in which these funds are to go to meet default. I will -Simply content myself by saying that these parties to the transaction are not in the same position. The hon. Member for West Belfast commenced his able speech by saying that it was the British taxpayer, the British Nation, that was responsible for the present condition of things.

MR. SEXTON

The British Government.

MR. T. W. RUSSELL

If the British Nation is responsible for the state of things that throws us back on the taxpayer; but the hon. Member for Northampton will have none of that responsibility, and will not have the British taxpayer involved in 1s. Therefore the hon. Member for Northampton answers the hon. Member for West Belfast. The hon. Member says the Government will settle all this, by seeing that the burdens are fair—that there will be no conspiracy against the payments if the burdens are fair. Coming from the hon. Member for West Belfast and those below the Gangway, that is equal to saying that if the tenants are allowed to fix the price there would be no difficulty. I say that is not fair. I have heard of seven years' purchase described by hon. Members below the Gangway, and I maintain that that is a very easy way of settling the question, if the Government are able to do it, but there can be no idea of justice in it.

(4.0.) MR. LABOUCHERE (Northampton)

I am in favour of this Amendment, and opposed to the proposal as it stands in the Bill. The Chief Secretary said he had explained the matter according to his legal powers. I think the right hon. Gentleman explained it very clearly and very satisfactorily, as an explanation. What I complain of is, that the arguments he used in favour of his proposal were not as sound and as good as his explanation. Under the Ashbourne Act it was decided that the landlord should put up a fifth, and the Chief Secretary admits that there is an alteration, and also, I think, that the alteration is, as we say, in favour of the landlord. If the alteration were in favour of the tenant we should have gentlemen opposite from Ireland protesting, and naturally Gentleman from Ireland on this side protest that it is in favour of the landlord. That it most unquestionably is, and the onus probandi lies with the Irish Secretary to show why this alteration should be made for the benefit of the landlord, and that I contend he has not done. The Chief Secretary for Ireland said it was a hardship to the landlord to put up this money. But the right hon. Gentleman does not free the landlord from putting up a fifth, though he relieves him of part and parcel of the possibility of losing a portion of that fifth. He says it does not necessarily follow, as my right hon. Friend the Member for Newcastle (Mr. John Morley) suggested, that the price will have been too high. The presumption must be that the price was too high because you have first to sell the interest of the land to some one else. A portion of the money has already been paid, and you only come to the landlord for a fifth or for a tenth, when it is shown by putting the property up to public auction you cannot find one single human being to give a sum which is not considerably less than was given to the landlord. In that case surely it is only fair and reasonable that the landlord should be the first person to pay back a portion of the money. It is proved the landlord has got too much. We have made a mistake and the landlord ought to suffer for it. We have had certain discussion as to what should be done in the case of a strike. The right hon. Gentleman says that the locality ought to share this liability of a strike because it would be the fault of the locality. I cannot see that it would necessarily be the fault of the locality, or that the locality is responsible for it. Take certain of the tenants. These tenants do not pay; you may call it strike or combination—what you like. But they can say, " We cannot pay, and we are not going to pay." Who suffers? The combination may be called into existence by a fall in price of produce. Why then are the grocers and others to pay a portion of this money to release the landlord, when they will themselves be suffering equally with the unfortunate tenant by the fall in the price of produce? We were told by hon. Members opposite that this Bill is not in the interest of the landlord. [A Conservative MEMBER: Bear, hear !] The hon. Gentleman opposite' says;" hear, hear !" Does he know that no landlord is obliged to sell by this Bill? If then the landlords do sell in considerable numbers we may assume that they think it to their interest to do so. Are we to suppose that the Irish landlords are philanthropists who are going to sacrifice their interests in order that this Bill may be carried into effect? Most assuredly not. And they will prove by making use of the Bill, by selling under it, that it is entirely to their interest. We give these landlords a great advantage. It is an advantage to say to the landlord: " If you like to sell, you may sell to us for more than you could get in the open market." Under these circumstances, we surely have a perfect right to make our own terms in regard to sale. They are not obliged to accept them, and the condition is a most fair and legitimate one, which was introduced into the Ashbourne Act, and ought to appear in this Bill—that you ought not to come on the locality until you have gone on this one-fifth.

(4.7.) COLONEL SAUNDERSON (Armagh, N.)

One circumstance has been manifest to the Committee, and it is this—that however opposed to the Bill hon. Gentlemen opposite of the Radical persuasion may be, yet my right hon. Friend the Chief Secretary for Ireland has found a supporter in the right hon. Gentleman the Member for Mid. Lothian. We did not before know that that right hon. Gentleman was a supporter of this Bill, but from an interruption by him during the speech of the hon. Member for South Tyrone, we learn that he, at any rate, disclaims any idea of opposing the principles of this Bill. To have secured so great an ally on the opposite side of the House ought, I think, to be a matter of thankfulness to Her Majesty's Government. But the hon. Member for West Belfast challenged one of my hon. Friends as to the popularity of this Bill. The proof of the popularity of this Bill is the action of hon. Members below the Gangway opposite. Very recently they were opposed to the Bill, and in their hearts they hate it still, 'but they know perfectly well they dare not revisit their constituents in Ireland if they oppose it in this House. Therefore, they have given it a qualified resistance by supporting an Amendment which, if carried, would have destroyed the Bill altogether. With regard to this proposal to increase the liability of the landlord who sells, I would point out that if there is a strike against rents, if a landlord has sold his property, surely the blame cannot be laid on him, but on the locality in which the strike against rents occurs. The House will remember a very interesting circumstance that occurred the other day when my right hon. Friend the Chief Secretary was speaking upon this Bill. " Who will fix the price? " was the question asked, and the hon. and learned Member for Longford interrupted and said, " The Local Land League." Well, if the Local Land League is to determine the price, to interfere with the price, and if there is to be a strike against rent, it will be the local Land League or whatever organisation hon. Gentlemen opposite will bring into life in Ireland for a political purpose which will instigate Irish tenants to strike against rent. Therefore, I think it would be a most monstrous thing that a landlord who sells his property, which will have the effect of reducing his income by one-half, should have to carry with him wherever he went the doubt rankling in his mind that at any moment the local Land League or some other Political Organisation might cause a strike against rent, and that because they cause that strike, he, forsooth, who was absolutely opposed to any such thing, would have to bear part of the blame. I look upon that as a most monstrous piece of injustice. The House naturally feels anxious as to whether the Commissioners are likely to advance too much money in buying these Irish estates. I hold in my hand a Return which is interesting from the fact that it bears upon this very question. This shows an estate for sale in County Cork—the estate of H. B. O'Sullivan. In the year 1878 this gentleman refused £27,000 for the estate. The other day he offered it to his tenants for £8,885, and the tenants accepted that offer with thankfulness. The effect of the offer would have been this: The tenants themselves were under a fair rent. I will take one case. His fair rent fixed by the Court was £45. He swore himself in Court that in his own valuation his farm was worth £35. Under the offer of the landlord to sell, the £35 in his case would have been reduced to £23. But the Commissioners refused to sanction the transaction unless the landlord accepted £7,389, which in the case of this farm would have reduced the rent to £16, although he himself had sworn it was worth £35. Is not that a very fair margin? Is it likely that the State would run very much danger by sanctioning purchase at that money. Therefore, I hope the Committee will see, first of all, that it would be most unfair and unjust—

