HC Deb 20 February 1895 vol 30 cc1190-232

Order for Second Reading, read.

SIR W. H. HOULDSWORTH (Manchester, N. W.) moved,—"That this Bill be read a second time." He said it had been before the House no fewer than five times, and on every occasion it had passed the Second Reading by considerable majorities. If the majority last year were not as high as that of 1893 he did not suppose that the Bill was in less favour, but simply that its supporters had to some extent become tired of supporting it by large majorities when they found that, owing to the forms of the House and the pressure of business especially the Government taking the days appropriated to private Members—it had been impossible to get this Bill further than its Second Reading. To show the great support it had always received he might mention that no fewer than 338 Members of the House had voted for it at different times. The object of the Bill was simple. In the first place, it was to define the law with with regard to the rating of machinery and tools in hereditaments where machinery and tools were at work. The law was now thoroughly uncertain upon the subject. Up to a short time ago the law was supposed to be known, and the practice was what was supposed to be the law. But recent decisions had upset the law, and instead of defining it these decisions, given on special cases, had tended only to make confusion worse confounded. The consequence was, that at the present moment the condition of things throughout the country was, that there was a different practice as to assesment in nearly every one of the different Unions. Even in the same Union the Assessment Committee sometimes applied a recent decision in one case and not in another. There had been a remarkable case in the Chorlton Union in Lancashire, where Messrs. Whitworth's industrial works were assessed on an entirely different principle from that on which the Assessment Committee assessed other industries in the same Union. This promoted litigation, which was constantly going on; money was being wasted and the industries of the country harassed by it, and, what was worse still, these law-suits were often compromised in a back door way, and there was no knowing whether justice had been done. The second object of the Bill was not only to define the law clearly, but to make it as clear as the law in Scotland and Ireland. He knew no reason whatever why the law in the three different parts of the kingdom should be no different bases. It created an immense injustice between the industries of Scotland and Ireland compared with those of England. In Scotland and Ireland there was no doubt at all with regard to the law or practice, and there everything worked smoothly. The supporters of the Bill claimed that in defining the law Parliament would be justified not only in defining it, but in making it the same as in Scotland and Ireland. The principle in Scotland and Ireland was simple, and was in practice over a great part of England—that hereditaments containing machinery should be assessed with the motive power and all that properly belonged to that hereditament; on the other hand, what the tenant would bring in, in the form of machinery and tools to do his work, should not be rated. He doubted whether there was a difference of opinion with regard to the principle he had indicated. A difficulty which could only be overcome by a Committee of the House was, to frame words in an Act of which would thoroughly carry out that principle. On the different occasions on which the Rating of Machinery Bill had been introduced the Government in power had given it its support. [Cries of "No!" and "Yes!"] At any rate, every President of the Local Government Board representing the Government of the day had given the Bill his support and had spoken strongly in favour of it. Lord Davey, then Sir Horace Davey, had expressed the following opinion on the subject:— The present state of the law was unsatisfactory. It was incomprehensible both to laymen and to lawyers, and it was uncertain in its operation. Uncertainty led to litigation, which had to be paid for by the litigant. Some Assessment Committees, while professing not to rate machinery, still considered that it enhanced the value of the premises, and the effect in some districts was, that the value of machinery was fully taken into account in the enhanced value of the premises. That appeared to him to be artificial and unsatisfactory in the present condition of things. There could be no doubt that the law ought to be defined and made clear and distinct and equal in its application to all parts of the country and all classes of the community. That was the basis of their contention, and it was quoted with approbation by the then President of the Local Government Board. With the authority of a Cabinet Minister, the majorities obtained for the Bill in the House of Commons, and Assessment Committees throughout the country supporting the Bill, it was unnecessary for him to argue the matter further. But he would like to say a few words with regard to the opposition they had to meet in that House. It appeared to him that it proceeded from four quarters. First of all, there were the Members representing agricultural constituencies, although they were not at all opposed to the Bill. No doubt the most formidable opposition came from the agricultural Members. The second quarter from which opposition came was from a few Members who represented the Sunderland district; then there were some Irish and Scotch Members; and, lastly, several Members representing the city of Birmingham. He could not help thinking that the opposition of the agricultural Members arose very much from misapprehension; they constantly represented to the House that the capitalist manufacturers desired to relieve themselves of a burden which they had hitherto borne, and to place it on the agricultural community; but he did not think that was a fair representation of the case. As far as the present practice was concerned, if this Bill were passed into law, over the greater part of England and Wales it would make no difference whatever. At present, Assessment Committees were not putting this high view of the law into practice, and the practice came much nearer to the provisions of the Bill than to the law as it was represented in certain quarters. What this Bill would do would be, to prevent a change of practice which was being insidiously introduced to the detriment of our industries, and to prevent litigation and insure uniformity. He believed this would be effected without imposing any burden whatever on the agricultural interest. He did not understand the opposition of the Sunderland Members, but it seemed to him that they were giving a friendly start to a most enterprising firm of surveyors, who were making a livelihood, perhaps a fortune, out of harassing manufactures throughout the country. He was not a Separatist, and did not wish to divide the United Kingdom into different parts, but he thought that, when they were only asking for the same privilege and just laws for England, as already existed in Scotland and Ireland, the Irish and Scotch Members should at least give them their support. He thought the opposition which came from Birmingham was a fair one. There was in Birmingham a particular system by which the assessments were made, not by valuation in one sense, not by taking the actual value of the hereditament, but in industrial concerns which had motive power, by taking a rate of from 40s. to 50s. per horse-power as a means by which to arrive at the assessment. He saw no reason whatever why, if this Bill passed, that system should not still be carried into effect in Birmingham, even without special provision in the Bill, because the Act would only lay down the principle on which these assessments should be made, and there, might be various methods of arriving at that assessment. The hon. Member for South Birmingham had on former occasions given some very striking figures as to the enormous change which this Bill would create in Birmingham. Some years ago, however, he had made a very careful calculation of the rate of 40s. to 50s. per horse-power, and he had found that, in the industries to which he knew that he could apply it, the rate would bring out almost completely the amount of the assessment which would be derived by taking the value of the hereditament of the industrial businesses and the value of the motive power. He cited instances which showed that in this way no change would be made. He appealed to the Government and to the President of the Local Government Board to give them facilities in order that this Bill might go to a Grand Committee. It seemed to him desirable that a Bill of this character should pass by a large majority, and its consideration by a Grand Committee was, therefore, eminently suitable, because it was in the details of the Bill that care must be observed. They wished to disturb the present practice as little as possible, and no doubt Assessment Committees would carry out the principles laid down in their own way.

*MR. M. OLDROYD (Dewsbury)

seconded the Motion.


in moving the rejection of the Bill, hoped the House would not think that he was actuated by any hostile feeling towards the industries of the country. Some hon. Members appeared to think that, if they excepted a certain class of manufactures from taxation, the money so removed would fall from the clouds; but it would, of course, be contributed in future by other members of the community who helped to make up the taxation of the country. The effect of the Bill would be to put extra taxation on a class of men who absolutely looked forward with dread to every Saturday night, lest they should not be able to find the money to pay the wages of their labourers; and who, therefore, were already in the very depths of agricultural distress. The farmer was rated on his profits, but the manufacturer was not. Hon. Members opposite thought it was wrong, and bad finance, to tax the machinery of production; but, in voting for this Bill, were they not proposing to tax the machinery of production by endeavouring to shift taxation from the mill-owner to the farmer? For the earth was the machinery of production to the farmer, and by that machinery food was produced for about one-third of the people of the country. Hon. Members opposite claimed to be Free Traders, and yet by this Bill they sought to tax the agricultural producer and even the earth itself. The hon. Member for Middlesbrough had stated, with absolute truth, in a speech on this question, that if the Bill passed it would have the effect of taking a burden off the shoulders of the manufacturer and placing it on the shoulders of the shopkeeper, and through the shopkeeper on those of the working man; and he thought that those hon. Members who professed to keep a sharp eye on the Labour question would do well to seriously consider the matter before they voted for this Bill, which was retrogressive and reactionary in its character. Hon. Members on both sides of the House, who were in favour of this Bill, supported the Amendment to the Address complaining that the Government had done nothing to relieve agricultural distress, and declaring that the agricultural interest was overtaxed; yet they were now going to vote for a measure which would unfairly still further increase the burden on land to the advantage of the manufacturer. It was as if he moved to exempt land in East Anglia from payment of the tithe rent-charge and to place it on the textile manufacturers of Lancashire or the ironworkers of Yorkshire. The part of the country which he represented had felt the weight of the prevailing agricultural depression heavier than any other part of the kingdom, as might be confirmed by the report of Mr. Pringle. Therefore he felt very strongly on the matter, and would most earnestly appeal to hon. Members not to yet further add to the burdens and disadvantages of the farmer by voting for the Second Reading of this Bill.

