FINANCE [EXPENSES] (CONSOLIDATED FUND).

HC Deb 17 August 1909 vol 9 cc1106-38

Resolution reported:

"That it is expedient to authorise the payment, out of moneys provided by Parliament, of any expenses or remuneration payable in connection with any valuation of land or premises for the purposes of any duty charged under any Act of the present Session relating to Finance."

Mr. E. G. PRETYMAN

Since this Resolution was introduced last week, there has been a little time for the House to examine it, and it certainly is rather a striking light which it throws upon what we may perhaps be allowed to call the old Resolution. It would not be in order to discuss Clause 12, and the old method of valuation; but, on Clause 16, I do think it is desirable to point out what would have been the effect upon owners of land, and what would have been the burden imposed upon them by the original proposal of the Government if it had come into operation. We have the statement by the Prime Minister that the cost of valuation by the State is to be £2,000,000, and that a staff of 500 highly trained valuers are to be employed to carry out the valuations. That is the measure of the burden to be thrown on the private owner. I am not really correct in saying that is the measure; it only gives a sort of test by which we may measure what the private owner will have to do. It is perfectly obvious that the private owner has not got access to a staff of 500 trained valuers. The State, no doubt will obtain some economy by working their highly trained staff by time over the whole country. But the private individual would have had to get the work done by piece, and would have had to pay piece rates for the valuation of his property, so that the expense to him would have been gigantic. Further than that, there would have been no supply of valuers available; therefore, it is quite obvious that the Government must have been perfectly aware, before they introduced their Bill, what would be the heavy cost entailed upon private owners. It is only now, and in response to an Amendment put on the Paper on this side of the House, that the Government have changed their minds, and have found it obviously just and necessary that if a tax is to be imposed requiring a valuation, that valuation should be made by the State, and should not be thrown upon the private individual. Now the Government have assumed that there would be no further discussion, and no opposition. In regard to our reception of the new proposals, I think the Prime Minister used the word "ingratitude."

The PRIME MINISTER

I said that I did not expect any gratitude.

Mr. PRETYMAN

I am not unwilling to express gratitude to this extent, for what it is worth. I entirely admit that the new machinery has removed an injustice from the private owner. To that extent I think we have the right to accept the change as satisfactory. But it is only a partial relief to the owner, because the whole of the expenses of valuation will not be removed from his shoulders. It is obvious that he will have to incur considerable expense to test the value which will be put upon his property by the Commissioners. Therefore, the burden is only partially and not wholly removed. But there was not only the injustice, there was the folly, and although the injustice is largely removed the folly is in no way lessened. What does this valuation amount to—what are we going to spend? From the point of view of the folly of it, it is immaterial whether you put it on the owners or on the State, but from the point of view of injustice it is very material.

4.0 p.m.

We have to consider from a purely business standpoint what it is going to cost to get the valuation, and what tax you are going to get out of it. The statement of the Government is that they are going to value the whole land of the country for two millions of money. Not only those interested in the land, but professional people who are also concerned, besides the landowners, are anxious to know on what authority and by what calculation the Government arrived at their estimate of two millions for valuing the whole of the land of the country. I think we have a right to demand an answer to that question. Naturally all the owners of land, professional valuers, and all those who have to do with great valuations, whether carried out by the owners or by the State, have, ever since the introduction of this Bill, been applying themselves to the problem from the point of view as to what the valuation would cost, and they have made various estimates. I have seen estimates made by different professional valuers of eminence and standing, and they have varied from the highest estimate I have heard of, namely, 1 per cent. down to 5s., or a ¼ per cent, on the valuation. It is estimated that the value of realty in this country which will have to be valued for the purposes of this Bill is £4,000,000,000. If you take the lowest estimate of any professional valuer I have heard of, 5s. or ¼ per cent, on four thousand millions is £10,000,000. The Government estimate that they will be able to value the whole of the land of the country for one shilling per cent. Will the Chancellor of the Exchequer tell us what professional adviser has told him that he can value all the land of the country for one shilling per cent, of its total value? Remember that the one shilling per cent, does not merely cover the ordinary valuation which is to be obtained, but it also covers the obtaining of the site value, and that the obtaining of the site value is a new process extraordinarily complicated and extraordinarily difficult. Can the Chancellor of the Exchequer convince the House and the country he is going to get not only the total value, but the site value, making all those deductions and divesting the land of all the things of which it is to be divested, and going through the whole complicated process we have been discussing for the past two weeks, that he is going to be able to do that at a sum of 1s. per £100 of value? I cannot conceive it possible. That goes to the root of the whole Bill and to the whole of these taxes, and it is obviously necessary for the Government to say something more than they have said to substantiate the accuracy of the estimates which they have made. That is the first point on which we require definite answer—the justification of the estimate.

The PRIME MINISTER

The cost of the valuation?

Mr. PRETYMAN

Yes. We do want some justification of the cost of the valuation. Let us for a moment assume that the Government figures are correct. What is to be said against that as to the yield of the taxes? The Government figures probably are correct as regards the present year, they are going to spend £300,000 in valuing this year. I do not think that we have any reason to quarrel with that figure, because the Government, in putting their machinery in motion, whatever may be the ultimate cost of valuation and over how many years it may be spread, I do not think are likely to spend more than £300,000 during the current year. We do not quarrel with that figure, but let us come to the yield of the taxes against which that has got to be put in regard to the present financial year. The Prime Minister stated, and the Committee will remember the figures—£50,000 for Increment Tax, £100,000 for Reversion Duty, and £175,000 for Undeveloped Land Tax, making a total of £325,000. But that was the original estimate made by the Chancellor of the Exchequer of the total yield of this tax when he introduced his Budget, and on their original basis on 12th May. His original claim was that the yield of those three taxes which alone are concerned in the valuation would be £325,000. A great many concessions have been granted since, and particularly the 10 per cent. of deduction which has been allowed in regard to Increment Value Duty. On last Thursday and Friday very considerable amendment was made in the method of valuation as to the expenditure which the owner or his predecessor in title have incurred upon the development of land, and which was all to be excluded. There have been many Amendments carried in Committee which must have materially reduced the value of that estimate, but no deduction whatever is made from it. Will the Government tell us at what figure they value the concessions they have made in Committee because, it is obvious, whatever value they place on the concessions made in Committee should be deducted? I noticed that when the Prime Minister was addressing a meeting in the City he made reference, and in fact the greater part of his speech was addressed to the concession which the Chancellor of the Exchequer was making in Committee. He referred constantly to the tenderness of the Chancellor of the Exchequer, and expressed the fear that he had given away too much. Then he comes down to the House of Commons three weeks later, and tells us the Chancellor of the Exchequer has given away nothing. It does seem to me that those two statements cannot be reconciled as they now stand. As we have confidence that the Prime Minister will not tell the financial authorities in the City that he has given away a great deal, without warrant, and he will not come down to this House and claim without warrant to have given away nothing at all, we think, therefore, that it is due to his credit, and to the authority which his statement as Prime Minister ought to possess, that those statements should be reconciled here in the answer he is going to give upon this question.

I would just point out, and I am sure this cannot be contradicted, that it is perfectly unwarrantable to claim any part of the new Mineral Duty under the new Clause 12, which we shall come to discuss at the end of the Bill, and which is now on the Paper. It is impossible to claim that any part of that tax is due to the valuation, or in any way concerned in the valuation. The Prime Minister did make such a claim in his speech the other day. I will not waste the time of the House by quoting his speech, as it will be in the recollection of the House. I am sure the Prime Minister will not contradict that he did make a definite claim that the new Mineral Value Duty would to some extent owe its product, or its fruitfulness, to this valuation. He will find when he examines the clause that it is absolutely impossible to connect it with valuation in any shape or form. The new clause is concerned with the value of minerals which are raised from the soil, and which is an ascertained sum. It is on a return which has to be made by the owners of those minerals whether they are royalties or whether they are the people who are working the minerals, and are at the same time owners. What they have to do is not a question of valuation at all. They have to make an actual return of the total sums which they receive by way of royalities, or as owners of those minerals. On that basis the new tax is to be levied, and it has nothing whatever to do directly or indirectly with the valuation. The next thing we want to ask the Prime Minister is to justify that statement, to justify that claim, and to tell us on what ground he associates the valuation with the proposal to levy a tax on minerals under the new clause. Therefore I am justified in assuming that that Mineral Tax is altogether out of the purview of valuation, and that the total sum now claimed by the Government, and which I have proved most clearly to be an excess of the sum which can be raised, is £325,000.