MR. PINKERTON (Galway, N.)

Would the hon. and gallant Gentleman give the valuation of that holding?

COLONEL SAUNDERSON

The old rent was £53.

MR. PINKERTON

What is the Government—the Poor Law—valuation?

COLONEL SAUNDERSON

The Government valuation is £24. [Opposition cheers.] Hon. Gentlemen above the Gangway cheer that because they know nothing about it. But hon. Gentlemen below the Gangway know something about it. If the tenant swears in open Court, in trying to get lair rent fixed, that he conceives the value of his farm to be £35 a year, and is willing to pay that rent as fair, and when the Commissioners refuse to sanction the sale unless, practically, the rent is reduced to £16, I say the margin between that figure and £35 is a very fair margin for the security which the State requires. Therefore, I hope the Committee will not sanction the idea that landlords are to be saddled with the whole of this fifth, but that it should be divided on one hand between the landlord who sells and the tenant who buys and on the locality on the other. It is in the interests of the locality when farms are sold not to endanger the county guarantee, and depend upon it that the locality will see that neither the local Land League nor political demagogues will incite the locality to refuse to pay when the loss will fall on their own pockets.

(4.15.) MR. W. E. GLADSTONE

I am very sorry that the hon. and gallant Gentleman drags me into this Debate by the gross misstatement he has made. I do not find fault with the hon. and gallant Gentleman. I know his eloquence is ungovernable, as it is, I am afraid on many occasions, unprofitable. He has claimed me as a supporter of the Bill, and he does that because an hon. Member behind me (Mr. T. W. Russell), perhaps inadvertently, said that the object of those who acted with me was to destroy the Bill. I totally disclaimed the statement that we wished to destroy the Bill. That is the extent of what I have done, and it is that upon which the hon. and gallant Gentleman, in the exercise of the understanding which the Almighty has given him, has represented me as being a supporter of the Bill. My position is a very simple one. I am only sorry to be compelled by the rather violent action of the hon. and gallant Gentleman to occupy the time of the Committee in stating that the aggregate objections to the Bill were such that, although I was desirous to see a Land Purchase Bill passed, they made it my duty to vote against the Second Reading of this Bill. But it is my duty now to endeavour to see whether by Amendments of the Bill it can be rendered such that I shall be enabled to withdraw that opposition, and that clearly is a position quite distinct, as the hon. Member will admit, from the position of one who pledging Imperial credit, and not against wishes to destroy the Bill, as it is quite distinct from the position of one who would deserve the glowing description given by the hon. and gallant Gentleman of being a supporter of the Bill. I am obliged to vote for the Amendment which has been proposed, and I do it upon two grounds. I do it because I think the arrangement proposed by the Government is unjust to the ratepayer and unjust to the State. I think it unjust to the ratepayer upon the ground which I will not travel over again. We have heard the admirable statement of my hon. Friend the Member for West Belfast, and I do not think anyone could possibly wish for a clearer exposition. On that ground I think the injustice to the ratepayer is such that I cannot for a moment be a party to inflicting it. But I think the Bill as it stands is also unjust to the State. The security of the rates is, in my opinion, totally unreal and unavailable, and it is unjust to the State to give it a fictitious security instead of a real one. As long as a guarantee by the landlord was available the security was a real one, but if instead of £1 out of that Guarantee Fund he must give 10s., and 10s. out of a supposed—presumed product of the rates, which I conceive to be based on injustice and impossible in practice, he may then greatly damage the security of the State. Whatever I think of the moral incapacity of this House to pledge Imperial credit, the House having been pleased by a large majority to vote that, my next duty is to see that there is some reality in the guarantee it is proposed to provide. I think the guarantee proposed to be provided on the rates is absolutely without value, because the provision to make it without the consent of the ratepayers, or of any Local Authority, and under circumstances in which those who have not been able to purchase and not receiving the benefits of the Bill are to be made to supply the defaults of those who have been able to purchase, is an arrangement which, when the time comes for giving it practical effect, will be found wholly unavailable for the purpose for which it is intended. I find that I have made a verbal mistake in the course of my remarks. My vote was given against the Second Reading of the Bill.

(4.22.) MR. T. M. HEALY (Longford, N.)

The Chief Secretary illustrated his argument by reference to a conspiracy in the locality. Let the Committee observe what the locality is. The locality is a county. One of the so-called conspiracies is that which the hon. Member for Hunts (Mr. Smith-Barry) is supposed to be operating against—a strike against rent on the Ponsonby estate, situated in the County of Cork, at Youghal. But the people in the districts of Castletown and Berehaven, in the County of Cork, are to be made to pay for the misdeeds of people at Youghal, which is as far distant from them as is Galway. That comes of the absurdity of making the county the unit. You do it because your plan under this Bill is to issue a precept to the Grand Jury to make up a local rate, and then the Grand Jury, without even the preliminary of a Presentment Sessions, are bound to strike a rate, and men 100 miles away from the scene of a so-called conspiracy are to make good a default which might be committed by people in a place like Youghal. Yet we are told by gentlemen like the hon. Member for Cork (Mr. Parnell) that we are struggling to defeat this Bill. My hon. Friend the Member for Northampton and other hon. Gentlemen have all assumed that this fifth is to be retained. But have we forgotten the juggle of the Land Department Bill? We have here a Land Department Bill which you have read with acclamation a second time; and Clause 17, Sub-section 2, of that Bill provides that you need not retain a penny of the fifth if you please. Then we have another illustration, not a very candid one, given us by the hon. and gallant Member for North Armagh in the case of the O'Sullivan estate. Now, that is an estate which I happen to know something about. I understand that estate was offered for sale for £8,885 instead of £27,000, which was formerly asked for it. That looks wonderful until you come to the facts. Who are selling the estate? Is it O'Sullivan? No; it is the Munster and Leinster Bank. Because the O'Sullivans were spendthrift, I presume, and chose to put blisters on their estate, the Mun- ster and Leinster Bank sell to the first man they can get, and he will only give £8,000. Accordingly, to trot out to us the O'Sullivan estate as if we knew nothing about the matter is, I should imagine, as though the hon. and gallant Gentleman thought he was talking to an audience of Ulster Orangemen.