MR. A. F. JEFFREYS (Hants, Basingstoke),

in seconding the Amendment, said his object in doing so was to protect the agricultural community from the injustice the Bill would inflict upon them. There was no class more heavily weighted with local taxation than the farmer, and he was not in a position to bear even the smallest addition to it. He opposed the Bill on the broad ground that it was wrong and unfair to relieve one class of property from taxation at the expense of another. If there were to be any change in ratable assessment let it be made all round, in common justice. If the law of assessment were to be amended, let it be done on the principle recommended by the Select Committee of 1887. On that Committee sat several hon. Members who supported the introduction of this Bill, among them the hon. Baronet who had just moved the Second Reading, Mr. Tomlinson, and Sir B. Samuelson. The Committee unanimously reported that it was most important that there should be uniformity in assessment, and recommended that the whole subject of rating should be dealt with comprehensively by the Government with the least possible delay. If anything were to be done in the matter it should be by a comprehensive measure introduced by the Government or some responsible Member; and the whole question of the re-adjustment of local taxation should be taken into consideration. To that course the agriculturists would certainly not complain, for through it they believed they would meet with some measure of justice. He hoped the hon. Member who moved the Second Reading was wrong in anticipating that the Government would actively support the Bill on the present occasion, seeing that Mr. Ritchie in 1892 and Mr. Fowler in 1893, who were then Presidents of the Board of Trade, declared to a deputation of the Chamber of Agriculture that they should take up a position of neutrality in regard to the measure. The present President of the Board was a friend of the farmer, and was in favour of reducing his assessments, and therefore he would hardly vote for the Bill. Why should manufacturers be relieved? He did not deny that there was a difference in the way of assessing machinery, just as there was in the way of assessing land; and he agreed that there ought to be some comprehensive scheme for readjusting taxation. But he objected to any piecemeal Legislation, and had, therefore, voted consistently against this Bill; and he hoped the House would to-day make it plain that it was determined not to relieve manufacturers by throwing extra burdens upon agriculturists. The total amount of property assessed for Income Tax in England and Wales, under all schedules, was no less than £608,000,000, but the amount for land and houses under Schedule A only came to £169,000,000, so that property to the value of £439,000,000 paid not rates at all. That was a very important fact. In his opinion, personal property ought to pay rates, though he had no hope of Legislation in that direction. But if they accepted the Biil they would add to that great amount of property which did not pay rates, and surely the House would hesitate before laying any further burdens upon land and houses already so overweighted with local taxation There was another point with regard to the rating of such property as railways and breweries. At present, railway companies paid a large amount of rates in respect of works at Crewe and elsewhere, but if the Bill was passed an immense amount of movble machinery at these places would escape taxation altogether. Surely the House did not think that the great railway companies were not able to pay poor rates, like the agriculturists. Then, brewers had a great amount of movable machinery which, under the Bill, would be exempt from the payment of rates. At present the farmer paid rates upon every acre of land he occupied, and not, as would be fair, only upon his house and premises. The result was, that a farmer who paid a rent of £200 a year for a farm of 400 acres, would if the assessment was 2s. 6d. in the £, pay £25. But a village shopkeeper, whose income was probably as large, but whose rent was only £24, would pay £3 in rates. When hon. Gentlemen realised the unjust way in which land was assessed at the present time, he was sure they would not be willing to legislate in a haphazard and piecemeal fashion by passing a Bill of this kind. He opposed the Bill on the part of agriculturists, not because they objected to machinery or wished to injure manufacturers, but because they objected to relieve manufacturers by having the burdens of manufacturers placed on their shoulders.


observed, that, as had been said again and again, the object of the Bill was to make the law, as it stood, clear and simple. And the necessity for the measure was the more pronounced, because the conditions of rating were not the same in England as they were in Scotland and Ireland. The law, as interpreted by Lord Esher, was quite unintelligible, not only to the lay mind, but to the legal mind. Hon. Gentlemen who opposed the Bill seemed to think that the measure was intended as a relief to the manufacturing interest. What were the facts? Simply that, whereas machinery was not now ratable by the usage and practice of the country generally, it had become so ratable by legal decision, and conspicuously as the result of the efforts of the firm of gentlemen referred to by the hon. Baronet in his speech, who seemed to be making a livelihood by seeking to impose a new and technical interpretation of the law on the different unions. The illustration given by the hon. and gallant Member for Essex was a decidedly exaggerated view of the case. It might apply in Sunderland, but no such case could be found in Essex. He was quite sure that the hon. and gallant Member would be willing to apply the same rule to machinery as to land in regard to assessment. What the Bill proposed was, that not only the shell, but also such parts of the machinery as appertained to the letting value of the premises should be assessed. The hon. and gallant Member would not suggest that the stock on the premises should be assessed any more than that farm stock should be assessed; and what they contended was, that the machinery which was introduced into the premises after they were let, and which was not comprised in the letting value, should not be assessed. Otherwise, one rule would be applied to farming and another to manufacturing in the same union. He wanted to know how the cases referred to by the hon. Member could be affected by this Bill. The shopkeeper would remain in exactly the same position.


said, his point was, that if there was to be a comprehensive scheme they should come in for part of it.


said, they were not now discovering a comprehensive scheme nor seeking relief from taxation; they were simply asking that undue taxation should not be heaped upon them. They asked that the existing uncertainty should be removed. The hon. Member had just now said, that the sufferings of the farmers were such, that they had the greatest anxiety at the end of the week as to where the means were to come from to meet the payment of wages. He did not know whether that appertained to all farmers, but it certainly appertained to some manufacturers who had a much larger wages-bill to pay than farmers. He challenged the figures quoted by the hon. Member opposite, and failed to see what argument he based on them. With regard to the railways, the assessment would be almost the same as it was now. He was sure the alteration would be very infinitesimal. Then, as to brewers, he did not think that under this Bill the assessment of brewers would be seriously altered, because a large part of the plant in breweries was connected with the structure of the building. He might say also, with regard to the textile industries, a very considerable amount of their machinery would remain ratable under the Bill. Therefore it was like misleading the House to advance, as an argument against the Bill, that the machinery in such cases would escape taxation. There was only one other point which he wished to lay before the House, and that was a practical difficulty which would arise in the various unions if this Bill passed. A fair and proper valuation of machinery would be a delicate and difficult task. Machinery was a very broad term, and applied not only to old but to new machinery. If spindles or looms or sewing machines were to be assessed, he was sure that very great difficulties would arise as to the real value of those machines. Old machinery not adapted to the times would have an additional burden thrown upon it, although for commercial purposes it was not equal to other machinery. He thought the arguments adduced by the hon. Baronet who introduced the Bill were conclusive, that the real state of the law should be defined. He believed that the Bill would make the law clear, would make it consistent wich the law of Ireland and Scotland, and he felt certain the House would affirm its principle as it had done in previous Sessions by a very large majority.

