Commons Sitting of 27 September 1909

Preamble
Mr. SPEAKER took the chair at a Quarter before Three of the clock.

PRIVATE BUSINESS.
Hamilton Burgh Order Confirmation Bill [Lords]—Read the third time, and passed, without Amendment.
Assurance Companies Bill [Lords]—Read the first time; to be read a second time to-morrow.

HOUSE OF COMMONS PAPERS INDEX.
General Alphabetical Index ordered to the Bills, Reports, Estimates, Accounts, and Papers printed by Order of the House of Commons, and to the Papers presented by Command, 1852–99.—[Mr. Hobhouse.]
ORAL ANSWERS TO QUESTIONS.

  War Department Officials.
  Mr. RENTONasked the Secretary of State for War how many officials, established and non-established, including non-pensionable employés, were employed by his Department on 31st March, 1906, and on 30th June, 1909, respectively?
  The SECRETARY of STATE for WAR (Mr. Haldane): To reply fully to the question as it stands would involve enormous labour, and the compilation of statistics from all parts of the world. If the hon. and gallant Member would explain to me privately what is the object of his question I will see what I can do to help him in the matter.

  Congo Free State (New Administration).
  Mr. BELLOCasked the Secretary of State for Foreign Affairs whether the Foreign Office had received information as to any act of cruelty committed in the Congo Free State since the establishment of the new régime; and, if so, could he inform the House as to the nature of the atrocity, its date, the place in which it occurred, and the name of the Belgian official responsible for it?
  The UNDER-SECRETARY for FOREIGN AFFAIRS (Mr. McKinnon Wood): I see no object in giving special publicity to any isolated act of cruelty. It would have comparatively little importance unless it were an illustration of a system of oppression. The system which existed under the old régime of the Congo State is described in published Consular Reports. Whether, or to what extent, that system has been changed by the Belgian Government will appear from the next publication of Reports, which will be made in due course.

  Brymbo Council School
  Lord ROBERT CECILasked the President of the Board of Education, whether the Brymbo council school is at present being carried on in four separate premises, two of which are chapels and one a working men's institute; whether some of the buildings are three-quarters of a mile apart; for how long this state of things has continued; and what steps are the local education authority taking to put an end to it?
  The PARLIAMENTARY SECRETARY to the BOARD of EDUCATION (Mr. Trevelyan): The facts are, I believe, substantially as stated by the Noble Lord, and the present state of things has continued since the beginning of 1908. The local education authority have obtained the Board's approval of a site for a new council school, and are understood to be ready to proceed with its erection as soon as the question of numbers has been definitely settled. The delay has been occasioned owing to the uncertainty as to the numbers for which the managers of the Church school will be able and willing to make permanent provision.
  Lord ROBERT CECILasked the President of the Board of Education, whether he is aware that, in May 1908, an inquiry was held with respect to the Brymbo Church of England school; whether that inquiry included the question whether the premises of that school could be used for the purposes of denominational education; what was the nature of the report of the inspector on that question; and what decision the Education Department have come to upon it?
  Mr. TREVELYAN: The inquiry held by an officer of the Board in May, 1908, with reference to the administration of the Wrexham Parochial (Educational) Foundation included the question whether,

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  upon the true construction of the Chancery Scheme, the school premises of the Foundation at Brymbo can be used for the purposes of denominational education. The Board, having taken legal opinion upon this question, expressed the opinion that the teachers of the school cannot, under the Chancery Scheme, teach to the children in the school the doctrines or tenets of the Church of England, or do more in the way of religious teaching or instruction than is provided in Clause 25 of the Scheme, but that the managers have, under Section 7 (6) of the Education Act, 1902, the control of the religious instruction (if any) to be given in the school, and can, under Clause 29 of the Scheme, allow the clergyman to enter and to give such religious instruction as they approve. This opinion has been challenged by the trustees, and the Board have now certified the case to the Attorney-General under the Charitable Trusts Acts with a view to obtaining a judicial decision.
  Lord ROBERT CECIL: When is the final decision on this matter likely to be reached, because it is very difficult for managers to take steps to rebuild the school, or do whatever is required, until they know exactly how they stand?
  Mr. TREVELYAN: I am afraid that that is not in our hands. I cannot tell the Noble Lord. Perhaps he had better ask the Attorney-General.

  Public Health Act (Dukinfield).
  Mr. W. THORNEasked the President of the Local Government Board if he received a communication, dated 20th September, 1909, from a person living at Dukinfield, Cheshire, in connection with the administration of the Public Health Acts in Dukinfield, about the state of the closets and ashpits of the houses, and whether he is aware that in consequence of the writer's name being divulged, he has received notice to quit; whether this is a distinct breach of faith; and whether he intends taking any action in the matter?
  The PRESIDENT of the LOCAL GOVERNMENT BOARD (Mr. Burns): I have received the communication referred to. The writer states that he complained to the sanitary inspector of the town council of the sanitary condition of the row of houses in which he lives, that his letter was read to the sanitary committee, and that as a result of his name being thereby disclosed he has received notice
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  to quit from the agent of the property. I am in communication with the town, council with regard to the matter.

  Sherborne Union (Nurse's Retirement).
  Mr. JOWETT (for Mr. T. F. Richards)asked the President of the Local Government Board whether he is aware that Lena Steward, recently engaged by the guardians of the Sherborne Union as a nurse, has been compelled to resign her position upon the advice of the medical attendant, G. R. Beckett, M.A., M.D., medical officer, Sherborne Union House, and who has been certified as unfit for such duties in future by H. Collier, L.R.C.P., L.R.C.S., of St. Paul's-terrace, Wolverhampton, and also certified as being unfit for future service as an infirmary nurse by H. Malet, M.D., senior physician, Wolverhampton and Staffordshire Hospital, and that this nurse has been engaged at the Wolverhampton-workhouse five years and eight months, at Wolstanton and Burslem workhouse one year, at Dudley workhouse two years, at Newton Abbot one year and two months, and at Rugby workhouse two years, or a total service of 11 years and 10 months, and completed 14 years' service at Sherborne workhouse by last December; that the Sherborne guardians have refused to recommend this nurse for pension in accordance with the Poor Law Officers' Superannuation Act, 1896, Sections (2) and (3); whether he has received an appeal on behalf of this nurse, and what was the nature of the appeal and also the reply, because up to the 10th of the month the applicant had received no reply; and what action he intends to take in the matter to give this nurse the benefit of the Act under which she has been working so long?
  Mr. BURNS: I would refer my hon. Friend to the answer which I gave to and identical question he put to me on this subject on Monday last. I am awaiting a reply to the letter which I sent to Miss-Steward, asking for her observations on the representations made by the guardians with regard to her appeal.

  Major-General Wolfe's Vault, Greenwich.
  Sir GILBERT PARKERasked the Secretary of State for the Home Department whether he is aware of the dilapidated condition of the vault at Greenwich containing the remains of Major-General Wolfe; and whether permission will be granted to the representative of the family to put it into a state of repair?
  The UNDER-SECRETARY for the HOME DEPARTMENT (Mr. Masterman): The Secretary of State finds on inquiry that the vault which contains General Wolfe's remains is not in a dilapidated condition, but in common with all the vaults under the church it was closed and bricked up many years ago, and is not accessible to visitors. In the church there is a tablet on the floor over the spot where the body lies, and also a mural tablet and a memorial window. The Secretary of State has no jurisdiction in the matter, but he has been informed by the authorities of the Church that they will be perfectly ready to entertain any reasonable proposal from General Wolfe's representatives for the renovation of the vault.

  Charge Against Trade Union Officers (Cork).
  Mr. KEIR HARDIE (for Mr. Barnes)asked the Attorney-General for Ireland if his attention has been directed to the charge of conspiracy against trade union officers at Cork; if he is aware that the person upon whose alleged information the warrant was issued for arrest has denied on oath giving such information, and that the magistrate who is alleged to have issued the warrant has denied any knowledge of it; and, if he is aware of these facts, what action he intends to take in the matter?
  The SOLICITOR-GENERAL for IRELAND (Mr. Redmond Barry): My right hon. Friend is fully cognisant of the proceedings in this case. The information on which the warrant was issued was, as I understand, sworn by a District Inspector of the Royal Irish Constabulary. During the proceedings in the police court one of the witnesses for the Crown was cross-examined as to whether he had not made the information in question and, as the fact was, denied that he had sworn any information. His denial was confirmed by the magistrate who issued the warrant. There is nothing in the matter calling for any action on the part of my right hon. Friend.

  Admiralty Contracts (Fair Wage Clause, Greenock).
  Mr. JOWETT (for Mr. T. F. Richards)asked the First Lord of the Admiralty whether he is aware that Scott's Shipbuilding and Engineering Company, Greenock, Government contractors, are violating the Fair Wage Clause by paying the labourers in their employ 4d. per hour instead of the customary rate in the dis-
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  trict at 4½d.; and whether he will take steps to have the Fair Wage Clause complied with?
  The PARLIAMENTARY SECRETARY to the ADMIRALTY (Dr. Macnamara): We wrote to the firm on the 21st September, and are still awaiting their reply.

  Portsmouth Dockyard (Overtime and Discharges).
  Mr. JOWETT (for Mr. T. F. Richards)asked the First Lord of the Admiralty whether he was aware that many of the employés in the new factory in Portsmouth Dockyard are working overtime, while at the same time other employés have received notice of discharge; and whether he will take steps to provide for a better distribution of the work by putting the yard on short time in order to obviate the discharge of workmen and an increase in the number of unemployed in Portsmouth?
  Dr. MACNAMARA: My right hon. Friend the First Lord has already informed the hon. Member that the average number of men employed on overtime in the new factory is 25, and that they are engaged on the special and confidential work connected with the manufacture of an experimental torpedo tube which has to be completed by the end of October. This overtime, because of the very special character of the work, in no way affects the question of discharges in the yard. As a matter of fact the expenditure on wages at the present time at Portsmouth yard is considerably in excess of the proportion of the Wages Vote. The nature and conditions of the work upon which the yards are engaged make the hon. Member's suggestion as to short time impracticable.

  Old Age Pension Appeal (Kilkee).
  Mr. ARTHUR LYNCHasked the Secretary to the Treasury whether he was aware that Mrs. Catherine M'Mahon, of Corry's Lane, Kilkee, has been in receipt of a pension under The Old Age Pensions Act, 1908; whether he could say for what reason the same had been discontinued; and was it on the recommendation of Mr. Martyn, the pension officer of the district?
  The FINANCIAL SECRETARY to the TREASURY (Mr. Hobhouse): I understand that Mrs. M'Mahon was awarded a pension as from the 20th instant by the local pension committee, but that the pension officer has entered an appeal to the Local Government Board on the ground that no documentary evidence of age has been produced

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  and that the census returns of 1841 show no traces of a Catherine in the claimant's family. The pension is not payable pending the award of the Local Government Board, with whom the final decision now rests.
  Mr. ARTHUR LYNCH: Has the right hon. Gentleman taken into account the latest reports of the Committee on Public Accounts, and will he continue the pension until a decision has been given with regard to that?
  Mr. HOBHOUSE: I do not think that the Public Accounts Committee has dealt with this particular point. In any case, it would not be possible to pay the pension pending the decision by the Local Government Board. The question of refund might arise, and this very often would complicate matters.
  Mr. JOHN O'CONNOR: Is documentary evidence necessary to establish a claim, or, in the absence of documentary evidence, would evidence of any other sort establish a claim?
  Mr. HOBHOUSE: I can quite conceive other evidence being sufficient to establish a claim, but primâ facie documentary evidence is the best.

  Income from Abroad.
  Mr. YOUNGERasked the Chancellor of the Exchequer whether he can state the income from abroad, so far as it is identified, for the year 1907–8, in the detailed form given on page 183 of the Report of the Commissioners of Inland Revenue for the year ended 31st March, 1908; and whether he can say when the Report of the Commissioners for the year to March last will be presented?
  Mr. HOBHOUSE: I beg to refer the hon. Member to pages 162–165 of the Inland Revenue Report for 1908–9, which was circulated on the 24th instant, and in which will be found detailed statistics with regard to income from abroad.

  FINANCE BILL.

    SURVEYORS OF TAXES (SALARIES).
    Mr. YOUNGERasked, in respect of the increased duties to be thrown upon surveyors of taxes by the requirements under the Finance Act with respect to new Schedule A allowances, Super-tax, graduation of rates of duty, children's allowances, etc., the Chancellor of the Exchequer proposes to increase their numbers and review their scale of salaries?
    Mr. HOBHOUSE: The scale of salaries of surveyors of taxes was revised last year, and authority was given for a substantial increase of their numbers.
    Mr. YOUNGER: Was that authority given before the Finance Bill was introduced or is it in consequence?
    Mr. HOBHOUSE: It was in connection with the general work of the Inland Revenue.

    COMPENSATION VALUES.
    Mr. BRIDGEMANasked if the register of compensation values to be made for the purposes of the Finance Bill will be available to owners or tenants of public-houses or to the licensing committees of justices?
    Mr. HOBHOUSE: The (register of compensation values is to be kept only for Revenue purposes, and accordingly no provision is made in the Ball (or appears to be necessary) for the register being available to owners or tenants of public-houses or to the licensing justices.

  Untenanted Land (Baggot Estate).
  Mr. KILBRIDE (for Mr. John Roche)asked the Chief Secretary for Ireland whether the Estates Commissioners intend to divide all the untenanted land upon the Baggot estate, Ballygar, county Gal-way, amongst the tenants who are in possession of uneconomic holdings; and will the tenants get possession of the game?
  Mr. REDMOND BARRY: May I ask the hon. Gentleman to postpone this question?
  Mr. KILBRIDE: Can the Solicitor-General for Ireland say when he wants it postponed to? It has been postponed for a week.
  Mr. REDMOND BARRY: If the hon. Member will say Thursday I will try to get the information.

  Intermediate Education (Ireland).
  Mr. JOHN MURPHYasked why the publication of the list of book prizes is delayed by the Commissioners of Intermediate Education beyond the usual time?
  The HON. MEMBERfurther asked if the hon. and learned Gentleman can state the names of the Commissioners of Intermediate Education who attended the last three meetings of the Board, and giving the names for each meeting?
  Mr. REDMOND BARRY: These two questions have been referred to the Commissioners of Intermediate Education, and the Assistant Commissioners inform me that they will be submitted to the Board at the earliest opportunity.
  Mr. JOHN MURPHY: Having regard to the great urgency of this matter, will the hon. and learned Gentleman ask the Secretary to the Commissioners on what date the list of book prizes may be expected?
  Mr. REDMOND BARRY: I understand that the Commissioners have fixed 22nd October, and no doubt the hon. Gentleman will get a reply then.
  Mr. JOHN MURPHYasked if the hon. and learned Gentleman can ascertain from the Commissioners of Intermediate Education the number of students who presented themselves for honours in each grade in the Modern Literary Course, divisions 1 and 2, in the years 1907, 1908, and 1909; the number and percentage of those who scored honours; the number and value of the exhibitions awarded; the percentage of those who presented themselves for honours who scored exhibitions; and the total marks which count for an exhibition scored by the students who were last on the exhibition lists in 1909?
  Mr. REDMOND BARRY: I would refer the hon. Member to the reply given by my right hon. Friend the Attorney-General for Ireland to the question asked by the hon. Member for West Kerry on the 21st inst., which contains the fullest available statistics on the subject. I would point out that honours are not awarded in a course or courses, but only in certain subjects.
  Mr. JOHN MURPHYasked if the Commissioners of Intermediate Education awarded the exhibitions in the Modern Literary Course, Divisions 1 and 2, in the manner suggested by him some time ago; and whether the Commissioners have acted in conformity with their own rules, Nos. 41 and 42, in awarding exhibitions for 1908–9 and this year?
  Mr. REDMOND BARRY: The rules regulating the awards of exhibitions in the year 1908–9 are those presented to Parliament in 1908. I am informed that in awarding the exhibitions the Commissioners of Intermediate Education acted in conformity with Rules 43 and 44 of those rules, which correspond to Nos. 41 and 42 of the rules for 1910 presented to Parlia-
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  ment in May last. There has not been as yet, and will not be until next year, any award respecting the year 1909–10.
  Mr. J. P. BOLAND: Can the Solicitor-General for Ireland say when the new Rules proposed to be introduced by the Commissioners next year will be laid before Parliament? Will it be before next May?
  Mr. REDMOND BARRY: I am not in a position to say at present. Perhaps the hon. Gentleman will put a question down?

  Produce of Prison Labour (Ireland).
  Mr. DEVLINasked whether his attention has been called to a resolution passed by the Belfast Trades Council condemning the action of the Prison Commissioners in tendering for contracts for the supply of brooms, brushes, etc., which they produce by prison labour, as against the paid labour of the ordinary manufacturer; and, if so, whether he will take steps to safeguard the interests of tax-paying tradesmen against this method of competition?
  Mr. REDMOND BARRY: My right hon. Friend has not received any resolution condemning the action of the General Prisons Board in tendering for contracts for the supply of brooms and brushes nor have the Board tendered for such contracts at any time.

  United States Beef Trust.
  Mr. BOWERMANasked the President of the Board of Trade whether he has received any official information showing that the operations of the United States Beef Trust in restricting the importation of live cattle for slaughter and reshipping the hides of imported animals to the United States have affected the prices of raw hides in London; and whether the Leather Trust of America controls the exports of leather from that country, and has been established by the combination known as the Beef Trust?
  The PRESIDENT of the BOARD of TRADE (Mr. Churchill): There has been an undoubted tendency towards an increase in the price of hides, but I have no official information that this is attributable to the cause suggested by my hon. Friend. I understand that the United States Leather Company, which is a consolidation of a number of leather manufacturing firms of some years' standing, occupies a predominant position in the

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  United States leather trade, but I can make no precise statement as to its business relations with the beef exporting firms.
  Mr. BOWER MANasked whether the right hon. Gentleman has received any official information be the effect that the United States companies engaged in the beef tirade in the United Kingdom had lately issued £11,300,000 of new capital to be used in obtaining further control of the Argentine cattle and beef markets?
  Mr. CHURCHILLinformation has been received from His Majesty's Ambassador at Washington to the effect that the companies referred to have recently raised a large amount of new capital, but I have no official information which would enable me to confirm the statements made as to the exact amount or the purpose for which it is intended.
  Mr. BOWERMAN: May I ask the right hon. Gentleman whether it is possible to get official information?
  Mr. CHURCHILL: I have given some attention to the subject, but I have no official information.

  Labour Exchanges (Appointments).
  Mr. ARKWRIGHTasked how many officials have already been appointed under the Labour Exchanges Act; and whether he will publish in the "London Gazette" the names of such officials?
  Mr. CHURCHILL: No actual appointments have yet been made. I will consider in due course the suggestion in the latter part of the question.
  Mr. KEIR HARDIE: Is the right hon. Gentleman aware that communications have been sent from the Board of Trade signed by a gentleman describing himself as secretary to the Labour Exchanges Committee? Has he been permanently appointed?
  Mr. CHURCHILL: A great mass of applications are coming in daily. Altogether nearly 4,000 have been received, and they are coming in at about the rate of 200 a day. I have had to organise a small staff for the simple purpose of docketting, filing, and answering the applicants, and getting information and material ready for the committee when it gets to work. It is the secretary of that small staff who has replied.
  Mr. KILBRIDE: When does the right hon. Gentleman propose to have this committee set up?
  Mr. CHURCHILL: I have already stated the names of the committee, and I understand they will get to work about the end of October. There is a great deal of preliminary work to be done in merely preparing material and classifying applications.
  Mr. RAWLINSON: Will the right hon. Gentleman give any directions that preference should be shown to the officials of the present labour bureaux, such as the Polytechnic, who will be thrown out of work when the State bureaux come into operation?
  Sir FRANCIS CHANNING: Has any limit been fixed by the Board of Trade for receiving applications?
  Mr. CHURCHILL: None as yet. With regard to the question of the hon. and learned Gentleman (Mr. Rawlinson), we will, of course, take existing interests into consideration as far as possible, having regard to getting the best men to do the work.
  Mr. T. M. HEALY: I presume the right hon. Gentleman will see that a fair complement of officials will be allotted to Ireland.
  Mr. CHURCHILL: Yes; I am giving special attention to that matter.
  Mr. KILBRIDE: Are we to understand that those appointed by the committee will have all the privileges of Civil servants?
  Mr. CHURCHILL: I will not attempt, in answer to a supplementary question, to define the different classes of interests appointed. Only a small proportion will begin by ranking as Civil servants.
  Mr. J. D. REES: Will the authorities apportion the appointments between the different parts of the United Kingdom, so that Wales, for instance, may have her share?

  Murder of Mrs. Luard (Arrest of David Woodruff).
  Mr. PICKERSGILLasked whether David Talbot Woodruff, lately a prisoner in Maidstone Gaol, was entitled to be discharged on Saturday morning last, the 19th instant; whether, in the ordinary course, he would have been discharged at or about seven o'clock in the morning; under what authority and by whose order

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  he was detained in prison until three o'clock in the afternoon of that day, when he was charged on a warrant with the murder of Mrs. Luard?
  Mr. MASTERMAN: A prisoner is not entitled to his discharge till the end of the day on which his sentence expires. As a matter of convenience, prisoners are usually discharged early in the day, but circumstances often occur which make it desirable to detain a prisoner till a later hour. The fact that in Woodruff's case there was a warrant for his arrest on a charge of murder was a fully sufficient reason for detaining him till there was an opportunity of executing it. The prison authorities in this matter acted at the request of the police responsible for the execution of the warrant.
  Mr. T. M. HEALY: May I ask the hon. Gentleman if he has conveyed to the magistrates the general approval that is felt at their action in at once discharging this man from custody?

  Loss of Submarine C11.
  Mr. GEORGE HARDYasked whether the First Lord of the Admiralty has any official information which would lead him to believe that the blue jackets in the forward part of Submarine C11 lived for several hours after the accident to that vessel on compressed air, and only lost consciousness and life as the oxygen was used up, and that they might possibly have escaped had they been supplied with submarine helmets?
  Dr. MACNAMARA: There is no truth whatever in the statement which has been made containing the suggestion referred to in my hon. Friend's question. The formation of chlorine gas inside the vessel must have caused death very rapidly in the cases of the men not immediately drowned. The circumstances were such that helmets could not have been used.

  Suffragettes in Prison (Supply of Food).
  Mr. KEIR HARDIE: I beg to ask the Secretary of State for the Home Department a question of which I have given private notice, whether he has any official information concerning the state of health of Mrs. Leigh and Miss Charlotte Marsh, prisoners in Winson Green, Birmingham, and whether it has been found necessary to administer food to those ladies by force, and, if so, under what authority that has been done?
  Mr. MASTERMAN: I do not think that is the exact form of question of which private notice has been given to me, but I think probably my answer will cover the ground. The medical officer of Birmingham Prison reported that certain women prisoners have persistently refused to take food. The Prison Commissioners therefore, with the approval of the Home Secretary, instructed the medical officer to apply such ordinary medical treatment as was, in his opinion, necessary to prevent the risk of their committing suicide by starvation.
  Mr. KEIR HARDIE: May I ask under what authority this action was taken or under what prison regulation this action was taken?
  Mr. PHILIP SNOWDEN: May I ask what was the kind of medical treatment administered, and was it by force?
  Mr. MASTERMAN: Perhaps the hon. Member will put down a question. The authority was the general responsibility of the Prison Commissioners and the Home Office. There are no special regulations on this matter beyond the general necessity and the duty of those in charge of prisoners to prevent the prisoners committing the felony of suicide.
  Mr. SNOWDEN: I also gave private notice of a question as to whether it was a fact that food had been administered to those ladies by force. The hon. Gentleman did not give any answer to that.
  Mr. MASTERMAN: The treatment is the ordinary hospital treatment in such cases, and the ordinary treatment which is frequently applied to men and women—to contumacious or weak-minded persons. Nine women altogether were in such a condition as necessitated for their health this treatment. I gather that some of them at least found no necessity to persist in their resistance to food, and that the full hospital treatment was only employed in the case of one of the nine.
  Mr. KEIR HARDIE: Can the hon. Gentleman say if the full operation is the food being pumped through the nostrils of these women or inserted by a tube down the throat? What has been the treatment?
  Mr. MASTERMAN: I think the ordinary method is the second one.
  Mr. KEIR HARDIE: The tube is inserted into the stomach and food pumped into it—horrible outrage, beastly outrage.
  Mr. SNOWDEN: May I ask if the hon. Gentleman will convey the suggestion to the Home Secretary that he should make application to Spain or Russia in order to adopt the most brutal and up-to-date methods of barbarism?
  Mr. KEIR HARDIE: Arising out of this same case, is the hon. Gentleman aware that a responsible firm of solicitors, acting for these ladies, applied for leave to interview them and obtain their own statement, and that the request has been refused, and on what ground it has been refused?
  Mr. MASTERMAN: I am afraid I must have notice of that question.
  Mr. W. P. BYLES: Am I right in saying that whatever the treatment is it is due to the law of the land, and not to the Home Office or the Government?
  Mr. MASTERMAN: It is entirely similar to the treatment usually applied.
  Mr. KEIR HARDIE: The last man died who was treated in this way.

WAYS AND MEANS.
Resolutions [22nd September] reported.
WAYS AND MEANS.

  MINERAL RIGHTS DUTY.
  1. "That there shall be charged for the current and every subsequent financial year on the rental value of all rights to work minerals and of all mineral way leaves, a duty at the rate in each case of one shilling for every twenty shillings of that rental value.
  The rental value to be taken to be—

  (a) Where the right to work the minerals is the subject of a mining lease, the amount of rent paid by the working lessee in the last working year in respect of that right; and

  (b) Where minerals are being worked by the proprietor thereof, the amount which is determined by the Commissioners of Inland Revenue to be the sum which would have been received as the rent by the proprietor in the last working year if the right to work the minerals had been let, and the minerals had been worked to the same extent and in the same manner as they have been worked by the proprietor in that year; and

  (c) In the case of a mineral wayleave, the amount of rent paid by the working lessee in the last working year in respect of the wayleave."

