HC Deb 02 May 1901 vol 93 cc464-556

"That there shall be charged on and after the nineteenth day of April, nineteen hundred and one, the following customs export duty on coal:—Coal (including culm, coke, cinders, and manufactured fuel), per ton, 1s."

Question proposed, "That this House doth agree with the Committee in the said Resolution."

MR. SAMUEL EVANS (Glamorganshire, Mid)

Perhaps the House will allow me to make a statement. Several of the Amendments on the paper with reference to the coal duty are in my name, but it has been considered, after consultation with high authorities, that it would be very much more convenient to discuss the question first on the general resolution. Therefore, I do not propose at this stage to move these Amendments. The Amendments are to be postponed to a later stage. I am authorised also to state on behalf of the hon. Member for Merthyr Tydvil that he concurs in this proposal.

*SIR WILLIAM HARCOURT (Monmouthshire, W.)

The House is called upon to agree to a resolution which introduces a system of taxation which has recorded against it the proscription and condemnation of more than half a century. We have seen a demand lately for a broader basis of taxation—for original taxation—[Mr. BALFOUR: Hear, hear.]—yes, but this has no claim to originality. It is the decayed corpse of an ancient system which was found so bad that it was abolished fifty-five years ago, and no finance Minister of this country has ever since dared to propose an export duty on a great British trade. It may, I think, be called the revival of the unfittest, where you have an export duty imposed upon a great British trade. It is said this is not a protective duty. No, Sir, it is much worse than a protective duty. A protective duty at least professes to support and promote British trade. But an export duty is an aggressive duty. It is a duty which discourages, and which, whatever one may say of the ultimate incidence of the tax, in the first instance is a direct burden upon British trade. In these days one ought not to be surprised at anything; but I never was so astonished in my life as when I heard the Chancellor of the Exchequer quote Sir Robert Peel and Mr. Gladstone as persons who were in favour of a duty of this kind. He quoted Sir Robert Peel at the date of 1842. At that time Sir Robert Peel was the champion of the principles, and the leader of a party, which taxed everything. They taxed imports, they taxed exports. But Sir Robert Peel in 1845 was a very different person. The Chancellor of the Exchequer might just as well have quoted the principles and the conduct of Saul as representing the doctrines of the Apostle Paul. But we must look at the doctrine of Sir Robert Peel after his conversion—or, indeed, I may say at the moment of his conversion. In his great Budget of 1845 the abolition of all export duties was a necessary corollary and complement to the great reductions he was then beginning to make upon import duties, and the inauguration of that commercial policy which then was a new policy, and which has led to the enormous extension of the trade of this country and the solidity of its present finance. In introducing that Budget be abolished all export duties and expressly refused to make an exception in the case of coal. That is the real doctrine of Sir Robert Peel; and it is one which condemns this tax and which has condemned all taxes of that description ever since that time. As to Mr. Gladstone's view of this matter, which was also quoted by the right hon. Gentleman, I will say something presently. Of course, Sir Robert Peel, in the new system of commercial doctrine which was introduced at that time, was perfectly aware that the imports of this country are paid for by the exports, and that anything which diminishes the exports of this country diminishes the imports also and is, therefore, injurious to the consuming classes of this country. The export duties were abolished, and, as I say, they have never been revived until the right hon. Gentleman has reproduced them to-day. That is not because there was not requirement for additional taxation during that half century. You had the Crimean War, you had various finance Ministers who had to provide for that war. They provided for taxation two or three more times more than you ask for, and it never occurred to them to put an export duty upon coal or upon any of the other trades of the country. Therefore, the authority which the right hon. Gentleman has relied upon breaks down under him altogether.

But in introducing, or, I should rather say, reintroducing this abolished and obsolete system of export duties, there is one thing which I think not only the interests concerned, but this House and the country have to complain of. It is the extraordinary recklessness with which this proposed tax has been propounded. This tax is, as I say, a violation of all accepted principles of finance. It has been introduced without any careful inquiry as to how it would affect the interests concerned-Look at the question of contracts. Not one single word in the speech of the right hon. Gentleman in introducing the Budget indicated that he had ever heard of the contracts or the material bearing of those contracts on this trade. As to sugar we had the most elaborate tables of polarisation which showed that the right hon. Gentleman had made some inquiry and had some information with relerence to the character of the trade upon which he was putting that tax. But as to these contracts one would really believe that the right hon. Gentle- man was not even aware that this coal trade was carried on by forward contracts at all, otherwise he never would have got into the extraordinary scrape in which he finds himself with reference to these contracts. He would have made up his mind how they were to be dealt with. He would have informed the trade on the very first night when he spoke of this tax how the contracts were to be dealt with. But apparently after he had announced the tax he first became aware of the question of contracts; and how were they dealt with? Look at the manner in which that affects the trade. I am told that it affects something like half or more of the trade. There were extraordinary documents issued by the Customs, a suggestion that if there were contracts they should be broken. That was a pretty suggestion to come from a British Government to British merchants! I am happy to say that the suggestion was repudiated, as it was bound to be repudiated. Then, in order to assist the violation of these contracts there were definitions of the legal obligation of these contracts, which I am sure must have astonished any tyro in law; and, considering that we pay £30,000 a year for the highest possible advice, I can only say that such advice as has been tendered by His Majesty's Government to the mercantile community on the subject of this trade was not worth the money. At this moment, although many days have elapsed since the discussion of how these contracts are to be dealt with, the right hon. Gentleman is obliged to say to-night that he had not made up his mind as to how he is going to deal with the matter. It does not only affect the trade, it affects his Budget, because if he is going to exempt the contracts, how much money will he obtain? That he does not know. And here we are asked to affirm a preliminary resolution for a tax of the yield of which the Chancellor of the Exchequer does not venture to offer an estimate. I believe at this moment the whole export trade in coal, certainly in South Wales, and I have no doubt also in the north, is thrown into chaos and confusion. All these traders are called upon to bring in their contracts and to exhibit their profits; and at this time they are not able to continue their trade on account of the manner in which this question has been dealt with. That is a most unbusinesslike way either of dealing with a great trade or of dealing with the finances of a great country. I say that this tax has been started without any knowledge of the conditions of the trade on which it is to be thrown.

Now, that is not all. This question of contracts most of us would call a most extraordinary bungling piece of business, and most vexatious, but it is only a part, and not the main part, of the question that has arisen. The right hon. Gentleman has based this tax on a certain proposition which I might call the postulate of the whole of his demand; it is this, that this tax is not going to be paid by the British trader, but that it will be paid by the foreigner. Well, I do not believe that there is anybody connected with this trade who believes that for a moment. I will leave to those far more capable than I am of dealing with the particular methods in which the trade will be affected; they will give to the House and to the country details of the trade. I will address myself, with the permission of the House, to the bearing of the economic argument upon this question. The right hon. Gentleman says— that our coal is of a class, taking the bulk of it, which the European consumer cannot do without; and that that is certainly true of the coal in South Wales, and is largely true of the coal in the north of England. Well, that is an extraordinary statement, and I believe it to be entirely unfounded. It will be shown to the House and to the country—and I venture to say that both the House and the country have a right at the earliest moment to know the facts of this case—that there is a competition of German coal from the Westphalian coalfields, of Belgian coal throughout Europe, and of American coal to the Mediterranean. Those are facts which are well known to the trade, and which might have been known to the right hon. Gentleman if he had ever made an inquiry before he launched this tax, in which case he would never have made the statement to which I have referred.

Then it is said, "Oh, you will get it out of the foreigner "; but why do not you get it out of the foreigner now? That is a question an answer to which I will ask from the Chancellor of the Exchequer. He is the worthy representative of the most ancient and most famous commercial city of this country—Bristol; has he learnt at Bristol that the merchants of Bristol are in the habit of asking 1s. a ton less for goods in which they deal, or one shilling a lb. less than they can get for tobacco, or any other commodity? If that is the mercantile education he has received in Bristol I would invite him to come to South Wales and have the opportunity, which I have enjoyed for five years, of learning what commercial principles are in that industrial community. His proposition amounts to this—if I put a tax upon you you will then be able to get 1s. more out of the foreigner than you get at present. Now, that is irrational; I venture to say that is an absurd proposition. All merchants, and coal merchants no less than others, get the best price they can in the competitive markets of the world. The price depends upon what? It depends upon the demand and the supply at each particular time, and upon the competition among those who have the command of the supply. That is the proposition on which price is based. The merchant, whoever he may be, and where-ever he may be, takes the best price he can get according to the demand in the market at the time, and the available supply at the time at the disposal of himself and his competitors. Let me illustrate it in this way. Supposing that Italy, or any other country, was to put an additional 1s. upon the import of English coal while it did not put any addition on the coals of other countries. You would complain of that, you would say that it was an unfriendly act, that it was giving an undue preference, that it would be a violation of the most-favoured-nation clause, that it would give an advantage to your competitors in the Italian market which they did not possess before. Well, that is the very thing you are doing against yourself. You are contending now with other countries in the different markets of the world, you hold your own at a certain price, and there is put upon you and additional charge which is not put upon them, and the consequence is that you must lose in the competition. Those are propositions so simple that I ought almost to apologise to the House for stating them. Those are the actual conditions, and that is the condemnation of an export duty on British trade. I would ask the right hon. Gentleman to tell me why putting a tax of 1s. a ton on the export of coal enables the merchant to get another 1s. a ton out of the foreigner when he did not get it before. That is a question to which I think we ought to have an answer, for it is that on which he bases his tax. I say that it is absurd. The merchant now gets all that he can in his business, and because you put another 1s. on his back you do not enable him to get more; on the contrary, you disable him the more from getting what he had before, you prevent him from being in the same position in which he had been in regard to the competition of his rivals. These are matters, I venture to say, that are not to be disposed of in a night. This is a great trade, which employs thousands upon thousands of men, and the House of Commons will ill perform its functions if they endeavour for personal convenience to stifle this debate. Every man who represents these interests has a right to speak in this debate and to defend these interests. Nothing can be more dangerous, in the present state of exasperation that exists with reference to this trade, than to endeavour to hustle this tax through the House of Commons, a course which it is impossible too condemn too strongly. The right hon. Gentleman says, "Oh, you will have future opportunities." But it is necessary that the House of Commons should at once, and to-day, understand and learn the bearing of this tax—aye, and I include the Government, for it is obvious from their conduct that they have not yet understood what is the effect and what will be the consequence of the tax which they are proposing. If we are wrong, let it be shown that we are wrong; but if we are right, then beware of what you are doing. I claim that there shall be no attempt to limit the voice of the men who represent this important trade in their discussion of this matter to- night, and on as many nights as are necessary for that purpose.

I will refer just for a moment to a few simple facts which illustrate the character of the evidence which I have no doubt you will receive in large quantities and in a more authentic manner from persons directly representing the trade. This is what the Chancellor of the Exchequer was told by Mr. Watson, who is. I believe, one of the largest exporters of coal, in answer to his remark that the Welsh coal was not better than the American coal— He was in Italy last October endeavouring to make a contract with the Government for the supply of coal to war ships, but the Italian Government bought American coal, and he lost the contract. I confront that statement with the fundamental principle of the Chancellor of the Exchequer that we are in possession of coal which other countries cannot do without. The Government of Italy, if that statement is true, have done without it, and they have taken their coal from America and not from you. Do you think by putting an additional 1s. upon this coal that you will get it out of the foreigner, and that he will be more willing to contract with you than if you had demanded 1s. less? That is a fair test of the fundamental principle upon which this tax is founded. But it is not only in European markets that you are confronted with this state of things; it is in Eastern markets, too. Mr. Shaw said that his own company used to send 250,000 tons to Bombay, and that he has lost this trade by foreign competition. In Singapore there was only Japanese coal used; and in the Mediterranean and the Baltic I understand the universal opinion is that much less than 1s. would give your competitors the market. Mr. Watson gives the prices of loading the coal and the freight from two places, and he says that the difference between coal shipped from Philadelphia to Marseilles and to Algiers and Malta and his own coal shipped at the same places is only 3d. If that is true, what will be the effect of putting 1s. on British coal? How are you to get that 1s. out of the foreigner?

These things are so elementary that I am almost ashamed of stating them in the House of Commons, because these are the A B C of trade, without a familiarity with which no man is fit to be a Member of this House. It is the most amazing thing that I have ever heard in my life. This sort of slapdash finance, imposing a duty upon such a trade as the coal trade of England—the trade which, after all, is the foundation of all our greatness—is a thing which I think is highly characteristic of what I would venture to call, without any meaning of offence, the slipshod method of conducting Government business. It is not the first time since the great reform of Sir Robert Peel in 1845 that this question of the coal trade has come up for consideration. I remember very well some thirty years ago or more that there was a great coal scare. There was a very ingenious gentleman, Mr. Jevons, who had persuaded himself and who persuaded other people that we were within measurable distance of the exhaustion of coal in this country. We always have a certain public taste for great catastrophes. We have from time to time days fixed at which the world is to come to an end. If the author of the scare is a theologian he finds his prophecies in the Book of Daniel; if he is a philosopher he calculates that some erratic comet, having left its orbit, is going to consume the world, which will perhaps have no coal left to aid in the conflagration. People get over these scares, and the world has not often come to an end even in my lifetime. People think no more about them, and they do not make the foundation of the Budget. They believe that both the world and the coal will last to the 1st of April. But at the time this Jevons scare was very popular. It had even affected the imagination of a great sensational political economist, Mr. John Stuart Mill.

MR. JOHN MORLEY (Montrose Burghs)

Was he sensational?


I used a wrong phrase. I meant to say sentimental. I do not wish to argue with my right hon. friend, but I should say that Mr. Mill had an amount of sentiment which is not common in political economists. But we will discuss that matter elsewhere. At any rate, I can assure my right hon. friend that this scare did not upset his economical conclusions upon the subject I am just going to mention. Mr. Mill thought that this was a very terrible thing and that we ought to make provision against it to guard our posterity, I yield to no one in veneration for the memory of Mr. Mill, nor in my testimony to his eloquence, because if anyone desires to read an eloquent speech upon the duty of this House to those who come after us it will find nothing more splendid than the speech of Mr. Mill in the discussion on the Budget of 1866 in answer to the vulgar question, "What have we got to do with posterity? Posterity has done nothing for us"; and I recommend hon. Gentlemen who wish to see magnificent eloquence to read that speech. But what was the conclusion Mr. Mill drew? Did he say that you were to put an export duty on coal, to interfere with the trade in coal? Not at all. He disavowed and condemned it, and what he recommended was that if it was a wasting asset you should do your duty to posterity by diminishing the mortgage, by reducing the burden on the National Debt. Those were the conclusions of a real economist. Mr. Gladstone in the same debate—for it was on his Budget in 1866, and he also had been impressed by Mr. Jevons's writings, and was not at all averse from making use of them for a purpose he thought to the public advantage—said: I disbelieve and disapprove certainly of all attempts to limit by law the consumption of coal. In vain would it be to think of diminishing that consumption by the imposition of a tax, and it would be more vain still to think of prohibiting its exportation.


I do not propose to do it.


No, no. You do not propose to do it. I only do the right hon. Gentleman justice when I say the Chancellor of the Exchequer is not one of the believers in the exhaustion of coal; he is much too hard-headed to entertain such an idea; but to say that Mr. Gladstone was in favour of an export duty on coal, either in the form of prohibition or to the extent of 1s., is absolutely contrary to the fact, because everything he said was in condemnation of an export duty on coal. What was his text? It was the same as that of Mr. Mill; and he appealed to the House to make provision for the future by establishing a regular system for the liquidation of the National Debt. You who quote Mr. Gladstone as an authority that you should put an export duty on coal, which he condemned, have not only not made provision for the paying off of the mortgage on posterity by the liquidation of the National Debt, but in eighteen months you have increased the National Debt by £127,000,000. Anything more condemnatory of the proceedings and the policy you have pursued than that declaration of Mr. Glad-stone's it is impossible to conceive. I do not believe that we are within measurable distance of exhausting the assets of this country. The right hon. Gentleman does not believe it either; he said so; but are you diminishing the mortgage on posterity? You have increased within eighteen months by one-fifth the burden of the National Debt of this country; and I would strongly urge the right hon. Gentleman to bear in mind that teaching of Mr. Gladstone, and not the opinions of Mr. Gladstone when he was a member of the Protectionist party in 1842.

Then this matter came under consideration again in 1873. Hon. Gentlemen in the House may recollect the coal famine, as it was called at the time. I remember giving in London nearly £3 a ton for coal at that time. I believe it was caused like the recent rise in the price of coal by the extraordinary activity of demand in the iron trade. A very small extra demand in a particular commodity will raise much more every mercantile article by which it is brought into existence; a comparatively slight increase in the demand for iron will greatly raise the price of coal. That was so in 1873, and a Committee was appointed to consider what should be done with reference to the belief that it was approaching exhaustion. That Committee very wisely decided—it had on it some sensible men like the late Mr. W. H. Smith—that it would be much better to do nothing. What happened? In a year or two the price of coal fell lower than it had ever been before. The opinion of that Committee is worthy of consideration. In considering the question of the export, of coal, they said that all export duties were bad, but a duty on coal was exceptionally bad on account of the injurious effect it had on freights and the shipping of the country. That is a most material part of this question, and the House will not understand, the country will not understand, the hearing of this question until you have heard from the shipping interest the manner in which freights are affected. How are freights affected by this? If there is a brisk export trade in coal to a particular place you are able to get freights from that place at a lower rate, and you obtain your imports cheaper than if you had not that export trade. It is a great advantage to the country to have commodities carried at cheap freights. The shipowner can afford to take a lower freight if he has a brisk export in coal in his vessels. Take, for instance, the coal that goes out to Spain. The vessels that carry coal to Spain come back with iron ore, a commodity absolutely essential to the iron trade of this country. If that ceases you will injure greatly the iron, manufacturers of this country. It is a remarkable thing that in the, Report of 1873 they said that if you want to save the store of coal hi this country you should not have an export duty upon coal, but should put it on pig iron, which represents two or three tons of coal, repudiating, of course, any such proposal, but showing the absurdity that exists in some minds as to the methods of preserving the coal reserves of the country. That is not what the Chancellor of the Exchequer says. He contends that you will export as much coal as ever, but that you will make the foreigner pay for it. Well, you will not export as much coal as ever and you will not make the foreigner pay for it. Mr. Wallace, shipowner at Cardiff, speaking of freights says he used to take 700,000 tons to the West Indies; he now takes 50,000 tons, and the balance comes from America, and he fears that the trade to Brazil and Argentina will follow the same course. You know the importance of the trade to Argentina and Brazil, and are you going to put 1s.—I would even say are you going to put 1d.?—of burden against British trade which is now in such keen competition there with that of America?