SIR R. PAGET (Somerset, Wells)

said, he understood the hon. Member to say that the object of the Bill was to remove uncertainties in the law with regard to this matter. But it was suggested that they should get the Bill into Committee in order to introduce into it what was now not in it. The position, then, was this: the Bill was brought in to remove uncertainties—to define what was to be rated; but the particulars were not in the Bill, and they must be brought in elsewhere. No one took exception to the mode in which the Bill was introduced, but in a moderately long speech they had heard few arguments with which they were not familiar. There had been a reference to the horrors which would accrue if this Bill did not become law. They had heard that before. They had been told what injustice would be done if the present law continued, but now they had a totally different matter presented to them. Everything was minimised. They were now told that if they passed this Bill it would make no difference at all. ["No."] They had been practically told that if the House passed the Bill it would make no difference whatever. If the Bill was minimised in this way, surely the case was extremely weak, and there was no sufficient reason why the House should give its Assent to the Bill. The second kind of argument used was that the law ought to be assimilated to that of Scotland and Ireland. He would like to ask those who upheld that contention, were they prepared to give to the suffering agriculturists of England the benefits that Ireland has got? were they prepared to give to England generally, that lavish expenditure which it appeared Ireland had only to ask for to get? He did not think that the supposed necessity for assimilating the law in this way was a sufficient inducement to pass this Bill. This proposal amounted to a transfer of burdens from one class to another. There was no escaping that. But was this a time when the agricultural or any other industry ought to be oppressed with additional burdens? In the present condition of things the House would be very ill-advised, in his opinion, to give an assent to the Second Reading of such a Bill as this. He had no wish to prevent changes in the law of rating. His desire was to see wholesale and sweeping changes, but he regarded this measure as mere fiddling with the fringe of the question. So far back as1887 a Committee examined minutely into this matter and came to the conclusion that the whole subject of rating should be dealt with comprehensively by the Government with the least possible delay. The least possible delay appeared to be seven or eight years. The right hon. Gentleman the President of the Local Government Board had recently given them in the public prints the benefit of the views he held with respect to the Law of Assessment. He hardly thought that the right hon. Gentleman would say that the law as its tood was in a state of perfection. The matter cried aloud for reform. The hon. Member who has just addressed the House did not, he thought, quite appreciate the figures used by the hon. Member for Hampshire. He understood his hon. Friend to say that the total value of property assessed to the Income Tax amounted in round figures to £608,000,000, while the total annual value of property on which local rates were levied amounted to only £188,000,000, and he showed that a vast amount of property in the country escaped local rates, and that the property of smaller value had to bear the whole of the burden of the rates, to which this Bill, if carried, would add. Then it was said that they were to pass the Bill on account of the uncertainty of the Law. But was there any uncertainty? The Courts of Law had always acted on one principle. Disquisitions in the Law had been made at different times by different Judges, but they were always founded on the same principle. He contended therefore, that there was no such uncertainty of the Law as some hon. Members had attempted to show. It would be found in every one of the decisions, that so long as the machinery was necessary for carrying on the business for which the factory was created, it was held to be legally assessable, not per se, but as enhancing the value of the building. The question of the rating of machinery was no doubt one of intricacy in some respects, and he would like to in some respects, and he would like to ask whether this Bill was to apply to water and gas works? His recollection was that when this Bill was introduced on a previous occasion the promoters declared that they did not intend it to affect either gas or water works. If that was so there would at once be an inequality introduced by Statute. So far as equality of taxation went, he was entirely in favour of anything that would tend to that. Moreover, he understood that to be the principle of Her Majesty's Government. If they were to touch this question at all it should be taken up with a bolder hand, on the principle, the Government themselves had taken up, and it should not be left to a private Member to deal with a question which involved the extra taxation of some of Her Majesty's subjects and the relief of others. Equality of taxation had been declared to be the leading principle of the question. He trusted that nothing would be done that was likely to add to the burdens of a class that was already over-taxed, in order that others, who were better able to pay, might be relieved. In former years, the attitude of the Government of the day, whether Liberal or Conservative, had always been one of neutrality with regard to this Bill, but not invariably of benevolent neutrality. In his opinion, the measure was not one that ought to be passed, the case which its promoters had attempted to make out not being proven.


said, that he should take the same course as was taken on former occasions by his predecessors, the present Secretary of State for India and Mr. Ritchie. He meant that he should leave this question to the judgment of the House, and should not attempt to influence that judgment by any Ministerial pressure. He was himself in favour of this Bill, because, in his opinion, the law with regard to the rating of machinery was at present in an extremely unsatisfactory state. If he could believe that the Bill would affect the agricultural interest injuriously, by shifting a burden from the shoulders of manufacturers on to those of farmers and others concerned in agriculture, he would not support the measure. He quite agreed that it would be very wrong to add to the burdens of agriculturists at the present time, for this was certainly not an opportune moment for doing anything of that kind. He thought, however, that those who opposed the Bill were under a misapprehension with respect to its probable results. He was convinced that the burdens of no farmer would be increased if this Bill were passed.

SIR R. H. PAGET (Somerset, Wells)

observed that that was not the view of the Central Chamber of Agriculture.


said, that he was only expressing his own opinion. It appeared to be considered by some hon. Members that manufacturers were rated now in respect of their machinery, and that the effect of the Bill would be to relieve manufacturers, and to impose upon others the burdens from which they would be relieved. That was a complete misapprehension, for the almost universal practice throughout the country was not to assess movable machinery. The hon. Member from Essex had put a hypothetical case. He supposed the case of a mill rated at £1,000 a year, £200 representing the value of the shell, or building, and £800 the value of the machinery; and he contended that, if this Bill should pass into law, the mill would in future only be rated at £200. But such a case as this did not exist; if there were a mill of such a value, with machinery of such enormous value in it, which he much doubted, it might be safely said that it was rated at £200 at the present time, so that the Bill would leave matters exactly where they stood now. The general practice for Assessment Committees for generations past had been not to assess movable machinery. In the last few years, however, there had been decisions in the Law Courts which had shown that that practice was not altogether in accordance with the law. There had been cases in which it had been laid down by Judges that certain classes of movable machinery ought to be rated; and if those decisions were acted upon a very large amount of machinery, which had hitherto escaped assessment, would be assessed, and the burdens of the manufacturers owning that machinery would be considerably increased. These decisions had caused much surprise to a great many Assessment Committees, and a great many lawyers also. He did not doubt that the view of the Judges of the law as it stood was right, but it certainly was not in accord with the practice of Assessment Committees. In 1887, a Committee of that House considered the whole question, and came to the conclusion that there ought to be a comprehensive reform; and they recommended that, pending that reform, the practice that had prevailed among Assessment Committees in respect of movable machinery should continue. The position, therefore, was anomalous. A Committee of that House had recommended that Assessment Committees should not observe the law as laid down by the Judges in the High Court.


remarked that the Report of the Committee contained nothing to that effect.


said that he was informed that the Committee recommended that the prevailing practice should be continued. There could be no doubt that the practice had continued, and that Assessment Committees still exempted movable machinery. Their practice, therefore, was opposed to the law as laid down in the Courts.

MR. W. E. M. TOMLINSON (Preston)

said, that what the right hon. Gentleman had in his mind was a Resolution passed by the Committee. That Resolution was not, however, embodied in the Report.


agreed that it was that Resolution which was present in his thoughts. He submitted that it was desirable either that the practice of the Assessment Committees should be brought into accord with the law, or that the law should be made to harmonise with the practice. If the Assessment Committees generally were to conform with the law as laid down by the Judges, the results would be very serious for manufacturers at Oldham and elsewhere. At Oldham machinery valued at £200,000, which had hitherto escaped assessment, would be liable to assessment; and, if the law were enforced, it would be a very serious matter for the trade of Oldham, and for all classes there. A very serious burden would be imposed upon the manufacturers, and the result would probably be that many trades, which were already almost profitless, would cease to be carried on. The law in Scotland and Ireland was wholly different from that laid down by the Judges in this country; and many people thought that if the law were strictly enforced here trades carried on at Old-ham and other places would be transferred to Scotland, where they would not be subject to rating in respect of movable machinery. He held that, on the whole, the wise course to take in the circumstances would be to bring the law into accord with the practice. This would not affect the Agricultural interest in any way, for mills in Agricultural districts were not assessed now in respect of movable machinery. An hon. Member had asked what would be the effect of this Bill on Gas and Water Companies, and in answer he had to say he believed the effect would be nil, because the machinery of these Companies was affixed to the soil, and was not movable machinery in the true sense of the term. In the same way, the effect of the Bill would not, as had been suggested, be to relieve railways from a considerable portion of the burden of rates which they now bore. He believed that railways were treated like other manufacturing concerns, and if other manufacturing concerns were not rated in respect of their movable machinery, so neither were railways. There remained only again the question of the Agricultural interest. He felt persuaded that if this Bill passed into law, it would in no way affect the Agricultural interest whatever. More than that, he held it was important in the Agricultural interest that the principle of not rating movable machinery should be asserted. It was quite possible that in the future of Agriculture it might be necessary to adopt machinery to a greater extent than now. He looked forward himself to considerable advances in that direction. Certainly it was the interest of Agriculture to encourage the growth of manufactures in the rural districts. Anything which would tend to drive those industries out of the rural districts would be a very great injury to Agriculture. He believed it would be a wise thing for all parties to assist in passing this Bill into law; and though he could not promise on the part of the Government to give any special time to the further stages of this Bill, yet, personally, he should do his very best to assist in carrying the measure. He could not but hope that the opportunity would be taken to arrive at some kind of compromise, because it was extremely important to all the interests involved that this matter should be settled on a broad and comprehensive basis.