In what financial position does the country stand? The Government state that they are going to spend £300,000 in the current financial year upon valuation, and they only claim £325,000 as the total produce of the tax for which that valuation is made. It is clearly demonstrable that £325,000 is largely in excess of the proper claim, so that it comes to this, that you clearly must deduct more than £25,000 for the concessions which have been made here in this House. Clearly that is so. If the £325,000, the original estimate, was a correct estimate, then the present estimate must clearly be below £300,000, and must, therefore, be below the cost of valuation for the current year. I am no constitutional authority, but it does strike me as a constitutional point whether it is proper or constitutionally correct to include in the Finance Bill, for the purpose of raising revenue, a proposal which is not to increase revenue at all, but which is actually to cause a loss to the revenue. It is obvious that the imposition of this tax and the cost of valuation will for the current year cause a loss to the revenue. The Chancellor of the Exchequer shakes his head. I know only the event will prove it. Ft must be a matter of opinion, and it is quite easy for the Chancellor of the Exchequer or the Prime Minister to get up and tell us that will not be so. But no impartial person studying the figures, which they themselves have presented to the House, and looking at the matter from a totally unprejudiced and impartial point of view, no arbitrator brought in would hesitate to come to the conclusion on the Govvernment figures, that they are going to spend more on valuation than they get in revenue in regard to these Land Taxes during the current year. That brings me to the question of future revenue. The Prime Minister claims that these taxes are going to greatly increase in fruitfulness in the years that are to come. That statement has been carelessly accepted here in the House, and we have assumed on the present basis that those taxes are going to yield a great deal more in the years to come than in the present year. I think that statement is very open to examination.

Let us take Increment Value Duty. Increment Value Duty is not, as is perhaps too lightly assumed in the first instance, going to be a constantly increasing revenue, and that you are always going to hark back to the original duty, and get the difference between that and each subsequent valuation. That is not the position at all. Increment Value Duty is a duty from which you are constantly going to be deducting something, and all you are ever going to get in the future is the difference between the valuation on the last occasion of passing and your valuation on the new occasion when duty is leviable. It is perfectly true that for perhaps five or six years it will be a growing duty up to a certain point, simply because the occasion upon which the duty will be payable will not arise so frequently in the first year as in the subsequent years. As soon as you get out of the few years now and enter the average number of occasions on which Increment Value Duty is leviable your Increment Value Duty will not be an increasing tax at all. I do not think it will produce a very large sum in view of the concession and alteration made in it. Then you have Reversion Duty. The Reversion Duty clearly will not be a growing duty, because Reversion Duty is simply a duty that will be levied on the difference of value when the lease falls in. No more leases are going to fall in next year than the year after. The number of leases which fall in are going to be a fairly even number every year, and there is no suggestion that the leases which were granted 80 or 90 years ago, and which are going to fall in next year, are of less value or of more value than the leases which were granted a year or two later. Therefore, I see no reason to suppose that the Reversion Duty is going to be a tax bringing in an increasing sum of money.

Then we get to the Undeveloped Land Duty. That is obviously not an increasing duty, because it is simply a tax upon un-built upon land of a certain value throughout the country at a given moment. There is no reason to suppose for one instant that the value of that land at any given moment in the future is going to be of any greater value than its value to-day. There is no reason why it should be. The process of development is that one plot of land, which to-day is chargeable with Undeveloped Land Duty, has a house put upon it and so passes out of the tax. Another piece of land which has not been subject to the tax comes in and takes its place. That does not involve a general increase. I, for my part, entirely fail to see on what ground the Government base a claim, which they are constantly putting forward in the country, and which is constantly received and accepted, that these taxes are going to grow in fruitfulness. There was no claim more ardently made by the Prime Minister, and I hope to-day he will go a little more into detail, and that he will define the claim he made. Of course, if the Government say that these taxes are only a beginning, that is another matter. I am bound to say that to those of us who look closely into these taxes this is a factor which greatly increases the feeling of insecurity. When we look closely into the matter, and see that by this proposal for valuation the Government are in the current year going to spend more money than they can possibly get in return; when we look for any reasonable period ahead, and see that they are going to get little if any more money than the cost of their valuation, we fail to see any possible inducement to them to add these proposals to their Budget, and to find ourselves, as we do, still sitting after the middle of August in a year which the Government told us was to be a year for raising money, but in which, as far as I can make out, not a single penny of money has yet been raised for any purpose whatever voted by the House. Therefore, we cannot help feeling that this proposal cannot be justified on its present basis. It cannot be justified to us on this side for reasons which are very obvious, and have been frequently stated; it cannot be justified to those who propose to place heavy burdens upon land for the purpose of meeting expenditure upon old age pensions and "Dreadnoughts," because, as I have endeavoured to show, there is no money for "Dreadnoughts" or for old age pensions in the present proposals of the Government.

I would mention one further point of complication in regard to valuation. The valuers will have a task of unprecedented difficulty. In our proceedings on Friday we settled, as was only fair, that any expenditure incurred by any previous owner affecting the value of any land should be a deduction. That involves harking back to the past any distance, and examining an enormous area of expenditure to discover what deductions are reasonable and proper. Take a concrete case which does not involve any delving into the past. At Eastbourne the Duke of Devonshire, clearly for the purpose of increasing the value and amenities of the town, for a considerable time kept a band at his own expense. Under this Bill any person who in the past has bought a piece of land for development from the Duke of Devonshire, and is now developing it, would be subject to this tax, and entitled to claim a deduction for the Duke of Devonshire's band.

The CHANCELLOR of the EXCHEQUER (Mr. Lloyd-George)

was understood to dissent.

Mr. PRETYMAN

The Chancellor of the Exchequer says not. Then we do not know what we were doing on Friday last. The Duke of Devonshire, as the owner of the land, and for the purpose of increasing its value, keeps a band. Somebody comes and buys a piece of the land and proceeds to develop it. It is perfectly clear that that action of the previous owner of the land has directly increased its value. Therefore the present owner will be entitled to a deduction. If that is not so I do not know where we stand.

It is perfectly clear that one of the greatest difficulties with which we shall meet in regard to valuation is that of future identification. You are going to value separate occupations. How many separate occupations there are in the country no man can say. The task is a gigantic one. These occupations are perpetually changing hands and being mixed up. It will obviously be necessary in this valuation to have a separate plan of every occupation or of every unit that is valued, otherwise how can you identify the piece of land in the future? It may be part of one occupation to-day and part of another occupation to-morrow, and mere descriptive words will not provide a sufficient means of identification. Unless you have a plan carefully marked and annotated available for reference both to the owner and to the Commissioners it will be quite impossible for this valuation to carry out the object you have in view.

One other claim of the Prime Minister was that this valuation would yield a large sum in the increase of Death Duties. If that is so, it must mainly be at the expense of agricultural land. That is a very serious consideration, because agricultural land is now held by people who accept a very low rate of interest by reason of their heavy expenditure upon the land. I am only restating a fact which was admitted by the Chancellor of the Exchequer in his Budget speech, namely, that the owners of agricultural land spend upon it a very large proportion of the income derived therefrom, so that the net interest which they derive as owners of agricultural land is extremely small.

Mr. LLOYD-GEORGE

I said that their expenditure was very heavy.

Mr. PRETYMAN

It is only another way of stating the same thing. The Chancellor of the Exchequer said that their expenditure was very heavy, and from that I deduced the very obvious corollary that the net interest which they receive is extremely small. They have had some advantage hitherto in the calculation of Death Duties in having the value of the estate calculated not upon the whole capital value, but upon a certain number of years' purchase of the very small interest which they receive. Now the Chancellor of the Exchequer proposes to do away with that privilege, apparently for the sole purpose of squeezing the last drop out of agricultural land. That can be the only purpose of the new clause on the Paper. It will be the last straw. The Death Duties have almost extinguished the small owner or squire, and if this squeezing process in regard to valuation is carried out there will absolutely be an end of the small squire, and the ownership of agricultural land will be purely a matter for very rich people, who can afford to pay Death Duties out of other resources, and treat their agricultural estates as a playground. Therefore I do not think the proposal of the Government to squeeze up the Death Duties on agricultural land by means of the new valuation will commend itself to anybody interested in agricultural land, or to the country at large. The Chancellor of the Exchequer has to some extent adopted Amendments which I myself placed upon the Paper for the purpose of obviating gross injustice. As the Bill originally stood the cost to the State would not have been justified. As the Bill stands now, after taking out the minerals, it is obvious, certainly from the points of view of the taxpayer, the revenue, and ordinary business sagacity, that the Government, in proposing this valuation for the amount of money which they intend to get out of it, are proposing something which is against the interests of the revenue, which can do nothing but cause trouble and expense to a great number of people, and give salaries to gentlemen who are probably excellently occupied now, and who would remain admirably occupied in conducting valuations in the ordinary run of trade and business, but whose business now is completely estopped. Evidence accumulates daily that the land market is in a state of chaos owing to these proposals. All that the Government's proposal amounts to is that valuers who would be legitimately occupied in carrying out valuations for the development of industry in this country are to lose their job at that, and to be employed at the expense of the taxpayer; while no result of the slightest value to the State or to the individual will accrue from any point of view whatever.