COLONEL SAUNDERSON

The hon. and learned Member could not, apparently, have been in the House when I spoke. I stated that the Commissioners refused to sell the estate.

MR. T. M. HEALY

I heard every word of the hon. and gallant Gentleman's speech, and the point he repeats, as a matter of fact, reinforces my argument. If the Commissioners refused to sell at the amount of the Munster and Leinster Bank's mortgage, does not that prove exactly our contention upon the business? Supposing the O'Sallivans were not encumbered at all, is it likely that they would sell for £7,000? What do they do? The Munster and Leinster Bank is not an Orange Lodge. It cannot vote for the Castle. It is a Limited Liability Company. It is not an institution which has at its back the Loyal and Patriotic Union. It has not a newspaper in its interest. It cannot lobby and interview the Chief Secretary in his chambers. The Munster and Leinster Bank must suffer loss. But if, instead of being an institution of a purely financial character, it were a landlord, it would make its complaints to the Purchase Commissioners at the Castle, make the matter known, and endeavour to intimidate them; and when the salaries of these Commissioners, having been taken off the Votes, could no longer be criticised in this House, the British public would then find that this transaction had taken place, and, instead of being refused to be passed at £8,000, it would most likely be passed at £18,000 or £20,000; and then, in 10 or five years' time, you would, perhaps, have a demand made on an estate so valuable as this that any default should be made good not by the landlord's fifth but by the locality. That is the way the argument of the hon. and gallant Gentleman goes. It goes to show the iniquity of the proposals of Her Majesty's Government. The right hon. Gentleman has no argu ment whatever to offer to the Committee for making half payable by the tenant. The argument of the Chief Secretary in favour of practically abolishing the landlord's fifth and making the ratepayers pay the half of it is absolutely absurd. The towns must pay for this as well as the country. Observe the curious result of the Government trying to escape from their own folly. Under the Bill the exempted towns are Dublin, Cork, Belfast, Londonderry, and Limerick. Cork goes a long way into the country,. and Limerick goes into the country also. You exempt these places so that the ratepayers will not kick against the proposal. Both Cork and Limerick contain large areas known as " liberties," which extend miles into the country, and you. exempt them from the Bill in order to make your area of charge purely rural.. But take boroughs like Newry, business. places like Lurgan, and cities like Coleraine. Why should they be called upon to make good any default in a particular-locality? In addition to this it is proposed to include the counties of the Cities of Kilkenny, Carrickfergus, Galway, Drogheda, and Waterford in the Bill. What is the meaning of this proposition? Many hon. Members. recollect the passing of the Redistribution of Seats Bill. That was the result of a compact between the two Front Benches, and whatever arguments were-addressed to the Minister in charge of the Bill he said, " I have agreed about this with Lord Salisbury, and I cannot make any concession." The Chief Secretary is padlocked to this provision because he has agreed with the landlords to make it—

MR. A. J. BALFOUR

I have not.

MR. T. M. HEALY

I am glad to hear that. Then give up the provision. Did not the landlords in Convention ask for this provision?

MR. A. J. BALFOUR

I do not know.

MR. T. M. HEALY

I say they did.

COLONEL WARING (Down, N.)

I say they did not.

MR. T. M. HEALY

Then they do, not want it. It is a free boon in the gift and grace of Her Majesty's Government.

COLONEL WARING

What I said was that the landlords did not ask for it. That is very different to accepting it gratefully.

MR. T. M. HEALY

I was saying that if the landlords have not asked for this boon the Government are not pinned to it. I suppose the demand was thought by the landlords to be so monstrous that they did not dare to put it forward at their Convention. These gentlemen would ask for the moon if it occurred to them to do so. What demand has been made by the hon. Member for South Hunts (Mr. Smith-Barry). It reminds me of the famous story about Mr. Hut: " Give him Ireland for an estate and he will ask for the Isle of Man for a kitchen garden." The landlords have not thought fit to ask for this provision, and we who have no local authority, and are to have no control, are to be made to smart and to pay when the landlord's fifth is lying there and no demand has been made upon it. I regard this proposition of the Government as the most unwholesome, pernicious, and objectionable of the entire measure.

(4.44.) MR. MAHONY (Meath, N.)

The Land Commissioners are not now empowered to see that the amount advanced is a fair price for the interest purchased. Will the Chief Secretary undertake to provide at some later stage that the Land Commissioners shall be compelled to see that there is fair and reasonable security in the land itself for the money advanced?

MR. A. J. BALFOUR

The duty of the Land Commissioners already is to see that the holding is such as to afford good security for the advance made.

MR. MAHONY

I exclude the tenants' interest; I mean the actual thing that passes in the sale.

MR. A. J. BALFOUR

They must do that now.

(4.45.) MR. M. J. KENNY (Tyrone, Mid)

Under the Bill the local guarantees have to ,be exhausted before the landlord's deposit can be touched. It is quite clear the object of the Government is not only to whittle down the landlord's liability to half of the one-fifth, they mean the landlord to get off scot free, and to transfer the liability of 'the landlord to the locality. I submit that if the Bill is unamended at this point the Courts will hold that they cannot touch the guarantee deposit until the Guarantee Fund, consisting of the two portions specified in Clause 3—that is, the cash portion and the contingent portion—are absolutely exhausted. I ask the Attorney General for Ireland whether he is prepared to insert words insuring that the guarantee deposit will be liable pari passu with the Guarantee Fund so that the landlord's portion and the tenant's portion will be exhausted concurrently?