MR. J. POWELL WILLIAMS (Birmingham, S.)

said, he had on previous occasions expressed the opinions which he entertained with regard to the proposals of this Bill, but he wished it to be distinctly understood, if it was not already understood, that he admitted it was a great anomaly that there should be a certain state of the Law as declared by the Courts, and a certain practice on the part of the assessing authorities which in any way differed from that Law, and what the promoters of this Bill maintained was that if the Law were to be put into operation in its strictness, there would be inflicted on manufacturing communities a very serious amount of rates which at the present time they were not called upon to pay. He did not wish to see any change at all in what had hitherto been the practice of the rating authorities, and if, through legal decisions, there had recently been imposed upon them an obligation to depart from the custom they had now pursued for so many years, he did not wish that that obligation should be a legal obligation; but, on the other hand, he should be glad to see them relieved of it. Whilst, however, he did not wish to see any change in that direction, he was also anxious, if he could, to guard the great city, a portion of which he had the honour to represent, from provisions in this or any other Bill which would deprive the rating authority of a considerable source of assessment to which it now had recourse. He listened with great interest to the speech of the right hon. Gentleman the President of the Local Government Board, who, he thought, stated the case, as far as he did state it, with perfect fairness. The right hon. Gentleman informed the House that he thought there was no necessity in this Bill to make specific exemptions in regard to gas and water undertakings. But he would remind the right hon. Gentleman that in the case of the Rating of Machinery Bill of 1890 it was thought necessary by the promoters to include a provision specifically exempting from the operation of the measure, waterworks, gasworks, and collieries. The right hon. Gentleman did not speak of collieries, and it would be interesting to know what the opinion of the Government was as to the operation of this Bill in regard to collieries. The President of the Local Government Board did, however, tell them something about railways, saying he did not think that there would be any change as respected the obligation of railway companies to pay rates, owing to the passing of a Bill like this. He (Mr. Powell Williams) had in his hand a document prepared by the Clerk to the Overseers of Birmingham two years ago, in which incidental reference was made to what would probably take place in regard to the great railway works at Crewe in the event of such a Bill passing. This gentleman stated that he had it on reliable authority that the London and North-Western Railway Company would obtain an abatement in rates of probably between £7,000 and £8,000 a year in respect of machinery in their large workshops not fixed to the hereditaments except by their own weight, and for which they would be entitled to exemption. Here they had on one side the right hon. Gentleman, and on the other side the clerk of a great rating authority, and the opinions which they expressed as to the exemptions which railway companies might derive under the Bill were entirely conflicting. If the truth was that the railway companies would get any exemption, that was to say, if the rating which they now bore would be shifted on to other shoulders, to what shoulders would it be shifted? If one class of ratepayers were exempted, another class must necessarily suffer, and in the case of Crewe that class would be the workmen of the railway companies dwelling in small house, of which, to a great extent Crewe consisted. Those who would suffer if the Bill passed in its present shape would not be the agricultural population, but the small householders and small shopkeepers, and the burden upon those people was already quite as much as it was possible for them to bear. He was aware it was said that compound householders were not affected directly or quickly by any change in rating, but he had heard of a case where, after the passing of the Free Education Act by the last Government, the landlord of a large number of compound houses raised the rents of the houses, alleging that he would have to pay a great deal more in rates. The fact was that he was not called upon to pay a single sixpence more than he had paid before. No doubt this was to some extent an agriculturist's question, but it was quite as much a workmen's question. The way to test the Bill was to ascertain whether or not it would make any change in practice. His hon. Friends said they did not wish there should be any change in practice; what they desired was that the practice which had obtained for many years on the part of the rating authorities should continue, and that that practice should be made legal. Therefore, if he could show that in the operation of this Bill the practice would necessarily be changed to the disadvantage of the small ratepayers, he was, he thought, justified in opposing the Bill, unless he could get some assurance that the promoters would in Committee insert a clause which would protect the places that had adopted a certain practice to which no objection was raised. It had been said that Birmingham in this matter was a law unto itself. The truth was, that Birmingham had done more to carry out the law as it had been recently declared, than probably any other constituency, with, perhaps, the exception of Sunderland. The law, as recently declared, was, that they should go beyond the motive power, to certain machinery which was attached to the motive power, and what was worked by it; and what was said was, that the law had gone much beyond fixed plant worked by the motive power—had, indeed, gone to goods and chattels which were strictly personalty, and which had never come under assessment. But Birmingham, though it had not gone to that extent, had gone some- where in that direction. Personally, he was in favour of the principle of rating all kinds of personalty; but he thought it was not fair to rate the personalty of a manufacturer whilst they did not rate the personalty of a private owner. He therefore agreed that there should be some change in the law, but he did not think the change should be in the direction suggested by the Bill. To return to the case of Birmingham, perhaps he would be allowed to state the case as it would be developed by the Bill. Mr. Clark, the city valuer, giving evidence before the Select Committee, stated—and his evidence was confirmed by the rating authority—that if this Bill passed in its present form, machinery in Birmingham of the valuation of at least £20,000 would be taken out of assessment. Mr. Clark spoke seven or eight years ago, but the House might take it that the result now would be the same as he then contemplated. As the rates of Birmingham were 6s. 6d. in the £, or, roughly speaking, one-third, there would thus be a loss of rating revenue amounting to between £6,000 and £7,000—that was to say, persons who had been paying that amount would be relieved, and another class of ratepayers would be additionally burdened to that extent. In Birmingham nearly three-fourths of the houses assessed for the Poor Rate were of the compound class, and did not exceed in rent 6s. or 6s. 6d. a week. If this Bill passed, without the Amendment which he would certainly move if the measure got into Committee, the result would be that the compound householders of Birmingham would have to pay a great portion of the £6,000 or £7,000, instead of the manufacturers, who had hitherto paid it. He, therefore, on behalf of the poorer ratepayers in the district to which he belonged, protested against the change which the Bill would make. If, however, he received from the hon. Baronet the Member for North-West Manchester, or from others who were promoting the measure, a promise that in Committee they would regard favourably, and endeavour to get embodied in the Bill, the Amendment which he put on the Paper last year, and which was to the effect that, as regarded machinery and motive power, the rating would be left precisely as at present, he would willingly withdraw his opposition, and, in point of fact, vote for the Second Reading.

