HC Deb 22 March 1897 vol 47 cc1128-36

(1.) The Treasury may, if they think fit, at any time for the purpose of providing money for the issue of sums out of the Consolidated Fund under this Act, or the repayment to that fund of all or any part of the sums so issued, borrow money by means of terminable annuities for such period not exceeding thirty years from the passing of this Act as the Treasury may fix, and all sums so borrowed shall be paid into the Exchequer.

(2.) The said annuities shall be paid out of moneys provided by Parliament for army services; and if those moneys are insufficient, shall be charged on and paid out of the Consolidated Fund or the growing produce thereof, but shall not be payable as part of the permanent annual charge for the National Debt.

(3.) The Secretary of State shall in every financial year cause to be made out and laid before the House of Commons an account, in the form required by the Treasury, of the money expended and borrowed and the securities created under this Act, and the accounts of expenditure under this Act shall be audited and reported upon by the Comptroller and Auditor General as appropriation accounts sin manner directed by the Exchequer and Audit Departments Act 1866.


ruled that the Amendment standing in the name of Mr. VESEY KNOX (Londonderry)—[in Sub-section (1), after the word "fix" to insert the words "having regard as to buildings rand furniture, to the periods allowed for the repayment of loans raised by local authorities for expenditure of a like character"]—was out of order, as the Committee had already decided that the period of the loan was to be in the discretion of the Treasury.

MR. T. LOUGH (Islington, W.)

moved, after Sub-section (1) to insert. Every loan raised in pursuance of this section shall be discharged before such date as may be fixed by the Treasury. He thought the right hon. Gentleman would have no objection to these words. The great fault he found with this part of the Bill, which governed the granting of the loan, was, that it was much more carelessly drawn than was the Bill of 1890. The words he proposed were adopted front the Bill of 1890.


said the Amendment was really quite unnecessary. He pointed out that the House had already agreed to a provision as to the period of terminable annuities.

Amendment negatived.


moved, in Sub-section (2), to leave out from the word "services" to the end of the Sub-section. He contended that these words were unnecessary and misleading. It was absurd to say that this money was not to be part of the permanent annual charge on the National Debt. It would come out of the Consolidated Fund, and to all intents and purposes it would be the same as any of her part of the National Debt.


said the object of these words was, that if there was any deficiency of the money voted for Army services in a, particular year, the sum should be charged on, and be paid out of the Consolidated Fund.


said that if the words were omitted the War Office would have no option but to come to Parliament for the money; whereas, if the words were retained they would have an option in the matter. They found when the Estimates were before them, that, owing to the influence which these loan Bills exerted, it was impossible to tell how much was spent in any year on the Army or Navy, end this Bill tended to widen that influence.


said it might hap-pen, owing to expeditions or otherwise, that the sum voted for the Army in a particular year was exceeded. In that case the matter would conic before the Public Accounts Committee, and, therefore, in such a case the matter would have to be sanctioned by the House. This provision was a safeguard to prevent the sum being charged on the National Debt.


said the Public Accounts Committee, although ranking very high among the Committees of that House, was not equivalent to the House itself. The position was really this, if this provision was retained the War Office would be able each year to exceed their expenditure on the ordinary Military Estimates without being compelled to present to the House a supplementary Estimate. He thought that was a most objectionable provision.


said that if the Amendment were adopted the result would be that the Treasury would be unable to borrow the money at all, because it was necessary that the charge should be imposed on the Consolidated Fund in order that proper security might be given to the persons who would lend. The object of the words the end of the section, providing that the monies should not be payable as part of the permanent charge for the National Debt, was to secure that the charge might not escape the notice of Parliament, but should be brought under the cognisance of Parliament every year.


said that as lie understood the effect of the provision, it would be possible for the War Office to apply the amount voted for annuities to meet an excess of expenditure under some other head of the Army Estimates, and to leave the annuities to be paid out of the Consolidated Fund.


The hon. Gentleman may rest assured that the Treasury will take care that nothing of the kind is done. ["Hear, hear!"]