There is one other argument which has been accepted by people whose intelligence should have prevented them from being influenced by it. That is what is called the fluctuation argument. They say, "Oh, well, but coal has varied in price much more than 1s., you have had it much higher and much lower; and therefore a tax within the limits of fluctuation is a matter of indifference." But on what do those fluctuations depend? Again I beg pardon for making mere elementary statements, but the fluctuations depend on the variation of supply and demand at the time, for if there is a great demand, and the supply remains the same, the prices go up; if there is a less demand and a correspondingly large supply the prices go down. But this 1s. which you are putting on does not depend on supply and demand. It is a burden outside altogether what Adam Smith called the "higgling" of the market. It is a dead weight attached to one particular competitor; supply and demand affect all markets alike, but if you put a shilling upon one trader it is a dead weight which tells against him, and gives the foreigner competitor the advantage and damnifies the trade of your own country. Apply this fluctuation argument to any other commodity. Suppose the price of corn varied 10s., as it used to do, sometimes between the higher and lower level. Do you mean to say that within that limit if you put a duty of 5s. on corn it would make no difference because the limits of fluctuation in that commodity were 10s.? The mere statement of the proposition shows the absurdity of it. This shilling is a dead weight entirely outside the fluctuations of the market, and seriously injures the country upon whom it is imposed. It will be shown, I believe it has been shown to the Chancellor of the Exchequer, that the trade to France to coal is equally divided between ourselves on the one hand and Germany and Belgium on the other.


We are beating Germany and Belgium.


Then go on beating them. You are just beating them. It is a neck-and-neck race, and you are winning by a nose. The figures show that it is a neck-and-neck race, and you are going to throw into the scale this 1s. when you are racing your competitors and just beating them in order to give them the market. Are you going, in a trade so evenly balanced as that, to throw into the scale this 1s. against the trade of your own country? Is this a moment to put an extra 1s. on? You talk of the high price of coal. You know it is falling now, and you know, if you know anything at all, that it is likely to fall still more, and you choose this moment to put an extra burden on this trade, in which the competition is growing sharper and sharper every day. I must say this fluctuation argument is the most ignorant argument ever yet put forward, and I am surprised that any man of ordinary intelligence should allow himself to be deceived by it. But the Chancellor of the Exchequer, as I say, has rested his argument very much on the high price of coal. He says to the coal trade—"You are getting a high price for your coal and you can very well afford to pay." That is a very bad argument to apply to a falling trade. The other day when opening the Budget the right hon. Gentleman refused to put an additional tax on beer because, he said, the consumption had been less lately, and he would not put a tax on a falling trade. But if the price of coal is falling you are putting a tax on a falling trade. And how will this affect the coal trade at home? The right hon. Gentleman already knows how the contracts will affect the trade. Already my information is that there are mines in South Wales beginning to be closed and men thrown out of employment. What do you think, if that goes on, will be your responsibility if a large portion of the miners of this country are thrown out of employment in consequence of the closing of the mines? In this condition of things I venture confidently to affirm that this tax will not fall on the foreign consumer, but on the home producer. It is upon the miner who gets the coal that the burden of this 1s. will fall. I believe that to be an incontrovertible fact. Where competition is close and profits are small, the only thing upon which reduction can be made is wages. Rent charges are fixed and cannot be altered. These are the mining royalties—unless the coalowners take the Chancellor of the Exchequer's advice and break their contracts. I am not altogether sorry that this discussion will bring into prominence the question of the mining royalties. I believe that this is a far more legitimate source of taxation than the present proposal, but mining royalties for the present are sacred. Then, there are other charges, machinery and so on, which are fixed and cannot be reduced. If, then, profits fall, the coalowner has only two courses open to him—he may either shut his mine or lower his wages. 1f he shuts the mine, what happens? Why, the men who were employed in it will go to seek employment in other mines which are still open, and the result will be superfluity of labour and a lowering of wages all round. Do you suppose the miners of England do not know this? If you imagine that, you know nothing of them at all. They are intelligent men and understand their business a great deal better than it is understood by His Majesty's Government.

I apologise to the House for occupying so much time, but I should like, in conclusion, to sum up the propositions which, I think, are deserving of consideration. First of all, the Chancellor of the Exchequer says that the foreigner will pay. I say, upon all economic principles, that the proposition, in the case of this trade, cannot be maintained. Secondly, it is alleged by some persons that if less coal is exported we shall get it cheaper at home, but that is based on the assumption that you have reduced the export, which is inconsistent with the doctrine of the Chancellor of the Exchequer, because the right hon. Gentleman says you will export as much as ever. You will not get it cheaper, because the allegation assumes that the output will remain the same. The output will not remain the same, and, therefore, the assumption that cheaper coal will be got if it does not go abroad is entirely unfounded. Then there are people who fear an exhaustion of the coal supply. That is inconsistent with both the previous propositions, because the Chancellor of the Exchequer says the process of exhaustion will go on just the same under the tax, because just as much coal will be exported. It has been shown by Mr. Mill and by Mr. Gladstone that this is not the remedy for the exhaustion of coal—that if the wasting of an asset takes place, what you ought to do is to diminish the mortgage upon the nation. There are other people who are amiable enough to say that by this duty we are depriving the foreigner of the supply of an article which is useful to him in his trade and manufactures. That is not a very neighbourly spirit, but there are people who entertain that idea to spite the customers with whom you desire to trade. Commerce depends on an interchange with friends, and not a campaign of enmity against foes. But why confine yourselves to coal? Prohibit the exportation of agricultural implements for fear the foreigner would improve his agriculture. Prohibit the exportation of machines for various trades, such as the spinning trade; and after a general prohibition of the exportation of articles which you think might be useful to other countries, then consider what would become of British trade altogether. These are generally the propositions put forward by the various people in support of this particular tax.

But the Chancellor of the Exchequer says, "I do it for revenue. I must make money somehow; it does not signify how I make it." That is a very ancient maxim, and it does not seem to have become obsolete. I am going to help the right hon. Gentleman to make his money honestly. I am going to point out to him how he can get a sum of money much more considerable than he will obtain from this tax after he has settled with the contractors. He is going to renew an expenditure which he might save. During the great battle which we fought upon the Agricultural Rating Act we were told the Government would appoint a Commission to inquire into the whole question; and they gave a pledge, expressed or implied, that they would not renew the aid to agricultural rates until they had settled the grave injustice of not extending the boon to dwellers in towns. We are now told that the Government without having considered the question as to what ought to be given to the towns, are going to renew this boon, this dole, of a million and a half, or more, this year. [Ministerial cries of "Hear, hear" and "Justly."] Oh, no doubt you are very glad to get your £1,500,000; and you are very happy to put £2,000,000 upon the coal trade and the coalminers of England. [Ministerial cries of "On the foreigner."] I say that in the situation in which you stand this is the most unjustifiable example of class finance that ever was proposed by a responsible Government; and that you are putting this unjust and most unequal burden upon the coal trade of the country in order that you may make this dole of £1,500,000 to a favoured interest. I say that is a most dangerous policy, an unwise policy and a most unjust policy. In every sense of the word this is reactionary finance. It violates all the principles of taxation and commerce which the last half-century has built up. It is founded upon a temporary rise in prices—a rise which has already passed—and it is imposed upon a falling trade. It aims at raising revenue by sacrificing trade—a thing which the Chancellor of the Exchequer disclaims upon his part. Already these unconsidered trifles of contracts have destroyed half the revenue you expected from this tax. For a comparatively trifling gain to the revenue you have disorganised and dislocated one of the greatest trades of this country. Indeed, you have paralysed that trade. This tax will not cheapen coal at home, as you pretend. It will lessen the output. It will shut up mines in the country, which are just upon the verge of closing, and can barely hold their own. Its ultimate burden will fall upon the mining population of this country—men whose occupation is the hardest, the most painful, and perilous pursued by our industrial classes, whose remuneration, in proportion to the risk they run, is the lowest in the scale of labour. There is no class more entitled to the sympathy of this House and of every man in this country than those who in this trade, which is so vital to the prosperity of this nation, lead dark and dismal lives. Besides other burdens which this unhappy and ill-omened war has brought upon us all these men are to bear this extra tax which you have inflicted upon them—this special and exceptional tax, a tax condemned alike by economical theory and practical experience—and, at the same time, you are bestowing a special dole upon a particular and a favoured class.

In my opinion, this is a most perilous example of class legislation and of class favouritism. I venture to hope that the Chancellor of the Exchequer and the Government at large will reconsider their position in the light of the full information which they ought to receive in the debates of this House, because it is clear that this case ought to be heard, and if in your impatience you choose to stifle this debate you remove the arena of this conflict elsewhere. Against that course I venture to lift a warning voice. But I cannot but hope, if the House of Commons does its duty, if it patiently and fully investigates this great issue upon what is a vital trade, that the Government, without any dishonour to themselves, may reconsider their position. I will offer them an example which they need not be ashamed to follow. Mr. Pitt after the great triumph in the dissolution which first placed him in possession of a majority far greater than even that you now enjoy, in his first Budget, in which he proposed many taxes and remitted some, there was a coal tax—it was a tax upon coal at the pit and upon coal at exportation—but in presence of the resistance of the coal trade, and of the conviction that it was injurious to the country, Mr. Pitt, then in the plenitude of his power, withdrew the tax, and that coal tax was the only tax which, in the whole of his career, he failed to carry. The Chancellor of the Exchequer need not be ashamed to imitate the wisdom and prudence of his predecessor, Mr. Pitt. I hope there is still time for the Government to reconsider this tax. But if, after all, that be not so, I have only to say, in conclusion, that the two other taxes which have been brought forward, and which seem to be necessary, in the disastrous financial condition to which you have reduced the country—[Ministerial cries of "No, no," and Opposition cheers.] Is it not a disastrous condition when you have wasted all the savings of half a century and added to your debt—I was about to say that under the pressure of that necessity I, for my part, have given a reluctant but necessary support to the demands of the Government with regard to the other taxes they have proposed. But this is a tax so unsound in its principle, so unjust in its incidence, so mischievous in its ultimate consequence to the trade of this country, that we feel bound by every consideration of equity and prudence to offer it at every stage and by every legitimate means a continued and determined resistance.


The right hon. Gentleman—in his capacity as Member for West Monmouthshire—has dealt with the proposal now before the House in a manner which I think his constituents will describe, in a phrase well known to them, as "very faithful." But I have to regret that the right hon. Gentleman has made two charges against us which are, I think, alike unfair and inaccurate. Is it true that we have attempted to hustle this proposal through the House of Commons?


I did not mean that, because I know the right hon. Gentleman at my instance postponed it. I was referring to the request for an extension of the time for the present debate.


Whose fault was it that this discussion did not begin on Tuesday? [Cries of "Name" and "Hay."] I have no desire to cut short the discussion on this or any other stage of the Budget, but I do not think it is fair that on such a stage as the Report of a resolution on which, in my recollection, even in that bitterly opposed Finance Act of 1894, there never was any prolonged debate—


There never was any closure.


I do not think it is fair that we should be expected to provide the time for lengthened discussion before the Finance Bill can be submitted to the House which the right hon. Gentleman appears to desire. But another statement of the right hon Gentleman seems to me even more unfair. He suggested, and he dwelt with emphasis on the suggestion, that this tax was proposed in order to continue the Agricultural Rates Act. If that was the object of the proposal, if it were true, as the right hon. Gentleman believes, that this tax will fall on the coalowners in the first place and not upon the foreigner at all, I would say even then that the coalowner could afford to pay better than the farmer. This tax is a part, and an important part, of the Budget of the year. It is proposed, as the right hon. Gentleman knows very well, not to provide for the renewal of the Agricultural Rates Act, but to provide for the general expenditure of the country; and, as a proposal for that purpose it ought to be regarded, if it is possible for hon. Members opposite to consider these matters apart from the mere question of party politics. The right hon. Gentleman has favoured us with a lecture on high economical principles and the evils of export duties. He almost suggested that an export duty on coal should be considered on the same footing as an export duty on corn, or cotton, or timber, or anything of that kind. He did not argue the matter, but I think anyone who fairly considers the question must agree with me that coal is an article of such a unique character that it was impossible to consider it on the same basis as those other articles I have mentioned. The right hon. Gentleman referred to my quotation of statements of Sir Robert Peel and Mr. Gladstone in support of this export duty, but he did not at all succeed in shaking the opinion I quoted from Sir Robert Peel in its favour, because I have already stated to the House that, when Sir Robert Peel repealed it, he did so because he considered its repeal as a part of a general policy of repealing export duties, and not on account of his objection to this particular tax.


I object to export duties altogether.


Yes, but I am speaking of an even greater authority than the right hon. Gentleman.


But he did repeal them.


Yes, but not for reasons which at all qualified his support of this particular tax in former years. But when the right hon. Gentleman went on to quote Mr. Gladstone, he could not quote a passage which in any way negatived the arguments which that statesman adduced in support of the tax in 1842. What Mr. Gladstone said was this—that he thought it vain to prohibit the export of coal—so do I—and that he thought it vain to impose a tax with a view to diminishing the export of coal. This tax is not proposed with that intention. That is all the right hon. Gentleman could quote from Mr. Gladstone in his later years, though on most subjects I am afraid he might find opinions in Mr. Gladstone's speeches absolutely contradictory of one another, which is, of course, the case with any man who has gone through a long political career; and for my part, I should prefer the earlier declarations of Mr. Gladstone to those of his later years. The right hon. Gentleman objected to this proposed duty as an obstruction to trade. Of course it is an obstruction to trade, and unless you can get rid of all taxes whatever, which is absurd, you must in some measure obstruct trade by your taxation. But when the right hon. Gentleman rests his argument upon the views of the Committee of 1873, I venture to take issue with him altogether. The opinions of that Committee were of a kind to which I, though I am a free trader, am bound to say I cannot assent. What was their argument in regard to an export duty on coal? Not only that it might affect the shipping interests of this country, but, far beyond that, that it would injure us generally, because the export of our coal to foreign countries enabled foreign manufacturers and foreign workmen to manufacture goods at a cheaper rate, and foreign railways by the use of that coal to transport those goods at cheaper rates to Continental ports, and so to supply the consumer here with foreign goods more cheaply than would have been the case if they had not had the use of that coal. That was the main argument of that Committee. I do not know what the strict doctrines of free trade may require, but I cannot assent to the proposition that we should grant to foreign countries in the competition of foreign producers with our own, our own natural advantages in addition to the natural advantages those foreign countries enjoy.


That was Mr. W. H. Smith's opinion.


I think my memory serves me when I say that Mr. W. H. Smith voted against that particular clause in the Report. Then, Sir, the right hon. Gentleman objected to this duty as a partial tax on a particular industry. Are there no partial taxes in our tariff? Every licence duty is a partial tax. Many of our stamp duties are partial taxes. Our indirect taxes in their primary incidence are partial taxes, and I am surprised at the objection to this as a partial tax coming from the right hon. Gentleman, who in the same breath suggests what has been advocated by others, that a tax on mineral royalties should be substituted for this export tax on coal. Then, Sir, the right hon. Gentleman argued that this duty was in effect a bounty to the foreign producer of coal in his competition with our producers of coal in foreign countries. That argument comes a little late in the day. For years past Parliament has enacted a code of legislation for mines and for shipping—a necessary code, but a code which imposes special obligations, and costly obligations, upon the management of mines and of ships owned by British subjects, and which, pro tanto of course, acts as a bounty to the foreigner against the produce of our own mines and the work of our own shipping industry. And more than that, what have we seen lately supported by the right hon. Gentleman? We have seen a direct bounty to the foreign producer of coal proposed in this House in the shape of a Bill limiting the hours of work in mines to eight in the day; and from time to time we constantly see proposals for a restriction of the output of coal in this country, proposals to limit the number of days in the week on which miners should work, and matters of that kind, all of which would have the effect of making the production of coal in this country more costly than it is in foreign countries. Yet the very persons who advocate these proposals, and go on to advocate the nationalisation of minerals in this country for the benefit of the people, bitterly oppose a proposal which takes but a small toll of our mineral wealth in the interests of the country at large, a proposal which, in my belief, will be as nothing in handicapping the coal industry of this country in its competition with foreigners when compared with the matters to which I have referred.

But, Sir, I will leave these arguments, which, after all, are of a more theoretical than practical character, and I will turn to what is the real question at issue as I apprehend it, and that is, Can the export trade in coal, which, to my great surprise, the right hon. Gentleman characterised as the foundation of all our greatness—can the export trade in coal bear this one shilling in the ton tax? The right hon. Gentleman, speaking with all his Welsh interest—


And knowledge.


And knowledge—the right hon. Gentleman gave us a not very flattering description of the Welsh producer of coal. He represented him as one who screwed the uttermost penny out of his foreign customer, and, on the other hand, imposed every possible burden on the person whom he employed. That was the description the right hon. Gentleman gave us. He is so sharp a man of business already that he cannot get anything more out of the foreigner, and he will not bear a penny of this tax himself, because he will put it all on the miner. The right hon. Gentleman suggests that his Welsh friend is really a person qualified to be Chancellor of the Exchequer. I think it was an imaginative description, and I do not believe either of those propositions. I do think the foreigner will bear a very considerable portion of the tax, though I entirely admit that how much he may bear depends on the state of the market at the time. But of one thing I am quite sure—that there is absolutely no necessity for the coal producer to pass a penny of it on to the miner. This is the real question—Will the coal owner, after the imposition of this tax, be able to obtain such a price from the foreigner that the export trade can continue? Now, I gave some reasons in my Budget speech for an affirmative reply to that question. I did not base this tax upon the high prices of last year, as the right hon. Gentleman suggested, but what I argued was this:—Everybody admits that the price of our coal at the port of shipment for export to Europe and the Mediterranean during 1900 was enormously high. Everybody admits that freights to Europe from our ports were also enormously high. Very well. In spite of those prices, our export trade to Europe increased by about seven per cent. in 1900, as compared with the previous year. What does that mean? I have heard it argued by some of the many deputations which have done me the honour of waiting upon me that it only means that the demand for coal, owing to the activity of trade in Europe, was in 1900 far greater than the supply. I do not think that is a sufficient reason at all. Take, in the first place, the price of coal at the port of export. The price of our coal at the port of export during that year rose much more in proportion than the price of United States coal rose at the port of export. There is no doubt about that. I do not know that the price of United States coal at the port of export rose at all. And yet, in spite of that, our export of coal to Europe in 1900 was 38,000,000 of tons—three and a half millions of tons more than in the previous year—as compared with the United States export of a little over 600,000 tons. Therefore it is perfectly clear that, although the price of our coal at the port of export rose very high indeed, and the price of the United States coal at the port of export did not rise, the United States coal was unable to compete with us in Europe during that year.