The PRIME MINISTER

The hon. and gallant Gentleman has made, as he always does, an interesting and, in some respects, a suggestive speech. I cannot share his gloomy estimate, still less his yet gloomier prognostications, as to the condition of the land market. The information which comes to me is in an entirely opposite sense. I do not believe that, within recent years at any rate, there has ever been a time when there was so large a demand for land, when such good prices were being realised, when land changed hands so quickly, and when the market was so brisk and vigorous as has been the case during the few weeks which have elapsed since my right hon. Friend introduced his proposals. Be it observed that land is being sold at an enhanced, and not at a diminished, price. But that, after all, is more or less incidental, and does not affect the principle of the Resolution we are now considering. The hon. and gallant Gentleman has attacked the principle upon two grounds. There are two counts in his indictment. The first is an allegation of injustice; the second is an allegation of unwisdom, or, as he calls it, folly. As regards the first, I take note that, so far as the concession upon which the hon. Gentleman started his speech was compared with the original proposals of the Bill, we have advanced a considerable step along the road to what he regards as ideal justice. The owner, he admits—and this was the gravamen of the charge made against the original proposal—is no longer required by his own labour, or the labour of those whom he employs—at any rate, at his own expense—to make a valuation of his land. The State has taken over from him that burdensome and no doubt expensive operation. From the point of view of justice, the only shred which remains of the original indictment preferred against this Bill is, as the hon. Gentleman says, that the owner would have to make his corrections, to establish his deductions, and, it may be, to undertake the cost of an appeal. But that is incidental to any system of valuation. It happens now in the case of rating. If the Assessment Committee rates your property higher than you think it ought to be, you have the trouble, first of all, of making the necessary corrections, and then, if the matter is contested, of establishing the justice of your contention before the tribunal appointed by law. When we come to consider, as I hope we shall very soon, the appellate tribunal which my right hon. Friend proposes, and the provision as to awarding costs in the case of a successful appeal, I hope that whatever remains of plausibility in the argument against the justice of this part of the Bill will be found to have completely disappeared.

I shall, therefore, address myself entirely to the second count of the hon. Gentleman's indictment, namely, what he calls the unwisdom or folly of our scheme. In the first place, he asks, Upon what authority do you found your estimate that the total cost of the State valuation will not exceed £2,000,000? He has adduced figures, to which he has referred before, showing that in the opinion of other authorities a complete valuation of the land of this country cannot be effected for less than something like £10,000,000. The hon. Gentleman asks what is our authority. I will tell him at once. It is the Board of Inland Revenue, who have gone most carefully into this matter. They have been reinforced of late by an addition to their staff of gentlemen specially conversant with the work of valuation, including at its head a very distinguished Civil servant, who for many years past has undertaken the valuation of Crown property for rating purposes. After going most carefully and minutely into the whole matter, with all the information at their disposal, they have come deliberately to the conclusion that in estimating £2,000,000 as the ultimate total cost of valuation they are rather within than outside the mark. And let me point out this to hon. Members who are sceptical, or inclined to be sceptical, of an estimate so much lower in its total figure than those which have been current during our Debates, and indeed of late years. There is an enormous potential saving, I think everybody will admit, from a business point of view, an enormous realisable saving, when you carry out a work of valuation, as now proposed, by a systematised and organised body of men, acting under the control of a central Department, 500 in number, carefully divided in point of area into 120 districts, working each within his own area as regards the properties there situated, but all subject to the inspection and control of superintendent inspectors, who are responsible to the central authority, and whose duty it will be to bring co-ordination and system into the arrangements which they are employed to supervise. No, what I may call, individual system of valuation, in which each landowner, for instance, had to value for himself, or by which a local authority had to value for itself, or in which even a group of local authorities—take the county—had to value for themselves, could compare—I will not say in point of efficiency, but in point of economy—with the carefully organised system of the kind I have spoken of pervading the whole country. Each district is taken—so far as the staff is concerned— with regard to its own special requirements and difficulties, and the parts are brought into relation to the whole by the supervising central body. I am satisfied—of course, this is only an estimate, and experience will show whether it is justified or not—I am satisfied that with some little experience in these matters—I have gone into the matter as carefully as I could—that the Board of Inland Revenue have taken every possible means, first of all to inform themselves, and then, by taking a cautious estimate with the materials at their disposal, and that the House will not be running any risk of embarking upon an indefinite and incalculable expense if it accepts the estimate given by the Board of Inland Revenue. More than an estimate, of course, in the nature of the case, it cannot be. Let me point out further to the hon. and gallant Gentleman that in a very large number of cases it will be to the interest of the owner, and a course which you may expect prudent and well-advised owners to pursue, to themselves furnish in advance, as they are empowered to do under the Act, the necessary materials to enable the valuers of the Inland Revenue to come to a judgment as to the rate at which the property should be assessed. They have in their possession in their offices, or their agents, stewards, and so forth, have plans, rentals, and all material particulars necessary for enabling a true valuation to be arrived at. It is not to be supposed that in any spirit of jealousy, or any desire to delay the operation of the law, they win not be spontaneously ready to furnish any information of that kind which is really at their disposal.

I come now to the second point with which the hon. Gentleman dealt—the question of the yield. Here I must enter a protest against what, so far as I understand it, appears to be his Constitutional proposition. That proposition, if not expressed, at any rate implied in the whole of his argument, was this: that unless the yield of a tax, or taxes, in a given year exceeds the cost of assessment and collection in that year they are not taxes which the House of Commons has any Constitutional right to impose. Is that the proposition?

Sir FREDERICK BANBURY

assented.

The PRIME MINISTER

The hon. Baronet the Member for the City of London says "Yes." I do not find the propo- sition is generally cheered on the benches opposite. I am not surprised at it. The hon. Gentleman did not say it, but is it not implied in his argument?

Mr. PRETYMAN

indicated dissent.

The PRIME MINISTER

Any such proposition strikes at the very root of the control of this House over the taxation of the country. If you were to limit the power of the House of Commons to tax by a consideration of what the yield of the tax would be in the succeeding year, as compared with the cost of raising it in that year, you would rule out at once as entirely outside the Constitutional purview of this House a tax like the Legacy Duty, the yield of which cannot in the nature of the case be foreseen. There is a great deal of cost in the collection of the Legacy Duty. You have to have machinery to be able to test the returns that are given you. Still more is that the case with the Succession Duty imposed by Mr. Gladstone in 1853. There you have a most elaborate machinery for the purpose of ascertaining the amount of Succession Duty. The immediate yield, as I pointed out the other day, of the Succession Duty, small as it was estimated to be, was very much less than the estimate. It was the same with the Death Duties in 1894. This House is perpetually assuming, what is indeed essential and almost elementary, that if it is to have the power of taxation at all, there goes with it the right to set up machinery which may for the moment be more expensive in its working than the actual yield within the next six or twelve months of the taxes in relation to which that machinery exists. But it is justified in the long run, because the cost of the machinery does not increase. In this particular case the cost of the machinery will largely diminish, and the yield of the taxes will be progressive year after year. I want to know if what I have said is not the Constitutional proposition of the hon. Gentleman? If it is not, then I do not know what it is, or why he introduced the word "constitutional" at all. I do not think he will dispute—I doubt very much whether any responsible critic of the Budget will dispute—the argument which I have addressed to the House. But let us assume that it is within our right, and strictly in accordance with Parliamentary precedent, to set up machinery for the assessment and levying of a tax, the tax itself being one which, at any rate during the remainder of the financial year—that is all we are dealing with to-day—may not be greater than the actual cost of the machinery. Assuming that, let us see how it applies under the present head. The hon. Gentleman has enumerated these taxes—the Increment Duty, the Reversion Duty, the Undeveloped Land Duty, and the Mineral Rights Duty. He asks whether we are entitled to set up any part of the cost of machinery required as against the Mineral Rights Duty. I think I spoke very cautiously on that subject the other night. I do not know, and cannot admit, that for some purposes of the Mineral Rights Duty the valuation might not be abused, particularly, I think, in the cases that come under Section (2) of Clause 15, where the minerals are not being worked by the lessee, but where they are being worked by the owner himself for his own purpose. I can conceive that in a dispute as to what sum should in that case be charged to the hypothetical tenant for working the minerals, the valuation of the minerals under the clauses which are under discussion now, might provide very valuable and useful material. But I leave that out of account. It is not essential for my argument. I take the other three duties—the Increment Duty, which does apply, and in regard to which the valuation of minerals is absolutely essential, the Reversion Duty, and the Undeveloped Land Duty. The hon. Gentleman has asked whether we should take the original estimate by my right hon. Friend with regard to these three duties as being unaffected in amount and quantity by the concessions he has made. So far as the remainder of the present financial year is concerned, my own impression is that the monetary value of the concessions will be very small. The greater part of the concessions which my right hon. Friend has made in the course of the Committee stage—I think I am right in saying, he will correct me if I am wrong, for I am speaking from recollection—have been in regard to the Increment Duty. The Increment Duty is estimated at the present time to yield an almost nominal sum—not more than £50,000. And the concessions to which my right hon. Friend referred must of necessity relate rather to the future than to the immediate yield from that particular source of revenue. But let me forecast for a moment what these taxes are likely to do in the future. If I understand the hon. Gentleman's proposition, it is this: that we have no right to estimate as regards any one of these three heads of revenue—I leave out the mineral rights—that there is a reasonable prospect of a substantial increase in the years that lie before us. I entirely differ from him, and the Government entirely differ from him. Just let me give two illustrations. I will not deal with the Reversion Duty. It is no doubt a very difficult thing to estimate. I take the other cases—first of all the Increment Duty; then I will take the Undeveloped Land Duty. As regards the Increment Duty, can anyone who knows such a simple fact as this: that the value of the land in London is rising in any given year by something like a million sterling, and, probably a great deal more—I am stating the most modest figure which is at all relevant to the tax—can anyone, I say, who knows that the same process is taking place in almost all the great urban communities, and knows further that land which is at present rural or village land, or land only beginning to be occupied and inhabited, that in those cases also the increase of population and the amenities of social life is constantly raising the capital value of the soil, can anyone who takes all these facts into account doubt that a duty like the Increment Duty is likely in the years to come to be a progressive source of revenue?