MR. J. A. PEASE (Northumberland, Tyneside)

Would it be possible for the War Office, under this Bill, to avoid coming to the House for a Supplementary Estimate they exceed the monies provided by the House?


It would be impossible. ["Hear, hear!"]

Amendment negatived.


moved, in Sub-section (3), to omit the words "of the money expended and borrowed, and the securities created under this Act," in order to insert the words, "showing as follows:—

  1. "(a) The money expended during that year in pursuance of this Act, and the purposes on which that money was expended, distinguishing the expenditure under each of the heads in the schedule to this Act; and
  2. "(b) The mode in which that money was provided, and the securities (if any) created for providing the same; and
  3. "(c) The aggregate of money expended since the passing of this Act on the purposes thereof, and the aggregate amount of money borrowed, and of securities (if any) created for providing for the same; and
  4. "(d) The balance (if any) of the sums authorised by this Act to be issued."
The object of the Amendment, which consisted mainly of the provisions embodied in the Barracks Act of 1890, where they had worked well, was to secure that the fullest and completest information of the expenditure miller the Bill was laid yearly before the House.


assured the hon. Member that there was really nothing in the Amendment that was not covered by the words of the Bill. So far from there being any deep design on the part of the War Office to deprive Parliament of information in the matter, the words of the Barracks Act of 1890 were not inserted in the clause simply because it was found by the Treasury on investigation that the clause as it stood was just as effective for the purpose aimed at.


said that the right hon. Gentleman's defence of the words of the Bill, so far as borrowing was concerned, was complete. The same security was given in the Bill in the matter of borrowing as was given in the Barracks Act of 1890. But the most important provision in his Amendment was that which related to the expenditure being set on that under set and distinct heads. He contended that under Clause 1, the War Office, if they effected a saving under one, head, could apply that saving to cover an over expenditure under another head, without coining to the House for a Supplementary Estimate, or the House knowing anything about it. They could not stop the work, but they could at least secure that the House of Commons should know how the expenditure had been incurred.

MR. D. F. GODDARD (Ipswich)

remarked that the Chancellor of the Exchequer had not said that the words of the Amendment were wrong, but that the words in the Bill really amounted to the same thing. He would suggest that, as the words of the Amendment would not do any harm to the Bill, or detract one iota from its force, but would simply render it compulsory, that there should be a full and complete statement made to the House as to the way the money had been expended, the Amendment should be accepted by the Government.


remarked that, as there were five different Loan Acts running at the same time, it was difficult, under the present form of account, to ascertain under which of them the money might be spent in a particular year. He had himself experienced this difficulty. The amount of money which had been repaid, for instance, in connection with the Army or Navy, was not shown, and they had to turn to the Estimates to see whether there was any item to be deducted from the total amount of loan. There was thus a great risk of confusion arising when they wished to ascertain the total amount of the expenditure. For his part, he should be satisfied if the Chancellor of the Exchequer would undertake either to make himself each year a very full statement to the House, or see that one was made at least once a year, showing the expenditure under each of the different heads in a particular year for both services. All he desired was, that the House should have an opportunity of knowing, year by year, the exact amount that had been spent in this way, and what was to be added to the amount voted in the Estimates for these services.


pointed out that the Amendment did not in effect differ from the words in the Bill, but it laid down most minutely the exact form of procedure. The right hon. Baronet was not satisfied with the form of accounts which had appeared in the past, as it did not convey a sufficiently full statement of what had been done. He was very much inclined to agree with the right hon. Gentleman. He thought it important, especially from the point of view of the. Chancellor of the Exchequer, that Parliament and the country should know thoroughly the sum of money that was being spent every year on the Army and the Navy, whether it were by annual estimate or by way of works, under Bills of this kind. He could assure the right hon. Gentleman if he would favour him with any suggestion as to the adoption of a clearer form in the future he should be very glad to receive it. He hope I, for the reasons he had given, the hon. Member for Islington would not press his Amendment. He could assure the hon. Gentleman he was quite as anxious as he that this information should be given, so that it might be known what had been done, because he thought it might be sonic check on the applications which were made for expenditure.


asked if the words as they; it present stood in the Bill would provide that the money expended should be shown under the various heads, so that Members could distinguish how much had been spent on each?


replied in the affirmative.


did not think the right hon. Gentleman had made out any case for rejecting the Amendment, which he should accordingly press to a division.