It had not time.


The hon. Member says it had not time; but let him remember that our prices have fallen since. If it could not compete when the prices of our coal were very high, it is absolutely impossible for it to compete when the prices of our coal are low, because the difference is a difference in railway and sea freight. That is what prevents the competition of the United States coal with us to any serious extent in the markets of Europe. Then I come to the questiou of the competition of European coal in the markets of Europe with our own coal. There the question of sea freight arises, and, as I have said, our sea freights last year were enormously high. There was no question of additional freight from Germany to France, or from Belgium to Trance, or from Germany to Italy, yet our exports to those countries largely increased, more in proportion than German exports did, in spite of the high sea freight. So there must be something in this matter, apart from the question of the demand being in excess of the supply, which gives us a market for our coal on the Continent of Europe better than any other nation enjoys. What is it that makes that difference? I will venture to put before the House two reasons which make that difference. In the first place, it is a question of quality. I will not dwell on anthracite coal, the export of which is comparatively small. Practically, Europe cannot get anthracite coal except from this country. I will go on to what is ordinarily known as Welsh steam coal. A gentleman who was present on one of the deputations which came to me described Welsh steam coal as pre-eminently possessing these qualities—I am speaking of Welsh steam coal of good quality, of course: it smokes less, it evaporates more water than any other coal, and it travels well, and, therefore, it is far more valuable than United States coal of the same kind, which is very friable in its nature. The right hon. Gentleman has ridiculed the idea of this class of coal having any monopoly in Europe. I think, with all deference to his superior knowledge as a Welsh representative, that he is absolutely wrong, and I base that opinion upon an observation that was made to me by a representative of the miners in South Wales, who admitted that in the case of the best South Wales coal the owners might recoup themselves for the extra tax.


A very little part.


Then I have got this admission, that for some, at any rate, of this tax the foreigner will pay.


No. I say that you get out of the foreigner as much as you can now. Putting a tax on does not enable you to get more.


I will leave the right hon. Gentleman to fight it out with the delegate of the miners in South Wales.


I would rather fight it out with you.


Now I come to the north-country coal. Well, the north-country gas coal is also of a very superior quality. There is no doubt about that. I do not say that it is as free from competition as the South Wales coal. But I must point out to the House that if it were not of exceptionally good quality for the purposes to which it is devoted the foreign countries to which it goes would surely supply themselves for those purposes—and it goes to many foreign countries which produce coal—instead of importing our coal for them. But there is another special advantage which our exporters of coal enjoy. That is, cheaper freight. Our coalfields are much nearer to the coast and the shipping ports than the coalfields of any country in Europe, and thus it is that we can practically command the markets of countries like Scandinavia, or Italy, or Spain, which have practically no coal of their own. The land carriage from the coalfields of Belgium, or of Germany, to those countries is practically prohibitive of competition with us. Even with regard to France, which produces coal of its own, and in which, as the right hon. Gentleman said, Belgian and German coal competes with our own even there, at many points, such as Bordeaux, our cheap sea carriage enables us to compete successfully, and will enable us to compete successfully, with even the coal produced in the country itself. I have proof of this. What has been the progress of our trade with regard to those countries? Our exports to Italy in the year 1891 were 3,490,000 tons; last year they were 5,407,000 tons. Our exports to Spain in 1891 were 1,670,000 tons; last year they were 2,624,000 tons. Our exports to Sweden and Norway in 1891 were 2,430,000 tons; last year they were 4,435,000 tons. Our exports to Russia in 1891 were 1,443,000 tons; last year they were 3,217,000 tons. Our exports to France in 1891 were 4,368,000 tons, while last year they were 8,446,000 tons. Our proportion of the total amount of coal consumed in France has been increasing, while the exports of Belgium and Germany to France, in proportion to the total amount of coal consumed in the country, have been absolutely diminishing. Therefore I think I have shown that we have a pretty safe market, as compared with any competitors on the Continent of Europe, for our coal.

Now I come to what I believe is the real crux of this question in the minds of the coal exporters—namely, the position of Germany. We hear a great deal—the right hon. Gentleman alluded to it—of the produce of the Westphalian coalfields. There seems to be a kind of panic that the Westphalian coalfields, whose export is as nothing compared to the produce of our own exporting coalfields, will drive us out of the market, not only in Germany, but in the countries which are to some extent already supplied from Germany. Well, it is a remarkable fact that, though Germany is an exporting country in the matter of coal, last year we sent to Germany six millions of tons of coal, as against four millions in the year 1891. Surely that points to this, that the Germans want our coal, or some kinds of our coal, for some purpose to which their own is not applicable, or that our coal is cheaper in comparison to its value than their own. Though you may hear a good deal from coal exporters in this country about their difficulty in obtaining contracts in competition with Westphalian coal, at certain places, when you come to ask them whether the coal is of the same quality I think they will admit that the Westphalian coal is of worse quality than our own. And, after all, quality has a good deal to do in these matters, besides the question of price. I was told by one of these deputations that the port of Hamburg was perhaps the place, of all others, where European competition from the Westphalian coalfields was dangerous to us, and it is natural it would be. What happened last year? A good deal of Westphalian coal was sent to Hamburg, and it was sent, I am told, under peculiar conditions. In spite of the enormous rise in the price of British coal, the Westphalian syndicate, I am told, undertook to supply their old customers in Hamburg with the same amount of coal as they had taken in the previous year at the price of the previous year, or something like it. That, surely, was an advantage to the Westphalian coal. But what were the imports of coal into Hamburg in 1900? The imports of British coal into Hamburg last year were 3,019,000 tons, as compared with 2,055,000 tons in 1898. The imports of Westphalian coal into Hamburg in 1900 were 1,602,000 tons, as compared with 1,652,000 tons in 1898. That does not look like losing the Hamburg market. Sometimes we hear that the German export trade is specially favoured by low railway rates. I do not doubt that it is; but have we nothing of the kind in our own country? I do not suppose for a moment that there exists, nowadays, anything like the old combination for the limitation of the "vend" which existed between 1787 and 1844, and which raised the price of coal for export to London from the Tyne and the Wear by 40 per cent. over the price for export to foreign places. But, irrespective of that, I suspect that cases are not unknown in which coalowners nowadays will sell coal for foreign export at much lower prices than they will sell it for home consumption. And of this I am quite certain—that railway rates in our coalfields deliberately and greatly encourage our foreign export of coal as compared with its transmission to our home consumers. I have received the rates from eighteen different collieries to a certain port in the north of England. They are 50 per cent. per ton, or, in most cases, a good deal more than this shilling duty per ton, less for foreign export coal than for coal sent to consumers for manufacturing and domestic purposes at that port. Parliament has deliberately legalised, for the whole of the north-eastern districts, lower rates for foreign export—which, I have no doubt, are very readily given—than those which are given to our home manufacturers and consumers.

SIR HOWARD VINCENT (Sheffield, Central)



At any rate, this is surely enough to show that Germany has no monopoly of those special advantages for her export trade. There is one argument which is often put to me in connection with this matter. We are told that, although prices have been very high owing to the demand being largely in excess of the supply, yet that the supply is so largely increasing by the development of mines, especially in Germany and the United States, that markets in future will be very different from what they have been in the past. That is a very favourite argument. Of course, there are ups and downs in the trade. Last year was a very good year, and this year will not be so good; and anyone who looks at the history of the coal trade, or of any other trade, over a period of years will find the same thing. But, taking a series of years, I am certain that you will find that the demand for coal has increased more than the supply. The right hon. Gentleman made a great deal of the markets which we had lost in the East and West Indies and in South America. There is no doubt that the amount of coal which we used to export to various ports east of Aden has very largely diminished of recent years, and Indian or Japanese coal has taken its place. There is no doubt that the United States are supplying the West Indies, and will probably soon supply other places in South America which we supplied in past years. But why is this? It is because of the higher freight from this country as compared with the freight from the United States in the Western hemisphere, or from India or Japan in the East. What lesson may we learn from it? That for precisely the same reason the European market, which is our important market, is practically for the time secure to us, because of the great difference in the freight from the United States or from India or Japan into that market as compared with the freights from England. But, in spite of the losses which our trade has sustained, the right hon. Gentleman did not venture to deny that there had been an enormous increase in our export trade. Why is this? Because, throughout Europe and the civilised world, the demand for coal is every year enormously increasing by reason of the growth of manufactures, by the expansion of railways, and by the use of coal for all sorts of purposes for which it was not used before. Therefore in our case it is true with regard to coal even more than with regard to any other industry in this country that the loss of one market has really meant the gain of a better market in its place; and whereas in 1845, after the repeal of the duty, our exports amounted only to 2,000,000 tons, last year they amounted to 46,000,000 tons, or double what they were thirteen years ago. Is it possible fairly to argue, when a trade has in this way been increasing over a series of years by leaps and bounds, increasing in spite of increasing freights and of all fluctuations in the market price of coal, that a shilling tax will destroy the trade? I am quite aware that that is not the view of those engaged in the trade. I am quite aware that the coal-owners protest loudly that the tax will destroy the trade.

MR. D. A. THOMAS (Merthyr Tydfil)

No, injure.


Oh, is it only injure? But that is not the statement which has been made to me. I have heard—and the right hon. Gentleman repeated the statement to-night—that mines would beclosed, that thousands of miners would be thrown out of work, that wages would be reduced, that ships would be laid idle and their crews left without employment, and the whole industry disorganised. That is what I characterise by the word "destroy." [Opposition cries of "No."] The right hon. Gentleman put forward an argument which I have heard from the coal-producers—that the more our export trade increased the more advantageous it was to the home consumer, because, the cost of production being spread over a greater area of produce, the home consumer could obtain his coal more cheaply. Has that been the experience of the home consumer last year? If it has not may we not be entitled to disregard the converse proposition—that if the export trade does not increase, or if it is to some extent diminished, mines will be closed, and consequently the price of coal will be dearer to the home consumer? Sir, we have heard all these things before. When Sir Robert Peel imposed this tax in 1841 the representatives of the coal-owners, as anyone who refers to the debates of that and succeeding years will find, put forward precisely the same arguments as to the ruin of their trade as are put forward to-day. And yet what happened? Why, the export of coal, under a tax of 2s. a ton on large coal and of 1s. a ton on small coal—more than double what I now propose—was actually increased in the year 1843 under that tax as compared with what it was in 1841, before the tax was imposed. I do not say that the increase was as much as it would have been without the tax; but I do maintain that it did not destroy or seriously injure the trade. But we have a more recent experience than that. Only two or three years ago what did we hear on the Compensation for Accidents Bill? Over and over again we were assured by the representatives of coal-owners in this House that that Bill would add 2d. or 3d. a ton to the cost of getting the coal, that mines would be closed, and that the coalowners would be ruined. The miners did not support that argument, because they thought that they would gain something from the proceedings, and they knew perfectly well the fallacy of these prophecies. Those prophecies have been absolutely falsified. I venture to disbelieve the same kind of prophecies that are now made with regard to the effect of this tax. I dispute the proposition of the right hon. Gentleman that this tax will not fall upon the foreigner. I believe that it would fall upon the foreigner in such a year as last year, and when the market was good in any other year. I am glad to observe, from a letter which I have just received, that the export price of coal is higher now than it was a little time ago, and that in South Wales the prices of February and March were higher than those of December and January. Therefore, at present, I do not think that the trade is in the position in which this tax could not be borne. But let me take the view of the right hon. Gentleman. Suppose it comes to a choice whether the increase in the export trade is to be stopped, or whether the coalowner is to bear part of the burden. I will take the second alternative first. Can the coalowner bear a part of that burden? Of course he says that he cannot. I have statistics here obtained from the Home Office and the Board of Trade comparing the year 1900 with previous years. I will not take comparisons of the gains or losses of individuals or single companies. I do not think they are fair comparisons, because in this industry, as in all others, there are, of course, some wealthy persons and companies, and some persons and companies engaged in it who do not do so well. The right hon. Gentleman referred to mines having recently been closed in dread of this tax. I happen to know something of South Wales, as well as the right hon. Gentleman, and I know this, that there are parts of South Wales where there are certain mines which are not worth working except at an exceptionally high price of coal, and that those mines are practically left unworked until a year comes when an exceptional price occurs. Then they are worked for a brief period, and when the hay has been made the mine is closed again. That is what has happened in regard to the mines the right hon. Gentleman was thinking of in his speech. Let me give the House some particulars of the profits on coal in the year 1900, as compared with past years over the whole trade. The average price of coal at the pit's mouth over the whole country in the year 1897 was 5s. 7d. per ton; in 1898, 6s. 4d.; in 1899, 7s. 7d.; and in 1900, 10s. 9½d. In the year 1900 225,000,000 tons of coal were produced, and it is estimated that the excess in value of that product over the year 1897, at the prices I have named, is no less than £55,000,000.


What is the authority for that estimate?


The Home Office and the Board of Trade.

SIR JAMES JOICEY (Durham, Chester-le-Street)

May I ask what statistics they have got?


These statistics are from Parliamentary Returns. Now, how much of this money went into the pockets of the coal-owners? That is a question which I am sure will interest the hon. Baronet. Of course, in the first place, you have to deduct the extra wages which the coalowners paid. Now the average weekly wages of miners of all classes in 1897 were 25s. a week; in 1898, 27s. 8d.; in 1899, 29s. 4d.; and in 1900, 33s. 4d. a week. Taking the increase of wages in 1900 over 1897, at 8s. a week, and taking 780,000 miners, which is the number the Home Office calculates to be in the country, you will arrive at the sum of £15,000,000 extra in wages paid in 1900 over 1897.


What was the increase in the number of men?


Allowance has been made for that; but 780,000 miners were, I understand, the number employed in 1900.


There were many more in 1900 than in 1897.


Then there are other increases on, various articles which increase the cost.




No, this is a question of the price of coal at the pit's mouth. Deduct £5,000,000, or if you like £5,500,000, for those increases, and £15,500,000 for extra wages to miners, or say, £21,000,000 altogether, from the £55,000,000, and you show £34,000,000 more profit to the owners than they obtained in 1897. Now, the total capital employed in the coal mines of the country is stated by the Mining Association (who are not likely to under-estimate it) to be £110,000,000, and therefore you have a return for that year of £34,000 000 net profit, as compared with the profit, whatever it was, in 1897, on a capital of £110,000,000. Sir, this is the interest which is going to be beggared and pauperised by this tax. I am quite aware that 1897 was not a good year.

MR. McKENNA (Monmouthshire, N.)

Was there any profit at all?


Oh, no; that will not do. Undoubtedly there were mines, perhaps a considerable number of mines, that made no profit in 1897; but I am absolutely certain that there were a good many did make a profit in that year.


Let us have the average for ten years.


If you allow for good years and bad years and take the average, as the hon. Baronet opposite has suggested, you must still admit that a profit of £34,000,000 in one year over the profit that existed in another year is not a bad thing for the industry concerned. But that is not all. Everybody knows that this is an increasing industry. Look at the increasing output and the number of fresh pits continually being sunk; look at the whole state of the trade. Of course it is a prosperous industry, and I confess I had some little difficulty in keeping my patience when deputation after deputation of coal-owners came to me and said their industry was so bad that they hardly made any profit on it at all on an average number of years. I think they have got by this time a very considerable little nest-egg, at any rate, with which they might, in the first place, bear any loss in the early future which this 1s. duty on coal is likely to impose on the coalowner.

Now, let me take the other alternative of the right hon. Gentleman. Suppose the export trade does not increase at the ratio at which it has recently been increasing, I want to know what hon. Members who take his view really desire? Do they desire that this export trade in coal should increase to an unlimited extent, as one might desire that our export trade in cotton, woollen goods, steel manufactures, or articles of that kind should continue to increase? I want to know whether that is their view, because it is not mine. I do not believe this tax will destroy or seriously injure this trade. I question whether it will diminish it at all. It may check its increase, but I do not believe—as I said in my Budget speech—that such a check on the increase of the coal export trade would be an unmixed evil to this country. I do not look upon the coal export trade as the foundation of all our greatness. Why, Sir, the right hon. Gentleman referred to the Royal Commission which reported in 1871. I am not a believer in the early exhaustion of our coal supply, but I do believe there is some danger of the early exhaustion of the cheaper sources of our coal supply in certain coalfields. In proof of that I may cite the authority of Mr. Bainbridge, a Member of the last Parliament, who told me the other day that, in his belief, the comparative cheapness of American coal at the port of export compared with the price of our coal at the port of export was due to the fact that we had largely worked out our cheap seams, while the Americans were still working theirs. Therefore I do not consider it to the interest of this country as a whole—and we must consider the interest of the country as a whole—that our export trade in coal should increase to the unlimited extent which apparently the right hon. Gentleman would desire. What has been the increase since the Royal Commission reported in 1871? They anticipated a certain consumption of coal during the thirty years immediately ahead of them. Their estimates were fairly well realised with regard to the home consumption; they were absolutely at fault with regard to our export trade. They estimated there would be 360 million tons exported in the thirty years, whereas there have been 960 million tons exported in that time. I confess I should prefer that, at any rate to some extent, our cheap sources of coal supply should be kept for the benefit of our own consumers rather than exported abroad. I quoted the other day from the work of the hon. Member for Merthyr, in which I noticed a little passage which, perhaps, he will forgive my recalling. He blamed his countrymen for "giving away to the foreigner with insane prodigality our mineral wealth—wealth which is by no means inexhaustible and cannot be replaced." I am afraid I have detained the House. The right hon. Gentleman found fault with me with regard to the question of existing contracts. I might, of course, have inquired into that question before I imposed the duty, but no one knows better than the right hon. Gentleman how difficult and dangerous it is to make inquiries of that kind before you propose a duty.


It would not have had any effect in this case.


I think it would, because I believe a good many more existing contracts would have been found. I have existing contracts now under my consideration, and I propose to deal liberally in that matter, not merely with a view to the interests of those who have made those contracts, but also to start the new duty fairly, so that there may be as little dislocation as possible to the trade. I know I shall lose money by this; that I have anticipated. But I do not propose this as a tax merely for one year. It is for the House to express an opinion upon it after full discussion. But unless some better arguments can be produced against it than any I have yet heard I venture to prophesy that the decision of the House, in spite of those threats with which we have recently been favoured, will record an opinion that it is not a proposal that will destroy or seriously injure the export trade of this country; that if it restricts to some extent the increase in coal exports, that is so much to the advantage of the country at large; that on the whole it is a fair proposal, that it is a just tax that the trade is well able to bear; and that in no way less objectionable could the money be raised that is required to meet the necessities of the country.