  Motion made, and Question proposed, "That this House doth agree with the Committee in the said Resolution."
  Mr. NEWDEGATE: Before passing the Report stage of this Resolution, I should like to point out that under this Mineral Duty they are very seriously taxing industry. At the beginning of these proceedings the Chancellor of the Exchequer gave out that he did not wish to tax the enterprise of people who had developed minerals in this country. In the neighbourhood in which I live instead of there being a large number of dukes who are receiving royalties for their minerals, and of which we have heard a good deal in the House and in the country, there is a very large proportion of owners of land who have developed their own minerals and are working them at the present time. I will only mention one case, that I am sure will be of some interest to the House, and possibly to the Chancellor of the Exchequer; that is the case of Sir Alfred Hickman, who bought a mineral estate in Warwickshire and developed it. He has got a very large business there and a very nourishing business, all owing to his own enterprise. He bought the land owing to his enterprise; villages have been created, houses have been built and a large amount of employment has been given in a particular district in Warwickshire. There are other parts of that county in which proprietors have also developed their minerals in the same way. Under this Resolution, although owners of land have laid out large sums in developing minerals, they are now to be taxed as if they were only lessors of the minerals. I beg before the House passes this Resolution to point out as earnestly as I can that they are taxing industry, and surely that is not in the interests either of this country or of the working classes of this country.
  Mr. SAMUEL ROBERTS: I would remind the right hon. Gentleman (Mr. Lloyd-George) of what he said when the deputation from the Mining Association waited upon him with regard to the Mineral Rights Duty It was perfectly clear what the right hon. Gentleman said at that time was that he did not intend to tax industry, that is the colliery proprietor, who has in many cases bought the coal, and that coal had become the capital of the company. Therefore, any tax that he puts on that capital must be a tax on the industry. On the occasion of the deputation, after alluding to the burdens which had been put on this

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  industry, the right hon. Gentleman (Mr. Lloyd-George) said:—
  "Therefore I fully recognise that we ought to avoid, in seeking contribution from the mineral wealth of this country, placing in our Bill any new burden upon colliery proprietors who risk their capital and have got to face all those difficulties. That I admit at once, and my object was to impose this share of the burden upon those who have not risked their capital, upon those whose sole share and interest in the mining interest is the receipt of either rent or royalty."
  The right hon. Gentleman clearly draws a distinction in the people that he means to tax. He meant to tax the people who have received royalty, and that is the alteration which he has made in this Bill, but at the same time he is going to tax the people. As my hon. Friend (Mr. Newdegate) said just now, who have developed the minerals? They have spent money in purchasing the mineral, and the mineral has become part of the capital of the company. If you put a tax upon the mineral so purchased you distinctly put a tax on the industry itself, and that is what the right hon. Gentleman said he did not mean to do. I have risen to ask the Chancellor of the Exchequer, before the new mineral Clauses are taken, to give special consideration to these cases, because unless they are dealt with in a different manner he will certainly be taxing the colliery proprietors.
  Mr. A. J. BALFOUR: I think the Government will probably agree that the subject which can be raised on this Resolution is one of first-class importance, and ought to have a full discussion. For my part, if the Government can come to some arrangement by which it might be understood that the new mineral Clauses should tome on at a reasonable hour, I think it would be more convenient to take the discussion upon the Clauses than upon the Report of a money Resolution. If the right hon. Gentleman could see his way to defer Clause 15, he would probably minister to the convenience of the Committee. I would suggest that we conclude the discussion on the Report of the money Resolutions and defer to the more convenient season the full discussion of the principles involved in the proposals of the Government.
  The CHANCELLOR of the EXCHEQUER (Mr. Lloyd-George): I think the right hon. Gentleman's request is a very reasonable one. These are very important matters, and I agree that it is desirable that they should be discussed on the actual Clauses rather than upon this stage, which is, after all, more or less formal. It is purely a Resolution to enable us to proceed. I am afraid that if we proceeded in the order in which the proposals appear on the Paper it might be inconvenient both for the Opposition and for the Government. It is desirable that all these Mineral Clauses should be discussed together, and at a convenient hour; therefore I assent at once to the right hon. Gentleman's suggestion that Clause 15 should be postponed. But I do not think that that would quite meet the right hon. Gentleman's view, because it would perhaps have the effect of bringing on the Mineral Clauses at a late hour to-night. Hence my suggestion is that we should postpone the Mineral Clauses. Clause 25 would then be first. That deals with an important point, but I do not think it should take the whole evening, therefore I suggest we should put the Mineral Clauses after the new Clauses. Several of these are, on the whole, agreed Clauses, being in the nature of concessions to the Opposition. I suggest therefore that we proceed with Clause 25 and the new Clauses tonight, and take the Mineral Clauses perhaps first to-morrow. But I am entirely in the hands of the Opposition with regard to that; I am only desirous of meeting their views.
  Mr. BALFOUR: I speak with some diffidence, as I have not the whole framework of the new Clauses in my mind; but I think the suggestion of the right hon. Gentleman, which I am sure is made in a conciliatory spirit, will be acceptable to all sides of the House.
  Question put, "That the House doth agree with the Committee in the said Resolution."
  The House divided: Ayes, 121; Noes, 54.

  Division No. 732.]

  AYES.

  [3.26 p.m.

  Atherley-Jones, L.

  Belloc, Hilaire Joseph Peter R.

  Burns, Rt. Hon. John

  Baker, Sir John (Portsmouth)

  Benn, W. (Tower Hamlets, St. Geo.)

  Buxton, Rt. Hon. Sydney Charles

  Barker, Sir John

  Boland, John

  Byles, William Pollard

  Barnard, E. B.

  Boulton, A. C. F.

  Channing, Sir Francis Allston

  Barnes, G. N.

  Bowerman, C. W.

  Churchill, Rt. Hon. Winston S.

  Barran, Sir John Nicholson

  Branch, James

  Clough, William

  Barry, Redmond J. (Tyrone, N.)

  Brunner, J. F. L. (Lancs., Leigh)

  Collins, Stephen (Lambeth)

  Condon, Thomas Joseph

  Lamont, Norman

  Pickersgill, Edward Hare

  Corbett, C. H. (Sussex, E. Grinstead)

  Lea, Hugh Cecil (St. Pancras, E.)

  Power, Patrick Joseph

  Davies, Timothy (Fulham)

  Leese, Sir Joseph F. (Accrington)

  Rea, Rt. Hon. Russell (Gloucester)

  Duncan, C. (Barrow-in-Furness)

  Lloyd-George, Rt. Hon. David

  Reddy, M.

  Everett, R. Lacey

  Lundon, T.

  Rees, J. D.

  Ferens, T. R.

  Lynch, A. (Clare, W.)

  Richards, T. F. (Wolverhampton, W.)

  Ferguson, R. C. Munro

  Mackarness, Frederic C.

  Ridsdale, E. A.

  Findlay, Alexander

  Macnamara, Dr. Thomas J.

  Robson, Sir William Snowdon

  Fullerton, Hugh

  MacNeill, John Gordon Swift

  Roch, Walter F. (Pembroke)

  Glendinning, R. G.

  MacVeigh, Charles (Donegal, E.)

  Rose, Sir Charles Day

  Gulland, John W.

  M'Callum, John M.

  Russell, Rt. Hon. T. W.

  Haldane, Rt. Hon. Richard B.

  M'Micking, Major G.

  Rutherford, V. H. (Brentford)

  Harcourt, Robert V. (Montrose)

  Maddison, Frederick

  Samuel, Rt. Hon. H. L. (Cleveland)

  Hardie, J. Keir (Merthyr Tydvil)

  Marnham, F. J.

  Seely, Colonel

  Hart-Davies, T.

  Massie, J.

  Sheehy, David

  Hazel, Dr. A. E. W.

  Masterman, C. F. G.

  Snowden, P.

  Healy, Timothy (Michael)

  Menzies, Sir Walter

  Stanger, H. Y.

  Hedges, A. Paget

  Molteno, Percy Alport

  Stewart, Halley (Greenock)

  Hemmerde, Edward George

  Montagu, Hon. E. S.

  Thomas, Sir A. (Glamorgan, E.)

  Henry, Charles S.

  Mooney, J. J.

  Thorne, William (West Ham)

  Hobart, Sir Robert

  Muldoon, John

  Trevelyan, Charles Philip

  Hobhouse, Rt. Hon. Charles E. H.

  Murphy, John (Kerry, East)

  Vivian, Henry

  Holland, Sir William Henry

  Murray, James (Aberdeen, E.)

  Wason, John Cathcart (Orkney)

  Howard, Hon. Geoffrey

  Nannetti, Joseph P.

  Waterlow, D. S.

  Idris, T. H. W.

  Norman, Sir Henry

  White, J. Dundas (Dumbartonshire)

  Jardine, Sir J.

  O'Brien, Patrick (Kilkenny)

  White, Sir Luke (York, E. R.)

  Jenkins, J.

  O'Connor, James (Wicklow, W.)

  White, Patrick (Meath, North)

  Johnson, W. (Nuneaton)

  O'Connor, John (Kildare, N.)

  Wilson, Henry J. (York, W. R.)

  Jones, William (Carnarvonshire)

  O'Keily, Conor (Mayo, N.)

  Wilson, P. W. (St. Pancras, S.)

  Jowett, F. W.

  O'Shaughnessy, P. J.

  Wood, T. M'Kinnon

  Joyce, Michael

  Parker, James (Halifax)

  Kekewich, Sir George

  Partington, Oswald

  King, Alfred John (Knutstord)

  Paulton, James Mellor

  TELLERS FOR THE AYES.—Captain

  Laidlaw, Robert

  Pearce, Robert (Staffs, Leek)

  Norton and Mr. Fuller.

  Lambert, George

  Pease, Rt. Hon. J. A. (Saff. Wald.)

  NOES.

  Acland-Hood, Rt. Hon. Sir Alex. F.

  Fletcher, J. S.

  M'Arthur, Charles

  Anson, Sir William Reynell

  Forster, Henry William

  Magnus, Sir Philip

  Arkwright, John Stanhope

  Guinness, Hon. W. E. (B. S. Edmunds)

  Mildmay, Francis Bingham

  Balcarres, Lord

  Haddock, George B.

  Morpeth, Viscount

  Balfour, Rt. Hon. A. J. (City, Lond.)

  Hardy, Laurence (Kent, Ashtord)

  Parker, Sir Gilbert (Gravesend)

  Banbury, Sir Frederick George

  Harris, Frederick Leverton

  Pease, Herbert Pike (Darlington)

  Butcher, Samuel Henry

  Harrison-Broadley, H. B.

  Pretyman, E. G.

  Carlile, E. Hildred

  Heaton, John Henniker

  Rawlinson, John Frederick Peel

  Cecil, Evelyn (Aston Manor)

  Helmsley, Viscount

  Renton, Leslie

  Cecil, Lord John P. Joicey-

  Hills, J. W.

  Salter, Arthur Clavell

  Cecil, Lord R. (Marylebone, E.)

  Hope, James Fitzalan (Sheffield)

  Stanier, Beville

  Clive, Percy Archer

  Hunt, Rowland

  Starkey, John R.

  Cochrane, Hon. Thomas H. A. E.

  Kimber, Sir H.

  Staveley-Hill, Henry (Staffordshire)

  Craig, Captain James (Down, E.)

  King, Sir Henry Seymour (Hull)

  Tuke, Sir John Batty

  Craik, Sir Henry

  Lambton, Hon. Frederick William

  Wilson, A. Stanley (York, E. R.)

  Dickson, Rt. Hon. C. Scott

  Lane-Fox, G. R.

  Younger, George

  Douglas, Rt. Hon. A. Akers-

  Lockwood, Rt. Hon. Lt.-Col. A. R.

  Faber, George Denison (York)

  Long, Rt. Hon. Walter (Dublin, S.)

  TELLERS FOR THE NOES.—Mr. Newdegate and Mr. S. Roberts.

  Fell, Arthur

  Lonsdale, John Brownlee

  INCREMENT VALUE DUTIES ON MINERALS.
  Resolution reported:—
  2. "That any duty charged on the increment value of minerals which are comprised in a mining lease or are being worked shall be charged annually, and the increment value shall be taken to be the sum by which in each year the rental value of the minerals exceeds the annual equiva-
  lent of the original capital value of the minerals, or the capital value of the minerals on the last preceding occasion on which Increment Value Duty has been collected."
  Question put, "That this House doth agree with the Committee in the said Resolution."
  The House divided: Ayes, 121; Noes, 56.

  Division No. 733.]

  AYES.

  [3.35 p.m.

  Atherley-Jones, L.

  Belloc, Hilaire Joseph Peter R.

  Burns, Rt. Hon. John

  Baker, Sir John (Portsmouth)

  Benn, W. (Tower Hamlets, St. Geo.)

  Byles, William Pollard

  Barker, Sir John

  Boland, John

  Channing, Sir Francis Allston

  Barnard, E. B.

  Boulton, A. C. F.

  Churchill, Rt. Hon. Winston S.

  Barnes, G. N.

  Bowerman, C. W.

  Clough, William

  Barran, Sir John Nicholson

  Branch, James

  Collins, Stephen (Lambeth)

  Barry, Redmond J. (Tyrone, N.)

  Brunner, J. F. L. (Lancs., Leigh)

  Condon, Thomas Joseph

  Corbett, C. H. (Sussex, E. Grinstead)

  Lea, Hugh Cecil (St. Pancras, E.)

  Pickersgill, Edward Hare

  Cullinan, J.

  Leese, Sir Joseph F. (Accrington)

  Pirie, Duncan V.

  Duncan, C. (Barrow-in-Furness)

  Lloyd-George, Rt. Hon. David

  Power, Patrick Joseph

  Everett, R. Lacey

  Lundon, T.

  Rea, Rt. Hon. Russell (Gloucester)

  Ferens, T. R.

  Lynch, A. (Clare, W.)

  Reddy, M.

  Ferguson, R. C. Munro

  Mackarness, Frederic C.

  Rees, J. D.

  Findlay, Alexander

  Macnamara, Dr. Thomas J.

  Richards, T. F. (Wolverhampton, W.)

  Fullerton, Hugh

  MacNeill, John Gordon Swift

  Ridsdale, E. A.

  Glendinning, R. G.

  MacVeigh, Charles (Donegal, E.)

  Robson, Sir William Snowden

  Gulland, John W.

  M'Callum, John M.

  Roch, Walter F. (Pembroke)

  Haidane, Rt. Hon. Richard B.

  M'Micking, Major G.

  Rose, Sir Charles Day

  Harcourt, Robert V. (Montrose)

  Maddison, Frederick

  Russell, Rt. Hon. T. W.

  Hardie, J. Keir (Merthyr Tydvil)

  Marnham, F. J.

  Rutherford, V. H. (Brentford)

  Hart-Davies, T.

  Massie, J.

  Samuel, Rt. Hon. H. L. (Cleveland)

  Hazel, Dr. A. E. W.

  Masterman, C. F. G.

  Seely, Colonel

  Healy, Timothy Michael

  Menzies, Sir Walter

  Sheeny, David

  Hedges, A. Paget

  Moiteno, Percy Alport

  Snowden, P.

  Hemmerde, Edward George

  Montagu, Hon. E. S.

  Stanger, H. Y.

  Henry, Charles S.

  Mooney, J. J.

  Stewart, Halley (Greenock)

  Hobart, Sir Robert

  Muldoon, John

  Thomas, Sir A. (Glamorgan, E.)

  Hobhouse, Rt. Hon. Charles E. H.

  Murray, James (Aberdeen, E.)

  Thorne, William (West Ham)

  Holland, Sir William Henry

  Nannetti, Joseph P.

  Trevelyan, Charles Philips

  Howard, Hon. Geoffrey

  Norman, Sir Henry

  Vivian Henry

  Idris, T. H. W.

  O'Brien, Patrick (Kilkenny)

  Wason, John Cathcart (Orkney)

  Jardine, Sir J.

  O'Connor, James (Wicklow, W.)

  Waterlow, D. S.

  Jenkins, J.

  O'Connor, John (Kildare, N.)

  White, J. Dundas (Dumbartonshire)

  Johnson, W. (Nuneaton)

  O'Kelly, Conor (Mayo, N.)

  White, Sir Luke (York, E. R.)

  Jones, William (Carnarvonshire)

  O'Malley, William

  Wilson, Henry J. (York, W. R.)

  Jowett, F. W.

  O'Shaughnessy, P. J.

  Wilson, P. W. (St. Pancras, S.)

  Joyce, Michael

  Parker, James (Halifax)

  Wood, T. M'Kinnon

  Kekewich, Sir George

  Partington, Oswald

  Yoxall, Sir James Henry

  King, Alfred John (Knutsford)

  Paulton, James Mellor

  Laidlaw, Robert

  Pearce, Robert (Staffs, Leek)

  TELLERS FOR THE AYES.—Captain

  Lambert, George

  Pease, Rt. Hon. J. A. (Saff. Wald.)

  Norton and Mr. Fuller.

  Lamont, Norman

  NOES.

  Acland-Hood, Rt. Hon. Sir Alex. F.

  Fletcher, J. S.

  Morpeth, Viscount

  Anson, Sir William Reynell

  Forster, Henry William

  Newdegate, F. A.

  Arkwright, John Stanhope

  Guinness, Hon. W. E. (B. S. Edmunds)

  Parker, Sir Gilbert (Gravesend)

  Balcarres, Lord

  Haddock, George B.

  Pease, Herbert Pike (Darlington)

  Balfour, Rt. Hon. A. J. (City, Lond.)

  Harris, Frederick Leverton

  Pretyman, E. G.

  Banbury, Sir Frederick George

  Harrison-Broadley, H. B.

  Rawlinson, John Frederick Peel

  Baring, Capt. Hon. G. (Winchester)

  Heaton, John Henniker

  Renton, Leslie

  Butcher, Samuel Henry

  Helmsley, Viscount

  Roberts, S. (Sheffield, Ecclesall)

  Carlile, E. Hildred

  Hills, J. W.

  Rutherford, Watson (Liverpool)

  Cecil, Evelyn (Aston Manor)

  Hope, James Fitzalan (Sheffield)

  Salter, Arthur Clavell

  Cecil, Lord John P. Joicey-

  Hunt, Rowland

  Stanier, Beville

  Cecil, Lord R. (Marylebone, E.)

  Kimber, Sir Henry

  Starkey, John R.

  Clive, Percy Archer

  King, Sir Henry Seymour (Hull)

  Staveley-Hill, Henry (Staffordshire)

  Cochrane, Hon. Thomas H. A. E.

  Lane-Fox, G. R.

  Tuke, Sir John Batty

  Craig, Captain James (Down, E.)

  Lockwood, Rt. Hon. Lt.-Col. A. R.

  Wilson, A. Stanley (York, E. R.)

  Craik, Sir Henry

  Long, Rt. Hon. Walter (Dublin, S.)

  Younger, George

  Dickson, Rt. Hon. C. Scott

  Lonsdale, John Brownlee

  Douglas, Rt. Hon. A. Akers-

  M'Arthur, Charles

  TELLERS FOR THE NOES.—Mr. Laurence Hardy and Mr. Lambton.

  Faber, George Denison (York)

  Magnus, Sir Philip

  Fell, Arthur

  Mildmay, Francis Bingham

  Question, "That Clause 15 be postponed until after the consideration of the Clause 'definitions for purpose of mineral provisions,'" put, and agreed to.

  ESTATE DUTY DEDUCTIONS.
  3. "That it is expedient to limit the debts and encumbrances which may be deducted from the value of an estate in determining the value of the estate for the purposes of Estate Duty."

FINANCE [CONSOLIDATED FUND].
Considered in Committee.
[Mr. CALDWELL in the Chair.]

FINANCE [CONSOLIDATED FUND].

  ADDITIONAL PAYMENTS TO LOCAL AUTHORITIES ON ACCOUNT OF LAND VALUE DUTIES.
  Motion made and Question proposed, "That there shall be charged on the Con-
  932
  solidated Fund in each year a sum equal to half the proceeds of the duties levied in respect of land values (including Mineral Rights Duties) under any Act of the present Session, and that sum shall be divided between England, Scotland, and Ireland in such manner and paid into such separate accounts for the benefit of such local authorities as Parliament may determine."
  Mr. LLOYD-GEORGE: When we discussed this question at an earlier stage of the Bill I intimated on behalf of the Government that our intention was to propose a new Clause dealing with the matter of the allocation of the amount between Imperial and local finance. Since then I have received quite a number of deputa-

  933
  tions from the municipalities upon this very question, and we have come to the conclusion that this year it would be undesirable to add to this Bill any Clause dealing in detail with the apportionment, and, therefore, I put a new Clause upon the Paper, which will have the effect of apportioning the sum equally between Imperial and local finance, but hanging up the portion which shall be paid to the localities, and paying it over to a separate account to be dealt with next year. It is perfectly clear that, local and Imperial finance has got to be dealt with in a very thorough, and I should say, searching way, and I think it would be a mistake probably to anticipate the lines upon which that will be dealt with and on which we propose to legislate by incorporating in this Bill anything in the nature of a complete and detailed allocation of the funds. I have seen a good many gentlemen who are specially interested in the matter, and they are all strongly opposed to any attempt being made this year to define the lines of the actual apportionment, and they certainly favour the idea of rolling up the sum and postponing the financial allocation and leaving it to be dealt with at a future date.
  I do not think that this will really make any serious difference in regard to localities because of any sum they could possibly receive now, it is so very late in the year. Assuming the Budget got through without difficulty or trouble, at the end of this month or the beginning of next month, the Land Taxes we anticipate to receive cannot possibly come to hand until possibly the very last week of the financial year, and, therefore, the mere postponing of the apportionment of the amount to the localites would be purely a question of a few weeks as between the last weeks of the present financial year and the first few weeks of the next. I therefore propose this Resolution with a view to moving later on the Clause which stands in my name on the Notice Paper.
  Mr. BALFOUR: The history of the proposal of the Government is that they intended to acquire all the results, great or small, of the Land Taxes and the Mineral Duties embodied in this Bill. There was then a protest made in various quarters, and, having regard to the situation created thereby, and being anxious to make friends with their enemies in the gates or their friends as the case may be, they proposed to hand over half the spoil to the local authorities. My own view—and I am not
  934
  going to develop it at this moment—with regard to the Undeveloped Land Duties and the taxation upon ground rents, is that, so far as those taxes should be levied they should be levied in the interests, and solely in the interests, of the locality. The only possible justification for these taxes is that here is real property which is benefiting by the local rates and not paying its contribution to that particular area. I do not say that that is right or wrong, but, at any rate, it is an arguable proposition. If it is decided that there is real property which escapes its full share of the rates it may be quite proper that that property should be made subject to the rates, and have its burdens increased in proportion to its gains. That principle is quite simple, although its application may not be easy. But that was not the principle upon which the Government started. I do not really see how the Government are going to join together in holy matrimony these two principles which are really so profoundly opposite.
  4.0 P.M.
  The general community seem to have no special concern in this matter. You take local property, and tax it for the benefit of a part of the community which has nothing to do with the locality in which the property exists. In consequence of opposition the Government propose to hand over half to local authorities. Having made that concession in the course of our discussions in Committee, the Government are face to face with the necessity of bringing before this House concrete proposals for carrying these general principles or want of principles into effect. I waited anxiously to see how they were going to carry them out, and they have saved themselves a great deal of trouble by not carrying them out at all. They have hung up the whole business, and they propose to allow these funds to accumulate until they or their successors can find a principle of division upon which they can hand over the lump sum to local authorities. I do not think that is a procedure we ought to accept for a moment, but if the Government say the matter is so difficult and complicated that, at this period of the year, in view of the considerable and the immense complexity of the questions we have still to discuss, they really cannot face it, if that is an appeal ad misericordium, that has my hearty sympathy. I think they ought to tell us what are the general views, and the broad principles upon which they propose to act when they

  935
  have an opportunity of bringing in their legislation. This money which is going to be collected from undeveloped ground near London, Manchester, Leeds, Glasgow, and the great cities of this country, is to be allocated in some fashion among the three Kingdoms. The whole of this money, on the confession of the Government, is to be derived from the industrial activity of the community in certain portions of England and Scotland. Is it to be distributed at large over England, Scotland, and Ireland, and over parts of the country which have nothing whatever directly to do with this commercial and industrial activity? Are the ground rents of London to be handed over to the peasants of Connemara? I am entirely in favour of the British taxpayers considering the necessities of the less fortunate portions of the Kingdom, and I am in favour of dealing with them in a generous spirit. I think the Governments with which I have been connected have shown themselves not oblivious of that principle. That, however, is different to saying that quite irrespective of the needs of a particular part of the country you are going automatically to take the property of that part and hand it over to another part of the country. Whatever may be the needs of London, you are going to take the taxes on undeveloped land in London and hand them over to agricultural districts which have nothing to do with undeveloped land. I understand the Government think they are going to derive great profit from the coalfields of England and Scotland. There are large parts of England where there are no coalfields. Is the enterprise of the industry which you are going to tax in the great mineral fields of England and Scotland going to be handed over upon some wholly unknown principle to a part of the country which has no more to do with that particular development than the people living in Argentina or the islands in the Pacific. On what principle is that to be done? I understand that under this proposal every part of the country contributes to the Exchequer, and out of the fund the Exchequer gives assistance to the distant parts of the country especially in need. In the case of a tax raised in a particular part of the country on the ground that the social forces in that part of the country have made an increment in value which the owners have no title to, I cannot see on what principle you are going to distribute that tax outside the
  936
  area in which it had its origin. You cannot do it. It is impossible that we should part from this Resolution without the Government giving us some vague intimation as to how they mean to distribute this money. This money, if it belongs to anybody, belongs to London, Leeds, Glasgow, Edinburgh and the great coalfields of Yorkshire and Wales, and I would like to know on what principle the Government are going to hand over the proceeds of this tax to other parts of the country. Is it to be a distribution according to rateable value? Is it to be in proportion to population or in proportion to the burden of the rates? There must be some principle, and the Government must have thought it over. The Chancellor of the Exchequer told us he has been occupied in receiving a large number of deputations from various authorities upon the subject of the distribution of this money. I am not in the secrets of the Government, and I do not know what the deputations said to him or what he said to them. I do not think reports have appeared in the Press upon this point, and I should be very much interested if the right hon. Gentleman would give us some account of what transpired on this question. Were there deputations from local authorities which have nothing whatever to do with undeveloped land or minerals, and did they come and say, "Do not let them get hold of this money. We are quite as much in need of it as they are. We have had nothing to do with producing the money which you are going to distribute, but remember, if we have given very little, we are very eager to get some of it ourselves. Do not forget us when you are distributing largesses throughout the country." I suppose there have been other deputations from the great towns. I do not know whether Glasgow has sent a deputation to the right hon. Gentleman, but I know Glasgow held the view—it was the originator of the view—that municipalities have a right to all this money. Is Glasgow still of that opinion, or is it content that half of the tax on undeveloped land should go to the Exchequer and to see the other half whittled away among communities, north, south, east and west, which have no more, and, indeed, much less, to do with the development of Glasgow than the commercial undertakings of Canada, United States, the East, West Indies, and so forth? I do not know what view Glasgow may take, but I shall be greatly surprised if they would be content to see half whittled