(4.46.) THE ATTORNEY GENERAL FOR IRELAND (Mr. MADDEN, Dublin University)

I am quite clear that the Land Commission can attach the guarantee deposit as soon as they declare the debt to be irrecoverable.

(4.48.) MR. KNOX (Cavan, W.)

It would be possible to insert words at the end of the sub-section which would meet the point raised. The mistake made in drafting is due to the simple fact that the draftsman forgot that the procedure which was sufficient under the Act of 1885 in respect of the guarantee deposit is not sufficient now. Under the Act of 1885, when the Land Commissioners wanted to apply the guarantee deposit they did so directly, and applied it in the payment to themselves of what was due. Under this Bill they have to carry the guarantee deposit, or such portion as the Government declares shall be used under this provision, to the Land Purchase Account. There is no mandatory provision in the Bill—but I suppose that is a slip in drafting—that at any particular period the guarantee deposit, or any part of it, shall be carried to the Land Purchase Account. There is another point I am desirous of raising. I have no doubt the Chief Secretary and Attorney General for Ireland are aware that in many cases at present the Land Commissioners sanction the sales of smaller holdings only on condition that a larger proportion than one-fifth of the purchase money shall remain as guarantee deposit. They are able, therefore, to sanction the sale of smaller holdings without risk or loss 'to the taxpayers, which but for that simple expedient could not be carried out at all. The provision will entirely prevent that course of dealing which I think the Goment must admit is one that everybody who has a practical interest in the ques tion of land purchase must be in favour of. It will practically shut the small farmers out of the Bill. We saw from the papers that it was said the other day the Bill will give reductions of 30 and 40 per cent. to 150,000 tenants in Ireland. Anyone who takes the trouble to read the Bill must know that no tenant will get more than 20 per cent. reduction for 25 years. We know also, from the experience of the Ashbourne Acts, that it will be many a long year before 150,000 tenants can by any possibility come within the scope of the measure.

THE CHAIRMAN

I fail to see how the hon. Member's remarks are pertinent to the question before the Committee.

MR. KNOX

I am anxious to show that, as the provision now under consideration prevents the Land Commissioners, on any default by the tenant, from taking more than one-half of the sum in default out of the landlord's guarantee deposit, there will be no practical advantage to the State in making the deposit larger. The guarantee deposit, as it is, will be so large in comparison with what may be taken out of it that it is almost impossible for the whole of it to be absorbed within the 18 years. As my hon. Friend the Member for West Belfast has shown, unless the tenant within the 18 years after purchase makes default in 20 half-yearly payments, the whole of the one-fifth guarantee deposit cannot be absorbed; So there will be practically no advantage to the State in making the guarantee deposit larger. The procedure under which advances have been made to smaller tenants will therefore be no longer of any use. I contend that if the provision is carried in its present form it will make impossible the carrying out of sales to tenants in those cases where sales are most required if social peace in Ireland is to be ,restored, and if the small tenants are to eke out a livelihood on their own land.

(4.54.) MR. WINTERBOTHAM (Gloucester, Cirencester)

Before this clause is passed, I wish to utter a protest. I have been hoping the Chief Secretary would say something in reply to the exceedingly able and unanswerable speech of the hon. Gentleman the Member for West Belfast. We English Members long ago realised that there is not much good in protesting here, and have felt driven to appeal to the English people from English platforms. As to this iniquitous Landlords' Bill we have told. the people, and we shall continue to tell them, that this is a Bill mainly to benefit the landlord class of Ireland. It now turns out that, unasked by the landlords, Her Majesty's Government have gone out of their way to make the landlords' position with regard to their share of the risk under the Guarantee Fund 50 per cent. better than it has been under the Ashbourne Act. It is quite evident to a sensible man that the landlord is a seller, for if he does not like the price he need not sell. It is quite evident to a man of business that the 20 per cent. which is kept in the Guarantee Fund is not more than the extra price the landlord gets for his land over and above what he would get if the land were put up to public auction and to free competition, and there is no injustice, therefore, in keeping this 20 per cent. as a buffer between the State and the loan which it has advanced. But I do not think enough has been said about the unfairness of putting half the possible loss upon the taxpayers of Ireland. That men who are allowed no voice in the matter, and who receive no benefit under the Bill, should have to pay for any default, is a most monstrous thing. But beyond this, you propose to " capture " the resources of Ireland. What right have you to pledge the resources of each locality for a purpose which will not benefit the general community? I only utter this word of protest. We cannot defeat or alter the measure. You have your majority to vote us down, but in the near future, when your friends the landlords, having pocketed the swag, have gone off, we may be in a position to take care than any loss which accrues shall fall not upon industry nor on vans and wheels, nor upon the poor people of the country, but upon the landlord class, who are the class benefited.

(4.59.) MR. CONYBEARE (Cornwall, Camborne)

I cannot agree with the right hon. Gentleman the Member for Mid Lothian in the desire to amend this Bill. I hope there will be as little. Amendment as possible, in order that the people of this country, who have been befooled into allowing a Tory Government to introduce a Bill of this kind against all their pledges, may realise the blessings of having a Tory Government. There has been a great omission in the course of the Debate. We have not yet heard any reply from the Government to the urgent arguments addressed to the Committee by the hon. Member for West Belfast, and now, Mr. Courtney, when you are on the point of rising to put the question, the Chief Secretary has made himself scarce. Furthermore, we have not yet heard the views of the noble Lord the Member for Rossendale (the Marquess of Hartington) who is jointly responsible for and guilty of the iniquitous fraud, which is now being perpetrated on the constituencies of this country. Then there is that able lawyer the right hon. and learned Gentleman the Member for Bury (Sir Henry James) from whom we have had no expression of opinion upon this clause. I distinctly recollect the time when the noble Lord and his right hon. Colleague had a good deal to say of a rather violent character against the land purchase proposals of 1886, which, as compared with the proposals in this Bill, were as safe as Consols. Now I take it that these Gentlemen share with the Government the responsibility for introducing this measure, and we have a right to know if they have any answer to what has been said with thorough knowledge of the subject by the hon. Member for West Belfast (Mr. Sexton). The Chancellor of the Exchequer has just returned to his place. I do not know whether he was present when my hon. Friend was arguing the question, but as he was posing yesterday as the guardian of the taxpayers of the country, it is desirable that he should offer some reply. It is monstrous that my hon. Friend, having put his case with a lucidity and force that appealed to the intelligenee of every hon. Member in the Committee, should have no answer. If my hon. Friend's arguments are unanswerable, then let the Amendment be accepted. I do not appeal to hon. Gentlemen below the Gangway opposite, because they merely answer argument with impatient cries for a Division, and I do not suppose they have given much attention to the Bill or that they understand it. We require a reply, however, from their responsible leaders; but, as this is not forthcoming, it may be that they desire more time for the consideration of the points raised, therefore, to afford them that time, I move that you do now, Sir, report Progress.