I agree with the right hon. Gentleman who spoke before me when he stated that it was unreasonable to expect that this discussion should be closed to-night. I think if there is one reason why the discussion should not be closed to-night more than another it is owing to the speech which we have just heard from the right hon. Gentleman the Chancellor of the Exchequer. The right hon. Gentleman in his speech quoted some very strong arguments to the House to show that if one class of people in this country could bear additional taxation more than another it was the coalowners. Well, he failed to satisfy me, in the first place, that the tax would fall upon the coalowner. But everybody who knows anything whatever about the mining industry of this country—and I cannot help thinking that the right hon. Gentleman the Chancellor of the Exchequer knows perfectly well the conditions under which this industry is carried on, and for a man of his position to get up and make a speech to this House and ask for the support of his Government on such grounds as he has done, when only quoting three years out of an industry of that kind is, I think, most unfair, and no gentleman better than himself knows that he has not given a true statement—[cries of "Oh, oh!" and "Withdraw"]—a full statement of the coal industry. There have been many authorities which have dealt with the profits of the coal industry. I am not for a moment going to say that during the last two years the coal industry has not been a very profitable one, but anyone who knows anything about mining must know that it is one of the most speculative industries in the country, and to make any change based upon one or two years in that industry shows, I think, a very great mistake in policy.

The right hon. Gentleman stated a great many things with which I shall have to deal, if I have the indulgence of the House. The impression he gave to the House that the coal industry is able to bear a larger proportion of taxation than another industry, I think is not tenable. The industries of this country, almost without exception, have had an extraordinary run of prosperity during the last two or three years, and if we were to base taxation on the prosperity that has taken place during that period, I maintain we should certainly not put this tax on the coal industry. I regret extremely that the fluctuating character of the coal industry—the great fluctuations of price—is certainly sometimes disastrous to even those in the trade as well as to customers. If you look over the prices during the last thirty years you will find that they vary to an enormous extent, and during that period I think that there have been only two or three of the booms upon which a number of collieries depend for their existence. If you could get to the secrets of the various banking accounts connected with the collieries in this country, I am satisfied you would find in many of them that there were large deficits to be made up, and that the collieries were only carried on from year to year in depressed times in the hope that a boom would come which would give some compensation for the capital invested in them. As I say, the question of profits has been dealt with by many authorities, and I challenge the right hon. Gentleman, who has made so much of this point, to set his opinion against the opinion of those who have had to deal with the subject. There is scarcely a mineowner or a large mining engineer of any great repute who has not given his opinion on this matter. I hold in my hand a copy of a paper which was read before the Coal Mining Association of Great Britain by a gentleman named John Bell Simpson. He is a gentleman who holds a very high position in the north of England as a mining expert, and he is a considerable colliery owner as well. He represents as mining agent the Duke of Northumberland and many other large landed proprietors. I think when I mention his name and the position he holds, that you will recognise he is an authority of some weight. In his paper he said— It is impossible to get exact statistics on this point, but the consensus of opinion seems to be that certainly under 5 per cent. over a period of years has been the result, if an allowance is made for the replacement of capital at the end of the lease. The only approximate guidance of much value which we can obtain seems to be from the Inland Revenue Returns. They unfortunately do not give coal mines alone, but include the mines of copper, lead, and zinc as well. The assessment also includes the rent and royalty. I have, however, endeavoured to arrive at an estimate by taking the results given in these Returns for thirty years, and after making a deduction for rents included, as estimated by Royal Commission on Royalties for 1889, there is left a net result of 6d. per ton as profit on all the minerals mentioned. Mr. Buddle, the late Sir George Foster, and the late Sir George Elliott have expressed similar views. I have not the slightest doubt, speaking as a colliery owner of some experience, that if I were to consult my friends in the trade they would say that what I state is true, that certainly there has been no large amount of profit made generally in the mining industry of this country. Six or seven per cent. at the outside will, I am certain, cover the average profit. I admit that there are exceptional years, but I contend that were it not for these exceptional years many collieries now working in this country would of necessity be closed. I could give you illustrations of what takes place. I hold in my hand a statement representing the results from one of the largest South Wales collieries during the last twenty years. That colliery is one of the best steam coal collieries in Wales. I can give the figures from 1879. The coal is of the first quality and commands the highest price of any coal in the market. The statement shows that the return from 1879 to the present time is no more than a half per cent. on the capital invested. That colliery produces half a million tons per annum and, as I say, it is the finest quality of coal. I feel sure of this, that there are many collieries in this country in exactly the same position. That result goes up to the end of 1900, and I maintain that for the Chancellor of the Exchequer to come down and make a statement such as he has done is to completely mislead the House and the country on this matter. In every industry you can select a few years which are exceptionally prosperous. I wonder what would be said of me if I went to the Tyne and selected the works of Lord Armstrong as a sample of the engineering business of the Tyne. Take another industry—the chemical industry of this country. On the Tyne we have seen one large works after another close. I remember when there were twenty works making, chemicals on the Tyne. I do not believe there are more than two now. [Sir HOWARD VINCENT: Foreign competition.] Yet during the whole time these works have been closed, Brunner, Mond and Co., have been making large profits. I could give other illustrations. I remember a large colliery in the county of Northumberland whose chief trade consisted in export coal, and during the last twenty years, in fourteen of these years they had not paid a farthing upon their capital. Possibly in 1897 they might have paid their way, and I admit that the last year and the year before they have had good results, but those results must be divided over the whole twenty years. I am certain that if the interest paid by that colliery were taken for twenty years, the profits would have been found to have been small. My position is this. It is most unfair to take one, two, or three years, and to fix upon those years as being fair samples of the coal mining industry.

Now I give a recommendation to the right hon. Gentleman. He says it is necessary that this country should have the best Welsh steam coal. If the Government believes that is necessary, I recommend him to go down and buy one or two of these steam coal collieries, and he will have an opportunity of showing in this House, every time the Estimates come on, what a large amount of profit he has made in connection with them. The right hon. Gentleman knows too well that when once the State gets possession of an industry, they are never able to give any particulars in this House showing the profit and loss they make upon it. I will take another point. During the last twenty or thirty years we have had a system in the counties of Durham and Northumberland by which, under the supervision of the workmen and colliery owners, public accountants take out the whole amount realised for the sales of the produce of the mines. That represents a produce of twenty-seven millions. There is no doubt about the accuracy of that amount. Now, what has been the average price realised according to these accounts? It has been 5s. 7d. per ton at the pithead, and I defy the Chancellor of the Exchequer to make out that, over a period like that, 5s. 7d. is an unreasonable figure to provide for cost of working and interest on capital. [An HON. MEMBER: What about the royalty?] The royalty rent represents, I think, 6d. per ton. Of course you must also take depreciation into account. The right hon. Gentleman says that this is a question of capital and not of interest, but what does he do when he is assessing mines in regard to the income tax? He makes no allowance for the working out or exhaustion of the coal. He charges the owner or lessee the whole amount of net revenue. I think that the coal industry is certainly as heavily taxed as any other industry in the country. We pay rates and taxes on the whole of our surface property, but, besides that, we pay rates and taxes on every ton of coal we produce in our mines. We do not get the advantage of the fact that we have no need of sanitary improvements in regard to mines, no need of watching or lighting, and yet every ton of coal produced contributes to the rates and taxes for expenditure on the surface with which practically we have nothing to do, so far as our coal is concerned. I maintain that the mining industry is as heavily taxed as any industry in the country.

Well, the right hon. Gentleman went on to say that one of the most important considerations was that there would be a saving in our coal, and that it would be a good thing if the export of coal was, not stopped, but a good deal diminished. Let us look at that question for a moment. Before going on to that, however, I may say that the right hon. Gentleman in his opening speech, when he put the Budget before the House, stated that it was a great disadvantage to work out the coal and that it was a loss of capital. I take issue on that point. I maintain that it is not a loss of capital to take something which is underground and which has no value whatever till it comes to the surface. It is dead capital until it is converted into cash which can be utilised in our industries and in providing a certain number of the population with food, clothing, houses, etc. I maintain that it is a foolish thing to say it is a loss of capital. Every ton of coal which is extracted from the earth becomes of living value, and, converted into cash, is utilised in the country for the benefit of the whole community. Then, again, the right hon. Gentleman says that all our industries have suffered very much from the high price of coal during the past year. I admit that all our industries have had to pay a high price for coal during the last year, but my experience is that during the previous year they were all forward contracts, and never felt the high prices, and that many of them contracted to the end of last year. I know of hundreds and thousands of tons which were sold on the Tyne at 8s. 6d. and 9s. 6d. per ton, and I do not think, considering the cost of mining at that time, that that was an unreasonable figure. But as a matter of fact the industries are always prosperous when prices of coal rise. It is owing to the prosperity of our home industries chiefly, even the railway in- dustry, that we are enabled to get higher prices for our coal, and I think it is nothing but fair and right that they should contribute to a certain degree to the prosperity of the mining industry. Therefore, I believe that there is nothing whatever in that point, and if you took the prices that are paid over a series of years by these industries to the railway companies it would be conceded that it was not an unreasonable thing.

All the arguments which the right hon. Gentleman produced were certainly, to my mind, arguments in favour of putting a tax upon all coal. If a tax had been put on all coal, I confess that, so far as exporters are concerned, there would not have been very much opposition to it. I think it would not have been an unreasonable thing if any industry had been called upon to contribute to the additional taxation at the present time, but I cannot see why the Chancellor of the Exchequer should select a portion of that industry and penalize it and allow the great bulk of it to go scot free. The tax will be most unequal in its operation, and it hits very hard indeed those districts which are engaged in producing coal for exportation. Take the North-East of England. We in the North of England export oversea fourteen million tons. South Wales exports 18,465,000 tons, and Scotland 6,700,000 tons, and the other districts about 3,500,000 tons; while our home production is no less than 182,553,000 tons. And yet what the Chancellor of the Exchequer proposes is that part of the coal industry representing forty-two millions tons should pay the whole tax of over two millions sterling, while the whole home coal production representing 182 million tons should pay nothing whatever. And that is his idea of justice and equality! I maintain that it is a most unjust and unfair tax on certain localities. If, in the interest of the community as a whole, it is necessary to put a tax upon the coal producers of our country, I say the tax should be put on all coal. It would not then tell upon the coal owner who has his capital invested in the mines and upon the workmen who practically has his whole life in the mine, while the royalty owners who have their contracts for many years—twenty, thirty, forty, or even sixty years ahead are going scot free, and have no burdens whatever put upon them. I say again that if those engaged in the coal industry are to be taxed the Chancellor of the Exchequer has no right whatever to select one portion of the industry and put a heavy burden upon it, and let the rest go free.

The right hon. Gentleman says that it would be a good thing that some of the coal was reserved for posterity. I scarcely think that the right hon. Gentleman understands the position when he states that. What is our position in the North of England? Take Northumberland and Durham. There our coalfield is pretty well occupied, and most of the mines are well worked through. Well, if anything comes to stop any of these mines, what is the result? Is the coal stored up for posterity? Certainly it is not. The coal is so worked that if there was a cessation of output the bottoms would rise, the roofs would fall in, the mines would become full of water, and the fact is that the coal, instead of being stored up for posterity, would be practically lost to the country. I think those who really understood the situation would realise that fact. The whole of the discussion has shown to me that the right hon. Gentleman the Chancellor of the Exchequer has displayed a lamentable ignorance of the entire question. I am surprised, considering that he was going to alter the whole taxation of the country in such a vital form, that the right hon. Gentleman did not inform himself more fully on the condition of things, and especially as to the true position of the coal trade. The right hon. Gentleman says, "How can the coal export trade fall off when it bore the huge increase of price of coal last year?" That is a very simple matter. An increase of 1s. or 2s. per ton last year was not a matter of very which importance. In every country to which we exported coal, industry was flourishing, and there was a large demand for coal, even in countries where they have a production of coal themselves. They were unable to supply their own demand, and naturally prices went up, both for the home produce and the foreign produce. That is why they were able to pay the high prices. The right hon. Gentleman gave, as an illustration, Hamburg. He said that a certain quantity of coal was sent from Westphalia to Hamburg—amounting to six million tons—and that though the prices were put up, still we increased our exports to Hamburg. The right hon. Gentleman did not know that the reason was that the Westphalian Syndicate of coal owners would not supply more coals to those people in Hamburg, who wanted coals, than they had done in previous years. That is the fact, and that is the reason why we increased our exports to such an extent. The Westphalian Syndicate have their output under complete control, and they study the people in their own locality first. Within the last fortnight the Syndicate have passed a resolution to increase their prices 20 per cent., but as soon as they learn that we reduce the area of supply on account of this tax they will rescind that resolution, and will sell the produce of their collieries to Hamburg.

Again, the right hon. Gentleman says that although freights were so high we were able to increase our exports. But freights were not so high as they were a few years ago. I do not think the highest freight to Chili was more than 8s. or 9s. a ton; but I have known those freights to be 20s. a ton. While freights have fallen during the last few years, it is owing to that that we have been able to hold our position in regard to exports, and even to increase them, and to retain our markets. I look forward, however, to the time when America will become a very strong competitor with this country. Three months ago, I know of a contract which was under discussion in Paris for a large quantity of steam coal; and it was only a very slight difference which induced the consumer to give the contract to a British firm, instead of to an American firm. And I will tell you why that French contractor gave it to the British firm. The American contractors wanted the contract for three years, and they made a promise, under guarantee, that if they got the contract for three years they would undertake to build ships of 10,000 tons burden, to enable them to deliver the coal in France on easier terms. These are facts. What has given us the pull in regard to coal exports in this country has been that we have a large import trade, and that our freights have been cheap. But the population of America is increased largely, and I look forward to the time when America will require many things which she cannot supply herself with, and she will require a large import trade. At present freights are high because America has no freight going from these foreign countries to any extent, or from the Mediterranean. When I first went into business we had a very large trade in gas coal—that coal which the right hon. Gentleman says the foreigners cannot do without. We used to export gas coal to Boston, New York, and Philadelphia, and many other ports in America, and at that time we paid from 20s. to 25s. per ton freight. We lost that trade owing to the opening out of the American collieries, which cut us out. We tried then by getting a reduction of freights to retain the trade, and we eventually were able to reduce the freights to 4s. a ton, but even then we were knocked out of the American and West Indian markets in regard to gas coal. It is the same in regard to steam coal in the Indian, Chinese, and Japanese markets. Our chief customer in Europe at present is Germany, where we send sixty-five million tons. Now the proportion of its own coal which Germany used in 1899 was 92.63 per cent., and Great Britain sent only 5.37 per cent. of the German consumption, so that all Germany has to do to oust us from the German market is to supply an additional 5.3 per cent. In the same year we exported to France 6,870,000 tons, but France supplied 72.29 per cent. of her whole consumption from her own mines, and the British provision was only 13.8 per cent. All that France has to do in order to cut us out of the French market is to increase her local supply by 13.8 per cent. Belgium consumed 83.41 per cent. of her own coal, and Great Britain only supplied her with 4.25 per cent., which shows that our proportion of supply to that country is very limited. But how does it come that we supply even these percentages at a profit? We have cheap sea carriage, and we are able to get into such ports as Hamburg, Bordeaux, Havre, Brussels, etc., a certain quantity of coal which is distributed thence to the places where we come into competition with the home produce. What this export tax is going to do is this. I think any reasonable man will admit that we have a frontier where we can compete in these various countries with their own produce; but remove that frontier nearer the sea coast and the result will be to take a considerable area of our supply and to give it to our competitors. Again, the time was when the whole of the consumption of coal in Holland was in our hands, but we are being fast driven out of that market. I am as certain as I am here that, if a shipping tax is put upon our export of coal, a considerable portion of our trade with Holland will be lost. Westphalia, Belgium, and France are not up to their full production, and they can increase their output wherever they can secure markets. It cannot be done in a month; it takes a few years. If we could have increased our output in a few months instead of a few years the coal masters would have taken good care that prices would not have risen to the extent they did last year. It is not our interest to have these high prices. We should much prefer to have more regular prices, more regular profits, and more regular wages.

The right hon. Gentleman the Chancellor of the Exchequer went on to say that our coal is largely of a class which European consumers cannot do without. Well, I think I have had as much to do with selling coal as any man living. I come in contact with buyers from all parts of Europe, but I never came across a customer or consumer who was prepared to give me a good price for my produce if he could get his coal cheaper from Westphalia, or Belgium, or America. The right hon. Gentleman forgets that, after all, quality, like price, is relative. People will pay a high price for a good quality, but if they can get an inferior quality they will take it, provided they pay for it a much lower price. If the right hon. Gentleman's argument is valid, why should the coal exporters have taken 15s., 16s., or 17s. per ton when, by asking for it, they might have got 25s., 27s., or 28s. per ton? All the people who have coals to sell get the best price they can for it. I think it is a slur on the coal salesmen of the country to say that they have been giving away coal for 1s., 2s., or 3s. a ton less than they could have got for it. It is a perfect fallacy. To tell me that our coal is the very class of coal which the European consumer cannot do without is nonsense. At a relative price the European consumer would take other coals. It is only a small proportion of the best Welsh coal that is slightly superior to what America can produce. The best Welsh has this advantage—and it is ts chief advantage—that it does not give much smoke. But as a steam-raiser I maintain there are lots of coals in the North of England that are just as good. Of course, in a fleet it is nice to have clean decks and not many smuts, and therefore smart seamen prefer a smokeless coal to coal which, though as good as a steam-raiser, produces a good deal of smoke. The right hon. Gentleman said that one advantage which shipowners in England would have would be that they could take as much bunker coal as they liked. But I have heard that it is the intention to prevent ships taking as much bunker coal as they like. It has sometimes been a custom to fill the bunkers and also to take a certain portion under hatches for their own use. Of course, when that is done a good deal of freight is shut out. The result is that there is no advantage to the ships to take a larger quantity of coal than the bunkers will hold. Now what effect will this have upon Durham and Northumberland? I am not going to say it will ruin the trade of those counties, but I am going to say it will injure it, and I challenge anyone to get up and say that that will not be the case. But to what extent it will injure the trade of Durham and Northumberland it is impossible to say—1s. a ton will injure it, 2s. a ton would injure it more, and 5s. a ton still more. It is perfectly clear that any burden put upon one competitor must of necessity injure the person on whom it falls. Then it is said that the foreigner will pay this tax. That, I think, is altogether wrong. The consumer in this country would pay if a tax was put on imported goods—


No, no.