  937
  away amongst its neighbours when it thinks it has an equitable and genuine title to the whole. If the Government say the difficulties are so great and the complexities so prodigious that it is impossible for them to present a considered scheme we may possibly accept the excuse, but we ought to be given clearly to understand on what general principle the distribution is to be made. Simply to collect the money at random without knowing how it is to be used seems to me contrary to every principle of sound finance, and inconsistent not merely with the canons of constitutional finance, but with wise and prudent statesmanship. As it is, the Government are holding in their hands a kind of bribe to give, when the occasion serves them, to the more deserving constituencies, and we know their view of which are the more deserving constituencies. I do not accuse the Government of that policy, because I have not an idea of what their policy is, but so long as they refuse to give us an idea of their policy they ought not too severely to criticise the position if an unkind construction is put on their silence and they are asked in a somewhat sceptical spirit for the information which the right hon. Gentleman seems so anxious to with-bold, and which I venture to say this Committee must have in its possession before it finally decides upon the wisdom or unwisdom, upon the justice or injustice, of a policy which is as novel in form as it is novel in substance. For these reasons, unless the right hon. Gentleman can give us some fuller information of his views than can be elicited either from the speech he has just delivered or the answers he has given to the deputations to which he has referred, I shall certainly oppose the Resolution.
  Mr. LLOYD-GEORGE: The speech just delivered by the right hon. Gentleman is very interesting, very significant, and I am not sure it is not very topical. I think it represents a great advance on the position he has hitherto taken up with regard to the Land Taxes. The right hon. Gentleman says that if taxes of this kind are to be levied on the locality on the ground that they represent an increment attributable to the expenditure of rates, then, so long as they go to the locality, there is a principle, but, so long as they go to Imperial purposes, it is theft. I am very glad to recognise this great advance in the position of the right hon. Gentleman on taxation of the kind I have suggested in this Bill. It is really not contrary or abhorrent to principle, and it does not
  938
  infringe the Ten Commandments. It is purely a question of the purpose to which you apply it.
  Mr. STANLEY WILSON: He never said anything of the kind.
  Mr. JOHN WARD: It was the whole burden of his song.
  Mr. LLOYD-GEORGE: Apply it to main drains, and it is a great and holy principle. Apply it to the defences of the country, and it is sheer theft and robbery. Now we know exactly what the position of the right hon. Gentleman is.
  Mr. BALFOUR: Nobody knows it, or is likely to know it, from the right hon. Gentleman's version of what I said. I am ready to submit to any version of my views, providing I am not regarded as responsible for it.
  Mr. LLOYD-GEORGE: I have only been unfortunate enough to quote the words of the right hon. Gentleman. He said, "There, at any rate, is a principle."
  Viscount HELMSLEY: "Whether right or wrong."
  Mr. LLOYD-GEORGE: Then he thinks it is a wrong principle.
  Mr. BALFOUR: What I said was that if anybody will look back at all the Reports of the Commission dealing with the taxation of ground values he will see that the argument always turns on this: Do these lands pay, or do they not pay, their just proportion to the rates of the locality? If you think they do not, I perfectly understand an agitation for making them pay their just proportion, and that is a principle, right or wrong. The allegation is that they gain by the rates, and they should contribute to the rates. That breaks down, however, when you leave the rating area and come to the Imperial area.
  Mr. LLOYD-GEORGE: The question is not only whether there was an agitation, but whether, in the opinion of the right hon. Gentleman, it was a just agitation. I understood this was a principle he would appreciate.
  Mr. BALFOUR: I do appreciate it.
  Mr. LLOYD-GEORGE: Then the appreciation of the principle by the right hon. Gentleman represents a very distinct advance upon his first position. His first position was one of unmitigated condemnation. His second position is that of

  939
  appreciation. His third position will be that of admiration and complete support, and I am perfectly certain it will be one of absorption when he comes to the position of having to apply the money. I am very glad the right hon. Gentleman takes this appreciating view of this taxation. The right hon. Gentleman says that if this money was spent in the locality he would appreciate it. He takes Glasgow and asks, What would you think of Glasgow spending all this money improving the value of land and then for the produce of this taxation to go to Connemara instead of Glasgow? What are the facts? The land being appreciated in value is not entirely within the boundaries of Glasgow. It is outside the boundaries of Glasgow.
  Mr. BALFOUR: It is not in Connemara.
  Mr. LLOYD-GEORGE: As far as Glasgow is concerned, I suppose it would be all the same to them so long as their rates are not reduced? Take London. Land in a great area outside London—10, 15, and 20 miles—is appreciated in value; but, if you apply 20 per cent. of the whole sum of money which is due to that appreciation to the parishes where it is raised, London does not get a penny. It is simply spent in small areas outside, where, very often, there is no population. It is the purely villa residents outside London who get it. London, with its teeming population, would get nothing if it had not been for the principle we lay down here that the fund is a national one and not purely a local one. Take the great cities of Lancashire—Liverpool and Manchester. The appreciation in the value of land is not entirely within the boundaries of Liverpool; it is outside, but it is entirely due to the trade and industry of Liverpool. Yet the right hon. Gentleman says that Liverpool has no right to a penny of that increment created by the trade, the enterprise, and the industry of Liverpool.
  Mr. BALFOUR: I did not say that.
  Mr. LLOYD-GEORGE: Still, he says they have just as much right to it as people who live in the islands of the Pacific.
  Mr. BALFOUR: I really object to the right hon. Gentleman attributing to me arguments I never thought of using.
  Mr. LLOYD-GEORGE: Was it not the argument of the right hon. Gentleman that, if increment was created by the ex-
  940
  penditure of rates within an area, the money ought to be spent in that area? If that is not his argument I really do not know what his argument was. I say the increment is outside and the expenditure within, and the reason we nationalise this fund is because by doing so the people who create the increment get their share of it. The only way they can get their fair share of it is by nationalising the fund. I think the right hon. Gentleman really sees that.
  Mr. BALFOUR: I do not see it; I think it is absurd.
  Mr. LLOYD-GEORGE: It is a fact. The right hon. Gentleman thinks it is absurd, and it is therefore necessary I should repeat it. I say, taking any great city, the increment in land is very largely outside its boundaries, and, if you spend the money in the district where the increment is raised, the people who create the increment do not get the benefit. Where is the absurdity of that? It is in accordance with the whole facts of the case. The right hon. Gentleman says you ought to lay down the general principles, and he asks if people who are just as much interested as those in the Argentine Pacific are to get anything? It is a curious sort of unionism that people who live in the remotest districts of the United Kingdom have absolutely no concern in the prosperity of great towns which may be some miles from them. I thought we were one community. I thought we had a general interest in the same common prosperity. I thought, if one part of the community withered, the whole of the rest of the body politic suffered. I do not take the same view as the right hon. Gentleman that rural districts have no kind of concern in our great thriving centres of population. The right hon. Gentleman invites me to lay down principles at the present moment, but I ask him, with all respect: Has he ever contemplated or realised the difficulties of dealing with the problem of local and Imperial finance? I met one deputation which had a clear and definite suggestion to make, namely, that it should be on the basis of rateable value. That deputation represented a very large body of municipal opinion. But then another section objected to the principle of rateable value: that was the agricultural section. It has been strongly urged that the Government should give the municipalities time to formulate their own proposals and to come to some understanding among themselves as to what they prefer. I think that is a very wise sugges-

  941
  tion. But the right hon. Gentleman says it is unreasonable, and, while the municipalities are considering what conclusion they should come to, he wants to bind the Committee in such a way that it will be quite impossible for them to depart from a particular line of policy. Is that a wise suggestion? Would it not be infinitely better to wait until the municipalities have made up their minds and sent in their suggestions, so that the Government may consider them and make up their minds? That, at any rate, is our proposal, and I think it is a fairly reasonable one.
  Mr. BALFOUR: The right hon. Gentleman has misrepresented me, and appears to be thoroughly determined that no interpolation of mine shall put him right as to what are really my views. Perhaps he will allow me to say one word upon a point which I raised in my first speech. I was dealing with the question originally raised at Glasgow with regard to ground values. I said it was a question of rating, and everybody knows that it was fought out on that ground before the Royal Commission. The allegation was that property was to benefit by the rates of a locality while it had not contributed to those rates. I think it will be admitted that that is a fair summary of the argument, and that argument cubs directly across this plan of distributing the money. Half the money is to go to Glasgow and half is to go to places which are in no way directly concerned with Glasgow, its trade, or development. The right hon. Gentleman says, "It is an absurd view for the Leader of the Opposition to put forward. Does not everybody know that the land immediately around Glasgow outside the borough has gained in value by the activity of Glasgow, and why should not some of that money be given to the municipality or locality where it has accrued?" That is perfectly possible, but it does not touch the real gravamen of my case. It is not with regard to those districts just outside the municipal area, where everything except the mere drawing of a boundary belongs to the commercial system, but I raise the point with regard to those parts of the country which have nothing whatever to do with the commercial system of Glasgow, and I ask on what principle you are going to distribute Glasgow funds among them? I ask the right hon. Gentleman to explain that, but he has given no explanation. He put forward this representation with regard to areas just outside municipal boundaries that, after all, are we not one community, do we not all perish
  942
  or flourish together, and do not we, therefore, owe some assistance to those parts of the United Kingdom which are specially needy? But I specially said in my speech that some contribution might properly be made from the Central Exchequer in these cases, but it should not be given automatically. It should not be part of a particular plan. It should be contributed in proportion to the national power of giving and to the needs of the locality for which the money is required. It ought not to be given as an automatic result of the manipulation of local taxes. That point has not been touched by the right hon. Gentleman. I speak now as a Member of a body which ought to look at these things as statesmen endeavouring to have some principle with regard to the expenditure of money which they are collecting. But the Government have no principle. They are collecting the money, but they avow they have no principle. I think that is utterly unstatesmanlike, quite unprecedented, and extremely dangerous.
  Mr. LAURENCE HARDY: I propose to deal with two points which have been entirely left out in the speeches delivered by the Chancellor of the Exchequer. The right hon. Gentleman has only dealt, in fact, with one-half of the question. We have to remember that a great deal more than one-half the sum which will accrue at once will not come through the tax about which the right hon. Gentleman has just had an encounter with the Leader of the Opposition. It will come from the Mineral Rights Tax. In passing I would only remind the right hon. Gentleman it is remarkable that at the moment he decided to give a part of the Mineral Rights Duty to the local authority he took the opportunity of altering a tax which was to bring in £175,000 so as to make it yield £350,000, thereby ensuring that he lost nothing by the transaction. But why this particular tax should be allocated in this particular way I cannot understand, especially as the arguments that are brought forward with regard to the other taxes apply almost inversely to the Mineral Rights Duty. The action of the community in making roads and drainage and in encouraging building, as well as providing all the accessories which increase the value of land, are really decrement as far as minerals are concerned, and, therefore, the Mineral Rights Duty is almost opposed to the other duties. I think we ought to have some explanation why this particular duty is seized upon, and why half of it is given to the local authorities. Of course a large

  943
  proportion of the district would have nothing whatever to do with the minerals. So far as the whole amount is concerned, I was rather interested to see the other day that, in the Grand Committee upstairs, the right hon. Gentleman made a passionate appeal not to throw the sum of £600,000 into the melting pot of local rates with reference to road improvements. Yet he is now proposing to allot a smaller sum of money as a reward to the local authorities for not opposing the new taxes he is putting on this year. Whether it is right or not, I think we should have some explanation why this particular duty has been divided. There is another point on which I should like an explanation. When the Prime Minister occupied the position of Chancellor of the Exchequer, he was specially strong against this principle of allotting portions of taxes to local authorities. He said the matter should be dealt with on a large scale, and he took the first step for abolishing this when he granted a sum out of the Consolidated Fund in lieu of various contributions from the Estate and other duties. That was to be the principle on which the Government were to proceed, namely, that they were not, in future, going to allot a portion of taxes to the relief of local rates. But no sooner had they established that principle than they began to whittle it away as fast as they could. Last year they gave a certain portion of the Licence Duties to the local authorities, and this year they propose with reference to four or five new taxes to divide them between the local authorities and the State, and, at the same time, they give no indication of the manner in which these taxes are to be applied. I think we are justified in remembering the very strong language the Prime Minister used when he was laying down this principle, and in asking for some explanation of the reasons why the Government are departing from that principle.
  Sir F. BANBURY: The right hon. Gentleman gave two reasons for this Resolution. First, he said, it often occurred that the tax was raised on land, the value of which had improved, not owing to the exertion of the people living in the locality, but through the exertion of people living in neighbouring towns, and he proceeded to give examples showing how in his opinion that arose. The second reason was that the local authorities were not unanimous in their opinion as to how the money should be divided. Some were in favour
  944
  of rateable value and some had other ideas, and he, therefore, thought it better to wait until they were able to come to an agreement among themselves. I propose to deal with both of those arguments. I will take first the point as to unearned increment value. May I say, however, that I do not see how that touches the Mineral Rights Duties, which are by far the larger part of the tax. The right hon. Gentleman appears to have left that out of his calculation. I do not know the nearest point to London at which the question of mineral rights could arise, but surely the right hon. Gentleman is not going to say that any income from those mineral rights ought to be divided among the people of Hoxton, or of any part of London. There may be something to be said on the question of increment value possibly. The right hon. Gentleman said the increment value near the big towns accrues owing to the exertions of the inhabitants of those big towns, and he argues that the money accruing from that increment value should go to places outside. But let me take the case of Croydon. That is a town about eight or nine miles from London Bridge. We know there has been a great rise in the value of land at Croydon, partly owing, I believe, to the action of the railway companies. At any rate, there has been a considerable rise, and I would ask how the inhabitants of Croydon would like it if the money raised by the increase of value of land in Croydon was handed over to the inhabitants of West Ham? It seems perfectly indefensible, because the inhabitants of West Ham had nothing whatever to do with the rise in the value of land in Croydon. The people in the City of London may have had something to do with this, because so many of them live at Croydon was handed over to the inhabi-but I do not fancy that the right hon. Gentleman proposes to endow the City of London, seeing that that is not a part which meets very much with his approval. But take the case of Liverpool. There are towns and villages round about Liverpool where there has been a considerable increase in the value of the land. I can only imagine that the reason for the proposal of the right hon. Gentleman to distribute the money in the way he suggests is that he wishes to dole out his bounty, and that this is the easiest way to do so. But there is nothing in the Bill which suggests mat there is to be anything in the nature of a radius; there is nothing to provide that the money arising from the

  945
  increment value within 20 miles of London is to go to London, or that that created within 20 miles of Liverpool is to go to Liverpool. There is nothing, in fact, in the Resolution which would prevent this money arising from the increase of land in Croydon being handed over to the Carnarvon Boroughs. So far as I can see there is absolutely nothing to prevent that.
  Mr. LLOYD-GEORGE: Has it never occurred to the hon. Baronet that there may be an increment in the Carnarvon Boroughs, as there really is, and that the people of Croydon would get the same benefit?
  Sir F. BANBURY: Would not the Carnarvon Boroughs get the same allotment? I think they might take both. Is the increment for the Carnarvon Boroughs to go to Croydon and that of Croydon to Carnarvon Boroughs? With regard to the other part of the question, and that is the possibility that the authorities have not made up their minds as to how this ought to be divided, I think that is very likely. The right hon. Gentleman says one set want rateable value, but the country constituencies do not want rateable value. I can quite understand that. This is a new tax, and all the local authorities want to get as much as they can. They have not agreed as to how they should share in the plunder given them by the Government, but have not the Government made up their minds, and, when they introduced this tax, had they not made up their minds? I should not wonder if they had not, because this was only a modification of the Budget made at the last moment in order to propitiate local authorities. Therefore, Parliament is asked to vote money without having the views of the local authorities who are to have the money as to how the amount is to be divided amongst them. That is to be decided by the right hon. Gentleman hereafter without any Parliamentary advice. The manner in which the money is to be divided seems to me to be a difficult question. We are, after all, quarrelling over a very small sum, because, when you pay the cost of collection, there will be very little left to divide. I think the Resolution says that the local authorities are to have a sum equal to one-half of the proceeds of the duties levied in respect of land values, etc. Is that to be the net proceeds or the gross proceeds? Because it is a very important difference if the sum is to be the net proceeds. An hon.
  946
  Friend below me says that the word "net" is in the Clause, but in the Resolution which we are discussing it says nothing about net, and perhaps the right hon. Gentleman will tell us. It is, as I have said, a very important question, because if it is net there will be very little to be divided amongst the municipalities, because the whole amount would only come to £675,000, and in the second, third, and fourth years the cost of collection will be something like £600,000. I should therefore like to be informed whether the word "net" is to be introduced or whether it is to be the gross amount. If the word "net" is in the Clause I think the Resolution and the Clause ought to coincide.
  Mr. WATSON RUTHERFORD: We have listened to two speeches from the Chancellor of the Exchequer and to two speeches from the Leader of the Opposition with great interest, and I am bound to say that the Chancellor of the Exchequer in his version of the speech of the Leader of the Opposition gave us little less than a travesty of the right hon. Gentleman's speech, and in both his own speeches the Chancellor of the Exchequer has entirely failed to give us the slightest indication as to what the general principles are on which he proposes to divide the money raised under this Clause among the municipalities if it is agreed to. As I understand it, the whole effect of the speech of the Leader of the Opposition was an argument and an appeal that the Committee here were entitled to know not perhaps the whole details of how this money was to be divided, but the general principles of the basis of the division. To the argument there has been no reply, and to the appeal the Chancellor of the Exchequer has turned a deaf ear. It is not really the demand of the Leader of the Opposition, but it will be the demand of the whole country. The Government are going to mix up these four or five taxes imposed upon the country, and half of the proceeds of those taxes is to be carried to a certain account, but we are not told when we ask the authors of the taxation the general principles upon which half of the proceeds of it is to be divided. The Chancellor of the Exchequer referred just now to the case of Glasgow, and he put his case in this way: He said there are outside the municipal boundaries of Glasgow very considerable areas of land which are considerably affected by the enterprise and expenditure of the municipality of Glasgow, and he said with a great deal of force—and if that

  947
  were the only argument there would be very little reply to it—he said, "Why should Glasgow be precluded from claiming the increment from the proportion of the tax which arises from the belt outside its own municipal area?" But what the Chancellor of the Exchequer did not tell the Committee just now, and what constitutes a complete reply to the whole of that line of argument, is this: That Glasgow, backed by other municipalities, came forward with a, proposal and a demand that their areas and their municipal boundaries should be extended and that they should have the right to include in them the whole of the land round about their borders, so that they might deal with it as a whole; and, of course, if that demand had been conceded it is quite clear that, on a basis in proportion to the amount of money contributed, they would participate in the whole of the benefit which their enterprise and their expenditure had brought about. I consider that is a complete answer to the whole of the argument of the Chancellor of the Exchequer en that point.
  If the right hon. Gentleman had given us the additional reason which I am going to suggest—if he had said the Government are going to bring in a Bill under which the whole of the municipalities of the kingdom will have power to enlarge their municipal boundaries and their own area's, so as to include all land that is beneficially affected, some sort of case would be made to postpone for 12 months the allocation of these monies, because we should then have time to arrive at a just and reasonable basis upon which the division could be calculated. But the Chancellor of the Exchequer has given us no such assurance. He has not held out a word or a hint of anything of the sort, but he has left us without the slightest knowledge or intimation as to the general principles on which this money is to be divided. I shall submit to you, Sir, before I sit down, a point of Order, and it is this: If we are asked under this Resolution, and under the Clause which carries it out and the other clauses referred to, to lay a burden of taxation upon the people or certain classes of people, is it in order to levy half of that taxation entirely without any object to which it is to be applied? I am not submitting the point now, but I shall submit that to your decision before I sit down. The point I raise is this—that in the reference of this question to the Committee there is no object assigned for
  948
  which half of this taxation is to be used, and, no object being defined or stated to the Committee. I contend that it is illegal to levy it.
  Perhaps I may be allowed whilst I am addressing the Committee to say a few words upon the principle of this tax. Here is the Chancellor of the Exchequer saying to a number of people who are landlords, "You are robbers; you have been taking for years, and you are now taking monies which belong to somebody else; monies which have been earned by the State or the municipalities, and you are taking them"; he does not, however, bring in a Bill to stop that robbery—nothing of the sort—but he says, "The State will come in and take part of the proceeds of your robbery—part of the swag"; and the idea is that the municipalities may object to that, and have brought forward Bills which are inconsistent with it; but the Chancellor of the Exchequer says further he is going to square the let by giving them a bit of the plunder. If that is the principle of the taxation upon which the country is to proceed—if that is the principle of the Liberal party—then God help, the country.
  With reference to the attack made by the right hon. Gentleman on the Leader of the Opposition in regard to the Bills that were brought forward and the agitation that took place to alter the basis of rating, so that the basis for the division of rating might be more in proportion to the site valuation, there were a considerable number of Members on both sides of the House who were in favour of that proposal. I was one of those who were in favour of it, and I seconded the Bill in 1903 which was brought in to that effect. But I wart to take this opportunity of pointing out that the principles at the bottom of that Bill were altogether and in every respect inconsistent with the taxation now proposed and which is dealt with in the financial Resolution now before the Committee. The principle at the bottom of that Bill was this: That when a municipality was obliged to raise certain sums for its own purposes and lay a rate upon its citizens, that rate should be proportioned, not as it is to-day to the enterprise of individuals in building upon the land, but should be in proportion to the opportunity which the City afforded them. That was the only principle, and the right hon. Gentleman now accuses the Leader of the Opposition of appreciating it. For my part I hope the Leader of the Opposition does appreciate it, because, as far as

  949
  I am concerned, with many others, I believe that is the correct basis on which the rating of all municipal areas should be arrived at. But that does not prevent us from now pointing out, that in effect that is the very taxation which is included in the clauses of this Bill, and which is to be divided, and that these principles are entirely inconsistent with the principle which we bad at heart, and which we have at heart now—namely, the principle that the municipality shall be entitled to charge its citizens in proportion to the benefits it confers upon them.
  The principles of this Bill involve that the State is to interfere, and the State is to take a different account of the tax in a different kind of way which would make it impossible in the future for the municipalities to carry out what they have had at heart so long and in order to quiet these municipalities and prevent them from interference here is the bribe offered by the Chancellor of the Exchequr, who says, "Have a bit of this plunder which we are taking from the landlords." I can only say that I look upon that policy embodied in this Resolution as being one of the most unjust and unfair that has ever been submitted to the Committee or to this House. We are asked to say: "Here is the plunder which the State is going to get. True, for a year or two it is not going to be much, because the expenditure is going to be enormous; there are not going to be any proceeds for many years to come, but there are going to be proceeds in future years, and the municipalities are to be bribed by this bit of money in the future which they are to get, and they are not to have the principal of which they have been defrauded for years past, by taking those houses round about and rating them in a proper manner. There are some of us on this side of the House as well as on the other who look upon the whole of these taxes as not merely unjust and impolitic, but as causing confusion, difficulty, annoyance and expense, which are wholly unnecessary, when the subject might have been dealt with in an equitable manner without causing any of this tremendous expense and upon a reasonable and proper footing. I reiterate the demand which the Committee was entitled to make for some explanation of the general principles on which this money is intended to be divided, and I put this point of Order: Are we as a Committee in order in allowing these taxes when we are distinctly told in the Resolution that half of the taxes are not going to be used
  950
  when there is no defined object laid before Parliament to which they shall be applied, and when even the general principles under which they are to be dealt with are withheld from us?
  The DEPUTY-CHAIRMAN: We are dealing at present with the Resolution as a Resolution, and, as the hon. Member is aware, the Resolution is always in very general terms, and the purposes are carried out by Act of Parliament. But he will find here that "half the proceeds of the duty are to be divided between England, Scotland and Ireland in such manner and paid into such separate account for the benefit of such local authorities as Parliament may determine." What will follow necessarily will be a Bill, and the Bill will, of course, determine that in the usual way.
  Mr. WATSON RUTHERFORD: Shall we be in order in submitting that point of Order to you later when the Clause comes up?
  The DEPUTY-CHAIRMAN: The hon. Member may take the opportunity of submitting the point of Order to Mr. Speaker on the Report stage.
  Mr. PRETYMAN: We are at a great disadvantage in debating this. We do not know whether the right hon. Gentleman means proceeds or net proceeds. Will he tell us that?
  Mr. LLOYD-GEORGE: It is all on the Paper.
  Mr. PRETYMAN: No. The Resolution says "proceeds," the Clause says "net proceeds." Which does the right hon. Gentleman mean?
  Mr. LLOYD-GEORGE: The Resolution is simply a sort of general authorisation; and you must take the Clause.
  Mr. PRETYMAN: That means that the cost of valuation will be deducted.
  Mr. LLOYD-GEORGE: No, it does not at all.
  Mr. MUNRO FERGUSON: No doubt the inquiries which have been held and the demands which have been made by the Scottish municipalities have been that the increment on building land should go into the local exchequer. That has been the general proposition up to now, and there might be something to be said in favour of the tax upon building lands going to the local exchequer and the tax on mineral values going into the Imperial Exchequer. But, at any rate, the local exchequer is