THE CHAIRMAN

Order, order ! The hon. Member must be prepared for my declaration that this is trifling with the Committee.^*

Question again proposed.

MR. T. M. HEALY

Does not the right hon. Gentleman think that some reply is due to my hon. Friend's speech?

(5.4.) MR. A. J. BALFOUR

No one has more admiration for the powers of eloquence of the hon. Member for West Belfast than I have. He has put the case for the Amendment in an excellent manner. I had previously put the case on behalf of the Government in a speech of some length. I do not know that I have anything to add to what I have said. I am quite content to leave the case as presented by the hon. Member on the one side, and by myself on the other, to the judgment of the Committee.

(5.5.)The Committee divided: —Ayes 205; Noes 158.— (Div. List, No. 145.)

THE CHAIRMAN

The Amendment which stands in the name of the hon. Member for Elgin raises a point which the Committee has already decided.

MR. SEXTON

Cannot an hon. Member move to substitute some other proposition than one-half of the Guarantee deposit?

THE CHAIRMAN

The hon. Member for Cork (Mr. M. Healy) proposes to leave out " one-half," and insert " three-fourths," and I call on him to proceed with that Motion.

(5.20.) MR. KNOX

In the absence of my hon. Friend (Mr. M. Healy), I beg to move his Amendment. I will not detain the Committee at any length, for, of course, the main part of the principle^{* *}The entry in the Votes is as follows: Mr. Conybeare moved, " That the Chairman do report Progress, and ask leave to sit again; " but the Chairman being of opinion that the Motion was an abuse of the Rules of the House, declined to propose the Question thereupon to the Committee. has been decided already. We now want, so far as we can, to remove the grossness of the inequality' which would exist if the proposal of the Government were carried into effect without any Amendment whatever. I propose on behalf of my hon. Friend to substitute in line 34 "three-quarters" for "one-half." The landlord would bear three-fourths of the loss in case of a default occurring during the first 18 years, and the Local Authority would bear the other fourth. I would ask the Chief Secretary to consider whether this would not be fair. The right hon. Gentleman states that his object is to make equality between the landlord and the Local Authority. Now, we on this side deny that there ought to be this equality between the Local Authority and the landlord, but of course we must take the last Division as having decided something. We take it that the Committee has decided, in spite of our protest, by a majority of Members in favour of the principle of equality between the landlord and the Local Authority in respect to this guarantee. But we contend that the proposal of the Government does not give that equality. The guarantee of the landlord is for 18 years, and that of the Local Authority for the whole term of the 'purchase annuity. Our proposal is that in a rough way you may arrive at an equality by the omission of " one-half " of the guarantee deposit and making three-fourths of the deposit applicable. In that way during 18 years you would have the landlord's deposit bearing the greater part of the risk in consideration of the fact that after 18 years the landlord would have no risk whatever. I would ask the Chief Secretary if this is not a reasonable proposal that he may accept in the interest of quick progress with the Bill? We all want to get through the Bill as quickly as we can, consistently with our duty to the ratepayers and farmers of Ireland, and I ask the Chief Secretary to carry his principle of equality between the landlord and the Local Authority into effect by the adoption of this Amendment.

Amendment proposed, In page 2, line 34, to leave out the words "one-half," in order to insert the words " three-fourths,"— (Mr. Knox,) —instead thereof. Question proposed, " That the words `one-half' stand part of the Clause."

(5.24.) MR. A. J. BALFOUR

The hon. Member acknowledges that the Committee decided by the last Division that the Local Authority shall bear its share of any default that may occur, and as I understand it is now suggested that during 18 years the greater part of the burden shall be borne by the landlords on the ground that after that period a landlord will have no liability for loss at all. Now, the hon. Member must recollect that the reason why the guarantee deposit is not required to bear any risk after 18 years is, that after that period, the value of the Guarantee Fund will have so augmented by the number of years' payments of annuities and the amount paid off by the Sinking Fund, that practically there will be no more loss to bear. Therefore, after 18 years we need not trouble ourselves as to the liability of landlord or the tenant, far advanced towards the position of owner. Under the circumstances, I certainly take the view of the Committee, as expressed in the last Division, to cover this point, and I ask the Committee not to expend further time in discussion of a matter which, I think, was exhausted on the last Amendment.