I take the Undeveloped Land Duty. I have dealt with this point before, but I may perhaps be allowed to reiterate what I have said. The Undeveloped Land Duty, in my view, and so far as I can form any estimate of the social and industrial future of the country, is of necessity a progressive tax. What do you see in addition to those phenomena to which I referred a moment ago, to which I applied the Increment Duty, and now apply the Undeveloped Land Duty? In addition to those you will see—I think it is a most healthy and helpful sign of our industrial development—a constant tendency for industries, to some extent old industries, still more new industries, the one to export themselves and the other to plant themselves in land which is at present not only not urban land, but is not occupied land. As I said a few nights ago, you have only to go along any of our trunk lines of railways, along the London and North-Western, and you see on what was countryside on each side of the railway factories, sometimes small, sometimes large, establishing themselves. With the building of the factory there comes a demand for land for cottages for the workmen and for ancillary works of every kind and description, which transforms that which was—which is at the present moment—purely agricultural land, and with no other value except for agricultural purposes, into the category of what in this Bill is called undeveloped land. That land is of higher value than ever it was before for agricultural purposes, and it is ripening for receiving an urban population. Without importing any kind of controversial matter into this consideration of the question, I do submit to the House that if you look at the existing and at the prospective condition, social and industrial, of this country as we find it at the present time, you have the best ground for assuming, both as regards Increment Duty and Undeveloped Land Duty that you have a large potential reservoir of resources which the figures estimated by my right hon. Friend for the few remaining months of the present year bear no relation to in regard to its possible value.

Mr. AUSTEN CHAMBERLAIN

Can the right hon. Gentleman say what the year's increase in the value of the land is?

The PRIME MINISTER

The figures as supplied to me are from the county councils.

Mr. AUSTEN CHAMBERLAIN

Are not these for land and buildings, and not merely land?

The PRIME MINISTER

I think they are land and buildings together, but my argument does not depend on a particular figure. I may be wrong; my hon. Friend the Under-Secretary for the Home Office (Mr. Masterman) thinks I am very wrong, and that I have very much understated the figure, and he knows more about it than I do; but, whatever the figure is, it is a very large sum. In Manchester, Liverpool, Leeds, Glasgow, and all other great urban communities, you will find corresponding phenomena to be taken into account when estimating the yield of these taxes. Finally, let me point out, when dealing with the question raised by this Resolution, it would be—I will not say unfair, but altogether irrelevant to deal with on the footing of the produce of this tax for the remainder of the present financial year as compared with the cost of collecting it. You must take the larger and longer view. Just as in this Budget you provide, or at any rate enable your successors to provide for prospective liability over two or three years or more, so in the same way when dealing with the tax we are imposing as compared with the cost of collection we must not confine the scope of our vision to the five or six remaining months of the year that lie before us, but must take account of the future. If I am right in the proposition I am endeavouring to make good, namely, that the cost of collection will not depend on the yield, but, on the contrary, when the valuation is once completed the expenses of collection will have enormously diminished—you will have made your valuation once and for all, after which the machinery will work after an automatic fashion—while the cost of collection is a diminishing figure, on the other hand, for the reasons T have given, taking into account the probable, indeed certain and necessary, increase in the yield of these taxes, and having regard to the social and economic conditions of the country, I think we shall find we have a sufficient answer to the temperately expressed criticisms of the hon. and gallant Member and a sufficient justification for the proposals of the Government.

Mr. BONAR LAW

The right hon. Gentleman began his remarks by a statement that the land market had never been in a more satisfactory condition than at the present time. I should like to ask him this question. Among the information which has reached him has he considered the deputation which waited upon the Chancellor of the Exchequer upon the subject? I happened to read a report where I find that one member, who is himself engaged in this trade of the development of land, stated that his wages bill was already half what it was before the Budget was introduced, and that by the end of this year, unless some change took place, he would be paying no wages at all. If that is not sufficient to set against the information of the right hon. Gentleman, I shall give one fact which anyone can verify for himself, and which proves with absolute truth that the statement of the right hon. Gentleman is entirely without foundation. Since the Budget has been introduced there have been exposed in the ordinary auction markets the usual number of building estates in and around London. As a matter of fact, since the Budget was introduced, not a single one of these estates has been sold; and to show how far the right hon. Gentleman was wrong in saying that in these cases they are getting higher prices, I may mention in the case of one of those estates which was offered by auction—the estate of Selwyn, near Richmond—it was put up at a reserve price of £21,000 this year and failed to find any buyer, while for the same property last autumn £25,000 was offered and refused by the owners.

There is, I think, no doubt about the statement made by my hon. and gallant Friend that this class of operation is entirely stopped, and therefore the valuers have got a right to look for some other employment, because their ordinary employment is taken away from them by the present Government. What I want to do is, what has not been done by the Government, namely, to look at this Resolution from the point of view as if it was a purely fiscal proposal. I shall, therefore, look at it from the point of view of how much revenue the Government is going to get in, and how much they are going to pay for the collection of that revenue. In the first place I shall take the figures exactly as they are given by the Government, and I shall put them before the House as a question of simple arithmetic. Later on I shall have a little to say by way of criticism as to the way in which the Government has arrived at them. These are the figures as put before us by the Prime Minister. He told us, when introducing this Resolution, that the amount of the cost of collection this year would be £300,000, and the revenue would be £675,000; that is to say, he makes a respectable addition from this tax of £375,000 to the revenues of the country. How does he arrive at that? I should like to have the attention of the Chancellor of the Exchequer upon this. He takes the full year's taxes, but only half a year's expenses of collecting them, and thus arrives at the figure of £375,000. But even if this figure is reached, when does the tax begin? These are the estimates of a year's yield. Would the right hon. Gentleman tell us when the tax is to date from?

The CHANCELLOR of the EXCHEQUER (Mr. Lloyd-George)

I intended to reply to all these questions later on, but if it will help, I do not mind answering now. Taking the Undeveloped Land Tax at £175,000, that certainly is not the full year's yield—

Mr. BONAR LAW

When does it begin?

Mr. LLOYD-GEORGE

You cannot possibly get a full yield this year. Assuming the Budget is through by the end of October, you cannot possibly get a full year's yield from the Undeveloped Land Tax. In a full year I expect £350,000 from the Undeveloped Land Tax.