  951
  to get half the Mineral Tax, and that will go some way to compensate for the loss of what they had anticipated in the matter of getting the whole of the building value. I have been associated with many of these inquiries and with some endeavours to deal with this question of building value, and although it is undoubted that we have always had the local ideal before us, the difficulties in the way of carrying it out have been very great, and these difficulties were brought out in the latest inquiry on the subject of the Scottish Land Values Bill. It was proposed there that this tax could be applicable only to urban areas, but it was soon found out that many county divisions are really indistinguishable from urban areas, and that it would be impossible to put this tax upon our urban areas and refuse it to what is nominally a rural area. Take a great mining district, like parts of Fife or Lanarkshire. It will be practically impossible to levy this tax in the urban districts alone. You must go over the whole area, and if you come to that I think there is a great deal to be said in favour of the scheme which has been adopted by the Chancellor of the Exchequer. There are far fewer difficulties in the way of collection. Many local authorities have been very much impressed by the delicacy of the undertaking of collecting these Land Taxes locally, and there are many officials who have never looked upon the project with great favour on that account alone. The tax is much better levied by the central authority. In the matter of distribution there is, I admit, still a great deal to be said, and I think it is wise to postpone the final settlement of how this could be done. It is not only a question of the views of different local authorities, although I am not at all sure that the poorer parts of the country might not participate in the advantages of its distribution as well as the richer part. I think there is a good deal to be said for that, but I am not a warm supporter of subventions to the local authorities when they can be avoided. Until we have a revision of the incidence of local taxation it is absolutely impossible to avoid it, and why we have separate projects of this kind, which do not always hang together with our general legislation or with our system of finance, is that at present one Government has found time to inquire into the subject of local taxation, but no Government has ever yet found time to deal with it, and the sooner we deal with it the better it will be for national and local finance.
  952
  There are certain services which can be far better carried on by the State than by the local authority, and I would much rather see the money used to carry out services which can be better carried out by the central authority than in giving subventions in aid of those services which are less efficiently administered by the local authority. I by no means say all services can be better carried out by the central authority, but there are some, and that may possibly be one way out of the difficulty. This Resolution, which gives half of these new taxes to the local authority, will be much better received by the country, and is, I think, in itself sounder than the original proposal, that the whole of the tax should go into the National Exchequer. Having had a great deal of experience both of inquiries and of local administration, I have come round to think that the proposal of the Chancellor of the Exchequer with respect to the levy of this tax is the best that has yet been made, and I think, in respect to the distribution of it, he is doing wisely in asking for time to consider the matter, and I think the country will support him in doing it.
  Mr. WALTER GUINNESS: In view of the great anxiety which is felt by local authorities as to the details of the proposal, I should like to ask the Chancellor of the Exchequer if he can possibly give us a little more information than he has yet seen fit to offer. In the first place, there is a discrepancy between the proposal as it appears in the Resolution and in the new Clause which appears on the Order Paper. The Resolution states that: "This sum shall be divided between England, Scotland, and Ireland in such manner and paid into such separate accounts for the benefit of such local authorities as Parliament may determine."
  That suggests that the money derived from England, Scotland, and Ireland will be separately ear-marked and separately paid into accounts for the benefit of those three different countries, and I should like to know, in view of the fact that there is no mention of that in the Clause at all, whether there is any idea of ear-marking the contribution of the three separate countries in the way that is suggested by the Resolution. I think we might have a little more information as to whether the yield is to be net or gross. I could not quite understand the motives of the right hon. Gentleman in giving such a very cryptic answer to the hon. and gallant

  953
  Gentleman (Mr. Pretyman). The right hon. Gentleman apparently said it was not going to be as in the Resolution, and that we must go by the Clause. Apparently, from the Clause, it is going to be half the net proceeds. That is a very serious matter to local authorities, and I should like to draw the attention of the Chancellor of the Exchequer to an answer which was given by the Financal Secretary to the Treasury to the hon. Member (Mr. Lane-Fox) on 18th August. The hon. Member asked what is the estimated net amount that the local authorities will receive from Land Taxes this year and next year? The Financial Secretary answered:—
  "It is anticipated that the yield of the new Land Taxes in the current financial year will amount to £675,000, of which one-half will be handed over to the local authority. My right hon. Friend estimates that the tax will yield next year one million, of which the local authorities will receive the same proportion."
  These figures, of course, are gross figures, and it means that the right hon. Gentleman has changed his mind if he is now going to deduct the cost of valuation.
  Mr. LLOYD-GEORGE: No. I said, "No" to the question put by the hon. and gallant Gentleman (Mr. Pretyman).
  Mr. WALTER GUINNESS: I am very much relieved to hear the right hon. Gentleman's answer. It was very ambiguous. It would have been very unjust to expect the ratepayer to pay a very large sum towards the valuation for several years to come.
  Mr. LLOYD-GEORGE: It simply means the cost of collection which does not amount to much one way or the other.
  5.0 P.M.
  Mr. WALTER GUINNESS: Then are we going to have a new Bill next year to carry this out, because if it is going to be left to a future Session I think it will be a great disappointment to local authorities who are counting on a return during the present financial year? I think the right hon. Gentleman is very wise not to give us details of the allocation, because local authorities are still in some cases in the fortunate position of enjoying holidays, and it has been quite impossible for them to put before him the opinion which they have every right to form on this matter. The right hon. Gentleman mentioned as one proposal that the money should be divided according to rateable value. I think that was the proposal of the Association of Municipal Corporations. I
  954
  should like briefly to state an alternative proposal, which, I believe, will shortly be put before the right hon. Gentleman by the London County Council, and which would meet some of the criticisms made by him.
  Mr. LLOYD-GEORGE: The views of the county council, I think, were represented before.
  Mr. WALTER GUINNESS: I think not. The Chancellor of the Exchequer had a deputation from the London County Council alone, and he asked that they should give him a memorandum of their proposals as to allocation. The proposals which they have formulated are very different from that with respect to rateable value.
  Mr. LLOYD-GEORGE: Have they been sent along?
  Mr. WALTER GUINNESS: They have either been sent along or will be shortly. I think it is important that they should be considered, for rateable value will cause great injustice in the allocation, and will give subventions to some authorities which are least in need of them. In addition to that, rateable value—as put forward by the deputation to which the right hon. Gentleman referred—will also apply to the Mineral Rights Duty. Obviously, the proceeds from the Mineral Rights Duty are in no sense due to local enterprise, and I think it would be most unjust that rateable value should come in at all in that case if rateable value is to be taken as the standard of the amount of work done by the local community in increasing values. The London County Council's proposal is to leave out the Mineral Rights Duty altogether, and to leave that tax to be divided, as the right hon. Gentleman may think fit, over the whole country. While my hon. Friends and I do not offer any opinion on that, we feel strongly that in the case of those revenues which are derived to a large extent by the enterprise of the local community, there ought to be a combination of two principles, namely, that existing local areas should not be accepted, but that zones should be created round large towns to bring in those parts of the country which share in the prosperity of the central town, and that the funds should be allocated to those zones and the towns surrounded by the zones according to the amount of money raised in the zones. That is the suggestion of the London County Council, and, as between the

  955
  outer part and the inner part of the zone, the basis of rateable value should be accepted. I think that would be a far fairer basis than rateable value, because it would ensure better treatment to the outlying districts who share in the prosperity of the commercial area without, perhaps, having contributed very much to its creation. At the same time, they would not get money to which they were not fairly entitled. I think the alternative proposal put forward by the Chancellor of the Exchequer is in many ways unsatisfactory. I would ask the right hon. Gentleman to tell us whether he is going to earmark the proceeds of the taxes in England, Ireland, and Scotland, and also whether he hopes to carry a new Bill this Session to allocate the funds so that the local authorities should get the benefit in the present financial year?
  Mr. E. S. MONTAGU: I desire to support the Resolution proposed by the Chancellor of the Exchequer. I do so on behalf of the agricultural community, and particularly the one I have the honour to represent. When the Chancellor of the Exchequer made his Budget speech he gave a list of the objects for which he was seeking money and expanding the revenue. He mentioned that one of the objects to be dealt with next year was a general revision of the relations between local and Imperial taxation. This is something which has been promised to us by many of his predecessors, and I venture to think that the Chancellor of the Exchequer has brought its realisation nearer than any of them. This Resolution and the Clause which is to be based upon it make it certain that this reallocation of the burden will be seriously tackled next year. It is gratifying to learn from the hon. Member for the West Derby Division of Liverpool (Mr. Watson Rutherford) that he admits that in these new taxes there is to be found an expanding revenue—a revenue which will grow in succeeding years. That is a proposition which has been often raised on this side of the House, and which has been denied on the other side with equal force. When the Chancellor of the Exchequer desires to help to remove the grievous burden under which the ratepayers have been suffering so long, he is always handicapped by the want of money. If he has a surplus there are many advocates for the removal of different taxes, and it is only by some means like this of earmarking a sum which will
  956
  go to the realisation of this purpose that any real progress will be made. I am myself an advocate of removing certain services from the domain of the local ratepayer and putting them on the Imperial Exchequer. There is nothing inconsistent with that in the allocation of these particular taxes to that plan, but it is absolutely impossible with the time at his disposal that the Chancellor of the Exchequer should undertake the whole of the work this year. We have already got these taxes, and we hope for the realisation of a larger plan next year. This small sum is only a nucleus which is to be distributed among the local authorities, but it is a guarantee that we are at last to get what we have so long advocated. There seem to be no taxes out of which the nucleus could better be found than these land taxes. The Leader of the Opposition said that if there was any justification for these taxes it was that they were levied on property which had in the past escaped rates. I would point out that they are also levied on property which has escaped Imperial taxation. The division, therefore, of the proceeds of these taxes between the Imperial Exchequer, on the one hand, and the relief, on the other hand, of the local ratepayers as a whole, and in particular of the grievous burden on the agricultural ratepayers, is to my mind one of the most hopeful of the various projects which the Government have proposed.
  Mr. F. W. JOWETT: So far as I am personally concerned—and I believe most of my colleagues will agree with me—I think the Resolution gives power to levy a tax which is very moderate indeed. I should have liked to have seen the Chancellor of the Exchequer going much farther and levying a tax equal in all cases to the rates of the district where such tax may be levied. Indeed, I would be in favour of undeveloped land being subject to all the municipal rates rather than that this alternative of the Chancellor of the Exchequer should be put in operation. It would be much more costly to the owner, because in many cases it would be equal to 8s. or 9s. instead of 1s., which will be the amount in most cases. I disagree with the position taken up by the Leader of the Opposition who, if I understood him rightly, maintained that the proceeds should go to the locality from whence the values were derived. Apart from the reasons given by the Chancellor of the Exchequer, which, I think,

  957
  were very sound, there are other considerations which, I think, ought to weigh in favour of the Chancellor of the Exchequer's view. Take, for instance, the case of waterworks. These are rated where they happen to be situated. It is a most grievous anomaly that because a large municipality has to go to some far away part and expend vast sums of money in the construction of waterworks, the immediate district should be able to levy rates on these works for all time to come. The same principle holds good with respect to railways and docks. It is not fair in such cases that the full rating values should always go to the locality where the works happen to be situated. I think it is only fair that these values should go into a central fund to be disbursed therefrom. I should like to put before the Chancellor of the Exchequer another view, and that is whether or not in determining how these central funds, which are to come into the Exchequer, shall be distributed, he will not consider the ear-marking of those funds for separate and distinct purposes. So long as the State gives subventions in relief of local rates without determining how the money shall be spent, it merely goes to relieve the burdens of the owners. But everybody knows that in every locality there are matters that need redressing that cannot possibly be undertaken because these localities have spent as much out of the local rates as they can afford, and, therefore, the work is not being done as it ought to be done. Sanitation and various other services that ought to have public money spent on them are not being looked after as they should be looked after in many places. If the Chancellor of the Exchequer would consent to earmark this money in such a way as to secure that it shall be spent on new objects of public utility so as to ensure that the public shall get extra services for that money, then the objection to subventions to localities would entirely disappear. As has been pointed out in the Minority Report of the Royal Commission on Poor Laws, those subventions that have been given to localities for different purposes, and have been subjected to efficient administration, have justified the action of the State in giving them. Take the subvention to the police. The fact of having given that money gives the State a distinct right to lay down that it shall be efficiently spent. It gives it the right of inspection and the right of seeing that the money has not been improperly dealt with. That is the line on
  958
  which all subventions from the State to the municipalities and localities should go. Without such ear-marking there is grave risk that the money given by the State will go to the relief of property, and not to amend those services which people have a desire to have amended, and which ought to be amended for the good of the country. I trust the Chancellor of the Exchequer will consider this point.
  Sir GILBERT PARKER: The hon. Member who has just sat down regrets that the proposals of the Chancellor of the Exchequer were not those which he would have made. He would, for instance, have dealt with undeveloped land by local taxation, and the 1s. which the Chancellor of the Exchequer expects to get would under his proposals probably be 8s., 10s., or 12s. But he need not despair of the Chancellor of the Exchequer. The right hon. Gentleman has a very receptive mind, and perhaps that may come. But I would direct the attention of the Chancellor of the Exchequer to one or two points which refer to my own Constituency and the county in which it is. When the Chancellor of the Exchequer first introduced this taxation of land values and the Mineral Tax he was going to apply the proceeds of this to national purposes. He was going to tax the undeveloped minerals or the raw material. He changed his mind, probably influenced by arguments in this House, probably by second considerations, and probably by the representations of deputations. At any rate, he has now come to a position when he is going to return the municipalities half the proceeds out of the Mineral Tax. I remember when the Chancellor of the Exchequer introduced his Budget he was very strongly, for instance, concerned at the necessity of placing a tax on undeveloped minerals, and he put it on the ground that the workmen and manufacturers were handicapped by it. The Chancellor of the Exchequer pointed out to this House that trade and industry were handicapped by these royalties, but the landlord got out of these royalties more than his due, and he ought to return something to the State to make up for the fact that the manufacturer and the workman did, as it was termed, their duty. The position now is that the Chancellor of the Exchequer has transferred the tax on undeveloped minerals to wayleaves and royalties, forgetting, I am afraid, that there are a great many proprietors who have bought out their wayleaves and royalties, for which they have compounded, as it were, with the landlord

  959 And now the Chancellor of the Exchequer proposes to tax proprietors who have commuted their royalties and their wayleaves. As an example of what has happened, I may refer to the case of the cement works at Northfleet, in my own Constituency. Here you have nothing contributed by the municipality, nothing contributed by anyone to the support of the population, but you have capital itself, which has made the place what it is. It was the purchase of the land and it was the development of the industry by the capital which was expended on the purchase of chalk land which has built up around those cement works a very large and prosperous community. The community owes everything to capital and to the initiative of the capitalists. Suppose the proprietors of those cement works bought their land from the surrounding owners, is it a fair and just thing to tax those proprietors who have compounded with the owners for their royalties and their wayleaves? Is it a fair thing to tax them and give the proceeds of that tax to other portions of Kent or other portions of the Kingdom? No one outside has contributed to the success of that great industry at North-fleet—and there are other industries of the same kind in other parts of the Constituency—except the capital which was spent on it and the energy behind the capital. The Chancellor of the Exchequer may say that that is not what he intended—that he intended by this tax on royalties and wayleaves to get at the chalk land, and the owner of the clay land for making bricks, and the owner of coal land for the production of coal, and that it was his object to compel them to pay, from his standpoint, what was due to the State. But the proceeds of this tax from the cement works at Northfleet will go to relieve the burden of other towns in Kent and other towns in other counties of the Kingdom who may be backward, non-progressive, and uneconomical in their expenditure or lax in fulfilling their municipal duties. Allusion has been made to municipalities in Essex, Kent, and elsewhere who were not doing their duty thoroughly. Why should other places, such as North-fleet, be obliged to pay for the non-progressiveness of other municipalities in their county or in other parts of the Kingdom? Yet, that is what the Chancellor of the Exchequer proposes. He proposes to tax these proprietors who have already compounded, who have already secured their royalties and wayleaves by purchasing the
  960
  clay and the chalk, and to tax them again, although they have paid for their royalties and wayleaves by giving a lump sum. It is most preposterous, for instance, to tax the owner or proprietor who has paid for clay land for the making of bricks. He has paid the tax already. He has bought these wayleaves and royalties, so that the Chancellor of the Exchequer is proposing a tax which in the circumstances is eminently unfair, and is all the more unfair—
  The CHAIRMAN (Mr. Emmott): I would remind the hon. Member that this is not a question of taxation. This is a question of the distribution of the proceeds of taxation, and he should confine himself to that.
  Sir GILBERT PARKER: I apologise. My object was to show that the Chancellor of the Exchequer was imposing a very heavy and very unjust taxation upon this industrial community, and that he was taking the proceeds and applying them to the needs or necessities of municipalities elsewhere which had no possible claim at all upon the proceeds of that tax. I think if the right hon. Gentleman makes inquiries into the case that I have presented on behalf of these proprietors, he will see how unjust it is to give the proceeds of a tax which they have bought out to relieving the needs of other municipalities throughout the United Kingdom.
  Mr. LLOYD-GEORGE: I have just one or two observations to make in reference to the discussion, which has been a very interesting one. I do not propose to follow the hon. Member for Gravesend (Sir Gilbert Parker) in his examination of the problems of taxation, but I may say that the hon. Member's argument is based on an error of a very common character. The facts in regard to his immediate Constituency are very like the facts in relation to almost every constituency of the country. I do not think he could point to a single constituency where he would not get at any rate some portion of Increment Duty of undeveloped land, and I should say mineral rights. I daresay if he looked at the balance-sheet of the Northfleet Company he would find that it comes out very well. I should be very much surprised if they were contributing more in proportion than the vast majority of the constituencies of the country. The hon. Member for Croydon suggested that his constituency was taxed much more than my own Constituency, but I should not be surprised if he found that there is a very

  961
  much larger increase in my Constituency than he probably thinks, and I believe that is the case in the vast majority of constituencies. The real argument is a national rather than a local one. The hon. Member said I had probably changed my mind on this problem. That is not the case at all. I pointed out in my Budget speech that in my judgment a part of the proceeds of the taxation which I was then proposing to submit to the judgment of the House of Commons should undoubtedly be allocated to the relief of local taxation. Municipalities, it is true, requested that we should earmark part of this money, and that we should give not merely a Parliamentary pledge, but a statutory pledge as to the division of the sum. Several very practical suggestions have been made which I think ought to be taken into account. The hon. Member for Bury St. Edmunds (Mr. Walter Guinness) made a very practical speech, indicating that he had devoted a good deal of time to the consideration of the subject. I noted that he approved of the action of the Government in hanging up the fund, and he declined prematurely to make up his mind as to the method of apportionment between the local authorities. He took that course after a careful examination of the problem. He told the Committee that the local authorities had not had time to examine the subject, that they had been away upon their holidays, that the Government had brought forward a totally different proposal, and that the municipalities had all been invited to consider the matter, but they had not yet finally made up their minds as to the best course to take. The London County Council has only quite recently given a reply.
  Mr. WALTER GUINNESS: Three weeks ago.
  Mr. LLOYD-GEORGE: Only three weeks ago! At any rate, I invited them to do so about a couple of months ago. I am not complaining, because I think it is a very important problem, and that the county council acted wisely in considering their answer for, at any rate, two or three months before sending it. I think they stand, I will not say alone, but almost alone; other great municipalities have not yet come to a conclusion. I think we have had one or two instances in which definite suggestions have been made. We have had the suggestion from the Association of Corporations, a very powerful body, whose spokesmen are exceedingly able men, but they only represent one section of the municipalities of the kingdom, and
  962
  I do not think the Government are entitled to accept their view as being that of the whole of the municipalities. I am not sure that the agricultural counties were represented.
  Mr. WALTER GUINNESS: I believe the agricultural counties were represented, and that is one of the chief reasons why the London County Council put forward an alternative proposal. At the time the Municipal Corporations Association proposed the basis of rateable value, the agricultural land was not exempted from the Land Tax. Since then there has been a considerable change in the basis of taxation, and therefore there is a still weaker case in favour of what was put forward by the deputation to which the right hon. Gentleman referred.
  Mr. LLOYD-GEORGE: I would like the Committee to realise what it is they are doing. They are practically depriving the agricultural counties of a very considerable part of the money that will be raised by this tax. It is a suggestion which has been pressed on the Government in the course of this Debate that we should spend the money actually on the locality where the money is obtained. What are the suggestions that have been put before His Majesty's Government? There are at least five. One is that the money should be spent in the locality where it is raised. The second suggestion is put forward by the Association of Municipal Corporations, that the money should be spent according to rateable value. The third is that it should be spent in proportion to population. The fourth suggestion is an ingenious one made by the London County Council, that we should declare zones, and distribute the money raised in those zones in proportion to the rateable value of the various districts within those areas. That is an extremely ingenious suggestion, and it struck me as a very practical one which deserves very careful consideration. The fifth suggestion is the one to which I may say I am very disposed to give favourable consideration myself, namely, that the money should be spent for some specific purpose of the Act, and should be spent locally. That was very largely the method adopted in 1890. At that time the whisky money was given to the localities, a very considerable number of which spent it on secondary and technical education. In my own locality it was used exclusively in building schools. I think if that money had gone into the rates it would have been lost. It has been

  963
  allocated to purposes connected with education, and children can be sent to secondary schools, where they receive admirable instruction at a £3 fee. I do not believe there are half a dozen towns in England where you get such an excellent system of secondary education at so cheap a price, and the fees are so low that artisans are able to send their children. That is purely due to the fact that the money, instead of being flung into the morass of the rates, has been definitely allocated to a specific local purpose. I earnestly urge the municipalities, when they come to deal with the problem, to consider that which seems to me to be the most fruitful suggestion for spending the money. These are the five suggestions which the municipalities have to consider, and which I believe they are considering. I earnestly urge the Committee not, merely for the sake of a temporary party advantage—I say this without any offence—to rush the Government into a definite allocation of the fund before the municipalities have had full time to consider the matter. I do most earnestly press that upon the Committee. It is all the same to me whether the money is allocated according to rateable value, or it is ear-marked in some other way. There would be no Parliamentary difficulty about it. If I had put into the Clause the words "according to rateable value," it would have been debated; those who are opposed to rateable value would have expressed their opinion, there would have been a Division, and there would have been an end of it.
  Viscount HELMSLEY: A mechanical majority.
  Mr. LLOYD-GEORGE: Mechanical majority? I think the Noble Lord has acted in a mechanical majority, and I have very little doubt if he be in that majority again that he will be a mechanician, and then he will know how to appreciate the value of a mechanical majority. We may have to remind him of this in future, but we will not be premature. I think the Noble Lord is one of those who is really interested in this matter. I think he was one of those who brought the matter to the attention of the House a year or two ago, and I am not sure whether or not I had the honour of replying to him, but I take it generally that he would now rather allow the municipalities time to consider before coming to a conclusion on this subject. Of course, it is a matter for the Committee to decide, but I think we ought to give ear
  964
  to the municipalities and learn what they have got to say. We ought not to force them to come to a premature decision upon the question. What happened in 1890? I remember perfectly well the Government changed its mind in the course of the proceedings. It was the best thing that ever happened to the country that the Government did change its mind. You may say: "Here you are making one set of proposals in May, and in June changing your mind and making another set of proposals." I do not complain of that. It is rather what the Opposition would say. It is one of their stock criticisms; we all do it in our turn; it is part of the machinery, or one of the weapons. At the same time I would urge the Committee to allow time for the consideration of this matter rather than force a decision of the problem. They probably think that they ought to decide it themselves, but it does not matter whether we decide it or they decide it, and I think we will come to a wise decision if, first of all, we have heard what the municipalities have got to say on the problem. That is all I urge upon the Committee at the present moment.
  Mr. F. W. LAMBTON: I would not have intervened but for the speech of the hon. Member for Bury St. Edmunds and the answer of the Chancellor of the Exchequer. I was alluding to my hon. Friend's speech as to the opinion of the London County Council. Throughout the whole of his speech the right hon. Gentleman spoke of the opinion of the municipalities and the attention that should be paid to it. I must ask him to pay some attention to the county councils. I presume he does not mean to leave them out of his calculation.
  Mr. LLOYD-GEORGE: The hon. Gentleman should have paid some attention to his hon. Friend's speech before addressing me. The first association which came before me was an association representing the county councils. They are responsible for the first suggestion which I mentioned in my list.
  Mr. LAMBTON: The right hon. Gentleman used the word municipalities throughout. I paid attention to the speech of my hon. Friend below me, and he alluded to the opinion of the county councils as to these mineral taxes, and said, I think, that he was speaking for the county councils, and that the mineral wealth was not due to the industry of the community in which that wealth existed. If the tax is to be