(5.25.) MR. SEXTON

I think the right hon. Gentleman is in error in supposing that the decision of the Committee on the last Amendment covers this point. What I take the Division to have decided is that a majority of Members are of opinion that the whole of the loss arising from default should not fall on the guarantee deposit. That was the extent of the Division. But it is obvious that, so far from deciding the question of the present Amendment was that decision, that it left altogether open the question as to what proportion of the loss arising from default should be borne as between landlords and ratepayers. Now, the proposal of my hon. Friend the Member for Cavan is at once ingenious and just. It proposes to equalise the burden between landlords and the locality, and to do so not by an even liability in years succeeding the passing of the Act, but by so arranging the relative liability during the entire period as to arrive at a rough equation between the parties. My hon. Friend argues that for 18 years the landlord should bear three-fourths of the risk and the locality one-fourth, and after this period of 18 years, and for 31 years more, we are willing that the locality should bear the whole of the burden of risk and the landlords none. That certainly does, in my judgment, afford something like an equation. But the Chief Secretary says that after 18 years there is no substantial danger of default. Well, but how does that bear upon his previous speech of to-day, when he shadowed forth before the Committee as one of the vast dangers coming in the distance, and in recognition of which all these precautions were necessary, the danger of a conspiracy or strike against the payment of these annuities to the State? How does he make out now that this danger disappears at the end of 18 years? Of course, there will be the growth of the feeling of ownership. We say there is no danger of a strike if the bargain is a just one, but he is not in a position to say there is less danger of a strike 18 years hence than now. A strike may occur at any time, according to his argument, under political conditions he indicated. If it be true that there is no danger of a strike at the end of 18 years, why then, provide a local guarantee for the whole of the 49 years? There would be no necessity for considering that question. Here is a suggestion that will undoubtedly ease friction in regard to this Bill. The right hon. Gentleman admits that the only danger worth considering is the danger of a strike against the payment of rent. For individual defaults he admits he has ample and abundant guarantee equal to 2½ years liability. The only real danger is that -of a strike, that is the only thing that renders a general guarantee necessary. But he himself uses an argument of great force when he says the interest of the purchasing tenants as owners will be so powerful that the folly of a strike will not be indulged in. Very well, if we accept that conclusion, then the whole case for a local guarantee after 18 years is at an end. If the Chief Secretary will not accept the Amendment of my hon. Friend, will he consider—I do not say that it will be equally satisfactory—will he consider a proposal that at the end of 18 years, when, according to himself, the danger of repudiation will cease, the guarantee shall be no longer exacted? The hon. Gentleman has asked why not make the landlord wholly responsible instead of throwing half the liability on the tenant. Now if I were certain that every act of default in the first 18 years was due to conspiracy, I should refuse to ask the landlord to give any guarantee at all: I should throw the whole liability on the county. But the fact is that the default may in some cases be due to conspiracy, and in other cases to causes over which the tenant has no control, and hence it is I propose to make the landlord a party to the arrangement. I have never pretended that there is any real absolute necessity for this guarantee, but the hon. Gentleman must know enough of public opinion in England to be aware that the British taxpayer would not take my individual opinion, but will require an absolute guarantee. I have provided him with one.

MR. T. M. HEALY

How?

MR. A. J. BALFOUR

I repeat that I have provided an absolute guarantee. I know we cannot pass this Bill without the assent of Parliament and of this country, and even to omit what I think are superfluous guarantees might lead to the destruction of a Bill which I believe hon. Gentlemen opposite are anxious should be carried.

THE CHAIRMAN

Order, order ! Although the hon. Member made a suggestion to the Chief Secretary touching the cessation of the guarantee, and the right hon. Gentleman has replied to it, it would be out of order to discuss it.

(5.34.) MR. T. M. HEALY

I propose to recall to the Committee the historical aspect of this question and of the circumstances under which this demand is made. The right hon. Gentleman says he believes that the guarantee is not necessary. Does he say that no loss will fall on the taxpayer.

MR. A. J. BALFOUR

No serious loss.

MR. T. M. HEALY

Then if it cannot fall on the taxpayer it cannot fall on the landlord, and our demand consequently becomes irresistible. How did this House in former years satisfy the British taxpayer? In the year 1870, under the Bright Clauses, in order to satisfy the British taxpayer you insisted that only one half of the purchase money should be advanced by the State. Under the. Act of 1881 you increased that one-half to three-fourths, and under the Ashbourne Acts there was a further advance to the extent of four-fifths, and finally it was arranged to advance the whole sum, but to retain one-fifth. Now the demand for this Bill comes not from the tenant, but from the landlord, and hence it is that the Government propose to throw part of the landlord's liability on the local ratepayer. Hon. Gentlemen opposite deny that the demandant for this Bill is the landlord. Why, the hon. Member for Cork and the whole of the National Members for Ireland voted against the Bill. Pour years ago we voted against advancing a second .£5,000,000 for operation under the Ashbourne Acts, and therefore, so far as the tenants' Representatives are concerned we have not come imploring the House for this Bill. It is the landlords who have asked for it, and this particular provision is one of the results of the landlords' conventions which have been held for the first time in the history of Ireland. I do not object for one moment to the holding of those conventions. I think they are very desirable, and if we were let alone no doubt an agreement would be easily arrived at between landlord and tenant. These securities the Government are now insisting upon never entered into the head of Mr. Bright, or of the right hon. Gentleman the Member for Mid Lothian, or of Lord Ashbourne. They first recommended themselves to the Liberal Unionist mind of the Chancellor of the Exchequer. The Chief Secretary has spoken of the probability of the disappearance of the landlord from Ireland. My suggestion is that if the Irish landlord remains at home he can act as a mode for the general community, and by his wealth, education, and intelligence— which we know every member of the class possesses so large a share—set an example of rectitude. He can be as a shining candle in his particular community. Surely it would be a graceful act on the part of the landlords to say that they will not leave the burden of this particular plaster on the community. If they intend to go let them clear out bag and baggage. Hon. Friends near me are always growling that the interests of the British taxpayer are suffering under this Bill. Why, Sir, the case of the Irish is far worse. They are Imperial taxpayers as well as English; but, although in the case of Englishmen only the Imperial taxes are affected, in the case of Irishmen their local as well as their Imperial taxes will suffer. I think the Government would be well advised to give in on this matter. May I point out that the vote, if they persist in their present attitude, is a foregone conclusion, as they rely on the support of frequenters of the Smoking Room, who go into the Lobbies without listening to a single argument.

(5.45.) MR. LABOUCHERE

I rise to point out how the right hon. Gentleman is trifling with this House and with the country. On the last clause the right hon. Gentleman urged many, as he considered, excellent reasons to prove the beauty of his scheme of guarantees; yet a few minutes ago he got up and practically threw over the whole of those guarantees. He said he did not care in the least for them—he did not believe in them, and that they were intended simply to throw dust in the eyes of the British elector.

MR. A. J. BALFOUR

No, Sir.

THE CHAIRMAN

Order, order! I have already intimated that this is not relevant to the Amendment.

MR. LABOUCHERE

I am not thinking of going into arguments; I was only accentuating what the right hon. Gentleman said.

MR. A. J. BALFOUR

Perhaps the right hon. Gentleman will allow me to correct him. I did not say I disbelieved in the securities. I said that, after all, they were only an additional, and, perhaps, a superfluous guarantee.

MR. LABOUCHERE

In regard to this specific Amendment, I, for my part, believe that any proposal to increase the liability of the landlord as against the ratepayer will fail. I do not agree with my hon. Friend in thinking that after 18 years, there will be no chance of a strike against the annual payments. We know perfectly well that produce has fallen enormously of late years, and we do not know what may occur in the future.