That is unanswerable; but what is our condition upon export taxes? There we lose control over the consumer; then, to use a familiar expression, it is "break or make." The market goes to others, and it is absurd to say the consumer would pay the tax upon exported coal. I admit there are places where English coal at the present time has the advan- tage, and if we can beat our competitors who supply those markets by more than 1s. a ton, it is quite likely that the tax would be paid by the consumers there. This tax represents a burden put upon Durham and Northumberland of no less than £700,000, nearly one-third of the amount it is proposed to raise by it. I think it is unfair to put so large a share of the taxation for this war upon so small a population. I observe with regard to Northumberland and Durham, taking the two counties together, that the export is no less than 30 per cent. of the whole production. With regard to Durham itself it is much larger, but taking the two together it is 30 per cent. of the total output; but suppose we only allow 10 per cent., what would be the effect? Speaking as a producer, I know this, if we take 10 per cent. off the production of coals, it must of necessity increase the cost of working much more than 10 per cent., because you have such a large amount of fixed charges that you cannot reduce. If you increased 10 per cent. on the 90 per cent. you had to sell, it is quite possible that you would put yourself outside the market altogether.

The right hon. Gentleman then said that all our contracts are entered for twelve months. It has always been the custom of the coal producers to carry on their business so far as four-fifths of their contracts are concerned by twelve-months contracts. We never for one moment thought that any British Chancellor of the Exchequer would be so foolish as to put an export duty upon coal, so that we were unable to provide for it; but if we had been able to provide, we should have lost our contracts. I personally was suspicious some time ago, and I tried to get a clause put into a contract that in event of the British Government putting an export duty on coal, it should be paid by the purchaser, and the persons with whom I was contracting refused to entertain it, and said they would not enter into any such contract. The result is that the exporter must necessarily pay the tax. If the Chancellor of the Exchequer consents to exempt these contracts from this tax, he must either exempt all contracts or no contracts—either the whole or else no portion—if he wishes to be just; and as to fixing the time when he will cease to exempt these contracts, it is clearly unjust to exempt any contract before the first of April.

There is another point, which I think is a very important one, and I regret that the Chancellor of the Exchequer is not in the House to hear this, because I should like to say what I am going to say while he was present. Nothing surprised me more than the recommendation that was given by the right hon. Gentleman on two occasions that merchants should endeavour to repudiate their contracts if the foreigners refused to pay this tax. I am glad to say, from what I know of the exporters and commercial men, that their code of honour is much higher than that, and I am glad to say that I do not believe there is a single exporter in the north of England who has made any attempt whatever to induce the people with whom he is dealing to cancel their contracts if they will not pay this tax. To a commercial man his word is as good as his signature. Previous to 1872 I have sold thousands of tons of coal in this country for export abroad, and have had nothing more than, word of mouth. That is the character of the commercial man in, the north of England, and I am sure that every man in the north who read that speech of the Chancellor of the Exchequer would be equally shocked with myself to think that a great Minister of this country—the head of the Financial Department of the Government of this country—should recommend men to repudiate contracts which they were not legally bound to fulfil. I am glad to say there is not a man in the north who will attempt to take that advice, and I hope the right hon. Gentleman is not going to act upon such advice in his own financial operations. We have never before had any such suggestions as that in this House. We must go to the South American Republics to hear such a doctrine as that. But when it comes from that bench, which is supposed to hold the highest intellect in the country, that men who are honourably bound, although they have not signed, to fulfil their contracts should repudiate them, I think it is a very dangerous doctrine indeed to preach. During the length of time that I have been in this House—and I have been here sixteen years—I have never heard such a thing come from a Minister of the Crown, and I trust I shall never hear such a thing again.

Now let me give an illustration of whether the consumer will pay or not. The right hon. Gentleman has put a duty on sugar. Supposing that instead of putting that tax on all the sugar imported into this country he had said to the West Indian Islands that they had better put a duty of 4s. 2d. on the sugar which they exported. Does anybody suggest that the consumer in this country would have paid that? Sugar would have poured into this country from Austria and Germany, and we should not have paid the duty at all; and the same thing will happen in the case of coal. I confess there is one idea in the mind of all people in this country who are not associated with the production, that the coal owners ought to have something taken off their profits—but would the consumer get the coal a shilling cheaper? I contend he would not. What is the custom in Westphalia, where there is a syndicate? They have always charged a higher price to the consumer than they have to the exporter of coal. They follow an exactly opposite course to that which we adopt. The consumer in the north gets his coal much cheaper than the price charged for coal for export, and I will tell you why. The home consumer takes his coal in daily quantities; it goes in truck loads, and it is a trade upon which you can depend; but when you have an export trade you get one cargo of perhaps 1,000 tons, and it is done with. It is to the interest of the producer to give the home consumer his coal cheaper. What is the fact? I have looked up this matter, and I find the price of coal to the consumer for twenty years only averages 5s. 7d. In 1897 the export price was 7.48; in 1839 the export price was 9.22; the average price for consumers, Northumberland 7s. 7d.; Durham, 6s.; in 1900 average export price 14s., and for consumers, Northumberland, 10s. 6d.; Durham 10s. 3d.; that was after allowing 1s. 6d. a ton carriage. Hon. Gentlemen will see that these figures are conclusive enough to show, if the correct figures were got out, that the consumers here got their coals at a very much better price than the foreigner.

I must say it is extraordinary that the Chancellor of the Exchequer should for the small amount he expects to receive attempt to upset the trade, when you consider that if he allows the exemptions on contracts he will not get half what he puts in his Budget. I certainly think he is unwise in insisting on this tax. When he first got this tax in his mind he was not aware of the difficulties in connection with it, and if he were a courageous man he would say—I should say myself to this House—"When I thought of this tax I thought I should get two millions. I had no idea of the difficulties, and I find now there are a large number of contracts which will affect half the yield, and under those circumstances I think it is useless for the sake of the million to press this tax." If ever there was a reason for the Government to drop a tax of this description the reason exists at the present time. The right hon. Gentleman can say what he likes, but the people of the north will know and recognise that the tax is put on this special class in order to continue the boon that was given in the shape of the Agricultural Rates Act, and when it is recognised that that burden falls more heavily upon one industry than another, and the miners of the country in many cases pay three-fourths of the rates, you will have some difficulty in convincing the miners that you are not going to continue to penalise them—they have got in their minds an idea that you are going to penalise this industry. One point will undoubtedly arise, and that will be the reduction of wages. Does the right hon. Gentleman realise the proportion that wages bear to the cost of production? John Stuart Mill estimated that the proportion was 66 per cent. of the whole production. I am told now it is 70 per cent. In event of difficulties arising, the only way in which we can compete with foreigners is by reducing the wages, and I am convinced that the wages will bear the bulk of this tax. I have shown that you cannot reduce the other charges, and if the profit on coal is reduced it will prevent people putting capital into the mining industry, and close many of the mines which have the greatest difficulty in existing even with the prices we get. I am not surprised that the miners are alarmed; they begin to see that this is a permanent tax, and that, if it is to be a permanent tax, it will be an increasing tax. I would urge the Government to reconsider their position. Why should you urge people to take strong measures? I do not want to see them do it, but it is a wrong thing on the part of the Government to take such a course as to drive 700,000 men to take strong measures. If the Government will not consider it from the miners' point of view or the owners' point of view, I implore them to consider if from the point of view of the general community. I have never known a tax imposed which, in my judgment, was more unequal and unjust, and, representing as I do a mining constituency, I shall do my utmost to oppose it.

*COLONEL BLUNDELL (Lancashire, Ince)

I have been interested in colliery property for forty-eight years, and, though I cannot claim to be an expert, I have a long experience of the results of such property. In that long period bad times have been much more frequent than good times. The Chancellor of the Exchequer spoke as if collieries were like banks and breweries, uniformly or generally prosperous. The colliery in which I am interested is in Lancashire, which is perhaps as little affected by the proposed tax as any of the coal districts. I think, therefore, that I am able to take an unbiased view of the effect of the proposed tax. I am confident that, if this tax is continuous, and its effect is to throw half the amount or 6d. a ton on the exporting districts of Scotland and the north of England for a permanency, those districts will be unable to bear it. The Chancellor of the Exchequer says that the foreigner will bear the burden, but I do not think anybody can say upon whom it really will fall.

During the last two years collieries have been in receipt of extraordinary profits; but those years are altogether exceptional, and no true inference can be formed from them as to the taxable capacity of collieries. A generation ago there was an extraordinary year (1872), but from 1874 to 1890 it was followed by a great and continuous depression, so that the year 1872 was regarded as having been a great misfortune, as the cost of producing coal had by its prosperity been enormously increased. The question then arises, Is this to be a war tax or a continuing tax? If it is to be a war tax, I would submit that it would be better to levy a tonnage tax upon the coal sold at all collieries, and not to disturb the natural course of trade. If, however, it is to be a continuing tax, as my right hon. friend has told us, then I would urge that nothing should be done until the great question of husbanding the coal of this country has been carefully considered. If that question is considered, I will hazard the opinion that it will be found that, though it is wise to husband our smokeless coal, it will not be thought desirable to check the export of other coal. The Chancellor of the Exchequer referred to the great outcry which was made when the Compensation Act was proposed. At that time the collieries in Lancashire were making absolutely nothing at all, and if the price of coal had gone down and 2d. per ton had been thrown on the collieries it would undoubtedly have led to a great struggle between capital and labour, and might have had most disastrous consequences. 2d. per ton was the amount anticipated. But fortune favours the brave, and from that moment prices began to rise. It has, therefore, appeared as though the outcry of that time meant nothing. But the Government did not, and does not, know the great danger it ran at that time. I am glad it turned out a great success—that, however, was entirely due to the accident that the price of coal rose instead of falling—but it might easily have been a great failure.

Before I sit down I should like to bring under the notice of the right hon. Gentleman a very interesting subject of taxation—I allude to the mortgagee. He is usually the temporary legal owner of a large proportion of the land and houses in the country. He pays income tax, but though he derives his income from strictly local sources, he escapes entirely from any payment to the rates. As mortgages are properly not disclosed, he is unknown. Probably if, as in some countries, mortgages were recorded he would not escape. I would urge that the mortgagee should pay a tax to the State in lieu of the rate which by our system he escapes. That, however, has nothing to do with the coal tax. I hope the Chancellor of the Exchequer will reconsider this matter, with a view to making the tax a war tax, and not a continuing tax, and also that he will institute a thorough investigation as to the necessity or otherwise of husbanding the coal of this country.

MR. PAULTON (Durham, Bishop Auckland)

I feel that it is a duty which everyone owes to his constituents, when they are deeply interested in a matter of this kind, that he should give expression to their sentiments. I should be sorry for it to be supposed that the miners of the north of England objected to pay their fair share or any reasonable share of the cost of the war. That that is not the case is proved by the way in which they have imposed levies on themselves for the support of soldiers' families in their own district—not a momentary contribution, but levies extending over the whole period of the war. In fact the miners have taken upon themselves a duty which the Government should have performed, namely, that of supporting the families of those who are fighting our battles abroad. These men oppose this tax most strongly—in the first place, because they consider it unfair that a special tax should be placed upon one particular branch of one particular industry. They object to it, in the second place, because it is partial, in the sense that it affects only particular districts. In the third place, and perhaps most strongly, they object to it because in the long run they know the tax will fall chiefly upon labour. It is possible that Scotland will suffer more than the north of England or even South Wales; but, so far as my own information goes, I know more of the condition of things in the north of England, and should, therefore, confine my remarks to that district. Personally, I am not a coal-owner and have no pecuniary interest in the coal trade. But I know the feeling of my constituents, and my object is to express their sentiments. I do not believe, if the tax had been a general one of so much per ton on all the coal raised in the country, there would have been anything like the same amount of opposition to it. Of course, human nature being what it is, there might have been some feeling against taxing a special industry. But if the Chancellor of the Exchequer had come to the House and the country and said, "In a national emergency of this kind, I must raise a certain revenue, and I appeal to the country to help me," I do not think the miners, any more than any other class in the country, would have raised any special objection. Or if, indeed, last year, when trade was booming, he had placed this tax upon the particular industry, I think it is possible he might have been able to carry out what he still believes he will do—namely, secure a certain portion of the tax from the foreigner. But what he is now doing is to give a shove to a declining trade—and a shove in a downward direction. I am told that, whereas last year contracts produced a profit of 1s. per ton, this year they produce a profit of barely 4d. per ton. That leaves a very small margin indeed when competition is met with, as we know it is at this time. What must be the result, for instance, in the county of Durham? The poorer pits will be "laid off"; the pits which have thin seams, about which we have heard something to-night, will no longer be worked, and the result must be that those pits will be swamped with water, and they will not be reopened. We have had a good deal of experience in past times of the result of strikes and other causes, and we know that when a pit has been closed, unless it is a pit which pays in ordinary times, it will not be reopened.

The argument with regard to husbanding our national supply of coal has been used, but the effect of this proposal will surely be to make it worth while for colliery owners to work only their best coal, so that the coal which will go out of the country will be the best, and that which, from a national point of view, we can least spare. It has often been said during the last few weeks, "Oh, many of you are in favour of putting an extra tax upon the rich brewer; why should you not put a tax upon the coalowner as well?" The answer is perfectly obvious. The brewers' profits are constant profits; year in year out they remain pretty much the same, or, if there is any alteration, it is in an upward direction; whereas the profits of the coal trade are a fluctuating amount. After all that has been said on the subject to-night, I will only express the opinion that if an average were taken of the coal trade profits during the last twenty years it would be found that they were certainly not higher than the profits of any other industry which could be selected. Indeed, I believe the amount would represent a much smaller return than would be the case in regard to most of the concerns in which people are willing to invest their money. The county of Northumberland affords a very good concrete instance of the effect of this impost. It raises, roughly, 5 per cent. of the total output of coal, but it exports 19 per cent. of the coal sent out of the country. The mining population is only ¾ per cent., so that you are asking ¾ per cent. of the whole population to pay 19 per cent. of a national tax. The amount of this duty in the county of Northumberland will be about £415,000. That represents on the capital invested in the industry a tax of close upon 7 per cent. An income tax of 1s. 2d. in the £ is only 5¾ per cent. upon profits. Therefore this tax means in the county of Northumberland that you more than double the income tax. I believe that everyone concerned in the coal trade there would vastly prefer a 2s. income tax to this impost, because they would have reason to hope that with better times that impost would be removed, and that it would not affect their source of revenue. The fear—and the well-founded fear—now is that, once having imposed this tax, you will have inflicted an injury on the trade from which it will not recover. Nothing is truer than the fact that every ton of export trade which is lost to this country is lost for ever. The Chancellor of the Exchequer says this is an experiment which he is making, He believes that he is right and that we all are wrong. It is a very dangerous experiment to make. He is playing with the life interests of a very large population, and whether he is right and we are wrong, or vice versa, an important trade will have been seriously damaged, and in many cases lost entirely. What is the right hon. Gentleman going to get from the experiment? I could understand that it would be worth while perhaps to dislocate even a great industry of this kind, and cause agitation and disturbance throughout the country, if the tax was going to raise a large revenue, but the nett result will be a miserable £1,000,000. [An HON. MEMBER: £2,000,000.] When effect is given to the concessions with regard to existing contracts the revenue will be less than £1,000,000. There is also the unfairness with which the tax will fall on particular individuals. A man on one side of a street may have satisfactorily completed a contract on April 18, and that firm will get a rebate of the duty. Another man on the other side of the street may have had his contract expire on the 19th April. When he tries to renew his contract he is obliged to go and ask his foreign customer to pay the tax, and the foreign customer will flatly refuse to pay it. Therefore one man will be unable to get his contract, while the other, by perhaps a couple of days, will have been able to make a profitable contract. As far as regards the county of Durham especially, the miners feel very strongly that anything which affects or dislocates trade must come upon their wages, that anything which affects the export trade and reduces employment north of the Tyne will bring increased competition to the labour market in their own district. That must mean a lowering of wages and the consequent suffering to the population.

I, therefore, enter my humble protest on behalf of my constituents against this novel and retrograde proposal. The Chancellor of the Exchequer is very confident that he is right, but I prefer to take the opinion of the men who have been engaged in the trade all their lives and know it by heart, and I warn the right hon. Gentleman that he is embarking on a contest without measuring the forces which are against him. He has opposed to him the most strongly organised industry in the country, and I only hope and trust that the effect of this debate will be to induce him, even at the last moment, to withdraw this proposal. In any case, I have ventured to utter my protest on behalf of my constituents against what I believe to be an unjust and unfair tax.


I have the good fortune to-night of being able to represent exactly the views of my constituents upon this subject. Directly after the Budget was introduced I spent several days in my constituency taking the opinion of the majority of those whom I represent. If my constituents are not coal producers, they are, at any rate, great coal users. There probably is no area in the whole of the Kingdom which, for its size, consumes or requires so much coal for its great industry as the city and district of Sheffield. My view is that it would be quite impossible for the Chancellor of the Exchequer to have devised a more generally popular tax than this export duty on coal. [Ironical cheers.] Of course, I speak for my own constituents, as I have a perfect right to do. I speak of the people of Central Sheffield, and, as far as I am able to gather, their opinion is strongly in favour of the tax. The only objection I have heard, and it has come from many quarters, is that the amount of 1s. per ton is not enough, and that it should be at least doubled. The following is a resolution which was passed at a general meeting of my constituents on this subject— This meeting of the Central Division of Sheffield Conservative and Constitutional Association congratulates His Majesty's Government and particularly the Chancellor of the Exchequer upon the extension of the principle of indirect taxation against the foreigner. It particularly approves the levying of an export duty on coal, the raw material for foreign competition, and the means of naval offence to our prejudice, and also the tax upon foreign bounty-fed sugar.


Did you draft the resolution?