  965
  allocated on that basis it will be extremely unfair to a great many mineral districts. Take the County Council of Durham: if you are going to rate the industry on which its increased rates are paid, surely it is light you should pay some attention to that county council. The County Council of Durham depends for its rates on the mineral interest, and ought to have the first claim in the allocation of these duties. I ask the Chancellor of the Exchequer to give some weight to the opinion of the County Council of Durham and other mineral districts as well as to London or any municipality.
  Sir FRANCIS CHANNING: I wish to put a specific question to the Chancellor of the Exchequer which may be of some importance. I think that he is perfectly right in inviting the decision of the various authorities affected, or likely to be affected, in the allocation of these taxes, and that a certain amount of time might be given to enable them to lay their opinions before the Government. At the same time, so far as I can recollect a ruling of Mr. Speaker Peel, in 1890, as to the necessity of allocating the money which was liaised then by Mr. Goschen in his Budget for the purpose of extinguishing certain licences, the decision was that that money must be appropriated during the actual Session the Resolution was passed. In view of that it seems to me it would be extremely imprudent that we should leave this question open until too late a period, and that some decision should not be arrived at with regard to the allocation of this money within a reasonable time before the close of the present Session. I myself do not expect that this Session will last for ever, and it seems to me this is a point of importance. If my interpretation of Mr. Speaker Peel's ruling is correct, it will be incumbent on the Government definitely to allocate this money to the various objects which are considered wisest to allocate it to before this Session comes to an end, and it is obvious that the time during which these matters can be considered is a limited time.
  Viscount HELMSLEY: I think that the difficulty which we are now in as to the allocation of this money arises from what I would call the "hand-to-mouth" legislation which has been indulged in by the Chancellor of the Exchequer in this sort of way. It seems to me this allocation of half of these taxes to the local authorities is, as a matter of fact, nothing but an elaborate sham. It is not really an allo-
  966
  cation of these particular taxes at all. After all, if it is an allocation of these taxes, the justification of it is, as my right hon. Friend the Leader of the Opposition pointed out, that the municipalities have done something in creating these taxes. That is the only justification. I maintain, as a matter of fact, if you are going to spread the proceeds over the whole of the country, you might just as well take this sum of money from any other tax you like—say, the Income Tax or the Death Duties—and devote it to the relief of local taxation. Or if that is really what has to be done, it would have been much better to have done that honestly when the question of local taxation was before us. The natural solution is to say that, as we cannot allocate this money, we will not raise the tax. That is the logical position. It seems to me obvious, from the position which the Government have taken up, there will be very great difficulty, by which the agricultural community will suffer. The other municipalities will say that this money is earmarked, and that it comes from property in which they have a special interest, and that, therefore, in any division they would claim to have a preponderating right over the agricultural community which has directly no connection with these taxes. Therefore those municipalities will be in a better position in coming to the Chancellor of the Exchequer or any Government of the day than they would have been in if a particular sum had been allocated for the relief of local taxation when that particular question was being dealt with.
  It seems to me that so far from having the effect the hon. Member for Cambridgeshire supposed, that of relieving agriculture, which we have all wanted for so long, it will have exactly the reverse, because the agricultural communities will not be able to speak with the same authority or voice to the Chancellor of the Exchequer as the other municipalities will. That seems to be a very great drawback, and it is the result of this second thoughts policy of devoting this Land Tax money to municipalities. It is either a fact or a sham. Either these taxes belong to the municipalities, and shall therefore go to those municipalities where they are raised, or it is a sham, and, as a matter of fact, this allocation means nothing, and you might as well take the money from any other tax and distribute it equally. I think the result will be to delay indefinitely the relief to agriculture, and to tie the hands of the agricultural interest when

  967
  they are trying to get their fair share, and to tie the hands of any Government who really wish to give that special relief to the agricultural community from local taxation which the Chancellor of the Exchequer and the Prime Minister have on various occasions admitted it deserved.
  Mr. THOMAS LOUGH: There are two things I wish very respectfully to place before my right hon. Friend the Chancellor of the Exchequer. In the very interesting speech which he has just delivered he seemed to me to mix up two question which I venture to hint to him he should treat as entirely separate. The two questions are, first the areas which will get the money, and, second, the purposes to which the money will be devoted. I venture to think that what we are all interested in, what everybody in the House is interested in, is the first question, namely, the areas which will get the money. I do not think there will be any dispute as to the purposes to which the money will be devoted. [An HON. MEMBER indicated dissent.] There cannot be a dispute without two sides, and I should agree with anything my hon. Friend suggests in the way of expenditure, so that there would not be any dispute. I do think the important matter is in what area this money will go? I will, therefore, hint that those two points should be kept entirely separate, and that the right hon. Gentleman will find that the House and country are most interested in the question of how the money shall be distributed within the areas. The other hint which I venture to give to my right hon. Friend is not to listen too much to the views of the local authorities. We may hear what they have got to say, although I know before they open their mouths what they will say. Every local authority will say "Give us the whole of the funds," or, if not the whole of it, give us as much as you can. The local authorities are all cormorants. They remember nothing but that they have got a stomach, and they want to get it well filled. They look at it from one standpoint, the standpoint of Little Peddlington, that is, to give them all they can get. I venture respectfully to say the duty will rest on this House, on Parliament, and, most of all, upon the Chancellor of the Exchequer and the Government to settle this matter fairly. I am sure my right hon. Friend will remember that these land taxes have almost been converted in the way they have been treated in the Budget
  968
  into urban taxes. They do not press as heavily on agricultural communities, and the agricultural communities have got one or two pieces of fat already. I believe that they will score very heavily under this concession made under Schedule A over the Income Tax, and they are getting half their rates paid at present at the expense of the houses and the towns.
  Mr. PRETYMAN: They are not getting half the general rate paid. It is only half a sanitary rate.
  Mr. LOUGH: I did not say half the general rate. I am sorry my hon. Friend is so touchy on this sore point. Does he not remember he was in the House when we were discussing the Agricultural Rating Bill, and surely it did some good, and it was something for the agricultural districts and for land. Land has had its turn, and I say the poorer urban districts ought to have their turn now. I would remind my right hon. Friend the Chancellor of the Exchequer that no one put the case of the towns more eloquently than he did in a speech he made in 1900. I wish he would read that speech again, although I know he is very busy at the present time. He promised when the taxes on land came in that those municipalities which were oppressed would receive great relief. All relief has been cut down to about half of the whole tax, although I think we ought to have all those taxes raised in the various localities. I do ask, especially from the standpoint of London, that he should see that the great municipalities where there is a large poor population, and where there are many public services to be discharged, shall have their claims remembered. I ask especially that he should remember the claims of London, for I must say that London has been unfairly treated in many past arrangements. I hope my right hon. Friend will not allow himself to be drawn into any allocation of the funds which will not do full justice to the municipalities.
  6.0 P.M.
  Mr. JAMES HOPE: I wish to refer to what has been mentioned by the hon. Baronet the Member for Northamptonshire (Sir Francis Channing). I would ask the Chancellor of the Exchequer whether there is any precedent for hanging up a tax in the way suggested in a case which is authorised by a Resolution of this kind. What happened in 1890 was that the taxes were raised, by Liquor Duties, for the extinction of licences. That was prevented by the efforts of hon. Gentlemen now

  969
  opposite, and the taxes were diverted to education very properly, but it was a very great shame on those persons on whom the taxes were levied. The point is as to that money which was raised that a new purpose was found for it and done in the financial year. Now apparently the tax is to be hung up, and, if this Resolution is passed, it might be hung up from year to year if the Government of the day did not care to undertake the problem of allocating it. In that case what would be done? Would the money be allowed to fructify, or would it simply be kept idle? Could it be drawn upon as far as it went to take the place of some of the short borrowings in which the Government has to indulge at the beginning of the financial year? Our general theory is that each financial year is a water-tight compartment, beginning on April 1st and ending on March 31st following. Certainly Votes of this House must be spent during the year, or they drop into the Sinking Fund. This money, I understand, will not drop into the Sinking Fund, the Treasury apparently having power to accumulate it. On the face of it, the proposal seems to be a great departure from precedent, because it allows the Treasury to have the handling of certain sums of money which are not accounted for in the Appropriation Accounts of the year. Before we agree to the proposal, I think it will be necessary that we should have some explanation on this important point.
  Mr. E. B. BARNARD: I hope the Treasury will not create a new method of dealing with this money. We have in operation at the present moment a method which practically regulates the contributions given to local authorities, and we are expecting in the near future a Valuation Bill which may alter the whole system. I believe the present method was formed in this way. Some 20 years ago it was calculated how much money each local authority was receiving for the various grants, and when those grants were consolidated the whole amount was put into the form of a fraction, the numerator being the total amount the local authority was receiving, and the denominator £2,000,000, and whatever the fraction was it has since been applied to all the English counties. Whether that is a perfect method or not, there has been no serious complaint at the division so regulated. Another advantage of adhering to that system is that there would be no rivalry between town and country: the same regulation applies to all, London receiving its share of the Ex-
  970
  chequer contribution in this manner the same as other places. I submit, therefore, that instead of creating a new system it will be much better to continue the existing method until we have the long-promised Valuation Bill.
  Viscount MORPETH: The right hon. Member for West Islington (Mr. Lough) refers to all other local authorities as Little Peddlingtons, which he describes as cormorants, and says they will only ask for more. The right hon. Gentleman is a pretty fair cormorant himself, because he spent the remainder of his speech in asking that this money should be allocated to London, and that it should not go to the local authorities. He was specially unjust, because the County Councils Association and the Municipal Corporations Association joined together to put a scheme before the Chancellor of the Exchequer, both desiring that if this money is to be allotted to the counties, it should be allotted as fairly as possible. When the Chancellor of the Exchequer promised part of this money to the local authorities, he must have known there would be a scramble for it. I think, on the whole, the local authorities have endeavoured to approach the Treasury in a reasonable manner, and that they desire the money to be allotted as fairly as possible. Owing to the taxes which have been selected and the incidence of those taxes on urban or rural areas, it will be very difficult for the Chancellor of the Exchequer to make such an allocation as will be just between rural and urban communities. I must, however, protest against the theory that all the money raised under these taxes will come from urban areas. If there is undeveloped land, it is very often outside the borough area and within the area of the rural authority, although no doubt it is land which is becoming urban. It is very unfair, too, that the money should be transferred from the district outside the borough back to the borough, it being notorious that the very fact that you have a growing urban population outside large cities like Liverpool, Manchester, and indeed, London, poorer than the borough itself, means a vast expense in the way of rates. Where you have a new town growing up outside an old town, it is the old town which is rich and the new town which is poor. So far from its being right that West Ham, Willesden, Tottenham, and other places of that kind should pay towards London, they are much poorer than London, being merely dormitories of

  971
  London, which ought to receive money from the great and wealthy city rather than contribute towards it. Although there has been increment in these places, if it is to be taxed the money should go to the rates of Tottenham, Willesden, and West Ham, where it is urgently needed to provide the necessary equipment of the new towns. Putting the principle aside, I am inclined to agree with the Chancellor of the Exchequer that it is not wise to press him to say at present how the money is to be allotted. The constitutional position has been put by my Noble Friend below me (Viscount Helmsley). I would suggest, however, one way in which the allocation might be made. The Treasury owe a debt to the local authorities at the present moment. They have made a definite promise, not once, but half a dozen times, to find the money for the medical inspection which has been placed upon them. Here is an opportunity. The Government tell us that they will have money coming in from these taxes. Let them discharge that debt. By finding the money for the definite purpose of medical inspection they will give relief to the local authorities, and at the same time help to carry out one of the most valuable works which is being done in the country at the present time.
  Mr. J. McD. HENDERSON: I think the Chancellor of the Exchequer is wise in not saying at present how he will allocate the money. We hear a great deal about the urban districts being entitled to it. I do not think they are. It is not Manchester that makes the demand for land in Manchester. It is the trade of Manchester which is entirely outside Manchester. It is India. In the same way it is not Glasgow that makes the demand for land in Glasgow. If there were no orders for ships from London merchants or Liverpool shippers, if Glasgow were left to develop itself, what would Glasgow be? It would be nothing at all. The whole of these urban demands for land arise from the general trade of the country, one might say of the Empire. I hope the Chancellor of the Exchequer will bear that point in mind.
  Mr. JAMES HOPE: Is there a precedent for hanging up a tax in the manner here proposed?
  Mr. LLOYD-GEORGE: I would not like to say that there is a precedent. We, however, consulted the authorities before putting the proposal in its present form, and
  972
  it is quite in conformity with precedent. The sum will accumulate specifically for this purpose.
  Mr. REES: The Chancellor of the Exchequer is wise in not saying how he will allocate this money, but I hope, when the time comes, he will not forget his own native country of Wales. Without going so far as my hon. Friend (Mr. J. Henderson) in making a claim on behalf of India, I do say that it is not fair that all this money should be allocated to urban areas. There is one area which the Chancellor of the Exchequer will remember, that has a special claim to some of this money, and that will be for the through roads leading to the coast which are kept up by the County Council of Montgomeryshire, which pays for the upkeep of roads carrying far more than county traffic.
  Resolution reported; to be considered to-morrow (Tuesday).

FINANCE BILL.

  CONSIDEHED IN COMMITTEE.— [35th day.]
  [Mr. EMMOTT in the Chair.]
  (IN THE COMMITTEE.)
  The CHANCELLOR of the EXCHEQUER (Mr. Lloyd-George): One word on the suggested arrangement with respect to the Mineral Clauses. The feeling is that they should come on early in the day so as to provide time for ample discussion. If they are taken immediately after Clause 25 that desire may not be fulfilled. I should like, therefore, to move that Clause 15 should come after the Government's new Clauses.
  Mr. E. G. PRETYMAN: I think that will do. But perhaps it would be better if the Mineral Clauses came after the Land Clauses, and before we get on to other matter, seeing that they belong to Part I. of the Bill.
  The CHAIRMAN: We are only dealing now with Clause 15. That does not finally settle anything about the other clauses.
  Mr. PRETYMAN: Clause 15 is a Mineral Clause. I think it is generally understood that the Mineral Clauses should come together for the convenience of Members. To whatever point we postpone Clause 15, the Mineral Clauses should come together with it. That is the Chancellor's suggestion, as I understood it.
  Mr. LLOYD-GEORGE: Yes.
  Mr. PRETYMAN: I would suggest now that they should come together at the end of the Government's new Land Clauses. That will be probably found to be more convenient. As to the time that they may come to it is impossible to say at what period of the day we may arrive at the end of the Land Clauses. We cannot say now how long the Land Clauses will take. I quite assent to the suggestion of the Chancellor of the Exchequer, and I think that it will be the most convenient course to postpone all the Ministerial Clauses till the end of the Government's new Land Clauses.
  Mr. LLOYD-GEORGE: I quite agree. I propose to withdraw my present Motion, and to move in that form.

  CONSIDEHED IN COMMITTEE.— [35th day.]

    CLAUSE 25.—(Exemption of Land Held for Public or Charitable Purposes.)
    No duty under this Part of this Act shall be charged in respect of land or any interest in land held by any person or body of persons carrying on any undertaking or institution without any view to the payment of any dividend or profit out of the revenue thereof, for purposes which in the opinion of the Commissioners are public purposes or charitable purposes, while the land is occupied and used by that person or body for those purposes, but nothing in this Section shall prevent the collection of Increment Value Duty where any such land is sold or ceases to be occupied or used for the said purposes.
    Sir PHILIP MAGNUS Sir PHILIP MAGNUS moved to leave out the words from the beginning of the Clause to the word "land" [" in respect of land or any interest in 'land'"], and to insert instead thereof the words "Nothing in this part of this Act shall apply to." On behalf of my hon. and learned Friend (Sir W. Anson), I desire to move the Amendments standing in both our names. I should say, with a view to saving the time of the Committee, that I have consulted to-day with some of my Friends who are interested in this Amendment; they have thought it better that these words should be followed by the Amendment which stands in the name of my hon. Friend the Member for the University of Oxford. Perhaps I might be allowed to
    974
    state at once that if this Amendment is accepted, which I hope it will be, by the Chancellor of the Exchequer, the first few words of the Clause will read: "Nothing in this part of this Act shall apply to land or any interest in land the income and profits whereof are legally appropriated and applied to the promotion of education, literature, science, or the fine arts." This Amendment anticipates the Amendment which is down in the name of the Chancellor of the Exchequer, and it goes a little further than his Amendment takes us. The words I have proposed to insert include all these proposals that were submitted to the Chancellor of the Exchequer on the occasion of the deputation which waited upon him in August last, and which unfortunately he personally was unable to see. That deputation was composed of a very large number of representatives of secondary schools in the country, who went to the Chancellor with a view of obtaining complete exemption from the duties under these land clauses in respect to any land which those schools hold. It also includes the proposals, which, I understand, were privately made to the Chancellor of the Exchequer by the small deputation on behalf of the universities of this country, which also naturally desire that they should be exempted from the incidence of these taxes. I would like to point out clearly and definitely that the Amendment which I am introducing proposes to exempt all educational institutions from the Increment Duty, the Undeveloped Land Duty, and also from the Reversion Duty. After the deputation to which I have referred the Chancellor of the Exchequer put down the Amendment in his own name which gives certain exemptions on behalf of these institutions. But his Amendment does not go far enough. I have no doubt he will explain when he comes to it how it is that Reversion Duty can be charged upon land which is occupied and used, and continues to be so occupied and used, by these institutions. I should have thought that under the circumstances the Reversion Duty would have only been charged when that land ceases to be occupied or used by these bodies. The Amendment of the Chancellor of the Exchequer proposes to exempt charitable institutions. I understand by this that educational institutions are all included. The right hon. Gentleman proposes to exempt them from Reversion Duty and Undeveloped Land Duty, but only with respect to land

    975
    which is occupied and used by those bodies, and only so long as they are occupied and used by those bodies. Further, he proposes that the Increment Duty shall not be collected periodically, i.e., without prejudice to the collection of the duty on other occasions. Now it is these exceptions to the exemptions which all those who represent universities and secondary schools of this country are desirous should be omitted from this Clause. I should like to point out in a few words only how very seriously this Clause, as proposed to be amended by the Chancellor of the Exchequer, will affect a large number of educational institutions which are doing splendid work at the present moment. It is well known that many of these schools have large funded property which is derived from the rents of freehold land, or houses standing on land. If the Reversion Duty is charged on this property they will be deprived of opportunities, to which they have been looking forward for years, of using the whole of these reversions for the purposes of extending their schools, building libraries or laboratories, or other departments which are required for their work. Let me take, for instance, the case of the schools of the Harpur Trust at Bedford, which are exclusively maintained by rentals received to a large extent from properties situated in London in the neighbourhood of Bedford-row. This property was so large at one time that the trustees were enabled to support not only two excellent boys' and girls' secondary schools, but also all the elementary schools connected with the trust. These taxes will fall very heavily upon the land occupied by them, and the, Undeveloped Land Duty and the Reversion Duty will have to be paid in respect of land the rentals of which are devoted to the purposes of the school.
    With regard to the case of Dulwich, which has been separately under the consideration of the Chancellor of the Exchequer, in the memorial which was sent to him it was stated:—
    "The Board of Education have been for some time past very desirous that the Estates Governors should provide further endowment for Dulwich College, which is sorely in need of funds to carry on its work. If this new tax is enforced the consequence will be to seriously cripple, not only the college, but all the other schools which are maintained out of that large estate."
    As regards undeveloped land, it is well known that many schools in the immediate neighbourhood of some of the large cities hold up a certain strip of land to serve as a
    976
    kind of buffer-state between the town which is approaching the school and the school. The land is held up—although it may be a valuable building site—so that the town shall not approach too near the school. Under the Clause, as amended by the Chancellor of the Exchequer, that land might be subjected to a very heavy Land Tax. I need scarcely remind the Chancellor of the Exchequer that we in this country devote far less money to secondary education than is devoted in many of the great Continental countries. This Clause of the Finance Bill proposes to take away from these secondary schools a part of the income which they at present possess. Surely this is not the time for doing anything of the kind. More money is certainly required for secondary and university education in this country. Here is a Liberal Government, which has always been supposed to be friendly towards education, coming in and putting down proposals in the Finance Bill which will seriously hamper these schools, and prevent them doing that useful work which they are now doing, and hope to do in the future. Out of this fund scholarships are even kept up, so that the effect of this tax will be to a great extent to prevent some of those scholarships from being awarded. Let me state for a moment the effect of this Clause upon some of our local authorities. There are many endowed schools scattered throughout the whole country which have a certain amount of income from landed property. A large number of these schools have not sufficient income to keep up the work in which they are engaged, and they constantly receive assistance from the local authorities. Under this Clause these schools would be receiving less than they previously received from their endowments, and they will consequently have to make a larger call than they do at present upon the local authority. Therefore yon are putting an additional tax upon the local authority by not exempting those schools from the tax which you impose in the Budget. It is proposed in the Chancellor's Amendment that institutions such as those to which I have referred shall be exempt from periodic valuation, and that is, of course, a considerable advantage; but the advantage which he gives with one hand he takes away again with the other, because he says "without prejudice to the collection of the duty upon any other occasion." That is to say, supposing they sold their land with the view to purchase more convenient land, then any increment that would arise upon that sale of the land

    977
    would be taxed. That again, I say, is very unfair. I venture to thank all these taxes which are proposed to be placed upon these institutions, which are doing great public work and where their income is necessarily and exclusively applied to educational work, should be applied in this way are very unfair. I have moved this Amendment for the purpose of raising a general discussion upon this matter, and with a view of eliciting from the Chancellor assent to the further modification of his own Amendment so as to exempt all institutions such as those to which I have referred from the Land Taxes contained in his own Amendment.
    Sir WILLIAM ANSON: My hon. Friend and I have combined our Amendments for convenience in raising the whole question, and it may be useful therefore that I should second his Amendment at once. The Amendments introduced by the Chancellor are certainly very disappointing, after the kindly way in which he received the deputation from the two Universities of Oxford and Cambridge. We hoped for more from him in the way of concession than we should merely obtain relief from periodic increment charge which will not relieve us from the very heavy charge which will fall upon us in the case of a sale, and certainly hoped for more than that the mere land in the immediate use and occupation of the colleges and schools should be exempt from the different forms of Land Taxes. I should like to point out to the Chancellor that we have endeavoured to confine the application of further exemption within very strict limits. The lands for which we ask exemption are lands which legally belong to the institutions, and are contributing towards the expenditure upon educational matters. In the case of universities or colleges that means that this property is governed by University College Estates Acts, and in the case of schools by the Charitable Endowed Schools Act, and in the case of literary and scientific institutions by an Act passed in 1854. Supposing that a college or a university obtained a windfall by a sale which had increased upon the increased value of the land what would happen to that money? It is immediately placed in the hands of the Board of Agriculture; the sale cannot take place without the approval of the Board, and the Board takes the money and keeps it until it is invested in land or in trust funds or sent to the college for the de-
    978
    velopment of its property. Supposing the increment does not take the form of a capital sum, but of an increased rental value; the use of that money is strictly limited to the statutory purposes of the institution to which it belongs. That money can only be used for the good of the university or the college, and I am right, I think, in saying that the endowment belonging to schools which fall within the terms of this Amendment are regulated by the Charitable Trusts Acts. Sales take place under the authority of the Board of Education or the Charity Commissioners, and the proceeds of that sale or any increment are all alike employed under the supervision of one or other of two Government Departments.
    I believe these literary and scientific institutions are very largely handed over to the local authority under the Local Government Act of 1894, and they will hardly come into consideration at all in so far as the terms of this Amendment go. What I am concerned with are the university colleges and public schools and the endowed schools. In the first place, I would ask the Chancellor to recollect not only is all this property governed by statute, and under the control of the Government Departments, but it is all applied to public purposes, and where money arises from undeveloped land, or from increment, or from increased reversion, it has all to be applied to public purposes for the education of children and to the advantage of the country generally. Take the case of the Undeveloped Land Tax. There are certain schools and other institutions which have bought land deliberately intending to reserve it so long as it is necessary. Harrow School has done this on a very large scale and has bought 8,000 acres of land in order to keep London off its boundaries. Eton has done the same in order to prevent a street being run through its grounds. The University of Oxford has bought land in order to have free access to the country on one side, and I venture to say that it is in the public interest that these great public schools should uphold some surroundings suitable for the good government and well-being of the school, and that the university should have at any rate on one side access to the country, when there is no demand for building on that land, which I am bound to say is very often liable to be flooded in wet weather.
    I think it is very much in the interest of public schools that they should have such free and open surroundings for the good of boys such as they have at Oxford. The

    979
    Undeveloped Land Tax has its effects upon the lands which the colleges and schools hold as part of their endowments for the purposes which these institutions are intended to serve. The Chancellor of the Exchequer, when this matter was raised on the Resolution, spoke in a very cheerful and encouraging way as to the slight effect this Undeveloped Land Tax would have upon the certain kind of property I have mentioned. I hope he may be right, but I am afraid not, because I have learned differently from hon. Members upon the other side. The hon. Member for Aberdeen and the hon. Member for Sheffield made very interesting speeches upon this question of valuation, both Gentlemen being eminently skilled in that branch of knowledge, and the impression they made upon my mind has been one of absolute uncertainty. It is not merely that the Undeveloped Land Tax may be very costly, but it is that it is quite uncertain what value a valuer will put upon it. And it is by no means certain that any two valuers would put the same value upon it. I have obtained the best information I could with regard to the Undeveloped Land Tax. A man with considerable experience in that line of business puts it at £1,000 a year in a case which I submitted to him, and £1,000 a year is more than an income of a professorship, and would certainly be a very considerable loss to the interests of learning in a university. I cannot say what it would be at Harrow, but I am told that it would have a very serious effect. When you add this actual loss to the uncertainty of the Land Taxes, I think everyone must realise that great injury will be done to these institutions by the imposition of this tax. We have heard from the very eminent valuer, who spoke upon the subject of the uncertainty, that probably no two valuers would value the same thing in the same way. We also heard from the Prime Minister that it would take at least two years to complete the Government system of valuation. I think from what we heard from others it will take considerably more, and during all that time these institutions will be in a state of uncertainty whether their land is to be regarded as undeveloped land or is to be regarded as nothing more than agricultural, and as to the value that will be put upon it and what the consequences of the tax will be. It must be borne in mind that in every school or college uncertainty with regard to its revenue is a much more serious thing than it is to
    980
    the individual. The individual may let his house, cut off his motor car, and economise in various directions from year to year or from month to month. But a college cannot decline to continue a professorship which it has once taken over. A school may have to reduce its staff or reduce the salary of its teachers, and this tax may prove a heavy hardship upon educational institutions. Upon whom will this charge fall? It will fall upon the universities and colleges. The consequence will be that they may have to diminish the number of their professors who are engaged promoting studies and advancing knowledge in their respective departments. Either the staffs must be diminished or the salaries of the teachers must be reduced, and it cannot be said that the teachers either in our universities or public schools are an overpaid class of men. On the contrary, I think it is admitted that the public get admirable work from the teachers—which it has taken them a long course of study to enable them to give—at an uncommonly cheap rate. This tax will also fall upon parents, because the sources of revenue of these schools are endowments, and if the revenues of the schools are reduced in one way they will have to be increased in another way. It must not be supposed that these large schools are used only by the children of well-to-do parents, because many persons put themselves to great inconvenience and deny themselves enjoyments in order to give their sons a good education.
    Then there is a fourth class of person who will suffer; I mean the students themselves. If there is a diminution of endowments there must be a diminution of scholarships, and everybody knows what assistance scholarships are to the boys who are enrolled amongst a group of scholars at a public school. I wish to call the attention of the Chancellor of the Exchequer to the extreme injustice of imposing these taxes on the higher education of the country. What is the sum spent upon elementary education? It is more than £11,000,000 annually. What is spent upon secondary education? Less than £800,000, and on university education the total is less than £200,000. Why is the State able to spare itself the expense of maintaining the higher education of the country? Because of these very endowments which you are now taxing. You save yourselves the cost of maintaining the great schools of the country which you would have to maintain but for the endowments which you