THE CHAIRMAN

Order, order!

MR. LABOUCHERE

Well, Sir, as you rule this is not relevant, I am afraid I can only say I must vote for the Amendment.

(5.49.) The Committee divided:—Ayes 215; Noes 154.—(Div. List, No. 146.)

(6.2.) MR. KNOX

I beg to move at the end of Sub-section 3 to insert the words— And such one-half shall be carried to the Land Purchase Account out of the guarantee deposit immediately on any sum due to the Land Commission in respect of any advance secured by guarantee deposit having been declared an irrecoverable debt. This Amendment will remove the obscurity occasioned by the defective drafting of the clause.

(6.3.) MR. A. J. BALFOUR

I think that the effect of the words is already covered; but there is no objection to inserting the Amendment.

Question, "That those words be there inserted," put, and agreed to.

(6.3.) MR. M. J. KENNY

I beg to move an Amendment, to be inserted after the words last added, to the effect that the landlord's liability for the debt shall be extended over the whole period of 49 years, instead of over the 18 years as at present provided. I move this Amendment having regard to the fact that the landlord's liability has already been reduced. Under the Bill, the Sinking Fund Account payable by the purchaser releases the guarantee deposit absolutely. The original vendor then ceases to be liable to the mortgagee or the taxpayer. In the meantime, the tenant not only continues liable himself, through the liability of his holding to be put up to auction, and his liability to be proceeded against in the Law Courts for the recovery of debt, but in addition to that the local guarantee fund named in Section 3 continues to be liable for the debt. I want to know why it is that the landlord, the original vendor, is to be released from all liability at the end of 18 years, whilst the tenant remains liable until all the instalments are paid up? In.' this, the liability of the landlord compared with what was fixed upon in the Ashbourne Act, is reduced by one-half. Seeing, therefore, that he gets so much, I think the taxpayer should get something, and that for this purpose we should require the landlords' liability to continue for a longer period. Of course, there would, always be the liability to redemption. By a rule of the Land Commission the landlords' deposit has been made assignable as an asset, and as a matter of fact, in some cases under the Ashbourne Act, the one-fifth has been assigned to creditors, although it might be ultimately required to meet default on the part Hof the purchaser. The landlord then can suffer no inconvenience through the deposit having to remain longer available for the purposes of this Bill, especially when you bear in mind that he enjoys the luxury of receiving 3 per cent. for his money. I can see no reason why the landlord should be relieved of all liability at the end of 18 years, whilst the Local Guarantee Funds continue liable till the expiration of the 49 years. If the right hon. Gentleman will explain his inconsistency in this matter, I shall be glad to hear him, but at present I protest against the proposal in the Bill, and the further proposal in the Land Department Bill, the object of which is to relieve landlords of their liability.

Amendment proposed. In page 2, line 36 after the word " account," to insert the words " And, in the case of any advance under this Act, such guarantee deposit shall not be repaid to the depositor or otherwise released until all re-payments under the purchase annuity shall have been fully completed and satisfied."—(Mr. Matthew Kenny.) Question proposed, "That those words be there inserted."

(6.10.) MR. A. J. BALFOUR

I think there is no reason, either on the analogy of the Ashbourne Act, or derivable from any past experience in land purchase,. for extending the period during which the landlord should be tied to the holding he has sold. The hon. Member for West Belfast has told us that there will be no practical danger of default on the part of the tenant when the security has been increased by the one-fifth, as it must be before the landlord can be relieved of the guarantee deposit. And I would point out that at the end of 18 years the individual tenant will have become so much of an owner that there will be no danger of casual default. There can be no question that the holding will supply a sufficient asset to meet the loans made upon it, when its value has been increased in the manner pointed out.

(6.12.) MR. E. ROBERTSON (Dundee)

I regard the Chief Secretary's answer as unsatisfactory. By the existing law the guarantee deposit is subject to a charge on account of the whole of the recoverable debt, but by the change just made only half the guarantee deposit will be subject to that charge. My hon. Friend proposes that in consideration of that reduction in the extent of the liability there should be an increase of time during which the Guarantee Fund should remain. So far as that goes I think there is a prima facie reasonableness in what he proposes. I would point out that the right hon. Gentleman seems to have forgotten the arguments which he used in introducing his recent Amendment. Then the right hon. Gentleman stated that the guarantee deposit was to be reduced by one-half because two guarantors instead of one had been provided. But if there is to be equality in the contributions of the guarantors, there ought also to be equality in the period of liability.

(6.15.) MR. SEXTON

A guarantee, if it is a guarantee at all, ought to continue as long as the debt continues. Its true nature is defeated by providing that after the liability has been partly discharged the guarantee is to be partly withdrawn. The right hon. Gentleman has said that there will be no danger of casual default after 18 years, as the individual tenant will have became so much of an owner that he would not part with his holding unless absolutely compelled by stress of circumstanees. Well, if there is no danger of the guarantee deposit being called upon, what can be the harm of accepting this Amendment? Why should the locality continue the guarantee? The right hon. Gentleman replies, because without that guarantee the British taxpayer will not be satisfied. But surely it should be as easy to convince the British taxpayer as it is to convince this House. Therefore, I ask him to place the two parties on an equal footing. If the British taxpayer is so dense as to think that an elaborate and irritating guarantee is necessary where no danger exists, then let him require the guarantee of the landlord to extend over the whole period of the transaction in a similar manner.

(6.17.) MR. SHAW LEFEVRE

I cannot agree altogether with the proposition that we have reduced the landlord's liability from one-fifth to one-tenth, for there may be cases in which the whole amount will be taken. The effect of extending the liability of the landlord in the manner suggested would be to take the one-fifth deposit guarantee. I wish to take, this opportunity of putting a question to the Chief Secretary—namely, whether the interest to be paid to the landlord in respect of the one-fifth will remain 3 per cent. during the whole period, or will be reduced to 2¾ per cent. If it is to remain at 3 per cent. while the interest on Consols is 2¾, there will be a loss to the State of £15,000 a year, and I want to know whether that loss will fall on the Guarantee Fund or on the ratepayers? In 12 years there will be a reduction in the interest on Consols which will then stand at 2½ per cent., so that the loss then will be not £15,000 a year, but £30, That, I think, is an important point.