MR. G. WHITELEY (Stockport)

said, it was to him a matter of regret to recognise the manner in which this important question was approached by various sections of the House. It was not approached from the standpoint as to whether it was right, or fair, or proper, that used machinery in mills should be taxed, or not; it was approached solely from the standpoint as to who was going to bear the burden from which the manufacturing industry would be relieved if the Bill, was passed. The House was, therefore, divided into sections on the question. On one side, opposing the Bill, were the county Members representing real property, and on the other side, supporting the Bill, were the borough Members representing property in mills and factories. The hon. Member for Hampshire, who was a typical agricultural Member, said the Bill meant the transference of a burden of the rates from the shoulders of the manufacturing industry to the shoulders of the agricultural industry. It was only a few evenings ago that the hon. Member moved a Motion in regard to agricultural depression, which he attributed mainly to the heavy burdens which land had to bear; pointing out that whereas real property had to pay 7s. 6d. in the £ in rates and taxes, personal property had only to pay 2s. 6d. in the £. The hon. Member suggested some alteration in this burden of taxation; but he was too good a stratagist to suggest where the money was to be found in order to supply the deficit in case the relief asked for were given to land. It was perfectly well known that if real estate were relieved from either taxation or rating, additional burdens would have to be imposed on personal property; and yet, notwithstanding that undoubted fact, many hon. Members on the Opposition side, who were interested mainly in personal property, voted for the Motion of the hon. Member for Hampshire. He therefore thought that hon. Members representing agricultural constituencies should not decline to meet urban Members in the same spirit of concession, in what after all was a matter of very little importance, by refusing them the very small measure of justice they asked for in the Bill. The hon. Baronet the Member for Somersetshire, referred to the Budget of last year, and pointed out that the Death Duties on real and personal property were equalised and graduated. Well, he voted for the graduation of the Death Duties, and he would have voted for their equalisation had a Division been taken. But he looked upon the Budget as the first step in a comprehensive scheme for the equalisation of taxation on every class of property. Possibly, within the next few months the Conservative Party in Office might be introducing a measure for the equalisation of taxation and rating on land. Was it then worth while for the agricultural Members to refuse to meet urban Members when they sought to relieve themselves to the very small extent proposed by the Bill? The hon. Member for Hampshire said the object of the agricultural Members was to protect themselves; and he asked why should manufacturers seek to relieve themselves from rates they at present bore? But supposing a Bill were to be introduced for the equalisation of all rating and taxing, what would be said of Members representing manufacturing districts if they said, "we want to protect ourselves, and we object to putting any burden on us that would relieve the agricultural industry." That would be taking a very narrow and selfish view of the matter. It was sometimes desirable to throw a sprat in order to catch a whale, and he, therefore, thought that manufacturers should be given this small modicum of justice in view of the large demand that would be made upon their liberality in the near future.

*MR. W. MATHER (Lancashire, S. E., Gorton.)

was glad to note many indications in the Debate that at last the long campaign in the interest of the Rating of Machinery Bill was about to end in a satisfactory solution of the question. He thought hon. Members representing rural constituencies ought to be assured, after what had fallen from the President of the Local Government Board, that the agricultural industry could not in the slightest degree, directly or indirectly, be affected injuriously by the passing of the Bill. He thought the only class of the community who had any grievance, and therefore who alone were entitled to be heard in the Debate, were certain persons in Birmingham, Sunderland, Gateshead, Newcastle, and other places in the North, whose Assessment Committees had accepted the interpretation of the law according to the last judgment of Lord Esher, and had declared that in future they intended to rate machinery in their respective districts. But those Assessment Committees did not altogether amount to a dozen, while on the other hand there were hundreds of Assessment Committees throughout the country who had not accepted Lord Esher's interpretation of the question. However, persons in those Northern constituencies thus affected were entitled to the consideration of the House; and the speech made on their behalf by the hon. Member for South Birmingham (Mr. Powell Williams) had brought them nearer to a satisfactory solution of the question, if the Bill could only get into Committee. The hon. Member had suggested that the status quo should be allowed to continue; that districts should be allowed to rate themselves as now under the method which had been in vogue for 20 years. He did not think it was possible that this voluntary arrangement could be made by the Assessment Committees through the country. What he thought was possible was to examine the Birmingham system, so as to see how far that system could be adopted as the law of the land. In the township of Openshaw, in his own constituency, there was, of the many manufactories, one which had been singled out for special treatment by the Assessment Committee, who had determined in that case to carry out the law as laid down by Lord Esher. The value of the land and buildings was £90,000, and on that an assessment of £900 was made. Then the smallest minutiœ of the machinery were assessed, or a total value of £112,000; making the whole assessment £2,020. Formerly only the engines, boilers, and main shafting had been assessed, making the assessable value of the machinery £30,000. This firm had protested against the assessment; but, year after year, they had expected the present Bill to pass, and so they had paid instead of testing the assessment at law. If the law of the land were passed on the Birmingham practice of assessing machinery at 45s. per nominal horse-power, the total assessment of the works he had mentioned would be only £1,450, instead of £2,020.


explained that the Birmingham system took account, not only of the motive power, but of the machinery which it worked.


said, that he understood that. The judgment of Lord Esher confined itself to these simple words:— The Court thinks that machinery should be taken into consideration, but how it should be taken into consideration, and to what extent, the Court will not say. What the Court would not say these Assessment Committees had undertaken to say. Then—to show the monstrosity of the situation—the Openshaw Assessment Committee said that, having established the new principle in respect to this one firm, they would have a re-assessment of all the works in the district, and would deal with them all in the same way. But this they had not done, because they dare not apply to the cotton industry of Lancashire the conditions they had imposed on the ironworks. If they had, there would have been a revolt. Could the House of Commons complacently allow the law to remain in this state? The House of Commons would be exposed to the ridicule of the whole country if it did not at once find a means of removing such gross anomalies. The Assessment Committees in the country would welcome a clear definition of the law as much as the manufacturers. The promoters of this Bill had, year after year, to repeat the same arguments and refute the same wilfully ignorant views. The House had always ratified the Bill by large majori- ties. He did not say that it would exactly fit the case; but Birmingham had hit upon a plan which might be applied. Birmingham was a city set upon a hill, whose light could not be hidden; and all its Members laid down the law like law-givers. The Assessment Committees were entitled to such assistance from the House of Commons as would enable them to conduct their functions on a rational basis. It was time for the question to be settled for ever. He understood that in Committee the hon. Member for South Birmingham intended to move an Amendment providing that the rating of machinery should be according to the nominal horse-power. As to that device, he should be willing to accept the decision of the House of Commons, for the time being, as the question would have to be compromised to some extent. Would the President of the Local Government Board send out a circular to the Assessment Committees of the country saying that, until the law had been more clearly defined, they were not to impose on manufacturers greater liabilities than they had hitherto been called upon to bear? He hoped that those hon. Members who opposed the Bill on behalf of the agricultural interest would permit it to go forward on the assumption that in Committee the utmost possible consideration would be given to the compromise suggested by the hon. Member for South Birmingham, and thus relieve them from many fears they entertained.

MR. S. T. EVANS (Glamorganshire, Mid.)