    981
    are now taxing in order to swell the Exchequer for other purposes. You are using these endowments for two purposes in two ways, and you are burning the candle at both ends. Literally these endowments suggest Goldsmith's lines:—
    "The chest contriv'd a double debt to pay,
    A bed by night, a chest of drawers by day."
    This policy is not only unjust and ungenerous, but it is also unwise, because you cannot lightly diminish the educational sources of the country. By this Amendment we are asking not for concessions, but we are merely suggesting the removal of a blot on the Bill, and I trust, at the close of this Debate, we may hear something from the Chancellor of the Exchequer which will lead us to hope that this blot will be removed.
    Mr. LLOYD-GEORGE: I should not have put forward a proposal of this kind unless I had very good reasons for doing so. Before I give those reasons, I should like to express my disappointment that the right hon. Gentleman does not appreciate the very great concessions made in regard to the Universities of Oxford and Cambridge. What are those concessions which have been treated as if they were merely nothing? They amount certainly to two-thirds, and all that is left is the one-third, which we cannot give up without surrendering a very considerable revenue. Of course, if concessions are made to universities, they must be made in regard to all lands similarly situated. May I point out that the Amendment which the hon. Gentleman has moved is extended by proposals put down by other hon. Members to other institutions? What is the concession made to Oxford and Cambridge? They are not to be charged at all as corporations. They are not to be charged Undeveloped Land Tax or Increment Duty in respect of property which they actually occupy and enjoy. They are not charged the corporation tax of 20 per cent. in respect of any of their property, and surely that is a great concession: I am afraid the hon. Baronet opposite does not quite appreciate that.
    Mr. BONAR LAW: Do I understand that the Increment Duty is not payable in the case of these institutions if they make sales of property belonging to them?
    Mr. LLOYD-GEORGE: What I said was that the corporation tax is not charged. There is a great difference between a tax on sales and the corporation duty levied every 15 years. When they
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    sell property I do not think the hon. Member for Dulwich will think it is unfair that the universities should pay. [An HON. MEMBER: "Yes it is."] Does the hon. Member opposite want property of this kind exempted altogether, because that proposition is absolutely indefensible. I want the Committee to realise what this means, since the Mover and the Seconder have not thought it worth while to inform the Committee.
    Mr. PRETYMAN: It is not an exemption, it only varies the occasion.
    Mr. LLOYD-GEORGE: The proposal is a complete exemption from the corporation tax. They only pay on sale, and if they do not sell they do not pay at all. What I am saying is strictly in accordance with the form of the Amendment proposed by the Government. Universities and educational institutions are not charged the tax at all, and that means that the duty which is levied upon land held by all other corporations except municipal corporations every 15 years is not chargeable at all upon educational institutions. That will be a very considerable sum. Take the increment in that property year by year. The Undeveloped Land Duty will be nothing compared with it. They have been let off all this, and yet it has been treated as if it were a mere £5 note every 15 years, whereas it is a very substantial concession.
    I come now to the taxes which are to be charged. The point is are religious, charitable, and educational institutions to be exempted altogether from taxation? That is a doctrine which was fought for hundreds of years ago, and fought successfully in the old feudal days. This is the old claim which was put forward then. It was proposed that they should be exempted from taxation, and in the past the accumulation of these lands became a very serious matter for the revenue, because in consequence of exemptions of this kind the tax fell much more heavily upon those outside. The hon. and learned Gentleman forgets that these institutions pay under Schedule A at the present moment in respect of this property a much heavier duty than the Undeveloped Land Tax. Under those circumstances, why should they be exempted from this tax while they are paying the other? Where is the principle of it? If you lay down a general rule that all these institutions should be exempted from taxation altogether there is a principle, at any rate, which is arguable, but which I at once say I do not

    983
    accept. Let there be no mistake about that. That is a thoroughly arguable proposition, but this is not. This is a proposal to get rid of the Land Tax. I will take the figures given by the hon. and learned Gentleman. He has come to the conclusion that All Souls' will pay £1,000 a year Undeveloped Land Tax. That means that All Souls' has a property so valuable that its building value over and above its agricultural value is very nearly half a million. And this, we are told, is a college that cannot pay its professors and cannot give a proper education to its students purely and simply because they have to pay £1,000 a year on this invaluable property. In this case the agricultural value is four times what it would be in any other district. That value is not created because the soil is especially good. In other districts not far away the value is £1 per acre, but I think I am right in saying that this college gets about £4 an acre.
    Sir W. ANSON: For allotments.
    Mr. LLOYD-GEORGE: I think they get more than £1 on an average.
    Sir W. ANSON: Not much more, but this applies to quite a small part of it.
    7.0 P.M.
    Mr. LLOYD-GEORGE: The part which is producing £4 an acre will probably have a special building value, but all that is exempted, and they are getting this high price for it. I do not think it is too much to ask that land of this enormous special value should pay a halfpenny upon the value over and above its purely agricultural value. Of course, were this purely a matter of universities it would not be worth arguing about. I think it is far better to levy this tax, and if universities are short of money it will be better to have a straight deal with Parliament on that point. If you are going to exclude universities, how can you include, say, the Ecclesiastical Commissioners with their enormous values? How can you except the great religious corporations? You cannot do it. If you begin exempting them, it will make a very serious hole indeed in the revenue, and I do not see, if you are going to exempt them from this halfpenny Land Tax, why you should not exempt them from the rates, from Schedule A, and from all taxes. I really do not see the distinction. I am not sure whether there is anything to be said in principle for the concession
    984
    the Government have made. After all, it is purely a compromise, and there is not in principle even anything to be said for that. We have, however, gone to the extent of meeting these corporations by providing that the tax shall be collected when they dispose of the property rather than every 15 years, and to that extent it is a departure from the principle, and I could not defend it purely upon principle. It is purely a compromise, as the result of a real and genuine desire to meet the case of the university. Land is getting more and more into the possession of great ecclesiastical, religious, and charitable institutions—very considerable tracts are getting into their possession, and if this exception is made it cannot be confined to educational institutions. The hon. and learned Gentleman's Amendment confines it to educational institutions, but let him look at the Amendment of the hon. Member for Kingston (Mr. Cave). He extends it to religious institutions, and, if you give it to educational institutions, on what ground can you refuse it to religious institutions? I can imagine the sort of argument that would be advanced. The hon. Gentleman seeks to confine it to educational institutions, but he would probably be in favour of extending the concession to religious institutions. Do I understand him to say he would not?
    Sir W. ANSON: I will wait until that Amendment is reached.
    Mr. LLOYD-GEORGE: The Ecclesiastical Commissioners are lying in wait, and, the moment the educational institutions have got this out of the Government, the hon. and learned Gentleman, I suppose, will join with the others in claiming that they should also be exempted. I am not going to talk of shoplifting or use language of that kind. I do not use that kind of language—that is the language of the universities. At the same time the Government could not resist that argument, and the hon. and learned Gentleman can see he himself could not resist it, although he has confined his Amendment to this particular branch of the subject. That would be simply whittling away the Land Taxes in one concession after another until there was nothing left. I think we have met the case of the universities liberally. The Undeveloped Land Tax is not a heavy tax except where the property is a very valuable one. I still think the hon. and learned Gentleman and his advisers grossly exaggerate the

    985
    amount they will have to pay. He is assuming that every acre is valuable building land at the present moment, but he says it is part of a swamp, and it will take a long time to have any building value. By that time they will be able to dispose of it at such a price that £1,000 a year will really be very little for them to pay.
    Mr. BONAR LAW: The Chancellor of the Exchequer began by saying this was an Amendment any Chancellor of the Exchequer would be unwilling to resist, and then he proceeded to give us the reasons why he, unwilling, was yet bound to resist it. I did not see much force in any of those reasons except the peroration at the end of his speech, when he told us he did not indulge in shoplifting and that sort of language. It is not the man who does it that uses the language; it is the man to whom the injury is done. If we examine the reasons the right hon. Gentleman gave I think he will admit they are slightly feeble. If the principle on which these taxes is based is correct, then the amount in the case of educational institutions simply accumulates. It is true they do not pay the tax until they sell the property or lease it, but then they pay all the more, and they gain nothing by this concession which the right hon. Gentleman says he gives them. He contemplated, of course, them selling, and, therefore, the full burden will inevitably fall upon them just as if this concession had not been made. The case I wish to put to the right hon. Gentleman and to the Committee as strongly as I can is the way this tax will affect an educational institution, the value of which many Members of this House on Loth sides know, and which, I am sure, no Member would be willing to injure if he could help it. I mean the governors of the Dulwich estate. The idea may be in the minds of some hon. Gentlemen that this is only going to hit the better class schools or universities, like Oxford or Cambridge, which can well afford it. If the Chancellor of the Exchequer had happened, as I did two years ago, to give away the prizes at the James Alleyn school in Dulwich, which is filled entirely with children of poor parents, and had realised what the effect of this taxation will be on the revenue of the governors, I think he would find better reasons for refusing, or he would allow this Amendment. The Undeveloped Land Tax alone will take, on a most moderate estimate, £1,000 a year out of a revenue of £1,900 from the land, leaving only £900 for educational
    986
    purposes from that source. That actually amounts to more than 7 per cent. on the total revenue enjoyed by this institution.
    Mr. LLOYD-GEORGE: Does the hon. Gentleman say really that the land is worth £500,000 over and above the agricultural value?
    Mr. BONAR LAW: I am giving the statement given to me by the governors of Dulwich College. The building land on the average would be £1,000 per acre, and the Land Tax on 480 acres amounts to £1,000. That is my authority. They went on to say that the total income from the land is only £1,900. That is not the only way in which this institution will be hit. They have, wisely or unwisely, adopted the proposal of leasing their land on the usual principle of getting back the property at the end of a fixed time, and a large part of their revenue depends upon the falling in of these leases. The Government propose to take 10 per cent. on the reversion and 20 per cent. whenever there is a sale. The governors say that amount will be extremely heavy, and it is absolutely impossible for them to form any estimate of it. What really is the answer which can be given? The right hon. Gentleman earlier this afternoon told us he was putting on this special tax with the view of handing over half of it for various purposes throughout the country in places other than where it is collected to a large extent. He is going to collect this money and then distribute it for purposes which he thinks for the good of the whole country. Can anybody imagine anything more foolish than to collect that amount of money from an institution like this and then hand it over to the hills of Wales and leave this institution suffering for the money of which it is deprived? The right hon. Gentleman says that if you once begin exempting this kind of institution you cannot stop, and must exempt religious institutions. He says it is a question of principle. Once you go down the slippery slope there is no end to it—you must go the whole way. I do not think that ought to worry the right hon. Gentleman. I do not think the principle or the length which he is going need concern him. He might fairly look at this question upon the merits and say, quite apart from religious institutions—and, as far as I am concerned, I say frankly I do not think they are on the same footing at all, and if I were in his position I would give exemption in the case of educational, but not in the case of

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    religious institutions—the expediency of it is in itself a sufficient justification for making this concession. Unless I am greatly misinformed, there is another very strong reason why he should make it. The right hon. Gentleman made a statement that institutions of this kind now pay all other taxes, and he asked why they should not pay this? There is one reason why they should not pay it. The Government do not pretend this is imposed merely for the sake of revenue. They say it is partly for the sake of revenue, but they profess it is for other objects as well. If they put on taxes not merely for revenue, then surely Amendments which have the effect of serving a good purpose should be accepted.
    I am informed by the governors of this institution that, contrary to what was stated by the right hon. Gentleman, they do not now pay Income Tax on this property. When the governor made that statement I asked him for his authority, and he sent me back the statement that they do not pay it in accordance with the Income Tax Act, 1842, Section 61, which says all land belonging to hospitals, public schools, and almshouses, or vested in trustees for charitable purposes are exempt from the payment of Income Tax. All we ask, if I am right in this, is that in imposing his new special taxation the Chancellor of the Exchequer should not be more exacting than in the old Income Tax, and should not at least put institutions of this kind in a worse position with regard to this tax than they are with regard to other taxes now imposed by the Government. I really think if hon. Gentlemen will seriously consider this question they must feel it is extremely unwise to deprive an institution which admittedly is doing a good work of a large part of the revenue which it is usefully employing, simply in order to give the money to some other purpose which may or may not be equally good. It cannot be said that the Dulwich Governors deserve this fate—that they are not acquiring their land to the best purposes. As a matter of fact, they are doing their best in that direction. I happen to remember when a statement was made by Mr. Gladstone to the effect that there was no better purpose to which property in the neighbourhood of large towns could be put than the erection of villas with gardens around. I cannot for the life of me see why the right hon. Gentleman should not yield in this case, although he says, if he does it now, he would have to do it for religious institutions.
    Mr. J. MASSIE: The Amendment proposed and the speeches delivered have touched a principle which opens up a wide sphere. You cannot confine this matter to education. You cannot give any special consideration to the four undergraduates at All Souls' College, nor can you give special consideration to a rich corporation like that at Dulwich. The words "charitable purposes" in the Clause cover, of course, by every custom and practice of law, education and religion as well as charity. We have often heard, from the other side that there is a combination which they call education combined with religion, and it is very difficult from their point of view to distinguish between the two. I was very much surprised to hear the hon. Member for Dulwich endeavouring to separate education from religion. I think there are some points in the Clause itself that are questionable, but I do not propose to offer any opposition to the Clause as shaped or re-shaped by the Chancellor of the Exchequer, although I am very uneasy about its substance. I wish to point out that the Amendments of the Chancellor of the Exchequer go quite far enough. He has burdens enough, and, therefore, I do not expect him to take in addition to them the mantle of the late Mr. Gladstone, which he wore in his Budget speech of 1863, when he proposed the exemption of charities from taxation—when he entered into what he called "the deadly encounter with the so-called charities." A reversal of an ancient custom would be too much for the present Chancellor of the Exchequer, as it was too much for Mr. Gladstone himself, even though, according to good judges, the speech he made on that occasion was among the two or three most powerful speeches he delivered in his career. In the course of that speech he knocked the bottom, if I may use a colloquial expression, out of the spurious charity claim when, as he said, "he upheld the reality of truth and justice against their superficial and flimsy appearances." Lord Morley, in writing of him, says he
    "Turned a rude searchlight on the illusions about charity which are all the more painful because they often spring from pity and sympathy."
    But Mr. Gladstone failed at that time as the Chancellor of the Exchequer would fail now, and for much the same reason. Lord Morley, if I may quote his words, tells us how
    "The House was impressed with the argument and the performance, but the clamour was too loud; all the idols of the market place and the tribe were marched forth in high parade, and the proposal had to be dropped."

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    Some of these "idols of the market place" we find represented in the Amendments today. These Amendments would exempt from taxation all land and incomes from the land which are connected, not only with charities, but with education and religion, even though those lands might not be occupied and used, or, to put it in shorter phrase, though they may not be the "homes" of charity, of school, or church. The Chancellor of the Exchequer himself proposes an Amendment to free them from the Undeveloped Land Tax and the Reversion Duty so long as they are occupied and used, and he delivers them from the periodical Increment Value Duty under all circumstances whatsoever. Now I have said that in the Clause and the Chancellor of the Exchequer's Amendments there are a few questionable features, and this seems to me one. It will discourage the sale and distribution of land, especially as after the sale the ordinary Increment Duty will have to be paid. But the hostile Amendments go much further; the limitations which the Chancellor of the Exchequer has put down in the words "occupied or used" are to be scattered to the winds if the Amendments are accepted which substitute "owned or held" for "occupied or used." Let us consider the consequences of these Amendments. These bodies, whether educational, or charitable, or religious, will be able to buy valuable property and hold it up while becoming more and more valuable, and keep it away from the community. They will not have to pay Undeveloped Land Duty. They may lease it for building and at the end of the lease they will be called upon to pay no Reversion Duty though they may exact fines and acquire other kinds of profit. This is nothing else than a gift to these bodies at the expense of the already overloaded taxpayer. What is the reason for it? What is their claim? It may be some of these bodies are wasteful; some even corrupt. Do they not owe anything to the State that protects them, or to the ordered condition of the community which adds to the value of their property and increases their security? What is true of charities in the ordinary way is true of religious bodies. I need not call the House to witness that religion is not by any means always charity. I am glad to have the agreement of the hon. Members opposite, shown by their cheers, to this statement. But I may add that religious funds are not infrequently used to kill charity. Do not these bodies—not forgetting the
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    Established Church, or the French Orders who have come over with bag and baggage to this country for shelter—do they not owe anything to the powers that be by whose beneficent providence they are enabled to worship under their own vine and fig tree, no man making them afraid? Are there any uncompromising hon. Members who are inclined to look askance at the vine as scarcely reputable? There are still the broad sheltering leaves of the fig-tree. The Ecclesiastical Commission would be exempt. They are the largest landowners in the country. I believe they hold more than 300,000 acres, and of their income—I am speaking in round figures—of something like £2,000,000 some £400,000 comes from landed property. The Orders that have come to us from abroad will also be exempt, and I am told that they are becoming some of the largest buyers of urban property in this country. Now, this cry from the charities, schools and religious bodies for exemption from their share in the burdens which are already so heavy on the community is becoming irksome and irritating, and tends to engender a certain feeling of contempt. The cry does not seem to me to be very manly. The late Mr. Gladstone declared it was entirely unjust. I cannot exactly quote his words, but the effect was this: Why should the fathers of families, with all their heavy burdens upon them (and I might add in this atmosphere, why should spinsters and widows) pay an augmented rate of taxation in order to furnish the luxury of exemption to bequests which, though meant for charitable purposes, are often useless and even deleterious bequests, made when the owner has no further use for his money except to leave it away from his children, or to hand down to posterity an everlasting name, in what Mr. Gladstone called in 1863 "enormous letters" of brass. There is one argument against this exemption of bodies connected with charitable purposes which Mr. Gladstone used which is even stronger now as against the Chancellor of the Exchequer's already sufficient indulgence. The argument was this, that when such exemptions were first granted the State expended practically nothing on education or on the Poor Law, and in 1863 Mr. Gladstone gave these figures: "But now the State is spending £1,111,000 on education and £227,000 on the Poor Law." But at the present time we are spending on all sorts of education something like 17½ millions, and on pauperism—I cannot separate the local from

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    the Imperial contribution—but on pauperism we are spending something between 16 and 17 millions. The State is just about, too, to spend £9,000,000 per annum on old age pensions alone. Therefore, the State has become more and more largely charitable out of the pockets of the ordinary taxpayer, and, therefore, it seems to me that these endowments of institutions, many of which are rich, ought to bear their fair share of the burden of taxation. I am not asking for anything more than a fair share in the burdens of the ordinary taxpayer while these bodies recognise their indebtedness to the State for protection and security. Of course, I cannot expect the Chancellor of the Exchequer to make any proposal which would carry out such a policy with drastic completeness, and so I am not prepared to oppose this Clause, with the limits in it to which I have referred, but I should strongly oppose any of the extensions of exemption which some of these Amendments seek to force upon the Clause.
    Sir HENRY CRAIK: I could hardly follow very fully the argument of the hon. Member who has just sat down, without running the risk of being called to Order for irrelevancy. The hon. Member, on an Amendment which does not touch the religious question at all, tried to induce us to enter upon it, but I will not do so further than to say that I note with satisfaction how closely the hon. Member thought that religion and education were necessarily bound up together. The hon. Member's argument against this exemption which we claim, seemed to me to be of a somewhat flimsy character. In the first place, he said these are rich endowments, and do not want help. The word "rich" which he used in this connection can be nothing more than a relative term. A university, or a college, or a school is rich, not because you can say that so much income comes to it, but because it has over-ample funds for doing the work entrusted to it, and which are necessary for that work. A university which had the richest endowment in the world might be poor if it had a task which was larger than that of any other university.
    Mr. MASSIE: I did not say the universities were rich. I spoke of some corporations being rich.
    Sir H. CRAIK: We were talking about the universities, and the hon. Member, I
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    assume, addressed his argument to what we were speaking of, and he most distinctly mentioned a scholastic institution at Dulwich and the University of Oxford and some of its colleges in this connection. The hon. Gentleman agreed with the right hon. Gentleman in trying to lead us on to a false track by raising the question of religion. I am not going to be drawn into any question of logic, but if the hon. Member wishes for my opinion upon the question I am quite ready to give it, and I think that a strong claim can be made for religious institutions as well as for those we are discussing, but the two institutions are not bound up with one another. I shall only give one argument in reply to the Chancellor of the Exchequer, which, I think, completely disposes of his argument that the two matters follow the same course. The right hon. Gentleman is giving grants for university education. Is he prepared to say, because he is giving those grants for university education, that he is bound to give grants for ecclesiastical education? And, if not, why does he seek to complicate this question by saying that necessarily the Amendment which we are now putting forward would force him if it were carried to grant some exemption to ecclesiastical institutions? At all events, I speak for those institutions which are not wealthy, and which are not for a select or privileged class. They are popular institutions, and they have the hardest work to make both ends meet in performing the educational task that lies before them.
    The right hon. Gentleman wishes, in the first place, in dealing with these institutions, to make a distinction for which I can see no ground whatever. He is ready to make a certain allowance—it is quite easy to prove that the allowance is only verbal, and is not really an allowance at all. He is prepared to make an allowance in regard to the Increment Tax, the Development Tax, and the Reversion Tax in regard to land which is actually held for the immediate purposes of the university or institution. But what can be the difference between land bequeathed to a university or an institution, the rent of which is to go to the University and be used for its purposes, and land which happens to be convenient for the University to use for its own scholastic purposes? What logical distinction is there between the two? I cannot see it. So far as the larger question is concerned, that of land held by a university, whether for its own special purpose or merely for the sake of

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    the profit which it brings in in a year, the right hon. Gentleman only allows the periodical Increment Tax. It is only, of course, as I said before, an allowance in words, and not in fact. As long as the land is not sold that periodical increment will not be charged. But the moment it is sold all the arrears of the quinquennial periods will be charged as heavily as in any other case. But I ask not only that the land so held shall be exempt, but I say that all land held by a university should be freed from this new tax.
    Let me give a case to the right hon. Gentleman which is a practical one, and which arises in one of the universities that I have the honour to represent. The university advanced money on mortgage in respect of a particular estate. They had no desire to come within that wicked and accursed class of landowners and advanced money on mortgage on land, as they might have advanced it on any other security. The land so held ceased to pay interest on the mortgage, and it fell into the hands of the university simply because the owners were no longer able to pay interest on the mortgage which the university holds, but only until it can realise the money that it has sunk in it. At present, if the estate were put upon the market, it would realise nothing like the amount they paid for it. But if they wait for a few years until, perhaps, it has recovered its value, then they will have to pay this Increment Duty on this land. Is that in any way fair? Why, if one of those pious benefactors whose motives the hon. Gentleman who spoke before this gave to be nothing but self-glorification, if a pious benefactor left for a university or another institution land rather than money, why is it necessary that you should take a part of his gift and lay your hands upon a part of it when you would not do so on that part of it if it was in money? There is an interesting bequest which was left by Thomas Carlyle, and the estate is still held by the university, and there is a great interest attaching to it. I hope the university will continue to hold it, but why is it to be taxed with an Increment Tax because Thomas Carlyle or his executors kept the estate together and handed it over to the university?
    The distinction which the Government attempt to make is really quite absurd, and I ask again why is the right hon. Gentleman to give lavish university grants in England with one hand if with the other he is taking away the proceeds of that which has been left to those institutions by pious
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    founders in times past. It seems to me to be almost a reductio ad absurdum of taxation, if at the very moment that you are putting a heavy burden upon the taxpayers to extend the range of university teaching in Wales and England you are at the same time to impose upon those who are unquestionably doing good work, and to whom you are giving a public grant, a very heavy tax which will tie their hands in the work that they have to do. Surely we have a right to claim in the midst of all this talk of widely increased resources for social development—surely we have a right to hold that which we have, without the interference of the State, with that freedom and independence which is the one essential element in the free and uncrippled life of a university—and that these institutions should be free from this new tax, which in the case of the university I represent would amount to something like £700 a year. The resources of this university are as narrow as they can possibly be. The clientèle which they provide for is amongst the poorest. The charges which they make to their students are reduced to the very lowest level. But you are now going to ask that they shall cripple their work, narrow the range of their education, or that they should pay less to their teachers and professors, or make the entrance to this university more difficult to the poor man. On all these grounds I say you would do well to release these educational institutions from the burden of your new taxes, and I shall be very much mistaken if throughout the whole of Scotland this part of your taxation is not unpopular with the vast masses of my fellow countrymen.
    Mr. S. H. BUTCHER: The Chancellor of the Exchequer seemed disappointed with us, and thought we were very ungrateful for the concessions which he had made. I amply recognise the meaning and value of those concessions as far as they go. At the same time, the Amendments in the name of the right hon. Gentleman do not, as far as I can see, add anything whatever in substance to the form of the Bill as it originally stood. The effect of those deputations, in whose breasts the right hon. Gentleman raised such hopes, has simply been to make explicit and clear what was obviously ambiguous in Clause 25. Let us see exactly what we have got. The universities which are most hit by the Land Taxes, of course, are the old Universities of Oxford and Cambridge. Let me enumerate the gains which we have from,