(6.20.) MR. KNOX

I beg, very shortly, to support the Amendment of my hon. Friend. I cannot understand on what principle the Chief Secretary is proceeding. He told us he wanted to establish an equality between the landlord and the Local Authority, and though equality is very often not fairness still it has a sound of fairness, and hon. Members opposite, presumably, voted for the principle of equality. My hon. Friend now proposes to apply that principle here. He proposes that just as the guarantee of a Local Authority continues during the whole period of the purchaser's annuity, so should the guarantee of the landlord. There could be nothing more equal. I do not say there could be nothing more fair. It would have been more fair if the landlord's liability had been made to stand as it does under the Ashbourne Act; but if there is to be a change, surely nothing could be more fair than the proposal of my hon. Friend. The right hon. Gentleman opposite has said that experience of the Ashbourne Act shows that there is no need for a longer guarantee than 18 years. That is, to say the least of it, counting the chickens of the Government before they are hatched. We have not yet had 18 years' experience of the Ashbourne Acts, but there have been sales and purchases of glebe lands more than 18 years ago, and it would be well that the Government should look to the case of these purchasers who have found such difficulty in paying their instalments, and not to that of the men who have bought under the Ashbourne Acts. I think it much more likely that the risk would be apparent after 18 years than before. After 18 years there might be such a fall in prices that the tenant would not be able to pay, for though an astute farmer might very accurately forecast the course of events for 18 years, he would have to be a very astute man indeed to forecast them for 49 years. Such a farmer might be accurate in his calculations in regard to the first 18 years; but at some subsequent period, owing to unforseen circumstances, he might find himself in such a position that it would be impossible for him to pay his instalments It has been said that the only risk of default is that there may be a general conspiracy. But I undertake to say that no public man in Ireland would be able to bring about a default except as the consequence of a great fall in prices, and that is more likely to occur after the 18 years are up than before. Therefore, I say that the landlord's guarantee should remain after the 18 years. The Chief Secretary knows that the glebe purchasers have in many cases had to be relieved of their bargains. In many cases they would have been bankrupt, if it had not been for the slight measure of relief—I think an insufficient measure, but still, a measure of relief—which was given to them. All experience shows that it is only after a considerable number of years that the real risks will become apparent, therefore, we ask that the landlord shall leave his guarantee deposit with the State so that he should be ready to meet these risks. The hon. Member for West Belfast has shown that it is impossible for the whole of the landlords' guarantee deposit to be appropriated within the 18 years. If there is any use at all in having this one-fifth guarantee, it ought to be left for a longer 'period than 18 years. I beg, therefore, to support the Amendment.

(6.26.) MR. LABOUCHERE

The fallacy that underlies the argument of the right hon. Gentleman the Chief Secretary, has been abundantly disclosed in the observations of the hon. Member for Cavan. The right hon. Gentleman seems to consider that past,., present, and future are entirely in his hands to deal with as he likes. The basis of the right hon. Gentleman's argument is that in 18 years one-fifth of the purchase price will be paid, and consequently that no owner will be willing to give up his property because he will lose by doing so, as the property will be worth more than four-fifths of its present value. But suppose the Bill had been brought in 18 years ago. Land has depreciated more than one-fifth both in England and Ireland during that period, and why what has occurred during the past 18 years should not occur again during the next 18 years I cannot understand. We only have the assurance of the right hon. Gentleman, as though he were a species of divinity, and could impress his own whim and wishes on the future. It is possible that land will fall in value in the future; but we are told that in 18 years' time we may safely relieve the landlords from their obligation, because we shall have sufficient guarantee in the case of a fall in value in the Local Authority. But while I wish to protect the British taxpayer as much as possible, I object to any Government taking property that does not belong to them and giving it as a guarantee. That is what the Government does when it takes the rates of the localities, and calmly tells the British taxpayer that -without the consent of those localities, those rates are to be rendered liable for an advance made by the Government. For my own part, I shall be glad to sweep away every species of obligation that is thrown upon the rates, because I do not see that any one has the right to pledge the rates,. unless it is the locality itself.

THE CHAIRMAN

Order, order!

MR. LABOUCHERE

I am sorry if I am wandering from the point, but the Chief Secretary introduces so many matters into these Debates, that one becomes irrelevant in trying to correct him. I hope he will keep in order and will not make these reckless statements. for the future. I am prepared to release the ratepayer from any species of liability with regard to this.

MR. SHAW LEFEVRE

Will the Chief Secretary answer my question?

MR. A. J. BALFOUR

I would refer the right hon. Gentleman to the last sub-section of Clause?

(6.35.) The Committee divided:—Ayes 135; Noes 218. —(Div. List, No. I47.)

(6.47.) MR. SEXTON

Sub-section 4, at which we have now arrived, provides for moneys being taken for default in payment of the annuities, and for other purposes, from the Sinking Fund. Ordinarily, only the Guarantee Fund will be used. But, suppose you get £70 on a farm, and you have a deferred annuity of £10, you cannot come upon the Guarantee Fund, and such a payment, when made, would come under the sub-section. I propose in page 2, line 39, after the words, '' or holding," to insert the words, " or from the guaranteed deposit."

Amendment proposed, in page 2, line 39, after the words " or holding," to insert the words " or from the guaranteed deposit."—(Mr. Sexton.)

Question proposed, " That those words be there inserted."

(6.48.) MR. A. J. BALFOUR

I conceive the Guarantee Fund would be liable to the full amount of any deficiency that may arise, subject, of course, to its being shared by the Local Authority.

(6.49.) MR. KNOX

I venture to think this would meet the case. Suppose you had a holding subject to an annuity of £4, and a few years after the agreement the tenant goes into default, The Land Commission could then take possession, and try to sell, subject to the annuity of £4. If they find themselves unable to do so, they will try to realise the property in the best way they can. The best course would be to sell the holding subject to a reduced annuity. There will be a good deal of loss which, though it will become apparent, will not actually accrue until the period of 18 years has elapsed; and the precise assurance I wish to get from the Government is whether the landlords, as much as the Local Authority, will bear the loss during the whole period of 49 years?

THE CHAIRMAN

Does the hon. Member withdraw his Amendment?

MR. SEXTON

No, Sir.

It being ten minutes before Seven of the clock, the Chairman left the Chair to make his report to the House.

Committee report Progress; to sit again upon Thursday.