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

The Committee divided:—Ayes, 193; Noes, 73.—(Division List, No. 139.)

On the question "That the Clause stand part of the Bill,"

MR. J. CALDWELL (Lanark, Mid)

urged that the money to pay for the works under the Bill ought to have been provided out of the ordinary Estimates, and not by borrowing. To defend the borrowing on the, ground that these works were permanent was the most extraordinary step. He should have called attention to this before, though he voted for the Second Reading of the Bill, had not discussion been closed after ten minutes' debate. It was no part of State policy to spread the payment of works over a period of years because the works were called permanent. That was a procedure strictly confined to local government, where resources were limited. A post office was a permanent work, but the whole expenditure on it was provided for in one year's Estimates. Pictures purchased for the nation were paid for at once. Ships for the Navy were paid for within the time occupied by their construction. These proposals of the Government were a new method of creating a national debt. The Chancellor of the Exchequer had plenty of money to pay for works as they were completed; but he even refused to reduce the period of repayment from 30 years to 15 years. As a protest against such an enormous amount of money being provided for by loan he should vote against the clause.


said that there was nothing left but to vote against the Clause, which was thoroughly had. The main provision was thrust upon the House suddenly. It was not embodied in the Barrack Act of 1890, though the House had been assured that it was; and if the House had realised that fact, the provision would not have been passed on Thursday. If a shorter period were adopted the difference in amount would not be so much as might be supposed, and sound finance required that the expenditure of the year should be met by the Estimates for the year. His right hon. Friend came into the House in an amiable mood, and said if something was promised he would support the Government; but why should not the promises find expression in the Bill itself? The clause was a bad clause, and should be modified in the direction of the Act of 1890. If the objection were carried to division he should vote against the Clause.

MR. HERBERT LEWIS (Flint Boroughs)

argued that it was not right to lay an undue burden on posterity in matters of this kind, and the Bill should follow the precedent of the Imperial Defence Act of 1888. The objects of that Act were practically the same as those of the present Bill, the construction of certain works of defence involving an expenditure of £2,600,000, and the term of repayment provided was 12 years. Why had the Government now extended the period to 30 years? As a matter of general policy it was wrong to have such a long period as 30 years. In local loans a shorter period was insisted upon, and there was no reason for departing from the salutary principle in Imperial matters. Some explanation should be forthcoming.


hoped the Chancellor of the Exchequer would not allow the Clause to be taken without an explanation.


said it had already been stated by the Under Secretary for War that the term fixed was the maximum term, and not necessarily the term for which all the money would be borrowed, and this maximum term was adopted from the precedent of the Naval Works Act, 1895, passed by the late Government. So much of the work included in the present Bill was of a permanent character that the term of 30 years was fully justified. There was land taken for manœuvres, ranges, and earth works, and expenditure on permanent barracks, replacing temporary huts, which would last for far longer than 30 years, and probably for 100 years, as the hon. Member opposite had suggested. Throughout the entire Bill the expenditure was of a nature that should not be thrown upon the taxpayers of a few years to come; it should be fairly spread over a reasonable number of years for the alleviation of the burden.


said the right hon. Gentleman had not answered the question as to State policy. He went back to the only precedent he could find, that of 1895—


said it was not the only precedent.


said a better precedent was the Naval Defence Act, where the period was 12 years, and the works took several years to complete.


said surely the hon. Member would not compare the life of a ship to the duration of these permanent works?


said he would not, but there was a fair comparison in the buildings that had been constructed, and for Civil Service and Post Office purposes a period of 15 years had been considered a sufficient period to cover the cost of constructing permanent buildings.

Question put, "That Clause 2 stand part of the Bill."

The Committee divided:—Ayes, 150; Noes, 60.—(Division List, No. 140.)

Clause 3,—