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    these concessions. In the first place, we get off the Undeveloped Land Tax in the case of our buildings, our libraries, our laboratories, our botanic gardens, our college buildings generally, and our playing fields, and similarly the schools which are in a position like ours get off the Undeveloped Land Tax on those lands which are in their own immediate use and occupation, and we get off the Increment Tax in the case of the 15 years' periodic tax, but we have still to pay the Increment Duty both upon the leasing of land and the selling of land. The Chancellor of the Exchequer actually told us that he had conceded about two-thirds of what we wanted, and that there was one-third left, but the proportion ought to be more than inverted. What we have actually got is exceedingly small, because to be let off the Undeveloped Land Tax on buildings which are occupied by the University is not freeing us from the tax. These are not the sources from which revenue comes in. The moment he sees the real source of revenue—undeveloped land—down he comes upon it We get off no tax upon actual revenue, but merely a tax upon buildings, or gardens, or the like that we occupy. Then in the Amendment of the Chancellor of the Exchequer it looks as if he had another exemption. But will the Attorney-General give his attention to these words:—
    "No Reversion Duty … under this part of the Act shall be charged in respect of any land, or interest in land, while the land is occupied and used by that body."
    How could a Reversion Duty be charged on land while the land is used and occupied for the purposes of that body? The word, no doubt, is surplusage, but it looks to the ordinary man as if we were being let off Reversion Duty. You cannot have Reversion Duty on land which is in your occupation. The words "while the land is used and occupied for the purposes of the body," really refer only to the Undeveloped Land Tax, which is combined with the other, and pays no Reversion or Undeveloped Land Duty under this part of the Act. This is misleading, and it has misled people outside who think they are getting off Reversion Duty when they are not.
    Now I come to what I think is, after all, the main point. We ask for complete exemption from all the Land Taxes, and the ground on which I base that claim is the principle which the Government have themselves asserted in their own Bill. I
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    refer to Clause 24, in which the Government give complete exemption from all the Land Taxes to schools conducted by local authorities. Why are the local authorities exempted? I imagine simply on the ground that the education which they give is supposed to be a benefit to the community at large. If that is so, can it be maintained that whereas the education given in the secondary schools is one which serves the public end, the education given in the universities and the great public schools which are not under local authorities is in any other and lesser sense a public benefit? Surely that is the real ground for the exemption. If anything, I should say that there is a distinction to be made in favour of the university education to this extent, that these local authorities give an education which serves a local purpose, while the universities give an education which serves a national purpose, and is not confined to any locality. Let us look for the moment into the distinction made in the Clause between land used and occupied by the body and land which they hold in some other way. Is that distinction in any sense a valid distinction, and what does it rest upon? My hon. Friend (Sir Henry Craik) proved that this is a wholly illusory distinction to make, because if you once grant that exemption is to be given for a certain public educational purpose, and also that the revenues of the school, or the university, are devoted legally, by statute or by deed, to that purpose, what earthly difference does it make whether the body itself uses that land or whether they choose to let it to some others? Is there any ground, in other words, for hampering the administration of a governing body who say it will be more convenient to them administratively to let their land than to hold it? If they hold it they are free from the Undeveloped Land Tax. If they let it they at once come under all the other taxes, and if they sell it they also come under the Increment Tax. This distinction seems to me of an entirely arbitrary character. May I point out two instances in which it works out in an absurd way, just as you might expect. I take the case of Trinity College, Cambridge, which at this moment proposes, and has, indeed, made arrangements for letting to the university certain agricultural land as an experimental farm under a lease of 10 years. If Trinity, Cambridge, had worked that experimental farm itself it would be free from the Undeveloped Land Tax, but it hands it over to a body whose educational objects are precisely the same as its

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    own, and for that reason it comes under the tax. Can any excuse be set up for such an illogical conclusion? It is the natural result of an illogical and absurd distinction. The two bodies exist for the same purpose, but the body that owns the land is not occupying it. The college lets it to the university, and therefore comes under the Land Tax which otherwise it would have avoided.
    8.0 P.M.
    The famous case of Harrow rests also upon the distinction, which I think breaks down, between land used and occupied for the purposes of the body and land held otherwise under lease for this same purpose. Harrow, at a cost of about £80,000, acquired some 250 acres in the immediate vicinity of the school. Its main object, no doubt, was to preserve an open space. Supposing these fields had been kept for organised games or as a recreation ground they would have got off the Undeveloped Land Tax. They have, as a matter of fact, been let for agricultural purposes, but they are being used for school purposes. They are being used for the boys to jump ditches, climb trees, and come in contact in various ways with country life. And though they are not used as cricket and football fields and the like, Harrow men tell me they look upon that 250 acres over which the boys roam as quite as valuable as the actual school fields in which they play their games. The tax they will pay will be something like £170 a year upon those lands, all due again to this absurd and illogical distinction. Although, in my opinion, the public schools of the country have an equal claim to be exempted from all the taxes, there are special circumstances which affect universities. In the first place the colleges of the universities are comparatively rich, and the universities themselves are poor, and by the last Commission a charge was laid upon colleges to make contributions to the universities. It refers to a prospective increase in value of the college lands. As a matter of fact, the agricultural rents have fallen from a third to a fourth during the last 20 to 25 years. On the other hand, the value of the building lands has been going up, and the hope has been that the balance might be redressed by the increased value of the lands which were ripening for building. Hitherto, few of the colleges have been able to pay their full quota to the university, but they were looking forward to the time when they could do so, owing to the great value of the other lands. Even if all the surplus funds of the college derived from this increasing value in the de-
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    veloping lands went to the university, the university means would still be unsatisfied. Instead of that you are cutting off some of that surplus money, and it is becoming necessary, quite apart from this, to make great appeals to the public for £250,000 for each university in order to extend and enlarge the scope of study, to equip the universities with the very costly scientific plant necessary for reseach, and to make them keep pace with the enlarging science of the day. That is one way in which they are placed, and therefore both universities have schemes for giving cheaper education to the poor man, and in proportion as you put on these taxes, of couse, you make it impossible to carry out these schemes. What we ask for is not, as in the case of other universities—the Scottish universities and the provincial universities of England—that the State should provide funds, but that they should be allowed to keep their own endowments when straining every nerve to bring the universities' equipment up to the ideal we desire. I have asked myself in reading this Clause, and it would be interesting to know, what is the relative value and importance of certain public ends in the eyes of the Government? We have with difficulty induced them to admit the public value of air, free space, light, and so forth. We also got them to admit in the Bill that education is a great public purpose, and one which entitles a school or body to an exemption from taxation if carried on by public local authorities, and only if so carried on. In other ways education seems to be ranked in the Bill with the erection of suburban villas. I would ask the Chancellor of the Exchequer if the work of the jerry-builder is a more important national object than helping to erect learning. It seems to me that in his unwillingness to give us these exemptions he lays the country open to the taunt often brought against us of national indifference to learning, and surely it is a squalid view of the ends of national existence that an intellectual factor in national life should count for so little. I believe that even from the point of view of material prosperity the intellectual work done in the laboratories of the universities is worth hundreds of thousands of pounds a year more than any of these taxes would be. Does it not seem a cruel, shortsighted, and Philistine thing to be crippling the universities at the very moment when they are doing their utmost for the extension of science. It is necessary that the Budget

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    should press hard on private ownership, at least I hope the Chancellor of the Exchequer, who I believe has great sympathy with these objects himself, will at least spare the great public institutions which exist for the spread of education, the adornment of life, and the advancement of learning.
    Mr. BALFOUR: The hon. and right hon. Gentlemen who have spoken on this side of the House have made speeches of very remarkable ability. They have all spoken on behalf of great institutions of learning, and perhaps therefore it is necessary someone representing the general public—and, from my own point of view, I claim to represent those who, while agreeing with me, are not directly connected with or directly representative of seats of learning—should take part in the Debate. The Chancellor of the Exchequer has only found one supporter so far on his own side, namely, the hon. Member for the Cricklade Division (Mr. Massie). I listened to his speech with very great regret. He is himself a man of learning and cultivation, but he approached this Amendment, which is to relieve learning of the tax, not from the point of view of learning whose interests are in danger, but from the point of view of a man profoundly alarmed lest any concession made to Cambridge, Oxford, Harrow, or Dulwich, should be extended to some religious denomination. Evidently he was obsessed, and mainly obsessed, by the terror that, if anything was done for education, the concession might be extended to a religious denomination. I do not think that is the proper state in which to approach the Amendment, and I am sorry that in his speech the Chancellor of the Exchequer seemed a little to yield to the same temptation as that to which the hon. Member for Cricklade yielded. That is not the only matter of regret in the hon. Member's speech. The hon. Member apparently has ransacked some Debate in 1863 in which Mr. Gladstone took part in order to justify the argument which he has placed before the Committee. I cannot imagine a more ungrateful, more unnecessary, or more unfortunate task being undertaken by any Member of the House The hon. Member said that the motive of the benefactor of a university or of a great school was to erect some monument, not to learning, but to his own benefit. He spoke in terms of contempt of those who leave their money to those institutions, and in a way which was
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    profoundly discouraging to those who, like myself, are deeply concerned in any movement which can add to the too narrow resources at present enjoyed by our great universities. It is a most unhappy way of treating that object. I have no doubt it was entirely in view of the fear with which he was oppressed lest any driblets of the Chancellor of the Exchequer's charity might reach in their course some religious institution that he spoke in that way. He went the length of saying that these pleas for relief from public taxation on behalf of charitable institutions were almost mean in their character. He forgets that almost every Church and Nonconformist chapel in the country is relieved from rates. Is that mean? Is that contemptible? I really cannot understand how a man with the breadth of intellectual sympathy which I believe the hon. Member possesses should allow himself to be dragged down by his fears, and I must say by his prejudices, to join with those who look with horror at the very possibility of the Chancellor of the Exchequer going even an inch further than the Amendment he has put on the Paper.
    Let us consider what the hon. Member's main point was apart from the religious point. He asked, "After all, what are these charitable institutions whose endowments you wish to preserve? Many of them are wealthy, many of them are extravagant, and some of them are corrupt." I do not know which he meant, but just compare with that description the corporate bodies in this country which are actually relieved from these taxes. Is every municipality in this country having large funds at its disposal free from the charge of extravagance? Is every municipality in this country free from the charge of corruption? I say if these charges are to be bandied about from one public body to the other it is not the trustees and managers of those great charitable, institutions which have most to fear from a critical examination on the lines suggested by the hon. Member for Cricklade. For my own part, I think the whole tone of the speech which he delivered is lamentable. We want, above all things, in this country imitators of those great American benefactors who have done so much to make the American universities among the best universities in the world. Is the way to maintain the liberality of men to throw in their teeth those charges that all they care for is to see their own names written in letters of brass, and to see their names immortalised by some monuments

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    whose chief purpose is to keep their memory alive, and not to carry out great public objects. I do most earnestly trust that the hon. Gentleman does not represent any large body of opinion in this country. On the contrary, the feeling of responsibility among wealthy men is growing that they do owe something, that they do owe much, to those great centres of learning, culture, and research from which more than from any other shape social reform can take, in my opinion, the future progress of the race must really proceed. If I come to the other total exemptions which the Government have made from these taxes—football fields and golf grounds—I shall not be charged with want of sympathy for any form of sport, and, least of all, to some of those forms of sport which the Government have exempted under the Bill. You say that a golf club or a cricket field is not to contribute to the defence of the country, but the Chancellor of the Exchequer says: Why should not these great educational institutions contribute to the defence of the country? If that is so, why should not a golf course or a football club contribute to the defence of the country? Are we really to say that in the view of the Government the educational work done by Cambridge, Oxford, Edinburgh, Glasgow, Dulwich, and Harrow is inferior to the work which is carried on—admirable work, I think—by our municipalities and the work which is carried on in connection with the sports of our people?
    A charge brought against us at present as a nation is that sport is all we care for. It is merely as football players, golfers, or cricketers that we count in the world at all. The Government seem by the legislation to suggest that the charge after all is well founded, and that any land which is set apart for these pastimes is land which may well be excused from any contribution whatever to the national purposes, but that land which is used for the improvement of the intellect of our people is land which, in the language of the Chancellor of the Exchequer, should be called upon to bear its share of the taxation required for the defence and development of the country. Compare the two speeches of the right hon. Gentleman, one at five o'clock this afternoon and the other about an hour ago on this subject. On the last Amendment the Chancellor of the Exchequer talked of raising revenue for great public purposes, and then he cast about to think what public purposes he would recommend
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    to the House. What was the public purpose he recommended? Secondary education in Wales. That was the great example. "We in Wales got part of the whisky tax; we earmarked it for the purposes of education." How admirable! How excellent! How more than excellent in its result! And now when we speak for places of education, which I am sure the Chancellor of the Exchequer will admit are not doing less important work than the secondary schools in Wales, he pares off, as he admits somewhat illogically, a little bit of the taxation here and some of the taxation there. But essentially he leaves on them the burden of the tax. How can he reconcile his speech of five o'clock with his speech of seven o'clock? They cannot be reconciled. The thing is quite impossible. I think he is in a difficulty; and why is that? None of my hon. Friends who have dealt so ably with the incidence of this tax on educational institutions have made this point: It is that the Land Taxes are special taxes, and they are placed arbitrarily on certain individuals or institutions. They are not taxes spread over the whole community. I think there is a great deal to be said for not freeing public institutions or private institutions from taxes spread over the whole communty. I believe that Cambridge and Oxford pay Income Tax. Schools do not, but universities do pay Income Tax, and pay their fair share of the general taxation of the country. If this was general taxation there would not be so very much to say about it. But the Chancellor of the Exchequer is caught in the toils of his own net. He has chosen to impose an arbitrary tax on certain kinds of property. He finds that that kind of property happens to be held in a very large measure by great public charitable institutions. He finds that he is not merely hitting this or that rich man, this or that poor man, this or that speculative builder, or this or that man who owns land in the neighbourhood of a big town. He is not only doing that—a pastime in which he so delights—but what is much more serious from the point of view of the general community he is taxing all the higher education in this country. I say that higher education in this country is already so ill-endowed as compared with the resources it possesses, and compared with every other big country in Europe that no Chancellor of the Exchequer ought to propose a tax which has its special incidence upon that special form of national

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    endeavour. For these reasons I support with special sympathy and special enthusiasm the Amendment proposed by my hon. Friend.
    The ATTORNEY-GENERAL (Sir W. Robson): The speech of the right hon. Gentleman in its earlier part was mainly directed against the taxation of educational institutions at all. They are treated as being institutions of such delicate and precarious existence that even when they have got endowments, and bring in very large incomes they ought, nevertheless, to be exempted from taxation altogether, because their incomes were devoted to such excellent purposes. That is an absolutely impossible doctrine, and that became clear to the right hon. Gentleman as he proceeded, because all these indirect taxes must fall on educational institutions, and they fall with special severity on schools. Indirect taxes fall on education perhaps more severely than any other tax. They add to the cost of education, and to the cost of the maintenance of the children, and, therefore, an indirect tax, which I suppose one may regard as not impossible, would fall with a greater degree of severity upon educational institutions throughout the country than even a tax upon undeveloped land; and on a far greater number of educational institutions. Let us take exactly the measure of this tax and this burden before we come to consider whether or not educational institutions should be exempted. Quite unintentionally I daresay, and not unnaturally, the weight of this burden has been much exaggerated, especially in the speech of the hon. Member for Dulwich (Mr. Bonar Law). He said that in Dulwich College they would have to pay £1,000 a year Undeveloped Land Duty. That means that Dulwich College possesses an annual estate worth £480,000 over and above the land which is used and occupied by the school itself, and over and above the agricultural value of the land. But I put that out of the question, because it is a small matter when dealing with figures so large as £480,000. The school is exempted by the Amendment which the right hon. Gentleman has put down, and the land used for games and other land used and occupied by the school are also exempted, and it is only what may be called the business lands, the lands productive of income that are to be taxed. "Now," says the hon. Member, "that land in this case will produce £1,900 a year,
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    and therefore you will take away £1,000 and leave only £900 for educational purposes, and you put a cruel and most oppressive tax upon the financial resources of a very great and most valuable educational institution." What, according to him, are the proprietors of the school doing at this moment? According to him, the proprietors of the school have got half a million of money which they are refusing to put to its best use. He said it is really depriving the school of £1,000 a year.
    Mr. BONAR LAW: That is the whole point of the case. I stated that the governors of Dulwich College admitted they were doing their very best to dispose of the land as quickly as they could. The hon. and learned Gentleman says that the value is grossly exaggerated, and that the Commissioners would not value it at so much. What I said was that the Commissioners would value it at £1,000, but the governors could not possibly sell it; no one would buy it, though they are trying to dispose of it as quickly as they can.
    Sir W. ROBSON: I am not in the least saying you are exaggerating the value; I am not quarrelling with their estimates, and I do not care whether it is half a million or £100,000. I take the hon. Gentleman's own figures, and we have got to take the value of the land in the market.
    Mr. BONAR LAW: The case is not what the land is worth, but that the Commissioners would value it at that rate.
    Sir W. ROBSON: I do not think the hon. Member has improved the position. We have got too deal with land which is valued for the purpose of this Act, and in valuing undeveloped land it has to be considered what that land will fetch in the market. [An HON. MEMBER: "There are many allowances."] There are plenty of allowances to be made before you can reach the net building value of the land. According to the hon. Member, it was not a question of going on paying £1,000 a year; it was a question of the necessity of getting half a million of money for this land before they would sell it. So that the hardship to education is not that the Government are going to take £1,000 a year, but that the governing body refuse to make many thousands a year by selling land which is in urgent demand in the neighbourhood.
    Sir P. MAGNUS: The land is not in urgent demand. It could not be sold as a whole, but only in small portions at a

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    time, and the governor are doing their best to sell it. The hon. and learned Gentleman is misrepresenting the governors.
    Sir W. ROBSON: I do not think that interruption is justified. Does any man in his senses pretend that Dulwich College, with such an enormous amount of land, could not sell it at a price? [An HON. MEMBER: "It is not saleable."] I am told by my hon. Friend (Mr. Masterman), who is no bad authority on the subject, that the governors of Dulwich College have been by no means very ready to sell at a reasonable price the land which is wanted by the adjacent population, and the enormous value which I hear is put upon it shows that the complaints of those who live near Dulwich are not altogether without ground. If the authorities of Dulwich College choose to keep back land from the paramount necessities of the community, and thus lose the interest which they might obtain on the purchase money, then the Dulwich authorities would be benefited by being reminded that they could fulfil their obligations both to the adjacent population and to the education which they control by selling their land at a reasonable price and investing the money for the purposes of education. The hon. and learned Member for Glasgow said it would mean £700 a year in the case of the university of that city; but if these universities, like any other great institution, choose to hold their land up in order to get a better price later, by all means let them do it, but do not let them complain of the tax which is laid precisely upon that operation in the case of others. I think the complaint of the hon. Member is altogether ill-founded and inappropriate. The hon. Member for Dulwich went on to deal with the Increment Tax. I think he was scarcely explicit enough in dealing with the remissions that the Government gave in the case of the quinquennial sum, or the equivalent of the Corporation Duty which will be paid. The Committee will understand exactly how corporations, whether educational or otherwise, are now treated under the Bill. There is, of course, the valuation on the ordinary corporation, and one that is not a charitable corporation pays an amount which would correspond with the amount which probably that property would pay on the average if it were in the hands of a private person who died, because there must be a corporation duty as a sort of equivalent to the Death Duty. All the educational institutions are exempt
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    from that duty if they do not sell the land or do not use it. If they do not sell the land—and there are many cases in which they do and must sell their land—[An HON. MEMBER: "Or lease."] The hon. Member does not propose that all these leases are made the occasion of collecting duty. It is only particular leases in particular circumstances that give rise to any duty. When a sale takes place we take 20 per cent. of the increment. That shows how far we have gone in the way of concession; indeed, I think my duty should really be to endeavour to justify such concession. Increment on what? Not an increment as between agricultural value and building value, but an increment over and above the value of the Dulwich land on 30th April, 1909. The whole of the existing value is exempt for the purpose of Increment Duty, yet the hon. Member gets up and first of all says we are taking £1,000 a year from Dulwich, and that if by chance they sell we wall take 20 per cent. of what they get. We are doing nothing of the kind. We take 20 per cent. of the increment value over and above the value as fixed on 30th April, 1909. There are many deductions, for some of which we shall be reproached, I suppose I say that that is not a very severe burden to put on any corporation, educational or charitable, possessed of these gigantic estates.
    Mr. REES: The hon. and learned Gentleman has not dealt with an entirely different class of case, in which the land of the educational institution cannot be sold because it is a necessary condition of the case that it should be held up from building, and should not be sold. I do not know the case of Dulwich, but I know that the case of Harrow, on which I wish to address the Committee, is such as I have described.
    Sir W. ROBSON: The hon. Member no doubt would put his case in due time. Now, what does the hon. Member for Cambridge University say? He asked the Committee whether the work of the "jerrybuilder" was to be considered of greater importance than the maintenance of these great educational institutions. I should be sorry to think that the sentiment of that observation was common to many Members. Nobody likes "jerrybuilding," but, after all, this is not a Debate as to the future construction of houses. It is the question of the provision of houses for the people, who must have land and are offering a famine price for it. Is not that of more importance than the maintenance of great estates in the hands

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    of corporations who will not deveop their land and who are withholding it? The other questions really are not of very great importance.
    Mr. BUTCHER: May I hope that the hon. Gentleman will give me an answer as to the point which I have raised, and that is as to the Reversion Duty in the beginning of the Chancellor of the Exchequer's Amendment?
    Sir W. ROBSON: It is quite true that in the Clause as amended, instead of saying no duty under this part of the Act shall be charged, and so on, we have said no Reversion Duty, or Undeveloped Land Duty, shall be charged in respect of land held by a governing body for charitable purposes while the land is used and occupied by that body. I think there is just enough justification for the words to have them there. Unfortunately, in drafting this Bill there is brought to the attention of those who are concerned many rare and remote cases, and very often when rare and remote cases are not brought to our notice we have to imagine them in order to see how far our words require to be extended and safeguarded. It was thought that the words had better be inserted there for the sake of perfect clearness. To deal with the case where land is possessed or held by managers from a body of trustees, for instance, and used for the purposes of a school. In order, therefore, that there might be no doubt and out of greater caution, it was considered necessary to insert the words so that no Reversion Duty is to attach at all, and so that if there are any of those remote cases we exclude them by the use of those words. That is the whole reason for the words being put there. The right hon. Gentleman the Leader of the Opposition did, I think, rather scant justice to my hon. Friend the Member for the Cricklade Division (Mr. Massie), who took a view rather in an extreme form, and certainly not in a form with which I would find myself in complete agreement. Still, he took a view which was not at all uncommon among the great masters of finance in the sixties, when our English financial system was put upon the basis which we thought was immortal, and which, after all, has lasted a fairly long time. A distinction was drawn then, and it was upon that that my hon. Friend relied most to-night, between educational institutions and religious institutions.
    With regard to education, there is much more common agreement among all sec-
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    tions than with regard to religion, in which there are profound and vital differences. There are those who regard it as worse than a hardship, almost an iniquity, that they should be compelled to support those doctrines in which they do not believe, and, after all, exemption from taxation for religious bodies is a direct form of State support to those organisations. We are not completely logical in England; but occasionally there comes forward someone like my hon. Friend who is not afraid to push the voluntary principle to its most extreme application, and he objected to any kind of benefit being given by way of exemption to those doctrines. It is not a new doctrine; it has many many arguments that could be urged in its favour, and I think it scarcely received quite fair justice from the right hon. Gentleman. We have made exemption in favour of all charitable purposes wherever land is held for charitable purposes. What are those charitable purposes? They were defined in the words of a great judge in a case which was decided in 1891, and which has since been the leading authority on all cases on what is the law of charity. I think I may say that hon. Members who have Amendments down may not take up their time in trying to add the word "educational" to charitable purposes. The hon. Gentleman who moved this Amendment wished to have the words "charitable or educational." The word "charitable" is already sufficiently wide to cover educational, and a great many other purposes besides. Lord Macnaghten in the case to which I have referred, said:—
    "In this case the expression 'charitable purpose' has a much more extended meaning than in the popular sense. The words include trusts for the relief of poverty, trusts for the advancement of education, trusts for the advancement of religion, and trusts for any other purpose beneficial to the community not falling under any of the preceding heads"
    We cannot have a wider definition than that, and for those who are desirous that charitable purposes should be exempt, this takes them as far as we can exempt them, and I think they would be well advised not to quarrel with the words as they are.
    Mr. RAWLINSON: The question of the exemption of religious bodies raises a question which no doubt is wider than that as to whether those bodies holding land forms a desirable use. This Amendment does not deal with that case at all, and I ask the Committee to judge the Amendment without reference to that part of the question. The Chancellor of the Exchequer asked how, if he granted an exemption to universities and public schools, he could

    1009
    logically withhold it from these religious bodies. The answer to that is that a long time ago there was a very strong feeling against bodies of this kind holding land in England at all, and the result of that was the passing of certain Acts called the Mortmain Acts, which are in existence at the present day, preventing the holding of land by religious bodies except under certain stringent conditions. But in those Acts exemption has always been granted to the universities and certain public schools. Therefore, as far as the case of the universities is concerned, from time immemorial a distinction has been drawn between them and other religious bodies in the matter of holding land; and I submit that there can be no logical reason why the same distinction should not be drawn with reference to this new taxation. The case of the universities rests on a perfectly logical basis. You have rightly exempted lands held by municipal authorities, because the land is held for the public benefit and is used for public and useful purposes—in some cases for the purposes of schools, in others for the general good of the community. The position of the universities rests on the same basis, namely, that they are devoting their endowments to public ends, to educational work, and to work which is of use to the community at large. Many universities at present receive considerable assistance from the Government by way of grants; others have not yet received that aid. To take the case of my own University (Cambridge), there can be no doubt about their want of money, and they have amongst members of their own body during the last year or two collected £150,000 for the purpose of extending their work, which extension is needed very urgently. If you put an extra tax on the land held by the University you will surely be doing a great injustice; you will either make a further claim upon the resources of the members of the University or you will curtail the useful work which the University is doing.
    The Attorney-General has referred to educational bodies holding up land instead of selling it. But he has failed to remind the Committee that land held by a college or university can in no case be sold by them without the leave of the Board of Agriculture, and in the vast majority of cases it is only after asking the advice of that Department that any step in the matter has been taken. The universities being in the position that the bulk of their endowments have been left to them in land which they cannot part with without the consent
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    of a Government Department, it is rather hard when an entirely new kind of taxation is being imposed, and an exemption is asked for on behalf of the universities, that they should be taunted with having held their land when they could not sell it except with the consent of the Board of Agriculture. What is the exemption which the Chancellor of the Exchequer has given? He has admitted that universities should be exempt up to a certain point. This matter will probably become of much broader interest when we discuss the exemption given to friendly societies. The property of the university—I use that term, but the argument applies equally to other educational establishments—is of two kinds. The first is that situated in Cambridge itself, which is used and occupied by the university for the purposes of the university. As far as that is concerned exemption from rates exists in a large number of cases. Under the Act of 1856 the Senate House and similar places are already exempted from rates. Under the present Bill it is proposed that land and houses occupied or used by the university for the purposes of the university shall be exempt from Reversion Duty which could never arise; from Undeveloped Land Duty, which is not likely to arise, and from the 15 years' periodical collection of Increment Duty. That is a comparatively small exemption, but one for which we are certainly grateful. It applies only to land within a mile or two of Cambridge, but ridiculous cases might have arisen if the exemption had not been granted. From a pecuniary point of view, however, the important matter is the land held by the university, but not used or occupied by the university for its own purposes, such as land in London and in different counties, the rents of which go to the emoluments of the professors and so on. As far as that is concerned we get no exemption from Increment Duty. There is exemption from the valuation at the end of every 15 years, but there is no exemption from the duty. Consequently, whenever a sale of such land takes place Increment Duty will have to be paid. In the case of land held upon leases, heavy duties will fall on the university in connection with reversions. The colleges are large holders of leasehold property, and will consequently suffer. They get no concession as far as Undeveloped Land Duty is concerned. Therefore, the concession to the universities from the financial point of view is practically infinitesimal, and the drain upon the resources of any educational

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    establishment of that kind must be very large indeed. I would strongly urge the Committee to deal fairly with this case, and not to be led away by references to religious houses or anything of that sort. I will not deal with the speech of the hon. Member for Cricklade (Mr. Massie). My position is a somewhat difficult one, as not only is the hon. Member for Cricklade one of my Constituents, but so also is the Leader of the Opposition, who spoke so strongly against him. I think I am entitled to say this much: With his distinguished, or rather various, university career at Ox ford, Cambridge, Birmingham, and else-
    where, the hon. Member for Cricklade (Mr. Massie) must know the great need for money, and he must feel, if not carried away with his views on the religious aspect of the question, that this is not the time to put additional taxes upon educational bodies which are doing public service.
    Sir W. ROBSON Sir W. ROBSON rose in his place, and claimed to move, "That the Question be now put."
    Question put, "That the Question be now put."
    The Committee divided: Ayes, 171; Noes, 53.