The resolution was proposed, seconded, and carried unanimously, and if hon. Members desire to read the full details, they will find them fully reported in the Sheffield Daily Telegraph of the 23rd April. But hon. Members make a great mistake if they fancy that approval of the tax is confined to a coal-using district such as Sheffield. I have a resolution passed by the Newport Chamber of Commerce, and I am surprised that the right hon. Gentleman the Member for West Monmouth did not refer to this in his speech, He probably is aware that Newport is a very important town in South Wales, and one which is much interested in the coal industry. The chairman of the Newport Chamber of Commerce is the gentleman who is now acting as agent to Mr. Spicer, the Liberal candidate in the neighbouring constituency. The resolution is as follows— That as the tax of 1s. per ton proposed to be levied by the Chancellor of the Exchequer on exported coal will he paid by the foreigner and not by the colliery proprietors, this Chamber is of opinion that the tax is fair and just, but urges the Government to exempt all existing contracts. We have heard from the Chancellor of the Exchequer that he proposes to be exceedingly liberal in the matter of existing coal contracts. That is a statement which one is very glad to hear, but I am also glad that he intends to require strict proof of loss. It is suggested that the tax will be paid, not by the foreigner, but by people in this country. It is therefore interesting to read the opinions on the matter in foreign countries. The Times correspondent at Copenhagen telegraphs on the 25th April— The increasing agitation in England against the coal duty creates astonishment here. Judging from the need of the Baltic countries and shipping for British coal, merchants here do not believe that the Continent can supply them with anything but a minimum at acceptable prices, and consequently foreigners will pay the duty on English coal. Then we have another statement from St. Petersburg. The Times correspondent telegraphs on 30th April— As it is generally admitted that this tax will ultimately fall upon the foreign consumer it is naturally resented by the latter. He goes on to say— The general feeling seems to be that it will not reduce to any extent, if at all, the imports of English coal. It is perfectly clear from these opinions what is the view taken upon this subject abroad. Of course, the customers of the coal exporters in this country are not going to be so foolish as to consent to put a shilling a ton on their contract price if they can possibly avoid it, and very likely it cannot he done on the existing contracts. But in future contracts it can be done, and if I mistake not it will he done. From Stockholm comes a telegram on the 24th of April, stating that— The British sellers not only demanded that the buyers should pay duty on old contracts, but were also compelling them to deposit the amount of the duty before shipment in the case of f.o.b. (free on board contracts. That shows that in some cases at least the exporters are taking very efficient steps indeed to obtain the amount of the duty from the foreigner. A great deal has been said about the necessity which exists in foreign countries for taking English coal. There are certain sorts of coal produced in this country alone which foreign nations must have, and particularly Welsh steam coal—I mean smokeless coal. The hon. Gentleman opposite so prominently connected with the shipping interest shakes his head, but I think he will agree that the orders for English smokeless coal for the French, German, Russian, and Italian navies have been very considerable in recent years.


Now they have nearly ceased.


For the moment they have nearly ceased. Their Stocks are so nearly full. A large portion of the forty-four million tons exported last year has been taken by foreign navies and for the moment they want no more.


They have found other sources.


As the hon. Gentleman is going to speak, very likely he will tell us the sources from which the French, German, and Russian navies will in the future obtain smokeless coal. If he does that he will earn the gratitude of those foreign Governments, because, being frequently in communication with naval officers in many foreign countries, I can vouch for it that the great majority of them at any rate are ignorant upon this point. If they can obtain that information from the hon. Gentleman I am quite sure it will be a great advantage to them. The Chancellor of the Exchequer gave us some very interesting and very important facts indeed concerning the export of coal, and we find that of the forty-four million tons exported last year eight millions went to France, three to Russia, five to Germany, five to Italy, a total of twenty-one millions. If we add Spain and Scandinavia, these foreign nations take upwards of thirty millions out of the forty-four which were exported from this country. Hon. Gentlemen have stated that the increase of a shilling per ton is likely very much to affect exports. I think I am right in stating that freights are constantly varying, and that the difference varies to as much as four shillings, but we do not find that they put any stop whatever to the trade, which is exactly the same. With regard to the properties of this Welsh coal which are so important, only within the last few minutes a very striking instance has been brought to my knowledge by a gentleman thoroughly conversant with the facts. He says that in Lancashire they are able to produce coal at a comparatively moderate sum, and offer it to the White Star steamers at 13s. a ton, whereas the Welsh coal on the Mersey steamers costs from 18s. to 20s. a ton. But in spite of this enormous difference in price the quality of the coal from South Wales is so much better that they are willing to pay the larger price for Welsh coal. If that is the view of English shipowners it is surely the view of foreign maritime powers. A very strong feeling now prevails in this country that considering the enormous increase in the production of coal, from about £16,000,000 in 1858 to upwards of £64,000,000 in 1898, and that the sources of coal are not absolutely illimitable, the users should take some pains to ensure that they shall not be exhausted by the enormous exports.

Why is there so little sympathy with this agitation of the coalowners in Sheffield from the coal-using districts? It is because when the foreign demand enables the colliery-owner to put up the prices the purchasers meet with extremely little sympathy and with cavalier treatment from the colliery proprietors. One of my constituents told me last year when the price of coal was very high that there would be considerable difficulty in getting it. He took a truck a day, and his foreman came to him and said, "This coal we are receiving is by no means up to sample or specification, and it will do us a good deal of harm." The partner said, "Do not say a word about it. We must accept it, whatever it is, because, if we do not, we shall not be able to get any coal at all." That is an incident which I heard mentioned in quarters where, if it were liable to be contradicted, it would have been contradicted, and I believe it accurately represents the attitude of many coal consumers at the time. The Chancellor of the Exchequer told us of one matter which, I hope, will not be allowed to rest where it is. He has told us about preferential charges against our own users of coal, that the foreign exporter is able to obtain much better terms from the railway companies than the users of our own British coal. That statement having been made by the Chancellor of the Exchequer, it is the bounden duty of the Government to put a stop to that state of things. It is a matter which has been complained of in this House before, and this matter of giving preferential rates to the foreigner, now that it has been complained of by a responsible Minister of the Crown, who speaks with full knowledge of the facts, must not be allowed to rest here, and it is incumbent upon the Government to take some steps in this matter.

I know many hon. Members desire to speak on this subject, and I have no desire to trepass further upon the indulgence of the House. I do, however, desire once again to give utterance to what I believe is the feeling of the great majority of my constituents, that the Chancellor of the Exchequer has devised a tax which will be just, which is popular in the country, which will be productive of good results, and which will be not only useful as a means of raising public revenue, but will be better still because it will tend to preserve that which has been the principal factor in the greatness of England, the natural product of coal in this country. Once used it can never be replaced, and if this export continues on the scale which it has been doing for the last two or three years there is very great danger indeed of the stock being exhausted. I congratulate the Chancellor of the Exchequer upon his firm attitude in this matter, and I hope he will not budge one single inch, and will not be deterred by these threats of a general strike or the shutting down of pits. What has been the effect of that? It has already doubled the price of coal. Who is going to reap the benefit of this enormous increase in price? Why the colliery proprietors like the hon. Baronet the Member for the Chester-le-Street division of Durham are the gentlemen who are going to reap the benefit of this enormous increase. I do not believe the miners, hard-headed sensible men as they are, will do anything so foolish and disastrous as to commit themselves to a general strike at the instigation of rich colliery proprietors. I speak the view of my constituents, and I urge the Chancellor of the Exchequer to stand firm, and I thank him for having introduced this tax.

*MR. BURT (Morpeth)

Personally I may be allowed to say in a sentence that I am much more concerned for the unwise and fatal policy that has made additional taxes necessary than I am even for the vast expenditure and the necessity—which I admit—for the imposition of new taxation. It would not be in order for me to discuss that policy, and the subject that is germane is important enough and sufficiently complex to demand more than the time that the Government seems disposed to allot to it. My hon. friend who has just taken his seat has told the House repeatedly that in every sense upon this question he represents the views of his constituency.

Now, I also represent my constituency in this matter, and I almost feel inclined to congratulate the Government upon having got the support of the hon. Gentleman opposite. We know that he is an anti-free trader, and that he is in favour of reciprocity. To come at once to the point. The Chancellor of the Exchequer needs money and he must have it. These are facts which are sufficiently patent to everybody, and need not be argued. He told us in his Budget speech, and he has told us again to-night, that he does not want to borrow all the money he requires. Borrowing dulls the edge of husbandry, and I think we have evidence of the right hon. Gentleman's virtue in the fact that though he has found it very much easier to borrow than to impose new taxation, yet he refuses to get all he wants by borrowing. There I entirely agree with him. He is also in favour of a broader basis of taxation, and in that respect also I agree with the right hon. Gentleman. I believe he wants those who encouraged the war to pay for the war, and there again I agree with him heartily. If he could get contributions from all those who clamoured for the war, beginning with the millionaires who took the initiative—if he could get contributions from all those who acquiesced in it without protest that would be a broad enough basis for him. I am afraid that I should myself come under the latter head. I did indeed attempt to speak upon this question before war was declared in favour of the dispute being referred to arbitration, but I was howled down. If I have any regret upon this question it is that I was perhaps too easily cowed, and that I should have protested more emphatically than I did against what I regarded as the most disgraceful war in our history. [Opposition cheers.] The Chancellor of the Exchequer has increased the income tax, and there again I support him. I went into the lobby with him upon that tax, and if he had doubled the income tax I should still have gone into the lobby with him. I am an income-tax payer myself, and if I only pay a little it is because my income is little. I think it is the smaller income-tax payers who will feel most severely the imposition of this tax. Therefore, I think I have manifested a sort of altruism in supporting the Chancellor of the Exchequer. He has placed a duty upon sugar. I did not vote against that, although I cannot say that I entirely approve of it, because it takes us further away from the free breakfast table which has been so eloquently advocated in the past. But Imperialism has given us no chance of getting a free breakfast table. The sugar tax is broad based enough. We have been told by the hon. Member for Oldham that every old woman who puts a piece of sugar in her tea is helping the Chancellor of the Exchequer to pay for the war. The tax on coal, however, is not a broad based tax, for it is a tax upon a single trade. My hon. friend who spoke a little while ago pointed out that it is not only a tax on trade, and, therefore, one of the worst of taxes, but it is a tax that operates unequally upon that trade. Economically it is unsound taxation.

The right hon. Gentleman the Member for West Monmouth, in his eloquent and able speech, dealt largely with the economic aspects of the question, and let nobody be impatient in discussing the economic aspects of this subject. They are not only important, but they are the dominant and determining factors in a question of this kind. Occasionally in addressing working men I have had to direct their attention to what I regard as important questions connected with political economy. They heard me with some impatience. They were hungry, and they did not know where to get their dinner, and with men under those circumstances some impatience is excusable, especially if you are advising them as a choice of evils to accept a reduction of wages. Therefore, the economic aspect of the question is of the greatest importance. I do not know whether the Chancellor of the Exchequer, who has, no doubt, been exceedingly busy of late, has had an opportunity of reading a letter that appeared in the press about a week ago from Professor Marshall, who is a very high authority—probably the highest in the country—on political economy. In that letter Professor Marshall did not attack the tax as being economically unsound, but he pointed out that he himself, twenty-five years ago, was inclined to advocate an export duty on coal, but he was deterred because it would dislocate trade, and it would be almost an invitation to other nations to retaliate upon us, who are perhaps among the most defenceless nations upon the face of the earth in opposing any retaliation policy. He said it would be a departure from the comity of nations to impose a tax on export coal. That was a complete contradiction of the position taken up by the Chancellor of the Exchequer. Professor Marshall says in regard to this tax that this country itself will have to pay the greater part. I noticed that in the speech made by the Chancellor of the Exchequer to-night, instead of saying that the foreigner would pay the whole tax, he qualified it, and said, "a considerable portion of the tax," and he made a further admission to the effect that the proportion would depend upon the condition of trade. This tax is a fixed amount. It will not adapt itself to changes of trade, and it is a shilling tax upon all classes of coal. The right hon. Gentleman has mentioned the best steam coal from Wales, but that is a very small quantity of the total produce. This tax is placed upon all coal, irrespective of its quality, and it will not adapt itself to fluctuations of trade during times of depression as well as during times of prosperity. I know that if we could get the foreigner to pay this tax we should all be satisfied. Surely it would give a touch of piquancy to the present position of things if we could get the foreigner, who does not love us too well, and who hates the war in which we have embarked, to pay the main cost of the war, or a very large portion of the cost of the war. I do not think the foreigner will pay much of it. My experience in foreign countries is comparatively small, but I have travelled, at one time and another, in different parts of the countries of Europe, and I may say that on the whole I have formed a very high opinion of foreigners. I do not think those are the best friends of our own country who try to raise prejudices against the people of other countries. I have found foreigners invariably courteous, and I think that probably a man of my simple and confiding nature, and with such a poverty of linguistic attainments, would excuse, even if he did not invite, a certain amount of imposition. Of course, we are dealing with the foreigner now as a commercial man. Though I have not had much to do with him in that line, my experience has been of the most satisfactory kind. It is quite true that once or twice I had base coins passed upon me, but then that has happened in my own country, where I am more familiar, though not too familiar, with the coins of the realm. I am not going to make a universal attack upon foreigners because an old Italian apple-woman once among my change gave me a bad florin. I believe that the foreigner, however well disposed he may be, and however honourable and straightforward he may be, is like every other virtuous man—like the Chancellor of the Exchequer—the amount he will pay for an article will depend upon his necessities and the amount of his cash to a large extent. Therefore he will satisfy his wants in the easiest possible way. He will not pay if he can help it, and in that respect he resembles the British patriot. Whatever British patriotism may mean, I think the Chancellor of the Exchequer will have discovered before now that it does not mean paying our own way out of our own pocket. As I think the Chancellor of the Exchequer will not get his money from the foreigner, I think he will have to get it from his own countrymen. That is where he ought to get it. We are not dealing with ethics or high morals, but I do think this country ought to pay for this war, and to that extent I agree, with the right hon. Gentleman; but I do not think he should ask a particular trade to pay, especially as I believe that it will greatly hamper that trade.

The right hon. Gentleman gave us to understand to-night that he had been annoyed very considerably by what he regarded as the exaggerations of the coal-owners. Well, everybody exaggerates—especially in this House. I believe the right hon. Gentleman and myself avoid as far as possible all exaggeration, but then the right hon. Gentleman might remember that a man who has a deficit of fifty-five millions is under no very great temptation to exaggerate. He and I have sat opposite to each other for about twenty-seven years, and I have a very high opinion indeed both of his character and his abilities. He has a trying time of it, and he has my sympathy. I believe he was a little angered with the persistency with which the coal-owners interviewed him. He thinks that they exaggerated, and I have already admitted that it is a common failing, and especially, Sir, if I may say so without offence—especially so on the part of rich men when their profits are threatened. I have heard them so often that, like the Chancellor of the Exchequer, I cease to be alarmed myself at any of their vaticinations, and I am not going to defend them; they do not need it—they are quite capable of defending themselves, and can do it very effectively. What I see is that the money will have to come out of the coal trade. I believe the Chancellor of the Exchequer will adhere to his position. It will have to be paid in the main by this country. Shippers and exporters may have to pay a portion, mine-owners may have to pay a portion, and I am perfectly sure the miners will have to pay a certain proportion. Economics will determine what proportion each shall pay. I have been connected with the coal trade all my life, and it may amaze the Chancellor of the Exchequer and Members on the other side of the House when I tell them that I am not a millionaire. Perhaps they will be surprised still more if I tell them I do not want to be one. I have sins and cares enough without embarking on that very troubled sea. But I do know this, Sir, that if the coalowners suffer severely, the miners also must suffer; the community by whom they are surrounded, farmers and shopkeepers, will also have to share that suffering. I believe this tax will bring suffering, if not disaster, on some of the mining districts. It is on that ground I oppose it. The hon. Member for Central Sheffield said this was a popular tax. I believe it is popular with everybody but those who will have to pay it. But that is the case with a good many taxes. Of course, we are deprived, according to my argument, if it is sound, of one great delight—we cannot fleece the foreigner; but then we can fall back upon the next best thing by acting iniquitously and doing unjustly and producing a considerable amount of discomfort and dissatisfaction among a large section of our own countrymen.

I want just for a minute or two to call attention to the position of the miners. I can see that from the point of view of a London householder, who pays 25s. or perhaps nearly 30s. per ton for his coals, that a shilling per ton may seem a comparatively small amount. But look at it from the other end. May I ask the Chancellor of the Exchequer to believe that when I talk about mines I know what I am talking about. I spent eighteen years of my life as an underground workman, and the House may gauge my ambition when I tell them that I never wanted to go higher. I never had any desire to change my occupation, but my fellow-workmen asked me to leave the pits and represent them. Well, I must not give you my autobiography, although it may be interesting to myself. [Cheers.] I am very much obliged to hon. Gentlemen opposite for their encouraging cheers. Those were not the least happy or the least satisfactory days of my life. I knew then, and it is a satisfaction to me to know now, that at any rate during one period of my life I earned my bread honestly. I have not always been sure since. I see that I have the attention of the Chancellor of the Exchequer. Let me, then, give him some notion of what a shilling a ton means from the coal-hewer's point of view. The hewer is many a time getting coal at a shilling a ton. [AN HON. MEMBER: "And less."] I think I have got it myself at a shilling a ton. It is only fair to say that is exceptional. But at the present time in Northumberland—I have gone carefully into the figures and there may be a halfpenny or a penny of difference, but there is not more, and I have no intention to misrepresent; at the present time in Northumberland—and this is an inflated period—the average price per ton paid to the coal-hewer is about 2s. 6d. or 2s. 7d. Now a shilling a ton from that point of view is a good deal. Then, what are the wages he is making on that? I do not want to deal with the coal-owner's side of the question, but it is not only the coal-owner's side when I refer to prices, because wages depend on prices. In Northumberlan from 1879 to 1889 the average price as ascertained by chartered accountants, representing employers and workmen, was 4s. 9.82d. at the pit's mouth. For the last twelve months the price was 10s. 6.65d. per ton. Let me say that the Chancellor of the Exchequer is one of the most cogent and clear reasoners in the House of Commons, and if you grant his premises you have to follow him to his conclusions. But I think his great fallacy in this case—and I am perfectly sure he has made a mistake—is in having taken an exceptional year—an admittedly exceptional year—and in gauging the whole situation by that exceptional year in connection, as he has admitted tonight, with a trade which is liable to extreme fluctuations.

Now I come to the wages of the men. From April, 1879, to December, 1889, the price in Northumberland never exceeded 5s. 4.87d. I well remember that during that period we had a strike for seventeen weeks. I went to the men and advised them to accept a reduction as the lesser evil. For the first and the only time in my life among Northumberland miners I was hissed and groaned at. Like the Chancellor of the Exchequer, I do not, I hope, unduly care either for applause or censure, but I would rather be cheered than groaned at. Yet, after all, it is not a man's main business in life to be popular. I am perfectly sure that I have never been more right in my life than when I have been howled at and prevented from expressing my opinions. I did not complain of their hostile reception; they were suffering severely, and I have tried them so often with my moderate ways and my unpalatable advice. Hardly any other man would have got away with his life. I am not one of those vicarious sacrifice men who always want to be sacrificing somebody else. Some of you will remember that Artemus Ward said he was so clear that the North was right, that he was prepared to give up all his able-bodied relatives, including his mother-in-law, rather than see the North defeated. What do hon. Gentlemen think is the average wage of miners in Northumberland even at the present time of high prices? I ought in fairness to say that the miners have some advantages in addition to this—very substantial advantages. Many of them have a free house and free coal, but they also have drawbacks and deductions. They have their tools to pay for, and also the powder which is necessary for the blasting of the coal, and these are sometimes rather heavy deductions. But what are the wages? About 8s. per day, and these be it remembered are inflated times. Everybody is angry, partly with the owners and partly with the miners, because they think that they have entered into a conspiracy to impose on the community generally. It is a great delusion. Many of the men are working at a much lower wage than the hewers, their average wage at the present time being 4s. 10d. or 5s. per day. If you put the two together—the highest and the lowest paid—you get a general average of about 6s. 2d. per day, or in round figures 30s. per week. Should the wages of miners ever be below that? Would anybody say that a man should work hard and risk his life in a mine as those men do for less than 30s. a week? No candidate in a mining district at the time of an election would say so.