5.0 P.M.

Mr. BONAR LAW

Every time the right hon. Gentleman rises we get new light upon his proposals. He has not in the least answered the question I put to him, which was, What is the date on which the tax begins? I said there was a full year included in this estimate of £675,000. After arriving at £675,000 the Prime Minister included £350,000 for the new taxes upon royalties. He attempted to justify that in the speech he has just made, but I doubt very much that he succeeded. It is perfectly obvious that for the purpose of raising taxes on royalties no valuation is necessary, and no 500 valuers are required. If you take the existing royalties the whole information is in the hands of the Inland Revenue Commissioners; returns have to be given for the sake of income, and there is not the slightest difficulty in obtaining the figures. The right hon. Gentleman said in the case where the Royalty Tax is paid by the man working the mine a different system applies. Here again there is not the slightest doubt that the present staff at Somerset House would be perfectly competent to do that without any addition. Let us assume that this Royalty Tax had been a fair tax introduced by itself without the other Land Taxes. I am certain there is no Member of this House but agrees with me when I say that no addition to the valuation staff would have been required, but that the tax would be collected in the ordinary course. To boil down the figures of the right hon. Gentleman, it amounts to this: the cost of collection, according to his own estimates, is £300,000 for the half-year. If we take the whole year, the cost will be double, that is to say, it will amount to £600,000, and the amount of tax collected is £375,000. In other words, the statement made by my Noble Friend (Lord Robert Cecil) the other day that the Government propose to spend 2s. in order to collect 1s. is entirely within the mark; but that by no means exhausts the total cost of collection that will have to be paid. Nobody who knows anything about valuation can for a moment doubt that the owners of land themselves will have to go to a great deal of expense in order to test the valuation made by the Government. To put it very mildly, it is well within the mark to say that for every 1s. this tax will give, the Government will have to spend 2s., and the people subject to the tax will have to spend another 2s. I quite admit the constitutional doctrine laid down by the Prime Minister, and, so far as I know, nobody on this side of the House has questioned it. We quite admit that if the system of taxation you propose is going to give a revenue in the future which will be a complete equivalent to the expenses of collection, then it is not a sufficient answer to that proposed taxation to say that for the first year it is levied, the amount of revenue will not greatly exceed the cost of collection. I quite admit that, but that is the whole point. The Government say this new tax is not going to give very much this year, but it is going to be a most fruitful tax in the future. I shall be interested to hear on what ground the right hon. Gentleman will substantiate that statement. He attempted to prove it, but his attempt was not very convincing, not even to his own Friends. Let me do what the right hon. Gentleman tried to do; let me take these taxes one by one and consider what is the likelihood of any substantial increase in any future to which we can reasonably look forward to. Take first the Increment Value Duty, I quite admit that with regard to the Increment Value Duty it is quite reasonable, on the assumption of the Government, to say that this is a tax which will pay more in the future than in the first year, and for this obvious reason: that the land on which you begin in the present year will be less than in future years, and the return, therefore, will not be so great. There are two or three considerations which I should like to put to the House. The Prime Minister minimised the effect of that consideration. In the first place he must remember that as the years go on the Increment Duty is not levied from the present year to the date at which the transaction takes place, but it simply goes back to the last transaction, and that must tend to diminish the increase which is expected from this tax. The whole assumption that there is going to be a big increase from this tax is based, if I may say so, upon begging the whole question under dispute in connection with the land taxes. The right hon. Gentleman said that the increase would be normal, regular, and continuous in the price of land. We have been discussing this subject for many weeks, I believe for almost a month, and there has been no evidence of any kind put before the House of Commons to show that during recent years there has been any rise in the value of land close to towns, although many instances have been given to the exact contrary. I gave an instance which ought to be of some weight with hon. Members opposite, because it applies to the corpora- tion of a city which is in favour of this land tax. The Corporation of the City of Glasgow hold building land in the centre of the city for which something like 30 years ago it paid £370,000, and yet it was admitted by a committee of the corporation that that land to-day is not worth what it was when they bought it. In the face of this figure what ground is there for assuming that a constant rise is going to take place in regard to such land?

There is another reason which has not been sufficiently realised by the Government. We have been told that these concessions made by the Chancellor of the Exchequer are not going to make any great difference in the amount of the tax except in the first year. I wonder how in the world anyone could come to such a conclusion. It seems to me that by any process of arithmetic known to me, if you give a discount of 10 per cent. you cannot receive the same amount as if you allowed no discount. What is proposed here is a discount of a great deal more than 10 per cent.; in fact it is a discount which takes away any reasonable expectation of a large amount of revenue from this tax. Perhaps it will be easier to put the effect of this tax in the form in which it will affect the return to the revenue. Suppose £100 is collected from six transactions, five of which represent an increment of 10 per cent., and one of them an increment of 50 per cent. Under the Bill, as it was introduced, that would have meant £100 subject to taxation, and the Government would have got £20. But what is the position now? In five of these cases they will get nothing, and on the other case 10 per cent. is deducted. Therefore, they get the taxation on £40 instead of £50, and the net return is £8 instead of £20 as it would have been under the Bill as originally introduced. The effect of this concession is not to take off 10 per cent., but a great deal more than £50, because it is very rare indeed that site value will rise so much as 10 per cent., and all cases under 10 per cent. are to be exempted. As a proof of the immense value of this Increment Tax, the Prime Minister told us that the land in London is rising in value by £1,000,000 a year, but he gave no figures, and I suppose somebody has guessed it. But before the Prime Minister attaches any value to that statement he must ask what is the total value of the land in London. Is that £1,000,000 more than 10 per cent. of the total, or is it less? If it is less then there is absolutely nothing comes to the revenue, and therefore the Government have no right whatever to expect any large addition to the revenue from this tax. I am willing to admit that there is a possibility of some increase in future years from the assumption that land is constantly rising in value. When the right hon. Gentleman came to consider the Reversion Duty he left it in the position in which my right hon. Friend placed it, namely, that there is not likely to be a greater number of transactions one year than another, and as it is retrospective there is not likely to be a greater yield from one year to another. Therefore, the prospect of any greater taxation from this source is gone even by the admission of the Prime Minister himself.

With regard to the Undeveloped Land Tax, the right hon. Gentleman did say that this was going to be a growing tax, and how did he attempt to prove it? He used what seems to me to be a most extraordinary argument. He said that if you travel along a railway you will see new works spreading out into the country. I suppose you will, but has it ever occurred to the right hon. Gentleman that one of the effects of this Bill is to prevent than class of operation going on in the future? Only the other day there was an Amendment down on the Paper which provided that factories which were moved out of the towns into the country on account of obtaining cheaper land should not be taxed on the land which was bought with the view of afterwards developing those factories. The House will remember that the Chancellor of the Exchequer would have nothing to do with that Amendment because he is going to tax those people in the future. Therefore that operation is going to be stopped to a considerable extent by this Bill. But what in the world has that got to do with it unless there is a total increase all over the country of the land used for industrial and other purposes? In the case of works which are taken out of London into the country the land they leave must be used for some other purpose, and therefore the land they take in the country only fills up the gap they leave in the town. Anyone who chooses to consider the likelihood of this development tax increasing will have to consider for a moment that when this tax comes into operation land suitable for building becomes subject to the tax at once, and unless you assume that five years hence there will be, in addition to the land that is actually built upon, a much larger amount of land ready to be built upon than is the case now, it is obvious there can be no increase from this source of taxation. What really happens is that when the land which is the subject of taxation to-day is taken over for building purposes, from that moment, if a certain amount of money has been paid upon it, it escapes your tax. It is quite true that other land further out immediately comes in to take its place, but all that happens is that the gap caused by building is filled up by the other land which comes in. That is why there is no reason to suppose that there will be a larger amount of taxation available from this source ten years hence than is available now. Hon. Gentlemen opposite shake their heads, but they have done nothing to disprove my statement, and I think it will be very difficult to disprove it. If I am right in this contention, then for the present year, and probably for future years, we are face to face with this position, that the Government are going to spend on the collecting of the revenue from these taxes at least as much as they are going to get out of them, and in addition to what they are going to spend, the people who own the land which is going to be subjected to this taxation are also going to spend a great deal on their own account. The result will be that in future we may look forward to the collection of these taxes costing more than the State will get from them in the shape of revenue. I quite admit that from one point of view the Government have the right to consider this as likely to prove a fruitful source of taxation in the future. The Prime Minister used at Bletchley the other day the same argument as he has used to-day. It was evidently not very convincing to his audience, because someone shouted out, "It is the principle we want to establish." Of course, that we understand. One hon. Gentleman below the Gangway told us at the introduction of these taxes that if the Government only take 10 per cent. or 20 per cent. they are robbing the community in one case of 80 per cent. and in the other case of 90 per cent. I remember that the hon. Gentleman the Member for Merthyr Tydvil told an audience in the country that if the number of Labour Members in the House of Commons had been twice as many that these taxes would have been twice as heavy. I think that is extremely probable, and if that is what the Government mean, then these taxes may prove in the future prolific sources of revenue. In the meantime, judging by what the Government say, they are spending two-pence to get one penny. We are aware that when everything else fails the Government and their supporters tell us "this is a great democratic Budget." That argument remains whatever else disappears. How does the democracy come in here? It takes this form, as I understand it: that the Government is going to tax the user of tobacco—the poor man's tobacco—and they are going to put an additional tax upon it in order to gratify the extreme section which sit below the Gangway who are supposed to be in favour of land nationalisation.

Mr. G. D. FABER (York)

The Prime Minister not long ago told us, on the information of gentlemen who have deliberately gone into the matter, that £2,000,000 will be an amply sufficient sum to ascertain the cost of the land valuation of this country. This includes not only all urban land, but every kind of land north, south, east, and west within these islands. I should like to put against the set of gentlemen the Prime Minister has called in another set of gentlemen who also examined into this matter, though not perhaps in quite so comprehensive a way. The gentlemen I allude to are the skilled witnesses who were examined before the Royal Commission upon Land Values in regard to land assessable to rating. The Bill brought in in the year 1905 by the present Secretary to the Board of Education was only a plan applied to urban districts separating the site value from the total value in the urban districts, and what was the cost of that operation? I will venture to read a quotation from the speech of the Secretary to the Local Government Board when he was summing up on behalf of the then Conservative Government:— With regard to the cost of the assessment proposed by this Bill, the evidence given before the Royal Commission shows that it would run into millions for separating site from structure. In London alone the cheapest estimate was £400,000 and the estimate of other surveyors varied between £2,000,000 and £4,000,000; but the net result to the whole country was that the valuation separating site from structure will cost £18,000,000. Although the Prime Minister told us that this matter had been gone into carefully and deliberately by the Board of Inland Revenue, he did not tell us—and we are entitled to know—whether the matter had been examined by experts. If not, such a calculation is hardly worth the paper and ink expended upon the operation. The expert witnesses whom I have just quoted were placed under the fire of cross-examination before the Royal Commission, and those are the figures which emerged from that ordeal, and I venture to put them against those of the Prime Minister. Unless the Prime Minister is prepared to tell us much more definitely the character of the experts, if they were experts, who told him that this enormous operation, unparalleled in the history of this country, can be done for £2,000,000, I venture to say the immensely larger figure I have just quoted still holds the field.

