§ Resolution reported, "That it is expedient that the following grants to Local Taxation Accounts, namely—(1) The Estate Duty grants paid under section nineteen of The Finance Act, 1894; and (2) The Agricultural Rates grant paid under section two of the Agricultural Rates Act, 1896; and (3) The Scottish Agricultural Rates grant paid under section three of The Agricultural Rates, Congested Districts, and Burgh Land Tax Relief (Scotland) Act, 1896, instead of being paid out of the revenues out of which they are payable under the present law, be charged on and paid out of the Consolidated Fund, but in the case of the grants which are payable during the continuance of any temporary Act, only so long as that Act is continued, and that where under the present law the proceeds of any duties are paid to any local taxation account, a sum equal to the proceeds of those duties at their present rates be paid to that account out of the Consolidated Fund, and the actual proceeds of the duties be paid into the Exchequer."
§ *MR. HICKS BEACH (Gloucestershire, Tewkesbury)said this was a very important Resolution and he hoped the Chancellor of the Exchequer would forgive him if he asked information on one or two points arising on it. He observed that it only alluded to a portion of the Imperial taxes paid into the Local Taxation Account. The licences for the retailing of beer and spirits, the ordinary Excise licences, gun licences, dog licences, licences for armorial bearings, and various things of that kind were all paid into the Local Taxation Account, but did not appear to come under this Resolution. The Chancellor of the Exchequer had told them that the 275 change which he proposed was really a book-keeping change, and that it would not affect the local authorities at all. The right hon. Gentleman led the House to understand that the local authorities would benefit from any normal increase in the yield of these taxes. He did not quite understand how the Chancellor of the Exchequer would be able correctly to apportion these amounts to the various counties and at the same time save the great amount of book-keeping which he led the House to believe would be saved through the proposed change. An important point to remember in dealing with Local Taxation Grants was that, while these contributions from the Imperial Exchequer had been increasing pretty regularly, at the same time the items of expenditure by the local authorities, to meet which these grants were given by the Imperial Exchequer, had been increasing very much more rapidly; and the result was that the balance of the charges which the Exchequer grants did not meet had fallen on the ratepayers. He understood that the Chancellor of the Exchequer wished to alter the arrangement in order to get into his net the Excise licences and among others the licences on motor cars; but apparently the right hon. Gentleman did not wish any benefit that might accrue from the issue of motor car licences to go to the local authorities. He submitted that that was a very important decision. In the case of local authorities the greater portion of their outlay apart from education had been on the upkeep of roads, which ought to be a national charge; and if the right hon. Gentleman was going to raise any considerable increase of revenue from licences on motor cars he ought to give the increase to the local authorities. They were the people who had to find the money to keep up the roads, and he submitted that the proceeds realised in that way ought to go to them and not to the Imperial Exchequer. He hoped the Chancellor of the Exchequer would be able to give the House more information in regard to these changes, because he was afraid they might have serious consequences.
MR. HARMOOP-BANNERsaid he would offer no apology for bringing 276 before the House a matter of great importance to municipal and borough authorities. In his Budget speech the Chancellor of the Exchequer in referring to Imperial and local taxation stated that the local authorities would share in any natural growth—that was, they would receive exactly the same sum in any year as they received now—and then occurred the words "natural growth or natural diminution." He submitted to the House that the proposal of the Chancellor of the Exchequer meant a very heavy addition to the rates payable to the municipal authorities. He had taken very good opinion on this matter from several municipal treasurers, and he had had the opportunity of looking at the accounts of some municipal corporations. He found that in their opinion it would mean an additional 1d. in the £ in borough or city councils.
§ MR. ASQUITHindicated dissent.
§ MR. HARMOOD-BANNERsaid the right hon. Gentleman shook his head, but he would endeavour to establish that proposition. If there would be another opportunity of bringing this subject up on the Finance Bill, he had no wish to put the House to any inconvenience in stating the case now.
§ MR. ASQUITHThere will be other opportunities.
§ MR. HARMOOD-BANNERsaid that he was to have a meeting to-morrow with 259 representatives of municipal authorities, and this question would come up. He would be bound to tell them that this proposal was going to impose a large additional burden on their rates, and he would have liked to have had an opportunity of discussing it. In deference to the right hon. Gentleman, however, he felt bound to shorten his remarks. This was a most inequitable proposition, and it was going to take from boroughs and counties a very large amount of their funds. He hoped the right hon. Gentleman would see his way to postpone the proposed change.
§ MR. ASQUITHsaid the hon. Gentleman might safely tell his 259 friends 277 that this would not impose a penny additional on any one of them. Perhaps the hon. Gentleman had better wait and see the Bill before he asserted the contrary. There would be a clause dealing with the matter inserted in the Bill. He had given an undertaking in his Budget speech, and if the Bill did not carry it out it could be amended. Not one halfpenny would be thrown on any of the local authorities. Did that satisfy the hon. Gentleman?
§ MR. HARMOOD-BANNERsaid that what the right hon. Gentleman told them in his Budget speech was that they were to have the normal growth. But if there was a diminution, a less sum would be received and the local authorities would have to suffer.
§ MR. ASQUITHsaid that statement showed to him one of the advantages which the hon. Gentleman would have by waiting to see the Bill. If the hon. Gentleman found in the Bill any such clause, the clause would be amended to make it clear. As to what he himself had said about motor cars, he thought hon. Members had better wait until he brought in the precise proposals. He had never said that the taxation from motor cars would go to the Imperial Exchequer without any consideration of the local authorities. What he said was that the present system was absolutely inequitable. Under the present system the persons who got the benefit were the local authority in whose jurisdiction the license was taken out. That was the absurdity in the present position of things which he pointed out.
§ Ordered, That it be a further Instruction to the Gentlemen appointed to bring in a Bill upon the resolutions reported from the Committee of Ways and Means on the 1st day of this instant May, and thon agreed to by the House, that they do make provision therein pursuant to the said Resolution.—(Mr. Chancellor of the Exchequer.)