said, that the speech of the hon. Member was an admirable one against the Second Beading of the Bill, because he had advocated a compromise on the system of rating in force in Birmingham, which was entirely inconsistent with the system advocated by the Promoters of the Bill. The House was asked to pass the Second Reading in order that the Birmingham system should be considered by a Committee, with the object of seeing whether it could not be adopted throughout the country. This was tantamount to asking whether or not the principle of the Bill should be changed in order to convert it into another measure. This Bill was, indeed, a hardy annual because there was a strong combination of Members, more or less, interested in its favour. He pointed to the important fact that every hon. Member who had spoken in favour of the Second Reading was himself a manufacturer; and this was a circumstance which the House ought to take into consideration. The Bill, however, was opposed by various interests. Up to the present time the opposition to it had proceeded from hon. Members who were more particularly interested in agriculture. He objected entirely to the Second Reading on a very broad ground. The principle of assessing property to the rates throughout the country ought to be uniform. It was a very large subject; it had been considered by a Select Committee, and in their Report they recommended that the whole subject should be dealt with by the Government. He maintained that no case had been made out for the exemption which was claimed on behalf of the manufacturers of the country to have any exceptional treatment with regard to this matter. If the question of assessment for the purpose of levying the rates required to be altered it ought to be looked upon as a whole. It was an accepted principle that the people of the country ought not to be taxed without the authority of Parliament; and if there were to be any alteration in the assessment of property for the levying of payment of local rates, then the question ought to be looked upon as a large one, and ought to be viewed as a whole. It certainly ought not to be dealt with by means of piecemeal Legislation, but rather by means of a large measure brought forward on the responsibility of the Government of the day. The hon. Member for Stockport said that the opponents of the Bill took a very narrow and selfish view of the considerations which ought to affect hon. Members. He did not think that the view he had put forward was a narrow or a selfish view. The narrow or selfish view was the view of the persons who desired an exemption to be made in favour of certain classes. The President of the Local Government Board said that a change had been made in the law. There had been no change in the law; from the time of Elizabeth up to the present time there had been no change whatever with regard to this matter. There was no ruling of cases in the Chard decision. This case declared what the law was; and, from it, it appeared that certain Assessment committees in the country had not been following the law at all. Was that any reason why the law should be changed, because it was a change in the law which the promoters asked the House to make? The hon. Baronet in moving the Second Reading of the Bill said there were two objects in view. The first object was to define the law; but it was only necessary to look at the Bill to see that this was not done. The Bill declared that it was "expedient to amend the law"—not to define the law—in favour of a certain class of manufacturers. The second object of the Bill was the existence of a strong desire to alter the law in order to conform with the law of Scotland and Ireland. He did not know whether that was a good object on which to base the Second Reading, and he did not know whether the hon. Member would carry that principle out in all measures. In many matters, indeed, the system of judicature in Scotland was different from that in England; but he thought that the second object of the hon. Member was as weak as the first. This Bill was, based on one or two fallacious arguments. The promoters possessed one or two phrases which they thought would be useful to them in pressing the Bill on the attention of the House and advocating it in the country. The first was, that if they did not exempt this particular class of machinery from being taken into account, in the assessment of premises where it was used, they would be taxing an industry. The working men, however, did not, he asserted, take that view. The money obtained by the levying of rates must be obtained from some source. The manufacturers wished to be exempt from certain rating; who then was to pay? That was a consideration which had been lost sight of by the Promoters of the Bill. The manufacturers said: "Relieve us; we do not care where the money comes from, so long as we do not pay it." If, however, the manufacturers were relieved, the burden must necessarily be changed from the shoulders which are better fitted to bear it to the shoulders which were too weak to bear it. If the House exempted large portions of the machinery of manufacturers from being taken into account the rates would have to be obtained from the cottage property. It was well-known that the landlords, immediately they had anything like a pretext for raising the rent of a cottage forthwith raised that rent. He knew a place where a School Board was established a short time ago, and before a rate was made in respect of that School Board the landlords came down on the tenants and raised their rents. On whose shoulders, therefore, was it desired to cast this burden? If the rating of machinery was a tax on industry, and it was considered to be a grand argument in favour of the Second Reading of this Bill, then it was an equally grand argument for the exemption of all machinery from rating; but the Promoters did not propose to exempt all machinery from rating. If a piece of machinery was put down and screwed to the ground they said it must be be assessel; but if, say, in a cotton factory a piece of heavy machinery was put down which did not need to be fixed to the ground, then it was not to be taken into consideration. A colliery with its important plant, which was almost all fixed plant, would not be exempted under the provisions of this Bill, though the machinery of the cotton mill next door, because it did not happen to be fixed to the ground, would not be taken into account for the purposes of assessment. He failed to understand why this principle of different treatment was advocated. Was it contended that personalty should not be rated? The workman's cottage was personal property, and care was taken to assess it immediately the cottage was placed on the land. It was only throwing dust in the eyes of the House of Commons, therefore, to say that they ought not to take into account this machinery because it was personalty. So far from relieving personalty and levying all the rates in respect of realty alone, he thought the law ought to be extended the other way—that was to say, they ought to assess personalty for the purposes of the poor rates. The President of the Local Government Board said he wanted to bring the law into an harmonious state; but the law was already harmonious, and what the right hon. Gentleman wanted to do was to harmonise the practice. The railway companies, who had a keen eye for anything which affected their interest, looked favourably upon the passing of the Bill, or else they would have offered it effective opposition. It was apparent that railway companies would be greatly benefited in respect of certain rates if this Bill became law. The fixtures or machinery that were to be taken into account with reference to assessment were of three kinds. First, there were things that were moveable, such as furniture. Secondly, there were things that were attached to freehold, so as to be some part of it. Thirdly, there were things that were capable of being removed, but were so far attached that it was intended they should remain permanent appendages. They were talking of the rating of machinery, but as a matter of fact, no machinery was rated at all. What was done was to take into account machinery which was there for the purpose of enabling the shell of the building to be used, and which must be included in estimating the real value of the premises to a tenant for manufacturing or industrial purposes. If it were objected that by doing this you were rating industry, you were equally rating it by the rating of fixed plant. No sufficient reason had been alleged for exempting any machinery because it was not affixed to the premises. He desired to protest against a misnomer in the title of the Bill. Machinery was not rated. Anybody would come to the conclusion from the title that this was a Bill which provided for or had to do with the rating of machinery, whereas it was a Bill to exempt machinery from being taken into account. The Bill was said not to be one for the relief of manufacturers; for whose relief then was it brought in? If it did relieve manufacturers, the removed burden must fall upon the shoulders of others, including those who did not participate as they ought to do in the profits of industry, who would have to pay higher rents for their small cottages. They had heard how such rents did go up when additional charges were imposed, or on the mere pretence that they had been. The last Budget produced a wail from the destitute Dukes, who would have to give up a palace that they might keep others; and this Bill was the wail of the poor millionaire manufacturers. If the principle of the Bill were accepted it ought to go before a Select Committee, which could take evidence with regard to its application. A Select Committee had already dealt with the matter, and had reported that it was desirable there should be uniformity practised, and they recommended that the subject should be dealt with comprehensively by the Government with the least possible delay. This was what he desired to see, and not change by piecemeal legislation. They were told that the Committee reported the Bill, and no doubt they did, but he did not read their Report as a recommendation that the Bill should be adopted. They only said that in their opinion it would meet the case of industries depending mainly upon steam for motive power. Why should that case be met specially? The Committee also passed another Resolution, which was that it was desirable rating authorities should not depart from their system of assessment. That Resolution was come to before the Bill was considered Clause by Clause, and it was not embodied in the Report of the Committee. It was said that the Bill had been accepted by the House by large majorities, but the majorities had become smaller from year to year. This year the promoters had not been able to make out a case; and he appealed to the House to say that they would not assist manufacturers to relieve themselves of rates and thereby impose them upon the shoulders of those less able to bear them.

MR. R. G. C. MOWBRAY (Lancashire, Prestwich)

said, he was not a manufacturer, and had not the smallest interest of a personal character in the question, but he represented in the House the opinions, not only of the manufacturers of the constituency, but also those of the working men, who heartily supported the Bill. Further, he was a member of the Select Committee which sat on the subject seven years ago. The most material part of the Report of that Committee was that in which they said, although they expressed no opinion as to whether there had been any variation in the law, or whether it had been altered by the recent decision, the conclusion to which they came was that the system acted upon by valuers in different parts of the country had varied considerably, and the practice to be pursued, in the absence of legislation, would in many cases have a material effect in the future. It was because of the expected material effect in the future it was recommended that the Bill, as amended by the Select Committee, should be proceeded with. He agreed with the Resolution of this Committee as to the necessity for a general reform in our rating law. But this had been waited for now for seven years. It was not a question of one Government or of another. No comprehensive scheme was obtained from the late Government, and there was little prospect of getting one from the present. Those who would be materially affected by the adoption of a system advocated by certain valuers were justified, on behalf of themselves and their workmen, in bringing this question before the House. Those who supported the Bill did not originate the controversy. They were content to allow things to remain as they had been, and to pay the rates they had paid before; but a certain firm of valuers had gone about the country stirring up this question, and seeking to extend the adoption of their system, which had not previously been adopted in the part of the country he represented. An hon. Member had spoken of the case of Openshaw. One of the highest rating authorities in Manchester, that the principle of the recent decision, if it were enforced there, would mean an increase of the rates on the mills of 125 per cent. That was the part against which the promoters of the Bill protested, in the name of the manufacturers and also in the name of the working men. The Secretary for India, when President of the Local Government Board, received a deputation of Trade Unionists representing half a million of men, and their spokesmen repudiated the idea that the Bill was one for the relief of capitalists, and mentioned that in this matter the interests of capital and labour were identical. This was not a manufacturers' Bill, nor a manufacturers' question; but a question of keeping up the great industries which provided employment for the working classes. He asked the House not to reject this Bill, and leave the door open for putting fresh burdens on already depressed industries. He hoped the Government would assist the supporters of the Bill to carry it into law. The cotton industry was not favourably disposed towards them. It felt it had a bone to pick with them which might be picked on another occasion. But in no Party spirit—for, as far as Party went, he wished they would leave this question alone—but in their own interests, and the interests of the district which he represented, he asked for their assistance in favour of the Bill.