I should like to try and drive home another point touched upon by the hon. Member for Dulwich (Mr. Bonar Law). The Prime Minister said the land market has never been more brisk. That was an extraordinary allegation to make. For the last few weeks or months land transactions have not only been not brisk, but they have gone far more in the direction of a slump. I hold a letter in my hand from to-day's "Daily Telegraph" by a gentleman, a great expert in the South of London, Mr. Edwin Evans. What does he say about this briskness in land transactions during the last few months? I venture to quote him:— May I be permitted as an auctioneer in practice for the past thirty years to draw the attention of your readers to the unprecedented state of things in the London suburban land market? During the seven weeks from 29th May this year (when the text of the Finance Bill was published) up to 17th July, fifteen suburban building estates within a radius of ten miles of London have been offered for sale by public auction in the City of London (some of them the best I have seen in the market for a long time), and not one of them has found a purchaser. In many cases no biddings at all have been made. The total amount at which they were declared unsold was over £150,000, and as a proof that the absence of sales is not owing to the fact that the sellers were unwilling to take low enough prices, I may mention that for one of the estates, which was withdrawn at £21,0 0, my firm offered £25,000 a year ago, and the price was declined. I quite admit it is not unusual for a percentage of all kinds of property to be withdrawn, but I venture to say there is no 'Mart' record of seven weeks in the very best selling season which will show anything approaching such a disastrous result. I estimate the out-of-pocket expenses alone of offering these fifteen estates at from £1,200 to £1,500. So much for the briskness of the London land market. I venture to set this statement of one of the best known experts in the South of London against the mere assertion of the Prime Minister. Admitting for the purpose of argument that the cost of valuation will only be £2,000,000, the most that can come into the Exchequer upon the Government's own showing is a paltry sum of £25,000, which will have to be divided between the local authorities and the Exchequer. The amount to be realised by the mineral royalties has gone by the board. It has never had any right to be included in the calculation at all. The very terms of the Resolution show that mineral royalties were never intended to be included in the cost of valuation. The words of the Resolution are: "It is expedient to authorise the payment out of moneys provided by Parliament of any expenses or remuneration payable in connection with any valuation of land or premises for the purposes of any duty."

All that is asked for by this Resolution is money to pay the cost of the valuation of the land or the premises, and the mineral royalties cannot come within the category "land or premises." You cannot bring them into one side of the account and not bring them into the other side. It leaves you, taking the Government's own figures as the amount likely to accrue from the Undeveloped Land Tax, the Reversion Tax and the Increment Tax, £325,000 in all. The cost of gathering that will be £300,000. It is, at any rate for the purposes of this year, an absolutely fatuous stroke of business from the financial point of view. Any financier would laugh you in the face if you told him you were going to set up this enormous and cumbrous piece of machinery which was going to bring beneath its harrow all the land of the country for the purpose of drawing in only a net sum of £25,000. It is also evident that unless this tax is increased the yield is not likely to be so fruitful next year or the year after as the Prime Minister has led his audiences in the country to imagine. The truth is hon. Gentlemen below the Gangway and ardent land reformers such as the hon. Member for New-castle-under-Lyne (Mr. J. C. Wedgwood), lie quiescent, because all they care about is the principle. They have said so, and the Lord Advocate has said so. Once establish the principle and once establish the machinery, and then you have only got to turn the screw. The cheers of hon. Gentlemen have let the cat out of the bag. The Government must know that is the motive. If they think they are going to delude the country by telling them it is only a halfpenny tax they are mistaken. It is the principle. I agree with the criticism of the hon. Member for Dulwich when he referred to an interpolation by a simple member of the Prime Minister's audience at Bletchley the other day. The Prime Minister remarked that even the Leader of the Opposition himself had said, "Why, you are going to collect so little, it is not worth collecting," and the simple member of the audience cried out, "But it is the principle you want." That is what you do want, and that is why we say that at the bottom of this whole matter is a principle we do not believe the country will have for a moment, when it sees it fairly and squarely, the Socialist principle. If you are going to take 10 per cent., why should you not take 100 per cent.?

Mr. SPEAKER

The hon. Gentleman must confine himself to objections to the Resolution.

Mr. G. D. FABER

My remarks really proceeded out of the hypocrisy of the Government pretending they are going to stop with land taxation initiated in this way. If they are going to stop there, it is not worth having, and, if they are not, it is the most dangerous principle ever put in a Budget in the history of this country.

Mr. LLOYD-GEORGE rose in his place, and claimed to move, "That the Question be now put."

Question put, "That the Question be now put."

The House divided: Ayes, 204; Noes, 92.