I want to touch on this point of wages because I am perfectly sure that this is exaggerated considerably in the public mind. These false notions and wild emotions get people into great difficulties. They got us into this war in South Africa. There is a false notion abroad that there is a conspiracy between the mine-owners and the workmen to raise prices. Coal has indeed been very high-priced—too high, in my opinion, for the other industries of the country. Several industries have been throttled by the high price of coal. That is entirely due to natural causes—to economic laws. I do not know, but I begin to imagine sometimes that the whole fabric is crumbling around us. But I did think that the doctrine—it is not mine—of buying in the cheapest market and selling in the dearest would have stood the test of all time. That is the doctrine that has been acted on by those extortionate coalowners. I should have thought that in the temples of Mammon everywhere that would have been accepted as the true gospel of wealth. If this fails, then "the pillared firmament is rottenness, and earth's base built on stubble."

I have hardly touched upon my own county—the county of Northumberland—but it will be peculiarly affected by the tax. I do not want to put it, however, on narrow sectional grounds. I am called a labour member. It is not my own choice of an epithet. I do not object to it at all; though I think no man should be here to represent lands, mines, railways, or anything less broad than the interests of the whole community. Northumberland is a large exporting county—four-fifths of the coal produced there is exported. We enter into severe competition with Westphalia. Last year there were exported more than eight million tons, over two millions of which were sent to Germany, Russia, and the Scandinavian countries. From Blyth, a seaport in my own constituency, more than three million tons were exported. That town will, I fear, suffer severely from the tax. In many cases we gain or lose a contract by a difference of threepence per ton. I do not say that Westphalia, Germany, and other parts of North-eastern Europe, being better situated geographically, should not compete and get contracts in preference to us. All I ask for is a fair field and no favour. The imposition of this 1s. a ton will in many cases cut us out of those markets. I have known pits where there was no conflict, no strike, no lock-out, where there was the most amicable feeling between the owners and the men, stand idle for months when a penny a ton would have kept the wheels going. What will this 1s. do? The Government mean to stand to this tax—it is a powerful Government, in some respects. It has a large majority; I do not know its number. Now with regard to the Chancellor of the Exchequer, Professor Marshall, who, as I have said, differs from him on some points, says he admires his courage. I myself know that he is courageous, and we all admire courage, even the most pusillanimous of us. But the right hon. Gentleman knows very well that courage is often akin to obstinacy and foolhardiness; the right hon. Gentleman has not that courage—he has the high courage if he has made a mistake, and if he can be convinced that he has made a mistake—to publicly admit his mistake and withdraw from the false position he has taken up. All we have to do is to convince him, and I hope the Leader of the House will have this debate adjourned to give us another opportunity of putting our case before the Government. The Government is powerful positively and negatively. No small fraction of their power is due to the fact, unprecedented in my memory of this House, that nobody wants to be in their place. So strongly do I feel on that subject that I have told some of my good friends on the other side of the House—where I have many with whom I pair in order to allow them to get to bed at a reputable hour—that if ever the Government got into a tight place my pair must be up, because I should like to be free to come to their rescue. I cannot on this occasion, because I think they are so absolutely in the wrong. I cannot come to their rescue now; I fear I must leave them where they are until they get us out of the horrible mess into which they have everywhere landed us.


As a new Member I feel some diffidence in following the eloquent Member who has just sat down, but, being a ship-owner and a coalowner, I may say my interest individually is against the im position of this tax. That being so, I have no doubt that the coalowners and the shipowners in this House will expect me on this occasion to vote against the Government, but I take this view of the position. I think most of us here are in favour of the war which was forced upon us, and therefore it would be unfair on our part to try and avoid our responsibilities with regard to it. We look, of course, to the Chancellor of the Exchequer to try and impose taxes in such a way as not to be unfair to any class. Now, in addition to the loan of £60,000,000, he has increased the income tax, has imposed a duty on sugar, which hits all classes, and he is now asking us to vote this 1s. tax on exported coal. The coalowners and miners object to anything like a tax of this description, because they say it will fall on them and not upon the foreigner who buys the coal. We have heard similar statements before with regard to the Workmen's Compensation Act, and I hope the time will come when the coalowners and the miners will have to admit that this tax has not fallen upon them but on the consumer. The coalowners say it will injure the export trade, reduce production of coal, and consequently the wages of the miners; but with regard to exportation it has been already pointed out that of the total amount of 44,000,000 tons only 5,600,000 are exported to Germany, while the other seven-eighths of the total amount are sent to countries where there is very little competition with us. Take, for example, Russia. North Russia is bound to have our coals, and there is no other country which could compete with us there. The same remark applies to Norway, Sweden, and Denmark, also Italy and Spain.

In eastern France we have to compete with the German coal, but that is because German coal has to bear no sea freight in that part of France, it merely comes across the frontier into France, and consequently is well able to compete with us. I maintain, however, that, so far as the rest of France is concerned, this tax will have no effect upon the exportation from this country. As to German coal, owing to the heavy railway dues, it cannot compete with us, the sea freight from this country being much cheaper. There is one country where it may affect us, and that is Germany, and I admit that Westphalian and Siberian coal may to some extent push out our trade. Now, we have heard a good deal to-night about the coalowners and the miners, but we have not heard a word said about the shipowners. A share of this tax may fall upon the shipowners, and, in point of fact, has already done so. That is proved by the fact that since it was seen that such a tax was likely to be imposed on coal, coal freights, especially to near ports, have fallen 1s. per ton, so that the whole of the tax is paid by the shipowners and not a penny by the coal-owners or miners. No doubt it will be said that all that will right itself and that ultimately the tax must fall on all the different classes interested in the export trade, which I dispute. I think it will mainly fall upon the foreigner, who must have our coal. How far this tax will interfere with the export trade will be discovered in the future, but we have this to look forward to, that the coal being produced will have to be sold, and if not exported will have to be sold in this country, which will probably mean cheaper coal, so that the iron and steel manufactories, shipbuilding yards, and all kindred industries in the country will be benefited by the imposition of this tax, and the wages of the men employed by those trades will increase, so that though the wages of the miners may suffer, which, however, I dispute, the result, so far as labour in these other in-industries is concerned, will be beneficial. It has already been pointed out that when we part with our coal we are actually parting with the capital of this country, and although the export trade may suffer, the community at large will benefit by this tax. We have heard a great deal to-day with regard to our own interests and the interestsof the community. I maintain that in a question of this kind we should not look at our own interests at all, but in the first place at the interest of our constituencies and in the second to the interests of the community at large, and if we do so, we shall see that this tax instead of doing harm will confer great benefits. The right hon. Gentleman on the Front Opposition Bench said that he had been told that the Italian Government last autumn gave a large contract to America because the exporters of South Wales could not compete with America. I do not doubt, for a moment, that what the coal exporter in that case was probably true. Last autumn and during the whole of last summer the price was very high for coal. At that particular moment America could export to Italy at a less price than this country, but the whole of that is now changed, as we have now normal prices. We are now paying 17s. per ton for South Wales coal for which last year we paid 25s., and freights from this country to Italy were 12s. to 13s. per ton, whereas to-day they are 8s. to 9s. per ton. No doubt Members will see at a glance that though America, under such conditions at that particular time could compete, she cannot do so to-day.

Now, a good deal has been said about the India trade. It must be well known to those interested in the coal and shipping trade that that trade has been lost to us because in India they are producing coal themselves that they can put into the market at a much cheaper rate than can be done from this country. Consequently the markets at Bombay, Calcutta, and elsewhere are to a great extent lost to us, but this 1s. a ton will make not the slightest difference with regard to India. We should bear in mind that the fluctuation of freights is considerably more than 1s. a ton. Freights rise even to home ports 1s. a ton in a very short time, and I have seen freights to India fluctuate as much as 5s. in a single week; and, that being the case, I put it to everyone who looks at this question with an unprejudiced eye, whether a tax of 1s. per ton on long voyages would make the slightest difference. It has also been said that America is now competing with us in Italy and France, but that is not a fact, and American coals cannot be delivered at ports such as Marseilles, Malta, and Algiers at the same price as English coals. With regard to Welsh coal, the only American coal which can approach the Welsh coal in quality is the Pochohantas coal, and that coal will not come into competition, owing to the higher price delivered at European ports, at all so far as Europe is concerned, though it may do so at the Azores. I listened to a debate in this House a short time ago upon the subject of the Eight Hours Bill, and I saw representatives from the north of England coal miners get up and heard them say that if the Bill was passed the price of coal would be increased 2s. or 3s. a ton. If that be the case, I cannot see how those gentlemen who are prepared to vote for the Bill can object to an increase of 1s. a ton in the form of a tax. I think there is far too much made of this coal tax, and I think it will be shown hereafter that the Chancellor of the Exchequer is right in saying that in the main it will fall upon the foreigner, who is bound to have our coals. Taxation is objectionable in every form, but we are bound to pay our way. I think this 1s. a ton export duty is a fair duty, and that it will not damage the export trade in the slightest degree. I should like to say, in conclusion, that I am much obliged to the House for giving me such a good hearing, speaking as I do for the first time in this assembly.

MR. JOHN REDMOND (Waterford)

I feel that the subject which is before the House so closely affects a large number of Members representing British constituencies that it would be improper on my part to occupy more than a few minutes, and I have no intention of being guilty of the impropriety of making a long speech, but I think the House will recognise that it is reasonable that a few minutes of its time should be afforded, so that a general explanation should be given of the action the Irish Members intend to take in this matter. The House will not be surprised to hear that we take an entirely detached view. We look at it from the point of view of our own country, and we think of our own case. We therefore do not share to any large extent in the arguments which have been adduced for and against this tax during this debate so far. The Chancellor of the Exchequer complained the other night that the Irish Members seemed not to understand and certainly not to appreciate the fact that this coal tax which he is now imposing is one that will not affect Ireland, and he seemed to think we were somewhat ungrateful to him for taking a new departure in taxation. The right horn Gentleman is quite wrong. We thoroughly understood the meaning of the new tax and thoroughly appreciate the fact, for what is worth, that he has made a new departure. The imposition of this tax upon Great Britain which does not affect Ireland would seem to be the opening of a new era in the history of taxation in Ireland. Since 1816 the exactly opposite policy has been relentlessly followed by all the financial authorities in this House, in 1816 the burdens which were borne by England and Ireland, according to their capacity for bearing taxation, were mostly due to European wars in which Ireland had no say or interest. From that date these burdens were, as I submit, most wrongfully, unequally, and unfairly periodically reduced or removed, while the taxes which hit Ireland were not touched at all. Let me give an example of what I mean. In 1816 alone seventeen and a half millions of taxation were taken off Great Britain, but not a single farthing was taken off Ireland. In 1810 £14,318,573 was taken off the income tax in Great Britain, £270,000 off the house and servants duty, and £2,700,722 off the malt duty in Great Britain, and not a single farthing was taken off the taxes which were pressing on Ireland. The same policy was carried out from 1823 to 1830. In 1823 £1,260,000 was taken off the house and window duty in Great Britain; in 1820 £1,063,000 was taken off the cider and spirit duties in Great Britain; in 1830 £3,080,000 was taken off the beer and cider duties in Great Britain; in 1832 £470,000 was taken off candles of Great Britain; in 1833 £593,000 was taken off soap in Great Britain; in 1830 £293,030 was taken off newspapers. During the same period, from 1816 to 1836, while taxes were thus being taken off Great Britain, extra imposts were imposed on. Ireland—for instance, the tobacco duty was increased from 1s. to 3s. per pound. Then in 1853 the income tax was fraudulently placed upon Ireland, and from 1853 to 1861 the spirit duties in Ireland were raised from 3s. 8d. to 10s. per gallon. I mention these facts to show that during all the century from 1810 to the present day there has been no instance of the imposition of taxation which would press lightly on Ireland and more heavily on Great Britain until the present Budget. Therefore the right hon. Gentleman will not entertain the idea, expressed the other night, that we Irish Members are unmindful of the fact that in this small matter of the coal tax he has made a new departure. I wish it would mean that it was the inauguration of a new era and a new policy of the taxation of the two countries. The financial policy with reference to Ireland has been ruinous to the country. It is absolutely true to state that to-day the taxation for Imperial purposes in Ireland per head of the population is double what it was at the time of the battle of Waterloo, while the same taxation in Great Britain is twenty-five per cent. less. I admit to the full that in imposing this coal duty on Great Britain, which does not touch Ireland at all, the right hon. Gentleman has made a new departure, and I repeat that I hope it will be the commencement of a new fiscal policy with reference to the two countries.

1 have said so much in consequence of the statement of the Chancellor of the Exchequer the other night, that we did not rightly understand or appreciate the meaning of the imposition of the coal tax. But allow me to say, on behalf of the Irish Members, that we feel constrained to regard this Budget as a whole. The Chancellor of the Exchequer in his speech to-night declared that this resolution dealing with the coal tax was a vital and important part of his Budget. Now this Budget as a whole inflicts grave injustice upon Ireland, and I may be allowed to express my regret and surprise that more organised opposition has not been offered to the imposition of the sugar tax. I cannot understand why it is that all the machinery of the Opposition has been put into operation with reference to this coal tax, while the sugar tax, which I regard as a much more serious and injurious imposition, has been allowed to pass practically without any serious opposition from hon. and right hon. Gentlemen above the gangway. So far as the Irish Party is concerned, we feel that if we are able to defeat the Government on the coal tax we will defeat the Budget, which imposes such injustice on Ireland, as a whole. We are bound to attack every part of it in order, if possible, to defeat the whole. There is another consideration which, though, perhaps, it is not entirely a logical one, is one which hon. Members will understand has some influence with us. For my part I believe that the coal tax will, in the main, fall on the working classes of Great Britain, but I am not unmindful of the fact that there are many thousands of Irishmen working in the mines of Great Britain, and that has some influence with me and my colleagues in voting against the coal tax, which will impose an unjust burden upon, and do considerable injury to, so many of our fellow-countrymen in Northumberland, Durham, and other parts of the country.

But, over and above all these considerations, there is one overriding view which influences the Irish Members. This Budget is necessitated by the expenditure by this country on the war in South Africa. The record of the Irish Party upon this matter is perfectly consistent and clean. In taking the stand we have in reference to this war I believe that Ireland has made sacrifices. I believe that in taking the attitude that we took and still take we have run risks of odium in this country, and we have had to face threats of injury to the future of Ireland, and to the cause of Home Rule. We have been influenced in our attitude in regard to this war by what we believed to be right and just. Hon. Members are quite wrong if they imagine that the attitude of Ireland is due to the fact that this contest is a contest between England and the Boers. I assert that if this contest had been, not between England and the Boers, but between any Continental nation and the Boers, our attitude would have been precisely the same. Our attitude has been one of resistance to a policy which we believe to be one of greed spoliation, and devastation; an attitude in defence of a brave nationality struggling for their freedom; and I do not think that in the long run Ireland will suffer anything from having taken its stand on these lines. Still, hon. Members must recognise and admit that in taking this attitude we have faced probable injury and much odium and misrepresentation, at any rate during the present, and they ought to give us credit for the sincerity of that attitude. We have been consistent from first to last in that attitude, and here tonight we declare that even though the coal tax does not press on Ireland, and although the imposition of the tax does hit Great Britain and not Ireland, and seems to open a new era in fiscal policy with relation to Ireland, still we shall refuse to vote for it, because it is raised for the purpose of carrying on this war. Having said so much, I would be acting improperly if I continued my speech and stood in the way of Members who are directly interested in the great coal trade, and who are desirous of bringing their views before the House.


I do not think it right that this debate should proceed further without the views being heard of that one part of the country which probably will be hit more than any other portion of the kingdom. I dare say in the course of the discussion we shall have some observations from my hon. friend the Member for Merthyr Tydvil, who occupies in South Wales the same position as the hon. Member for Chester-le-Street does in the North of England. The House will have heard certainly two things to-day at which they must have been surprised. One of these was a statement of the Chancellor of the Exchequer which will create the greatest dissatisfaction in the country, and which may create disturbances which he did not for a moment expect. We have always thought that this tax was a bad one. When we heard the proposal of the Government for the first time, we at any rate thought that it was a temporary tax for a limited number of years; but the Chancellor of the Exchequer has said to-night that he is satisfied that the tax will be a permanent one. That is a matter which may involve consequences of a far-reaching kind, and that the Chancellor of the Exchequer will find before many days are over. The other matter is that the Chancellor of the Exchequer admitted for the first time to-night that this tax would be an obstruction to trade. That is what we have said over and over again, and it is because this tax is an obstruction to trade that we oppose it so strenuously. For my part, I should not object to a tax which would hit the rich coal-owners, but I am not at all sure that the Chancellor of the Exchequer invented this tax merely because he thought that last year and the year before these people could afford to bear the burden. There is, however, a method of getting at the incomes which these gentlemen have been having for the last year or two, without placing a tax on the trade of the country, and without turning our backs on the policy of free trade. Why does not the right hon. Gentleman introduce a graduated income tax? I have argued before now in favour of a graduation in the income tax, and, so far as I am aware, the only objection to it is the difficulty of collection. But this tax is graduated in other countries without difficulty, and could be so graduated in this country. The effect would be that you would secure a certain portion of the incomes of these millionaires. And it would not be unfair to them, for if they are successful in one year they would pay much, and if unsuccessful in another year they would pay less. In that way you would not burden trade with a tax which it cannot bear.