*MR. W. H. HOLLAND (Salford, N.)

denied the assertion of the hon. Member for Mid Glamorgan, that the majority in favour of the Bill had dwindled year by year. On the occasion, only two years ago, when he introduced the Bill, there went into the Lobby with him a larger number than had ever voted for it before, and the majority was unprecedented. They were asked where, if they removed the burden from the manufacturers, they would place it? They would leave it exactly where it was now, for in the great mass of cases the Bill would make no change. The Bill was said to be a manufacturers' Bill, but when deputations had waited upon the President of the Local Government Board with reference to the Bill, the most effective arguments for it had proceeded from leaders of the operatives. If the burdens on the manufacturing industries of the country were increased, it was absolutely certain the numbers of the unemployed—an urgent question just now—would increase. No industry would be so much affected by this Bill as the great cotton industry of Lancashire and Yorkshire. He did not think the Bill was really hostile to the interests of agricultural constituencies. Among the questions put to a witness from the agricultural districts by the Select Committee who inquired into this matter in 1887, was the following:— (No. 634): Under the Tyne Boiler Case decision, would you feel bound to rate agricultural implements? The answer was:— Yes; I do not see how you can avoid it. So that agriculturists had an interest as well as manufacturers in the definite settlement of this matter.

*MR. W. P. BYLES (York, W. R., Shipley)

said, he would have no hesitation in voting for the Bill. An ancient lawgiver laid down a principle of fiscal policy which ought to govern them in this matter: "Thou shalt not muzzle the ox that treadeth out the corn." Machinery did much of the work that oxen did in the time of Moses, and to rate machinery was to muzzle the nineteenth century ox. The hon. Member for Mid Glamorgan (Mr. Samuel T. Evans) said that money not raised by rates must be got somewhere, and asked the supporters of the Bill to indicate the source from which they were to get the money raised by the rating of machinery. In his own judgment rates and taxes should not be imposed where they checked industry or hindered enterprise. There was a source from which they would be drawn and where the undesirable results which he had just mentioned would not ensue. The unimproved value of land of this country was abundantly able to bear all the burdens of the country, and upon that he would place them.


said, he would reiterate words spoken on a former occasion, and say that this was a Bill to relieve rich manufacturers and capitalists at the expense of poor farmers and labourers, small shopkeepers and householders, because it was evident that if they reduced the amount of property which was to be taxed, heavier taxes would be imposed on other property. The fact that on four or five occasions the Bill had not got beyond its Second Reading showed that it did not form a burning question, and the fact was not so much discreditable to the House as to the Bill itself. If the feeling in favour of the Bill were very strong, the Government would soon be induced to get it passed. With regard to the effect of the Bill on agriculture, the President of the Board of Trade undertook to say that it would do no harm to farmers or labourers. He ventured to say that prophecy would not be fulfilled. During the Debates last Session, on the question of the Death Duties, he thought it was allowed by Members on both sides of the House that, if the Death Duties were to be equalised on realty and personalty, then the rates ought also to be equalised on them. He could not, as an agricultural Member, and as representing an agricultural constituency, consent to support this Bill. He felt that in the face of the proposal to equalise the incidence of the rates on personalty and realty, and in face of the proposal, which he thought a very good one, for one assessment for Imperial and local taxes, it would be a very great mistake if this Bill passed its Second Reading. He wished to re- mind hon. Members that agriculture was the only industry which was assessed in the Income Tax on the gross and not on the net profits, and the present was the very worst time to put any increased tax upon agriculture. The fact could not be disguised that if machinery were exempted from these rates the burden would fall upon lands and houses, and he hoped, therefore, that the Bill would be opposed, not only by the agricultural Members, but also by those Members who represented large centres of population, who represented the small leaseholder and the artisan who owned his own house.

*MR. H. MATTHEWS (Birmingham, E.)

said, he did not desire to enter into a controversy between one side and another in regard to this question, but to consider how this Bill would affect the law of rating as it now stood. It struck him that there had been a good deal of confusion in the minds of many of those who had addressed the House as to the present state of the law and the change which this Bill would bring about. The law of rating had not altered in the least, at any rate for the last 100 years. According to the law of rating, it was absolutely clear that stock-in-trade and personal property were not rated, but that what was ratable were premises and land in their actual condition of occupation. Then came the question of machinery, about which the difficulty was entirely of fact and not a difficulty of law. If machinery was fixed to the freehold and was part of the freehold, nobody disputed that it was and always had been ratable. If premises were adapted to receive a particular sort of machinery, and if that machinery was essential to the occupation of the premises and was intended to remain so long as they were so occupied, then that machinery, whether fixed or otherwise, was properly taken into account in estimating the ratable value of the premises. There had been no change made in the law in that respect, and he would ask the House whether that was not a reasonable view to take. Would it not be absolutely ridiculous to rate a shipping yard or a cotton mill without the machinery? In such a case they were not rating a shell, a mere inclosure of ground; the machinery was essentially necessary, and was therefore a part of the hereditament. In one of the earliest reported cases on the subject a very learned Judge laid it down that, if a person took over a house containing a billiard table, so long as the table was there and added to the letting value, it would properly be taken into account in the assessment. Was not that common sense? That had been the law for certainly the whole of this century. It was said that the practice was different, and that might be true. He had no doubt that in many places it had happened that Assessment Committees had been induced to leave out of the ratable value of certain manufacturing premises the value of machinery which, according to the principles of the law, ought to be included in the valuation, and it might also be the case that they were now awakening to a sense of their past error.


said, that nine-tenths of the manufacturers of the country had been rated on the basis that they were not being charged for movable machinery.


said, that in that case nine-tenths of the rates were unfairly charged. He congratulated the manufacturers on their past good luck, but they must not lay any claim to its continuation. Turning to the Bill itself he had no hesitation in saying it altered the law fundamentally and to the advantage of one class of ratepayers only. It altered the law in regard to premises used for trade and manufacturing purposes, and it substituted for the rule he had laid down what he might call the technical rule of fixtures against non-fixtures. Everything which was not so permanently fixed as to be incapable of removal was to be left out of account in estimating the ratable value of the premises. The consequence of that would be that the owner of a large business would only have to arrange that his machinery should not be permanently fixed in order to prevent that machinery being rated. Something had been said about agricultural machinery on a farm, but that was, to a large extent, of a very different character from the machinery of a cotton mill, a shipbuilding yard, or a brewery, for in the latter case it was part of the premises for which rent was paid and would be paid. The Bill would introduce a rule of great difficulty and obscurity, and would probably lead to years of litigation. It introduced a test which was purely arbitrary and altogether novel, and the application of which would lead to increased difficulties and evils. As it seemed to him, therefore, that the existing law was not unjust, and that the alterations in the law proposed by the Bill were unjust and not very rational, he should vote against the Second Reading. He was ready to confess that there were many points in the existing law of rating which demanded change and improvement, but the change now proposed was partial and piecemeal, and in its very nature wrong and unjust. In this matter one class of the community deserved no more sympathy than another; the burden of the rates should be borne equally and fairly by all classes. It was, therefore, because he believed that the changes proposed in the law were unwise and unjust, and because the measure was a partial meddling with a large and complicated subject, that he should vote against the Bill.