Division No. 451.]	AYES.	[5.25 p.m.
Acland, Francis Dyke	Fenwick, Charles	M'Callum, John M.
Adkins, W. Ryland D.	Ferens, T. R.	M'Laren, H. D. (Stafford, W.)
Ainsworth, John Stirling	Ferguson, R. C. Munro	M'Micking, Major G.
Armitage, R	Fiennes, Hon. Eustace	Mallet, Charles E.
Atherley-Jones, L.	Foster, Rt. Hon. Sir Walter	Markham, Arthur Basil
Baker, Sir John (Portsmouth)	Fuller, John Michael F.	Marnham, F. J.
Baker, Joseph A. (Finsbury, E.)	Gill, A. H.	Massie, J.
Balfour, Robert (Lanark)	Gladstone, Rt. Hon. Herbert John	Masterman, C. F. G.
Baring, Godfrey (Isle of Wight)	Glendinning, R. G.	Montagu, Hon. E. S.
Barnard, E. B.	Glover, Thomas	Morgan, J. Lloyd (Carmarthen)
Barnes, G. N.	Goddard, Sir Daniel Ford	Morton, Alpheus Cleophas
Barran, Sir John Nicholson	Gooch, George Peabody (Bath)	Murray, Capt. Hon. A. C. (Kincard.)
Beck, A. Cecil	Greenwood, G. (Peterborough)	Myer, Horatio
Bell, Richard	Hancock, J. G.	Nicholson, Charles N. (Doncaster)
Bethell, Sir J. H. (Essex, Romford)	Harcourt, Rt. Hon. L. (Rossendale)	Parker, James (Halifax)
Bethell, T. R. (Essex, Maldon)	Harcourt, Robert V. (Montrose)	Partington, Oswald
Bowerman, C. W.	Harvey, A. G. C. (Rochdale)	Pearce, Robert (Staffs, Leek)
Brace, William	Harvey, W. E. (Derbyshire, N.E.)	Pearce, William (Limehouse)
Branch, James	Haworth, Arthur A.	Pearson, W. H. M. (Suffolk, Eye)
Bright, J. A.	Hazel, Dr. A. E. W.	Perks, Sir Robert William
Brooke, Stopford	Hazleton, Richard	Pickersgill, Edward Hare
Brunner, Rt. Hon. Sir J. T. (Cheshire)	Helme, Norval Watson	Pointer, J.
Brunner, J. F. L. (Lancs., Leigh)	Hemmerde, Edward George	Ponsonby, Arthur A. W. H.
Bryce, J. Annan	Henderson, Arthur (Durham)	Priestley, Sir W. E. B. (Bradford, E.)
Buckmaster, Stanley O.	Henderson, J. McD. (Aberdeen, W.)	Raphael, Herbert H.
Burns, Rt. Hon. John	Henry, Charles S.	Rea, Walter Russell (Scarborough)
Buxton, Rt. Hon. Sydney Charles	Herbert, Col. Sir Ivor (Mon., S.)	Rees, J. D.
Byles, William Pollard	Higham, John Sharp	Richards, T. F. (Wolverhampton, W.)
Carr-Gomm, H. W.	Hobart, Sir Robert	Richardson, A.
Causton, Rt. Hon. Richard Knight	Hobhouse, Rt. Hon. Charles E. H.	Ridsdale, E. A.
Cawley, Sir Frederick	Hodge, John	Roberts, Charles H. (Lincoln)
Channing, Sir Francis Allston	Hope, John Deans (Fife, West)	Roberts, G. H. (Norwich)
Cherry, Rt. Hon. R. R.	Hope, W. H. B. (Somerset, N.)	Roberts, Sir J. H. (Denbighs.)
Churchill, Rt. Hon. Winston S.	Hornlman, Emslie John	Robertson, Sir G. Scott (Bradford)
Cleland, J. W.	Howard, Hon. Geoffrey	Robson, Sir William Snowdon
Clough, William	Hudson, Walter	Roch, Walter F. (Pembroke)
Clynes, J. R.	Hyde, Clarendon G.	Rogers, F. E. Newman
Collins, Stephen (Lambeth)	Idris, T. H. W.	Rose, Sir Charles Day
Collins, Sir Wm. J. (St. Pancras, W.)	Jackson, R. S.	Rowlands, J.
Corbett, A. Cameron (Glasgow)	Jardine, Sir J.	Runciman, Rt. Hon. Walter
Corbett, C. H. (Sussex, E. Grinstead)	Jenkins, J.	Russell, Rt. Hon. T. W.
Crooks, William	Johnson, John (Gateshead)	Samuel, Rt. Hon. H. L. (Cleveland)
Crosfield, A. H.	Jowett, F. W.	Scarisbrick, Sir T. T. L.
Crossley, William J.	Kekewich, Sir George	Sears, J. E.
Cullinan, J.	Laidlaw, Robert	Seely, Colonel
Curran, Peter Francis	Lambert, George	Shackleton, David James
Davies, Timothy (Fulham)	Lamont, Norman	Sherwell, Arthur James
Dewar, Arthur (Edinburgh, S.)	Lea, Hugh Cecil (St. Pancras, E.)	Simon, John Allsebrook
Dickson-Poynder, Sir John P.	Lehmann, R. C.	Sloan, Thomas Henry
Dilke, Rt. Hon. Sir Charles	Lever, W. H. (Cheshire, Wirral)	Snowden, P.
Duckworth, Sir James	Levy, Sir Maurice	Stanley, Hon. A. Lyulph (Cheshire)
Duncan, C. (Barrow-in-Furness)	Lewis, John Herbert	Steadman, W. C.
Edwards, Sir Francis (Radnor)	Lloyd-George, Rt. Hon. David	Stewart, Halley (Greenock)
Erskine, David C.	Lupton, Arnold	Strachey, Sir Edward
Essex, R. W.	Luttrell, Hugh Fownes	Strauss, E. A. (Abingdon)
Esslemont, George Birnie	Macdonald, J. R. (Leicester)	Summerbell, T.
Evans, Sir S. T.	Macdonald, J. M. (Falkirk Burghs)	Taylor, John W. (Durham)
Everett, R. Lacey	Macnamara, Dr. Thomas J.	Taylor, Theodore C. (Radcliffe)
Faber, G. H. (Boston)	MacVeagh, Jeremiah (Down, S.)	Tennant, H. J. (Berwickshire)
Thomas, Sir A. (Glamorgan, E.)	Wardle, George J.	Wilson, Henry J. (York, W.R.)
Thorne, G. R. (Wolverhampton)	Warner, Thomas Courtenay T.	Wilson, John (Durham, Mid)
Thorne, Wm. (West Ham)	Wason, John Cathcart (Orkney)	Wilson, P. W. (St. Pancras, S.)
Tomkinson, James	Watt, Henry A.	Wilson, W. T. (Westhoughton)
Toulmin, George	White, J. Dundas (Dumbartonshire)	Winfrey, R.
Trevelyan, Charles Philips	Whitley, John Henry (Halifax)	Wood, T. M'Kinnon
Verney, F. W.	Wiles, Thomas	Yoxall, Sir James Henry
Villiers, Ernest Amherst	Williams, Sir Osmond (Merioneth)
Vivian, Henry	Wills, Arthur Walters	TELLERS FOR THE AYES.—Mr. Joseph Pease and Captain Norton.
Walton, Joseph	Wilson, Hon. G. G. (Hull, W.)
NOES.
Anson, Sir William Reynell	Guinness, Hon. R. (Haggerston)	Randles, Sir John Scurrah
Ashley, W. W.	Guinness, Hon. W. E. (B. S. Edmunds)	Rawlinson, John Frederick Peel
Baldwin, Stanley	Hamilton, Marquess of	Remnant, James Farquharson
Balfour, Rt. Hon. A. J. (City, Lond.)	Hardy, Laurence (Kent, Ashford)	Renton, Leslie
Banbury, Sir Frederick George	Harris, Frederick Leverton	Renwick, George
Banner, John S. Harmood-	Harrison-Broadley, H. B.	Roberts, S. (Sheffield, Ecclesall)
Bowles, G. Stewart	Hill, Sir Clement	Ronaldshay, Earl of
Bull, Sir William James	Hills, J. W.	Rutherford, Watson (Liverpool)
Butcher, Samuel Henry	Hunt, Rowland	Salter, Arthur Claveil
Carlile, E. Hildred	Joynson-Hicks, William	Scott, Sir S. (Marylebone, W.)
Carson, Rt. Hon. Sir Edward H.	Kennaway, Rt. Hon. Sir John H.	Sheffield, Sir Berkeley George D.
Cave, George	Kerry, Earl of	Smith, Abel H. (Hertford, East)
Cecil, Lord R. (Marylebone, E.)	Kimber, Sir Henry	Smith, F. E. (Liverpool, Walton)
Chamberlain, Rt. Hon. J. A. (Worc'r.)	Lambton, Hon. Frederick William	Smith, Hon. W. F. D. (Strand)
Clive, Percy Archer	Lane-Fox, G. R.	Stanler, Beville
Clyde, J. Avon	Law, Andrew Bonar (Dulwich)	Stanley, Hon. Arthur (Ormskirk)
Corbett, T. L. (Down, North)	Lee, Arthur H. (Hants, Fareham)	Starkey, John R.
Courthope, G. Loyd	Lockwood, Rt. Hon. Lt.-Col. A. R.	Stone, Sir Benjamin
Craig, Captain James (Down, E.)	Long, Col. Charles W. (Evesham)	Talhot, Lord E. (Chichester)
Craik, Sir Henry	Long, Rt. Hon. Walter (Dublin, S.)	Talbot, Rt. Hon. J. G. (Oxford Univ.)
Dickson, Rt. Hon. C. Scott-	Lowe, Sir Francis William	Thomson, W. Mitchell- (Lanark)
Doughty, Sir George	Magnus, Sir Philip	Tuke, Sir John Batty
Douglas, Rt. Hon. A. Akers-	Mason, James F. (Windsor)	Walker, Col. W. H. (Lancashire)
Faber, George Denison (York)	Mildmay, Francis Bingham	Walrond, Hon. Lionel
Fell, Arthu[...]	Morpeth, Viscount	Williams, Col. R. (Dorset, W.)
Fletcher, J. S.	Newdegate, F. A.	Winterton, Earl
Foster, P. S.	Nicholson, Wm. G. (Petersfield)	Younger, George
Gardner, Ernest	Parker, Sir Gilbert (Gravesend)
Gibbs, G. A. (Bristol, West)	Pease, Herbert Pike (Darlington)
Gordon, J.	Peel, Hon. W. R. W.	TELLERS FOR THE NOES.—Sir A. Acland-Hood and Mr. H. W. Forster.
Goulding, Edward Alfred	Powell, Sir Francis Sharp
Gretton, John	Pretyman, E. G.

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

The House divided: Ayes, 214; Noes, 92.