I am not going to say who will bear the greater proportion of this tax; but the Chancellor of the Exchequer apparently conceded to-night that it was only a small proportion of the tax that will be borne by the foreign consumer. What is important to consider is whether or not the trade of this country in coal has such a monopoly that you can afford to laugh at competition. That is the question. If any one could say that the trade can afford to brave all competition, then probably we might with a light heart this year impose some tax of this kind. But when we can show that, even at the present moment, the competition of countries abroad is severe, surely that is a matter which ought to make us pause long before we give our sanction to a tax of this kind. I could prove to the House in a few moments that the competition has been so keen up to now that we cannot afford to laugh at it. The Chancellor of the Exchequer made some comparisons and quoted some figures, but he took the worst year on the one hand and the best year on the other. I say that is not a fair comparison. He took the year 1891 and said what were our exports then, and compared them with the exports in 1900, without telling the House that in 1891 the coal trade was at its very lowest, whereas in 1900 it was at its very best. What we have to consider is the American market. It has been conceded, in the course of the debate this evening, that some American coal is very nearly as good as some of the best Welsh steam coal. Anyone can show that America has advanced by leaps and bounds in the last ten years. In 1890–1 the exports of coal from America were 1,932,000 tons, while in the year 1900 they amounted practically to eight million tons. Now, of course, these figures are small compared to the British figures, but when we look at the proportion we see that the export trade of America has quadrupled in ten years. No such figures can He produced in respect of the British coal trade. It is perfectly clear that America is intent on driving out our trade in the Mediterranean. We know that there is a proposal to grant a subsidy of two millions sterling in order to cheapen freights. We know that great American merchants are over in this country trying to arrange to buy more than a million tons of British shipping. What does that mean? It means that America sees that the question of delivering her coal at the Mediterranean ports is a question of freights. That is a fact, surely, proving that this is not the time for us to place a tax of this kind on coal which may drive us out almost entirely from the Mediterranean trade. The exports of American coal to European countries in the year 1889 were only 35,222 tons; in the year 1900 they had gone up to 635,237 tons. The coal trade with South America shows the same advance. At one time we had a great deal of that export trade. In 1890 the American export to South America amounted to 49,355 tons, but in 1900 it had risen to 214,126 tons. The exports of America to the British West Indies, including Bermuda, were 760,879 tons, and to the United Kingdom 89,271 tons. America competes with us at the River Plate, and not very long ago American coal exporters actually got a contract from the Italian Government for the Italian fleet. These are facts. Surely this country ought to pause before putting 1s. per ton on the export of coal which faces a strong competition coming from the other side of the Atlantic in our own markets. The exports of coal from Germany in 1890 were 9,000,000 tons; in 1900 they bad gone up to 15¼ million tons; and undoubtedly the competition in the markets of Japan, India, and China will be far keener in the future than in the present day.

That is not all. We see that we are losing markets, and we know perfectly well that when a market is once lost it is difficult, or impossible, to regain it. To use a current phrase, one ton taken from Great Britain means a ton gained by somebody else. A great deal has been said of the Cardiff trade, but the Return shows that there was a decrease in the exports from Cardiff in 1900 as compared with 1899 of 421,769 tons. I will quote the figures in regard to some of the markets, just to show where the pinch comes in. There is a decrease in the export of coal to Italy I have shown that America is exporting coal to Italy—of from 2,211,253 tons in 1899 to 2,008,754 tons in 1900. Take Roumania, where coal is now being taken from Germany. In fact, a very considerable contract has just been placed from Roumania in Germany which up to the present time has been given to Cardiff. The exports from Cardiff to Roumania were in 1899 158,658 tons, and in 1900 only 46,828 tons. I have shown that from Cardiff, where there is the very best Welsh steam coal, a very considerable decrease has taken place in our exports; therefore, surely, we are right in warning the House that this is not the time to place an export duty on coal or to turn our back on the traditional free trade policy of this country. I am afraid that, when we come to the details of this matter, we see accumulative evidence that the Chancellor of the Exchequer took very little trouble to weigh the facts of the situation before imposing this tax. He seems to have approached the matter somewhat in this fashion:—"I want a couple of millions, but I dare not take it from the income tax, because my supporters, who can bear the burden, will object. But, oh! there are the coalowners"—and the hon. Baronet referred to them with what I thought was a spice of malice in his voice—"Let us put a tax on these great coalowners." In this way the right hon. Gentleman, no doubt, came to propose the tax without any consideration for one of the most important factors in the situation, referred to by the right hon. Gentleman the Member for West Monmouthshire. It is almost inconceivable that the Chancellor of the Exchequer of this country should propose a tax from which he expected to receive two millions, and that, before the resolution is passed by the House, he should have to acknowledge that the half of the tax must go. But that is not the whole situation. It is not fair, however rich a man may be, however well he can afford to bear the burden, to tell him that although he has entered into a contract on the 1st January, according to the custom of the trade, he must pay 1s. per ton on all coal he exports. Taking the whole country over, the right hon. Gentleman has become aware that 50 per cent. of the export of coal for the next twelve months has been contracted for in advance. Now you cannot differentiate these contracts, and there goes a million of the tax. The right hon. Gentleman omitted all reference in his speech to existing contracts, and when asked about them, he replied that he did not know that that was a very important matter, but that he should think we could put a provision in the Finance Bill breaking the contract, unless the foreigner were willing to pay the 1s. tax. From no part of the country has the Chancellor of the Exchequer had any kind of support for that immoral suggestion. He may attack the coalowners and the millionaires as much as he likes, but not one of them has ever suggested that he should break his contract because the foreigner would not pay this tax. I have read with great care the proceedings of the deputations which have appeared before the right hon. Gentleman from time to time, and which have apparently produced a great deal of irritation in his mind. One and all of these deputations informed the Chancellor of the Exchequer that they could not hear of any such proposal. They said that that was not the way the trade of this country had been built up, and that they would not even suggest to the foreigner anything of the kind. We are in a hopeless difficulty with regard to these contracts. No one knows who is to pay the duty, and that is one of the difficulties which the Chancellor of the Exchequer even at the present moment is unable to solve, and he is not even able to say when he will put before the House his proposal with reference to these contracts.

I am impartial with reference to the question of bunker coal; but there is another branch of this subject which I wish to touch upon, especially with reference to Glamorganshire. When the South Wales coal trade is mentioned, it is imagined that the great steam collieries in the Rhondda Valley are referred to. No difference is made between the best quality and the worst quality of Welsh coal, and it is proposed to put a shilling a ton on the best steam coal and on the poorest household coal. In other words, you are putting exactly the same duty on coal selling at 15s. a ton as on coal selling at 7s. or 8s. a ton. If the right hon. Gentleman inquired, he would find that every mile west of Cardiff the collieries become poorer. Already collieries have been shut up, and undoubtedly others will be shut up as a direct result of placing this imposition on this trade. I am told by an hon. friend that thirty small collieries are already closed in Glamorganshire. That is a serious matter. It is not a question of coalowners only; it is also a question of coal miners, and the whole community surrounding the colleries, and as the right hon. Gentleman has up to the present declined to make any difference between coal of good quality and coal of inferior quality, he cannot be surprised at the feeling exhibited among the small colliery proprietors at the extraordinary tax which is going to be imposed on them. I am not here to defend the large colliery owners at all. I have not a penny interest in coal myself; my interest arises entirely from regard for the poor mining population, and I believe with my hon. friend the Member for Morpeth that the person who will have to pay the greater part of this imposition is the poor miner himself. Anything that affects a trade of this kind must affect wages, and must affect wages before it affects anything else. It is not merely that the small collieries which have been able to keep alive, many of them by reason of the good years—last year and the year before—may be closed, but we are also hampering the development of the coal industry in places where pits have not yet been sunk. Are we, by putting this tax on coal, encouraging people to put their money into the coal industry? Undoubtedly one result of this tax will be that colliery development will be retarded for many years to come. There is the further question of manufactured articles, which was also airily dismissed by the right hon. Gentleman as of no importance at all. Patent fuel is a very important trade in this country, and the coke trade is also very important, and yet we are placing this tax on these manufactured articles.

All these matters show that the tax is ill-considered, and is unsound in principle and in policy. It is admitted that it will hamper trade. The right hon. Gentleman the Chancellor of the Exchequer said that it would not "destroy" trade. He wants total destruction apparently before he will acknowledge any valid objection to the tax. Surely it is enough to show that it will injure trade and hamper trade, and bring hardship to small mining communities. When the right hon. Gentleman was looking about for people on whom to place a burden of taxation in this country I am surprised that he did not find one party who are also associated with the coal industry, but who do nothing whatever except receive money from it. Collieries have paid last year which have not paid dividends for years previously. I have got instance after instance showing that many collieries have not paid a dividend at all for ten, twelve, or fourteen years. There is one large colliery in my own constituency, employing 800 men, that did not pay a dividend from 1884 to 1889, and yet the Chancellor of the Exchequer compared the profits from these collieries for the years 1900 and 1897. Taking this particular colliery alone, I am told that, while there was a large profit last year and the year before, if the receipts were estimated from the beginning the average profit would only amount to 1¼ per cent. per annum. Therefore, instead of imposing burthens on people who have sunk their money in collieries, why did not the right hon. Gentleman put at least a part of the burthen on the people who receive mining royalties? If a tax of 2d. or 1d. were put on all coal produced in the country, it would at all events have the advantage of not making a difference between one colliery and another, merely because one exported coal and the other did not. If 1d. a ton were put on all coal produced in the country, and 1d. tax also on mining royalty receivers, the right hon. Gentleman would have double the two millions which he is going to have out of the dislocation and disturbance of the coal trade, The coal-mining community and the country are looking at this matter with keen eyes and with very keen intellects, and are not to be frightened by the Chancellor of the Exchequer. Far be it from me to suggest any course which would throw the whole of this country into a state of disturbance, and which would bring even the Chancellor of the Exchequer to his knees, but it is a matter he has to consider. He has seen a deputation of miners. They are convinced that the trade in which they earn their livelihood, if it is not going to be destroyed, is, at any rate, going to be very seriously injured. What would be the consequences of a strike over the whole country? It would affect not only the coal industry, but every industry in the country. That is a calamity which I hope will not occur, but there is naturally fear of it if this tax is proceeded with. At any rate, I think we have been able to show that by this tax the Government are doing an injury to an important trade from which it may not be able to recover even by the removal of the tax in future years.

*MR. PLUMMER (Newcastle-on-Tyne)

I am well aware that it is the established custom in this House, when a new Member speaks for the first time, to make some sort of apology for venturing to intrude on its attention. If I omit that apology to-night I am sure the House will excuse the omission, when it remembers that the subject under discussion is coal, and that the constituency of which I have the honour to be one of the representatives is Newcastle. Newcastle and coal have for many generations been synonymous terms, and it has been impossible to think of the one without at the same time recalling the other. If it be true—as I believe as regards the past it is true—that, in the words of the Chancellor of the Exchequer, coal has been the life-blood of this nation, and that it is coal that has made this country what it is, with much greater force and greater emphasis can the same declaration be made with respect to Newcastle. If, however, I have not commenced with an apology, I must commence with an expression of regret that, on the first occasion on which I venture to address this House, I should find myself in opposition to His Majesty's Government rather than being in a position to offer them that whole-hearted support which and I would much prefer to do, and although I cannot expect the House generally to appreciate my position, I know full well that hon. Members from the North of England, on whichever side of the House they sit, will believe me when I say that though the situation comes to me with all the freshness of novelty, it brings to me none of the delights which some hon. Members on this side of the House—the hon. Member for Kings Lynn, for example, seem to experience, judging by the number of times they repeat the operation. But if Parliamentary representation means anything, it surely means the right of a constituency to make its voice heard in a constitutional manner, when any subject which materially concerns not only its present but its future welfare is under discussion in this House.

Let me say at the very outset that I do not believe that the opposition which conies to this tax from the North of England comes to it because it is a tax. In other words, it is not an opposition to bearing a fair share of the burthen which the Chancellor of the Exchequer is bound to impose on the country on the present occasion. There is no other district which has more fully supported His Majesty's Government in their South African policy than the north of England, and I say it with all sincerity, although the assertion may be received with irony from the other side, that no part of the country is more fully prepared to pay its fair and equitable share of the burthen which the Chancellor of the Exchequer is now bound to impose. My whole argument and my whole contention is, and my rising will be useless on this occasion if I cannot prove it, that the burthen which the Chancellor of the Exchequer is imposing on the North of England and certain other districts of the country is unfair in its direct result, and unjust in its indirect consequences. The right hon. Gentleman in his Budget speech, with reference to the sugar tax, laid down a definition of what he considered to be a fair and equitable tax. He defined it as one which fell on the country generally, and the hon. Member the Leader of the Irish party expressed a few minutes ago his astonishment that the imposition of the sugar tax had caused no outcry compared with the outcry against the imposition of the coal duty. But the reason is obvious, the sugar tax is recognised as a fair and equitable burthen on the whole country, whereas the coal tax falls unfairly and inequitably on certain districts Only.

The right hon. Gentleman said that he wanted a tax which everyone would pay. How far does the coal duty comply with that condition? How far does it come up to the standard which he himself has laid down with regard to the sugar duty. The tax does not fall on the whole country, but only upon one trade, and that one of the most important trades in the country. It does not fall on the whole of that trade, but only on the export trade, for it does not touch the large and important coalfields in the Midlands and Staffordshire. Again, it does not fall equitably even on the whole export trade, for so long as the tax is maintained on its present basis, and not placed on an ad valorem basis, it falls most unfairly on Northumberland small coal, say at 6s. per ton, compared with Cardiff coal at 16s. a ton. I repeat, therefore, that by this tax a heavier burden will be placed on Newcastle and the north of England than on any other part of the country. New-castle is the second most important coal exporting centre in the country. No less than fourteen million tons were exported last year, and, as we have already heard from the eloquent lips of the hon. Member for Morpeth, 70 to 80 per cent. of Northumberland coal is exported. Upon the maintenance of that trade on its present level many of us believe depends the prosperity of many thousands in the north of England, and it is the contemplation on the part of the Chancellor of the Exchequer of a possible decrease in the export trade which I firmly believe has caused more alarm and anxiety in certain districts of the country, particularly in the North of England, than any other portion of his Budget speech. Much capital has already been expended in connection with the development of the coal export trade. The North Eastern Railway Company has spent hundreds of thousands of pounds in erecting coal shipping staithes at Dunston, on the Tyne, for the purpose of dealing with the development of this trade. I am well aware that the right hon. Gentleman views with equanimity the possible decrease of the coal export trade, but is there any need after all to check the increase in that trade? Are not the inventions of science likely, long before our coal resources are exhausted, to enable us to economise and prolong the life of our coalfields? I believe scientific invention is pointing more and more every day to the time when coal may not even be worth the cost of winning. Some hon. Members have spoken in this House from the point of view of the coal-owner. I could almost imagine I see the hon. Member for Chester-le-Street shuddering in his seat at the idea that coal may some day lose its value, but my advice to him and to others, if they will allow me to give it, is, sell it while you can, and make hay while the sun shines—even out of coal. Only this week in a Committee of this House I heard an eminent Counsel claim on behalf of a new gas that by its use 1,000 tons of coal would produce the same horse-power which now require a consumption of no less than 5,000 tons of coal. Sir Frederick Bramwell prophesied at the same Committee that in something like a quarter of a century the steam engine, the greatest and most wasteful consumer of coal, would, figuratively speaking, only be found in one place, and that a museum.

I know that the Chancellor of the Ex- chequer contends that the foreigner will pay this tax. I wish I could share the right hon. Gentleman's confidence. Since this proposal was first suggested I have received innumerable communications from the north of England all pointing to the fact that contracts have been obtained at a profit of less than 1s., and in many cases at far less than 1s. I confess I fail to see under these circumstances how the north of England—and after all we must look after our particular constituencies in this House—is to maintain its preeminence as a coal-exporting district if this tax is to be imposed. I do not wish to deal at any length with the question of the competition of West-phalian and other Continental coal, but it is an important fact, which has already been mentioned, that to Hamburg alone there was exported last year no less than four million tons; therefore I cannot view with the calmness of some hon. Members the possibility of the future competition of America. I read the other day of an inportant contract for no less than 100,000 tons which had been placed by the Paris Gas Company in the United States. That contract formerly came to this country, but now it has been secured by America. No one will be more glad than I will be to find that my fears are unfounded, but I am afraid that we are experimenting with a trade which cannot afford to be experimented with. What experience have, we had? Our only experience is founded on a tax which was in existence more than fifty years ago, at a time when our export trade only amounted to one-and-a-half million tons, instead of being between forty-five and fifty millions as at present. I do not believe for one moment that the Chancellor of the Exchequer desires to injure trade, but many a man has ultimately found that he had done that which honestly and sincerely he had no intention of doing. The right hon. Gentleman said in his Budget speech that we must not, in aiming at revenue, sacrifice trade. Yet this is just the fear which animates a large and important section of the population of this country, and certainly in the north of England. No one will be more glad than I to find that those fears are unfounded, but at the present moment they undoubtedly exist. There are so many difficulties and so many complications in connection with this tax, that I still hope the right hon. Gentleman will reconsider whether it is necessary to impose it. I am not here pleading for the coal-owners. They are well able to plead their own case, and they have capable representatives sitting on the benches opposite. It is because I believe that the prosperity of the coal trade and the coal-owners—perhaps unfortunately, but yet undoubtedly—is wrapped up with the prosperity of the shipping trade, and to a certain extent also with the shipbuilding trade, the mining industry, and indeed of trade in general, that I venture to support the plea that for the present, at any rate, the imposition of this tax should be withdrawn, and that a longer time may be available to consider what its possible result may be. Before sitting down, I should like to say again how sorry I am that I am not on this occasion in agreement with the large majority of hon. Members on this side of the House, and also with the right hon. Gentleman the Chancellor of the Exchequer. I beg to thank the House sincerely for the attention it has kindly given me.

SIR EDWARD GREY (Northumberland, Berwick)

I beg to move the adjournment of the debate.


I confess it is with much regret I hear the motion that has been made by the hon. Baronet opposite. I had hoped that, in accordance with what I think is the almost invariable precedent, we should have disposed of this preliminary stage of the Budget without any very prolonged debate. The custom of this House has been to reserve its lengthy formal debates until the second reading of the Budget Bill, and the discussion of the details of the Budget to the Committee stage of the Bill. But I have to recognise that in this case, at all events, the general sense of the House is against that practice—a wholesome practice as I venture to think it—and I have to admit that I do not think it would be possible to conclude a debate, the importance of which I recognise, at a reasonable hour to-night. In these circumstances I shall assent, so far as I am concerned, to the motion of the hon. Member opposite, and we shall of course resume the debate on Monday next. I hope the House will recognise that, at all events, we have done our best to give full and free discussion to this question, and that hon. Members will not make the conduct of business more difficult than it need be in view of the arrangement I am now glad to enter into.

Debate adjourned till Monday next.