*MR. ALBERT SPICER (Monmouth),

said, that as he differed from many of his hon. Friends on the question he could not give a silent vote. He thought it would not be just to relieve manufacturers of the rating in question if the effect of doing so would be to throw the burden on the shoulders of another class. The question was only a small part of a large and important subject—the incidence of taxation—and one phase of it could hardly be dealt with effectively. He held the view that land ought to bear a larger share of taxation than at present and according to its capital value. At the present time a landowner was really punished for improving his land, whilst certain advantages were given to him if he left the land unused or not used to the best advantage. With the views he held on the matter he did not think he would be acting unjustly to his hon. Friends by voting against the Bill, because even if manufacturers were relieved of the rating in question, and the land was made to bear increased rates according to its capital value, the manufacturer would, in consequence, have to pay just as much, for the bulk of manufactories had to be erected where the population was established; and, therefore, on land of comparatively high value. For those reasons he should vote against the Bill, but he hoped that hon. Members interested in the question would not rest until the whole subject of the incidence of taxation was brought forward and considered.


said, he did not agree with the hon. Member for Dorset that there seemed to be an absence of any very strong or considerable feeling on the question among those interested in it. Possibly the hon. Member was misled to that conclusion by the very temperate and proper tone in which the matter had been discussed on both sides. It was not accurate to say that all those who supported the Bill were connected with the manufacturing interest. At any rate, there was a class of the community who were neither manufacturers nor agriculturists, but who were very much interested in maintaining the existing condition of things—he meant the lawyers. He maintained that the existing law in connection with the rating of machinery was grievously uncertain. Hon. Members who represented rural constituencies had contended that if the burden of taxation in question was removed from the manufacturers it would be thrown upon the agricultural classes. But was that the proper way to view the question? What they had to consider was, whether the law in regard to this matter was equal, or just, or certain. And if it could be shown that there was inequality, injustice, or uncertainty in the law relating to the rating of machinery, it was right that an effort should be made to remove the evil. The right hon. Member for East Birmingham had spoken of the certainty of the law on this question, but he spoke of it with all the confidence of one who, fortunately for himself, had been some years removed from private practice. The right hon. Gentleman, in stating his definition of the law, would have them believe that all uncertainty, all question of doubt, was removed from it. The opinion held by the right hon. Gentleman was not held by Lord Esher, who decided the Chard case. In that case it was decided in one breath that machinery should not form the subject of rating, but that it was to be taken into consideration. And when an appeal was made to the Judges as to what were to be the considerations which were to affect the judgment of the rating authority, it was pointed out that these considerations must depend upon the circumstances of each individual case. The result was that Assessment Committees were left to grope blindly in order to ascertain what the law was. The hon. and learned Member for Glamorgan, in his admirable speech, said the law was now the same as it was in the time of Elizabeth. But there was not so much machinery in the time of Elizabeth, and different considerations had arisen as enterprise had introduced machinery into the development of trade. The object of rating, of course, was to impose, if possible, an equal burden upon all; but the policy had always been that care must be taken in fixing the rate not to interfere with the commercial enterprise and the development of the industry—not to muzzle the ox that treadeth out the corn. The hon. Member for Hampshire expressed a wish that personal property should be rated. The doctrine might lie an uncommonly good one for the landlord, but it would be a precious bad one for the tenant, and the hon. Member would not wish to lose sight of either of those parties in this matter. He quite agreed that it would have been most desirable if they could have had a comprehensive measure dealing with the rating question from all points of view. But no Government apparently had had time to take the question up. Now a Bill had been introduced which dealt in a satisfactory manner with inequalities in the law of rating and disposed of the uncertainty which existed in regard to a particular matter. Was it reasonable that they should object to half a loaf because they could not get a whole one? In giving his approval to the Bill he spoke merely in his private capacity. He did not know what the hon. Baronet proposed to do in regard to the future of the measure supposing the Second Reading to be carried, but he should have thought that there was no better tribunal to which it could be referred than the Grand Committee on Trade. A suggestion had been made with regard to a Special Committee; but surely no assembly could be better fitted from all points of view to deal with the minutiœ of the measure than the Grand Committee. He therefore suggested that if the Bill were read a second time, this would be an admirable mode of dealing with it in the Committee stage.

The House divided.—Ayes 185; Noes 134.—(Division List No. 9.)

Motion made, "That this Bill be referred to the Grand Committee on Trade."—(Sir W. H. Houldsworth.)

SIR R. H. PAGET moved, as an Amendment, that the Bill be referred to a Select Committee. He had had experience of both Committees, and there could be no doubt that if the Bill was to be put into shape, the Select Committee was best fitted to do the work.


supported the Amendment, and pointed out that the majority was the smallest that had ever been given in favour of the Bill. The more the House saw of the Bill the less they liked it. The Select Committee was best suited to the sifting of the question because evidence could be taken, whereas no evidence could be produced before a Grand Committee. Besides, as he was once told by the late Mr. W. H. Smith, only Government Bills were sent to Grand Committees. The strongest reason, however, for sending the Bill to a Select Committee was, as he had said, that evidence could be taken there; and he thought that more evidence ought to be taken before they proceeded to deal with the question in a piecemeal fashion. The chief promoters of the Bill, he thought, admitted that there was a great deal to be said in favour of the adoption of the Birmingham principle, but if that were applied the whole character of the Bill would be changed. If they referred the Bill to a Select Committee, they could take the evidence of Birmingham experts. If this Bill went to a Select Committee, there would be ample opportunity of taking the evidence of experts on the subject; and, looking at the matter from any point of view, he ventured to think that no real ground could be adduced for sending the Bill to the Grand Committee on Trade.

*SIR A. K. ROLLIT (Islington, S.)

pointed out that, though the majority that day had not been as large as former majorities, the Bill had been a long time before the House, and the majority that day was certainly a decisive one. The only advantage he could see in a Select Committee would be that of the power of calling witnesses. The Measure was perfectly well known to the House, and, although the law on the point might be uncertain, it could be dealt with perfectly well before the Grand Committee. The hon. Member for Glamorgan contended that it never was intended that private Members' Bills should be referred to Grand Committees; but there could be no objection in principle or practice to such a course being taken, for several Private Members' Bills, e.g. his own Bankruptcy Act of 1890, had been so dealt with, and every Amendment could be laid before the Grand Committee. The Amendment of the hon. Member was simply dilatory, and intended to prevent the Bill from passing. Until they were wise enough to carry on a Bill like this from Session to Session, they should hesitate to accept a proposal which would seriously interfere with the passing of the Bill.


thought that the Bill should go to a Select Committee. The hon. Member who had just sat down asserted that the Bill had been a very long time before the House. It was true that this Bill was the same Bill as that presented last year, but it was a totally different Bill from previous Bills. For instance, the Bill of 1883 contained a clause having reference to waterworks, gasworks, and collieries; this Bill contained no such clause, and that in itself was a most important point. Before such a point as that could be determined, evidence would have to be taken from those interested in gasworks, waterworks, and collieries as to the nature of the under- taking they carried on. Moreover, there had been a dispute between the two Front Benches as to the law on the subject. A learned Gentleman on the Front Opposition Bench contended that it was clear and did not need elucidation, and the Solicitor General said the reverse. It seemed to him that that was another argument for sending the Bill to a Select Committee.


said, that the object of the hon. Member for Mid Glamorgan was to re-open the question of the principle of the Bill. He ventured to point out that there never had been a Bill before the House, the principle of which had been fought out in Committee. The hon. Member for Mid Glamorgan complained that the majority was not large enough, but it was equivalent to a majority of 100 in a full House.


I said it grew smaller every year.


said, the numbers voting on both sides this year were smaller than before, but the majority obtained was, as he had said, equivalent to 100 in a full House, and surely that was sufficient to carry the principle of the Bill. He hoped the House would send the Bill to the Grand Committee.

MR. JAMES LOWTHER (Kent, Thanet),

pointed out that Grand Committees were constituted on Party lines, and this was by no means a Party question. All sections of the House were in hopeless confusion as to the law on the subject, and that was one of the reasons why the House itself should desire to retain the ultimate control of the details of the Bill. He did not think that a Grand Committee was such a tribunal as could efficiently discharge work of this kind.

The House divided:—Ayes, 139: Noes, 175.—(Division List No. 9.)

Bill referred to the Standing Committee on Trade.