Division No. 452.]	AYES.	[5.35 p.m.
Acland, Francis Dyke	Burns, Rt. Hon. John	Duncan, C. (Barrow-in-Furness)
Adkins, W. Ryland D.	Buxton, Rt. Hon. Sydney Charles	Edwards, Sir Francis (Radnor)
Ainsworth, John Stirling	Byles, William Pollard	Erskine, David C.
Ambrose, Robert	Carr-Gomm, H. W.	Essex, R. W.
Armitage, R.	Causton, Rt. Hon. Richard Knight	Esslemont, George Birnie
Atherley-Jones, L.	Cawley, Sir Frederick	Evans, Sir S. T.
Baker, Sir John (Portsmouth)	Charming, Sir Francis Allston	Everett, R. Lacey
Baker, Joseph A. (Finsbury, E.)	Cherry, Rt. Hon. R. R.	Faber, G. H. (Boston)
Balfour, Robert (Lanark)	Churchill, Rt. Hon. Winston S.	Fenwick, Charles
Baring, Godfrey (Isle of Wight)	Cleland, J. w.	Ferens, T. R.
Barnard, E. B.	Clough, William	Ferguson, R. C. Munro
Barnes, G. N.	Clynes, J. R.	Fiennes, Hon. Eustace
Barran, Sir John Nicholson	Collins, Stephen (Lambeth)	Foster, Rt. Hon. Sir Walter
Beck, A. Cecil	Collins, Sir Wm. J. (St. Pancras, W.)	Fuller, John Michael F.
Bell, Richard	Corbett, A. Cameron (Glasgow)	Gill, A. H.
Bellairs, Carlyon	Corbett, C. H. (Sussex, E. Grinstead)	Gladstone, Rt Hon. Herbert John
Bethell, Sir J. H. (Essex, Romford)	Crooks, William	Glendinning, R. G.
Bethell, T. R. (Essex, Maldon)	Crosfield, A H.	Glover, Thomas
Bowerman, C. W.	Crossley, William J.	Goddard, Sir Daniel Ford
Brace, William	Cullinan, J.	Gooch, George Peabody (Bath)
Branch, James	Curran, Peter Francis	Greenwood, G. (Peterborough)
Bright, J. A.	Davies, M. Vaughan- (Cardigan)	Hancock, J. G.
Brooke, Stopford	Davies, Timothy (Fulham)	Harcourt, Rt. Hon. L. (Rossendale)
Brunner, J. F. L. (Lancs., Leigh)	Dewar, Arthur (Edinburgh, S.)	Harcourt, Robert V. (Montrose)
Brunner, Rt. Hon. Sir J. T. (Cheshire)	Dickson-Poynder, Sir John P.	Harvey, A. G. C. (Rochdale)
Bryce, J. Annan	Dilke, Rt. Hon. Sir Charles	Harvey, W. E. (Derbyshire, N.E.)
Buckmaster, Stanley O.	Duckworth, Sir James	Haslam, James (Derbyshire)
Haworth, Arthur A.	Marnham, F. J.	Simon, John Allsebrook
Hazel, Dr. A. E.	Massie, J.	Sloan, Thomas Henry
Hazleton, Richard	Masterman, C. F. G.	Snowden, P.
Helme, Norval Watson	Montagu, Hon. E. S.	Stanley, Hon. A. Lyulph (Cheshire)
Hemmerde, Edward George	Morgan, J. Lloyd (Carmarthen)	Steadman, W. C.
Henderson, Arthur (Durham)	Morrell, Philip	Stewart, Halley (Greenock)
Henderson, J. McD. (Aberdeen, W.)	Morton, Alpheus Cleophas	Strachey, Sir Edward
Henry, Charles S.	Murray, Capt. Hon. A. C. (Kincard.)	Strauss, E. A. (Abingdon)
Hernert, Col. Sir Ivor (Mon. S.)	Myer, Horatio	Summerbell, T.
Higham, John Sharp	Nicholson, Charles N. (Doncaster)	Taylor, John W. (Durham)
Hobart, Sir Robert	O'Connor, James (Wicklow, W.)	Taylor, Theodore C. (Radcliffe)
Hobhouse, Rt. Hon. Charles E. H.	O'Connor, John (Kildare, N.)	Tennant, H. J. (Berwickshire)
Hodge, John	Parker, James (Halifax)	Thomas, Sir A. (Glamorgan, E.)
Hope, John Deans (Fife, West)	Partington, Oswald	Thorne, G. R. (Wolverhampton)
Hope, W. H. B. (Somerset, N.)	Pearce, Robert (Staffs, Leek)	Thorne, William (West Ham)
Horniman, Emslie John	Pearce, William (Limehouse)	Tomkinson, James
Howard, Hon. Geoffrey	Pearson, W. H. M. (Suffolk, Eye)	Toulmin, George
Hudson, Walter	Perks, Sir Robert William	Trevelyan, Charles Philips
Hyde, Clarendon	Pickersgill, Edward Hare	Verney, F W.
Idris, T. H. W.	Pointer, J.	Villiers, Ernest Amherst
Jackson, R. S.	Ponsonby, Arthur A. W. H.	Vivian, Henry
Jardine, Sir J.	Priestley, Sir W. E. B. (Bradford, E.)	Walsh, Stephen
Jenkins, J.	Raphael, Herbert H.	Walton, Joseph
Johnson, John (Gateshead)	Rea, Walter Russell (Scarborough)	Wardle, George J.
Jowett, F. W.	Rees, J. D.	Warner, Thomas Courtenay T.
Kekewich, Sir George	Richards, T. F. (Wolverhampton, W.)	Wason, John Cathcart (Orkney)
Laidlaw, Robert	Richardson, A.	Watt, Henry A.
Lambert, George	Ridsdale, E. A.	White, J. Dundas (Dumbartonshire)
Lamont, Norman	Roberts, Charles H. (Lincoln)	Whitley, John Henry (Halifax)
Lea, Hugh Cecil (St. Pancras, E.)	Roberts, G. H. (Norwich)	Wiles, Thomas
Lehmann, R. C.	Roberts, Sir J. H. (Denbighs)	Williams, Sir Osmond (Merioneth)
Lever, W. H. (Cheshire, Wirral)	Robertson, Sir G. Scott (Bradford)	Wills, Arthur Walters
Levy, Sir Maurice	Robson, Sir William Snowdon	Wilson, Hon. G. G. (Hull, W.)
Lewis, John Herbert	Roch, Walter F. (Pembroke)	Wilson, Henry J. (York, W.R.)
Lloyd-George, Rt. Hon. David	Rogers, F. E. Newman	Wilson, John (Durham, Mid)
Lupton, Arnold	Rose, Sir Charles Day	Wilson, J. W. (Worcestershire, N.)
Luttrell, Hugh Fownes	Rowiands, J.	Wilson, P. W. (St. Pancras, S.)
Macdonald, J. R. (Leicester)	Runciman, Rt. Hon. Walter	Wilson, W. T. (Westhoughton)
Macdonald, J. M. (Falkirk Burghs)	Russell, Rt. Hon T. W.	Winfrey, R.
Macnamara, Dr. Thomas J.	Samuel, Rt. Hon. H. L. (Cleveland)	Wood, T. M'Kinnon
MacVeagh, Jeremiah (Down, S.)	Scarisbrick, Sir T. T. L.	Yoxall, Sir James Henry
M'Callum, John M.	Scott, A. H. (Ashton-under-Lyne)
M'Laren, H. D. (Stafford, W.)	Sears, J. E.
M'Micking, Major G.	Seely, Colonel	TELLERS FOR THE AYES.—Mr. Joseph Pease and Captain Norton.
Mallet, Charles E.	Shackleton, David James
Markham, Arthur Basil	Sherwell, Arthur James
NOES.
Acland-Hood, Rt. Hon. Sir Alex. F.	Gretton, John	Powell, Sir Francis Sharp
Anson, Sir William Reynell	Guinness, Hon. R. (Haggerston)	Pretyman, E. G.
Ashley, W. W.	Guinness, Hon. W. E. (B. S. Edmunds)	Randles, Sir John Scurrah
Baldwin, Stanley	Hamilton, Marquess of	Rawlinson, John Frederick Peel
Balfour, Rt. Hon. A. J. (City, Lond.)	Hardy, Laurence (Kent, Ashford)	Remnant, James Farquharson
Banbury, Sir Frederick George	Harris, Frederick Leverton	Renton, Leslie
Banner, John S. Harmood-	Harrison-Broadley, H. B.	Renwick, George
Bowles, G. Stewart	Hermon-Hodge, Sir Robert T.	Roberts, S. (Sheffield, Ecclesall)
Bull, Sir William James	Hill, Sir Clement	Ronaldshay, Earl of
Butcher, Samuel Henry	Hills, J. W	Salter, Arthur Clavell
Carlile, E. Hildred	Hope, James Fitzalan (Sheffield)	Scott, Sir S. (Marylebone, W.)
Carson, Rt. Hon. Sir Edward H.	Hunt, Rowland	Sheffield, Sir Berkeley George D.
Cave, George	Joynson-Hicks, William	Smith, Abel H. (Hertford, East)
Cecil, Lord R. (Marylebone, E.)	Kennaway, Rt. Hon. Sir John H.	Smith, F. E. (Liverpool, Walton)
Chamberlain, Rt. Hon. J. A. (Worc'r.)	Kerry, Earl of	Smith, Hon. W. F. D. (Strand)
Clive, Percy Archer	Kimber, Sir Henry	Stanler, Beville
Clyde, J. Avon	Lambton, Hon. Frederick William	Stanley, Hon. Arthur (Ormskirk)
Corbett, T. L. (Down, North)	Lane-Fox, G. R.	Starkey, John R.
Courthope, G. Loyd	Law, Andrew Bonar (Dulwich)	Stone, Sir Benjamin
Craig, Captain James (Down, E.)	Lee, Arthur H. (Hants, Fareham)	Talbot, Lord E. (Chichester)
Craik, Sir Henry	Lockwood, Rt. Hon. Lt.-Col. A. R.	Talbot, Rt. Hon. J. G. (Oxford Univ.)
Dickson, Rt. Hon. C. Scott-	Long, Col. Charles W. (Evesham)	Thomson, W. Mitchell- (Lanark)
Doughty, Sir George	Long, Rt. Hon. Walter (Dublin, S.)	Tuke, Sir John Batty
Douglas, Rt. Hon. A. Akers-	Lowe, Sir Francis William	Walker, Col. W. H. (Lancashire)
Fell, Arthur	Magnus, Sir Philip	Walrond, Hon. Lionel
Fletcher, J. S.	Mason, James F. (Windsor)	Williams, Col. R. (Dorset, W.)
Forster, Henry William	M[...]dmay, Francis Bingham	Winterton, Earl
Foster, P. S.	Morpeth, Viscount	Younger, George
Gardner, Ernest	Newdegate, F. A.
Gibbs, G. A. (Bristol, West)	Nicholson, Wm. G. (Petersfield)	TELLERS FOR THE NOES.—
Gordon, J.	Pease, Herbert Pike (Darlington)	Mr. G. D. Faber and Mr. Watson
Goulding, Edward Alfred	Peel, Hon. W. R. W.	Rutherford.

Question, "That Clause 15 be postponed," put, and agreed to.