    Division No. 734.]

    AYES.

    [8.55 p.m.

    Agnew, George William

    Glendinning, R. G.

    Pease, Rt. Hon. J. A. (Saff. Wald.)

    Alden, Percy

    Glover, Thomas

    Pickersgill, Edward Hare

    Allen, A. Acland (Christchurch)

    Gooch, George Peabody (Bath)

    Pirie, Duncan V.

    Allen, Charles P. (Stroud)

    Gulland, John W.

    Pointer, J.

    Ashton, Thomas Gair

    Harcourt, Robert V. (Montrose)

    Pollard, Dr. G. H.

    Atherley-Jones, L.

    Hardie, J. Keir (Merthyr Tydvil)

    Rea, Rt. Hon. Russell (Gloucester)

    Baker, Sir John (Portsmouth)

    Hardy, George A. (Suffolk)

    Rees, J. D.

    Balfour, Robert (Lanark)

    Harmsworth, Cecil B. (Worcester)

    Richards, T. F. (Wolverhampton, W.)

    Barker, Sir. John

    Harmsworth, R. L. (Caithness-sh.)

    Roberts, Charles H. (Lincoln)

    Barnard, E. B.

    Hazel, Dr. A. E. W.

    Roberts, G. H. (Norwich)

    Barnes, G. N.

    Hedges, A. Paget

    Robertson, Sir G. Scott (Bradford)

    Barran, Sir John Nicholson

    Helme, Norval Watson

    Robson, Sir William Snowdon

    Barry, Redmond J. (Tyrone, N.)

    Henderson, J. McD. (Aberdeen, W.)

    Roch, Walter F. (Pembroke)

    Beauchamp, E.

    Higham, John Sharp

    Rowlands, J.

    Bell, Richard

    Hobart, Sir Robert

    Russell, Rt. Hon. T. W.

    Benn, W. (Tower Hamlets, St. Geo.)

    Hodge, John

    Rutherford, V. H. (Brentford)

    Berridge, T. H. D.

    Hope, W. H. B. (Somerset, N.)

    Samuel, Rt. Hon. H. L. (Cleveland)

    Bethell, Sir J. H. (Essex, Romford)

    Horniman, Emslie John

    Schwann, Sir C. E. (Manchester)

    Black, Arthur W.

    Howard, Hon. Geoffrey

    Sherwell, Arthur James

    Boulton, A. C. F.

    Hudson, Walter

    Shipman, Dr. John G.

    Bowerman, C. W.

    Hyde, Clarendon G.

    Simon, John Allsebrook

    Bramsdon, Sir T. A.

    Idris, T. H. W.

    Snowden, P.

    Branch, James

    Jackson, R. S.

    Stanger, H. Y.

    Brigg, John

    Jenkins, J.

    Stanley, Albert (Staffs, N. W.)

    Bright, J. A.

    Jones, Sir D. Brynmor (Swansea)

    Steadman, W. C.

    Brodie, H. C.

    Jones, Leif (Appleby)

    Stewart, Halley (Greenock)

    Brunner, J. F. L. (Lancs., Leigh)

    Jones, William (Carnarvonshire)

    Stewart-Smith, D. (Kendal)

    Brunner, Rt. Hon. Sir J. T. (Cheshire)

    Jowett, F. W.

    Straus, B. S. (Mile End)

    Burns, Rt. Hon. John

    Kekewich, Sir George

    Summerbell, T.

    Byles, William Pollard

    King, Alfred John (Knutsford)

    Taylor, John W. (Durham)

    Channing, Sir Francis Allston

    Laidlaw, Robert

    Thomas, Sir A. (Glamorgan, E.)

    Clough, William

    Lamb, Edmund G. (Leominster)

    Thompson, J. W. H. (Somerset, E.)

    Cobbold, Felix Thornley

    Lamb, Ernest H. (Rochester)

    Thorne, G. R. (Wolverhampton)

    Collins, Stephen (Lambeth)

    Layland-Barratt, Sir Francis

    Toulmin, George

    Compton-Rickett, Sir J.

    Lea, Hugh Cecil (St. Pancras, E.)

    Trevelyan, Charles Philips

    Corbett, A. Cameron (Glasgow)

    Lehmann, R. C.

    Verney, F. W.

    Corbett, C. H. (Sussex, E. Grinstead)

    Lever, A. Levy (Essex, Harwich)

    Vivian, Henry

    Cotton, Sir H. J. S.

    Lever, W. H. (Cheshire, Wirral)

    Wadsworth, J.

    Cross, Alexander

    Levy, Sir Maurice

    Walsh, Stephen

    Dalziel, Sir James Henry

    Lloyd-George, Rt. Hon. David

    Ward, John (Stoke-upon-Trent)

    Davies, Timothy (Fulham)

    Lough, Rt. Hon. Thomas

    Wason, Rt. Hon. E. (Clackmannan),

    Davies, Sir W. Howell (Bristol, S.)

    Lupton, Arnold

    Wason, John Cathcart (Orkney)

    Dickinson, W. H. (St. Pancras, N.)

    M'Callum, John M.

    Waterlow, D. S.

    Duckworth, Sir James

    M'Laren, H. B. (Stafford, W.)

    White, Sir George (Norfolk)

    Duncan, C. (Barrow-in-Furness)

    Maddison, Frederick

    White, J. Dundas (Dumbartonshire)

    Duncan, J. Hastings (York, Otley)

    Mallet, Charles E.

    White, Sir Luke (York, E. R.)

    Dunn, A. Edward (Camborne)

    Marnham, F. J.

    Whitehead, Rowland

    Dunne, Major E. Martin (Walsall)

    Massie, J.

    Whittaker, Rt. Hon. Sir Thomas P.

    Edwards, Sir Francis (Radnor)

    Masterman, C. F. G.

    Wiles, Thomas

    Essex, R. W.

    Menzies, Sir Walter

    Wilkie, Alexander

    Evans, Sir S. T.

    Molteno, Percy Alport

    Williams, J. (Glamorgan)

    Everett, R. Lacey

    Mond, A.

    Wilson, Henry J. (York, W. R.)

    Falconer, J.

    Murray, James (Aberdeen, E.)

    Wood, T. M'Kinnon

    Ferguson, R. C. Munro

    Myer, Horatio

    Yoxall, Sir James Henry

    Findlay, Alexander

    Norman, Sir Henry

    Foster, Rt. Hon. Sir Walter

    Nuttall, Harry

    Fuller, John Michael F.

    Parker, James (Halifax)

    TELLERS FOR THE AYES.—Captain Norton and Sir E. Strachey.

    Fullerton, Hugh

    Partington, Oswald

    Gibb, James (Harrow)

    Pearce, Robert (Staffs, Leek)

    NOES.

    Anson, Sir William Reynell

    Gretton, John

    Pease, Herbert Pike (Darlington)

    Balcarres, Lord

    Guinness, Hon. R. (Haggerston)

    Pretyman, E. G.

    Baldwin, Stanley

    Guinness, Hon. W. E. (B. S. Edm'nds)

    Randies, Sir John Scurrah

    Baring, Capt. Hon. G. (Winchester)

    Hamilton, Marquess of

    Ratcliff, Major R. F.

    Butcher, Samuel Henry

    Hardy, Laurence (Kent, Ashford)

    Rawlinson, John Frederick Peel

    Carlile, E. Hildred

    Hart-Davies, T.

    Remnant, James Farquharson

    Carson, Rt. Hon. Sir Edward H.

    Helmsley, Viscount

    Roberts, S. (Sheffield, Ecclesall)

    Cecil, Evelyn (Aston Manor)

    Hope, James Fitzalan (Sheffield)

    Rutherford, Watson (Liverpool)

    Cecil, Lord R. (Marylebone, E.)

    Hunt, Rowland

    Smith, Abel H. (Hertford, East)

    Clyde, J. Avon

    Kimber, Sir H.

    Staveley-Hill Henry (Staffordshire)

    Craik, Sir Henry

    Lane-Fox, G. R.

    Stone, Sir Benjamin

    Dalrymple, Viscount

    Law, Andrew Bonar (Dulwich)

    Talbot, Rt. Hon. J. G. (Oxford Univ.)

    Dickson, Rt. Hon. C. Scott-

    Lowe, Sir Francis William

    Tuke, Sir John Batty

    Doughty, Sir George

    Magnus, Sir Philip

    Walker, Col. W. H. (Lancashire)

    Douglas, Rt. Hon. A. Akers-

    Mildmay, Francis Bingham

    Wortley, Rt. Hon. C. B. Stuart-

    Duncan, Robert (Lanark, Govan)

    Morpeth, Viscount

    Fletcher, J. S.

    Oddy, John James

    TELLERS FOR THE NOES.—Sir A. Acland-Hood and Mr. H. W. Forster.

    Gardner, Ernest

    Parker, Sir Gilbert (Gravesend)

    Goulding, Edward Alfred

    Parkes, Ebenezer

    Question put accordingly. The Committee divided: Ayes, 176; Noes, 50.

    Division No. 735.]

    AYES.

    [9.10 p.m.

    Agnew, George William

    Findlay, Alexander

    Masterman, C. F. G.

    Alden, Percy

    Foster, Rt. Hon. Sir Walter

    Menzies, Sir Walter

    Allen, A. Acland (Christchurch)

    Fuller, John Michael F.

    Molteno, Percy Alport

    Allen, Charles P. (Stroud)

    Fullerton, Hugh

    Mond, A.

    Ashton, Thomas Gair

    Gibb, James (Harrow)

    Murray, James (Aberdeen, E.)

    Atherley-Jones, L.

    Glendinning, R. G.

    Myer, Horatio

    Baker, Sir John (Portsmouth)

    Glover, Thomas

    Norman, Sir Henry

    Balfour, Robert (Lanark)

    Gooch, George Peabody (Bath)

    Nuttall, Harry

    Barker, Sir John

    Gulland, John W.

    Parker, James (Halifax)

    Barnard, E. B.

    Harcourt, Robert V. (Montrose)

    Partington, Oswald

    Barnes, G. N.

    Hardie, J. Keir (Merthyr Tydvil)

    Pearce, Robert (Staffs, Leek)

    Barran, Sir John Nicholson

    Hardy, George A. (Suffolk)

    Pease, Rt. Hon. J. A. (Staff. Wald.)

    Barry, Redmond J. (Tyrone, N.)

    Harmsworth, Cecil B. (Worcester)

    Pickersgill, Edward Hare

    Beauchamp, E.

    Harmsworth, R. L. (Caithness-sh.)

    Pirie, Duncan V.

    Bell, Richard

    Hart-Davies, T.

    Pointer, J.

    Benn, W. (Tower Hamlets, St. Geo.)

    Hedges, A. Paget

    Pollard, Dr. G. H.

    Berridge, T. H. D.

    Helme, Norval Watson

    Rea, Rt. Hon. Russell (Gloucester)

    Bethell, Sir J. H. (Essex, Romford)

    Henderson, J. McD. (Aberdeen, W.)

    Rea, Walter Russell (Scarborough)

    Black, Arthur W.

    Higham, John Sharp

    Rees, J. D.

    Boulton, A. C. F.

    Hobart, Sir Robert

    Richards, T. F. (Wolverhampton, W.)

    Bowerman, C. W.

    Hodge, John

    Roberts, Charles H. (Lincoln)

    Bramsdon, Sir T. A.

    Hope, W. H. B. (Somerset, N.)

    Roberts, G. H. (Norwich)

    Branch, James

    Horniman, Emslie John

    Robertson, Sir G. Scott (Bradford)

    Brigg, John

    Howard, Hon. Geoffrey

    Robson, Sir William Snowdon

    Bright, J. A.

    Hudson, Walter

    Roch, Walter F. (Pembroke)

    Brodie, H. C.

    Hyde, Clarendon G.

    Rose, Sir Charles Day

    Brunner, J. F. L. (Lancs., Leigh)

    Idris, T. H. W.

    Rowlands, J.

    Brunner, Rt. Hon. Sir J. T. (Cheshire)

    Jackson, R. S.

    Russell, Rt. Hon. T. W.

    Burns, Rt. Hon. John

    Jenkins, J.

    Rutherford, V. H. (Brentford)

    Byles, William Pollard

    Jones, Sir D. Brynmor (Swansea)

    Samuel, Rt. Hon. H. L. (Cleveland)

    Channing, Sir Francis Allston

    Jones, Leif (Appleby)

    Schwann, Sir C. E. (Manchester)

    Clough, William

    Jones, William (Carnarvonshire)

    Sherwell, Arthur James

    Cobbold, Felix Thornley

    Jowett, F. W.

    Shipman, Dr. John G.

    Collins, Stephen (Lambeth)

    Kekewich, Sir George

    Simon, John Allsebrook

    Compton-Rickett, Sir J.

    King, Alfred John (Knutsford)

    Snowden, P.

    Corbett, A. Cameron (Glasgow)

    Laidlaw, Robert

    Stanger, H. Y.

    Corbett, C. H. (Sussex, E. Grinstead)

    Lamb, Edmund G. (Leominster)

    Stanley, Albert (Staffs, N. W.)

    Cotton, Sir H. J. S.

    Lamb, Ernest H. (Rochester)

    Steadman, W. C.

    Cross, Alexander

    Layland-Barratt, Sir Francis

    Stewart, Halley (Greenock)

    Dalziel, Sir James Henry

    Lea, Hugh Cecil (St. Pancras, E.)

    Stewart-Smith, D. (Kendal)

    Davies, Timothy (Fulham)

    Lehmann, R. C.

    Straus, B. S. (Mile End)

    Davies, Sir W. Howell (Bristol, S.)

    Lever, A. Levy (Essex, Harwich)

    Taylor, John W. (Durham)

    Dickinson, W. H. (St. Pancras, N.)

    Lever, W. H. (Cheshire, Wirral)

    Thomas, Sir A. (Glamorgan, E.)

    Duckworth, Sir James

    Levy, Sir Maurice

    Thompson, J. W. H. (Somerset, E.)

    Duncan, C. (Barrow-in-Furness)

    Lloyd-George, Rt. Hon. David

    Thorne, G. R. (Wolverhampton)

    Duncan, J. Hastings (York, Otley)

    Lough, Rt. Hon. Thomas

    Toulmin, George

    Dunn, A. Edward (Camborne)

    Lupton, Arnold

    Trevelyan, Charles Philips

    Dunne, Major E. Martin (Walsall)

    MacVeagh, Jeremiah (Down, S.)

    Verney, F. W.

    Edwards, Sir Francis (Radnor)

    M'Callum, John M.

    Vivian, Henry

    Essex, R. W.

    M'Laren, H. D. (Stafford, W.)

    Wadsworth, J.

    Evans, Sir S. T.

    Maddison, Frederick

    Walsh, Stephen

    Everett, R. Lacey

    Mallet, Charles E.

    Ward, John (Stoke-upon-Trent)

    Falconer, J.

    Marnham, F. J.

    Wason, Rt. Hon. E. (Clackmannan)

    Ferguson, R. C. Munro

    Massie, J.

    Wason, John Cathcart (Orkney)

    1014

    1015

    Waterlow, D. S.

    Whittaker, Rt. Hon. Sir Thomas P.

    Wood, T. M'Kinnon

    White, Sir George (Norfolk)

    Wiles, Thomas

    Yoxall, Sir James Henry

    White, J. Dundas (Dumbartonshire)

    Wilkie, Alexander

    White, Sir Luke (York, E. R.)

    Williams, J. (Glamorgan)

    TELLERS FOR THE AYES.—Captain Norton and Sir E. Strachey

    Whitehead, Rowland

    Wilson, Henry J. (York, W. R.)

    NOES.

    Acland-Hood, Rt. Hon. Sir Alex. F.

    Goulding, Edward Alfred

    Parkes, Ebenezer

    Anson, Sir William Reyneil

    Gretton, John

    Pease, Herbert Pike (Darlington)

    Balcarres, Lord

    Guinness, Hon. R. (Haggerston)

    Pretyman, E. G

    Baldwin, Stanley

    Guinness, Hon. W. E. (B. S. Edmunds)

    Randies, Sir John Scurrah

    Baring, Captain Hon. G. (Winchester)

    Hamilton, Marquess of

    Ratcliff, Major R. F.

    Butcher, Samuel Henry

    Hardy, Laurence (Kent, Ashford)

    Rawlinson, John Frederick Peel

    Carlile, E. Hildred

    Helmsley, Viscount

    Remnant, James Farquharson

    Carson, Rt. Hon. Sir Edward H.

    Hope, James Fitzalan (Sheffield)

    Roberts, S. (Sheffield, Ecclesall)

    Cecil, Evelyn (Aston Manor)

    Hunt, Rowland

    Rutherford, Watson (Liverpool)

    Cecil, Lord R. (Marylebone, E.)

    Joyce, Michael

    Smith, Abel H. (Hertford, East)

    Clyde, J. Avon

    Kimber, Sir Henry

    Staveley-Hill, Henry (Staffordshire)

    Dalrymple, Viscount

    Lane-Fox, G. R.

    Stone, Sir Benjamin

    Dickson, Rt. Hon. Charles Scott

    Law, Andrew Bonar (Dulwich)

    Talbot, Rt. Hon. J. G. (Oxford Univ.)

    Doughty, Sir George

    Lowe, Sir Francis William

    Tuke, Sir John Batty

    Douglas, Rt. Hon. A. Akers-

    Lundon, T.

    Walker, Col W. H. (Lancashire)

    Duncan, Robert (Lanark, Govan)

    Mildmay, Francis Bingham

    Wortley, Rt. Hon. C. B. Stuart.

    Fletcher, J. S.

    Morpeth Viscount

    Forster, Henry William

    Oddy, John James

    TELLERS FOR THE NOES.—Sir P. Magnus and Sir H. Craik.

    Gardner, Ernest

    Parker, Sir Gilbert (Gravesend)

    Mr. LLOYD-GEORGE Mr. LLOYD-GEORGE moved after the word "No" ["no duty under this part of this Act shall be charged in respect of land"], to insert the words, "Reversion Duty, or undeveloped land."
    Mr. STUART WORTLEY: This is one of the series of Amendments which, I understand, are to be made to reconstruct this Clause for the purpose of effecting the concessions, such as they are, which the Chancellor of the Exchequer has consented to insert. I had an Amendment on the Paper along with my hon. Friend the Member for Kingston (Mr. Cave) which had for its object the exemption of land held by religious bodies. The last thing I wish to do, as the representative of the largest of these bodies in this country, is to appear in the attitude of an unreasonable and vexatious consumer of the time of this House. I do not propose, however, to move my Amendment, because I recognise the decision the House has just come to in its refusal to exempt land of religious bodies, practically disposes of my Amendment also. But it remains for us to see that such concessions as the Chancellor has offered to those lands in the hands of educational and other bodies and charities are fully carried out. It is quite clear that these lands come within the benefits of the exemption which the Chancellor is giving; but is it quite clear that glebe land in the possession of a parson would come within that definition in the Amendment of the Government, which appears in the name of the Chancellor of the Exchequer lower down upon the Paper? Where it says "governing body" does
    1016
    that include any person who has the management of land? The importance of that will be seen when it is borne in mind what an extreme hardship it would be to impose upon the life-tenant all these duties. The position as regards the Increment Duty is extremely difficult. I want to make quite sure that along with all the other bodies intended to have the benefit of this exemption the clergyman will come into the advantages, and will not be excluded by reason of the fact that this proposal is made to apply in the first instance to communities which will be under the control of what is called "a governing body." The proviso standing in the name of the Chancellor of the Exchequer on page 20 of the White Paper gives a definition of the phrase "governing body." and it is probably intended to meet the case of individuals who stand in the position of a governing body. I hope I may receive some assurance that glebe land will get the benefit of this limited exemption.
    Sir W. ROBSON: I hope we are taking the discussion on this point upon the understanding that the discussion will not be renewed. I think the Committee will agree with me when I say that we should not have a discussion of this kind repeated. First of all, the right hon. Gentleman opposite asked me whether a clergyman would be included in the expression "governing body." The definition standing in the name of the Chancellor of the Exchequer lays down that "the expression 'governing body constituted for charitable purposes' includes any person or body of persons who have the right of holding, or any power of government of, or

    1017
    management over, any property appropriated for charitable purposes." I think the clergyman in the case put by the right hon. Gentleman would undoubtedly be held as having a right of management over property appropriated for charitable purposes. On the spur of the moment that seems to me to be the literal construction, but I put forward that construction with some doubt. Whether the clergyman would come within the substantial wording of this Clause for charitable purposes when he is holding it for his own maintenance I am not so sure. Perhaps the right hon. Gentleman will allow me to reserve the point for the consideration of those better skilled in conveyancing law than I am. My own impression is that he would come within the construction, but I will consider that point later on. The general definition is very wide. The words "charitable purposes" include four classes. In the first place, trusts for charitable purposes; secondly, advancement of education; thirdly, the advancement of religion; and fourthly, trusts for other purposes beneficial to the community not included under any of the preceding heads. Those are the words of Lord Macnaghten, and I think if those words are left alone they will suit the object of hon. Members opposite much better than introducing specific charitable purposes which may limit the general meaning of the phrase "charitable purposes" itself. The effect of this Amendment would be that the Court would say it is clear that the expression "charitable purposes" is not intended to have the wide meaning given to it in Benson's case or it would have been unnecessary to have this other definition. Education and religion will remain, but it may have more of a limiting than an extending effect. The definition of "charitable purposes" is so wide that I am quite sure it is sufficient to meet all practical purposes.
    Lord ROBERT CECIL: After what the Attorney-General has said I do not wish to occupy the time of the Committee. The actual question whether a clergyman is included can be specifically raised by the next Amendment of the Chancellor of the Exchequer, which alters the definition by leaving out certain words and inserting "governing body." Under the Clause as printed in the Bill there is not the least doubt a clergyman would have been included. I ask the Government to consider very carefully before we reach the next Amendment whether they desire to exclude
    1018
    the clergymen and include the Ecclesiastical Commissioners. The effect of the Amendment would be that a body like the Ecclesiastical Commissioners would remain, but it is doubtful whether a clergyman would remain or not. The clergyman is a person who certainly has not more than enough money to live upon and carry out his duties, and he ought to be more an object for the consideration of Parliament in putting in an exemption of this, sort than a body like the Ecclesiastical Commissioners, some of whose beneficiaries are people comparatively wealthy. The Clause provides that "No duty under this Part of this Act shall be charged in respect of land or any interest in land held by any person or body of persons carrying on any undertaking or institution without any view to the payment of any dividend or profit out of the revenue thereof, for purposes which in the opinion of the Commissioners are public purposes or charitable purposes, while the land is occupied and used by that person or body for those purposes." Surely that would clearly include a clergyman. At least, I should have thought so. I should have thought he was clearly a person carrying on an undertaking for charitable or public purposes. If he is not doing that he is not doing his duty. I can conceive that in law he is a corporation sole for charitable purposes. I should have thought it was quite clear he was a person within the meaning of that Clause. It is quite true the Government by substituting the words "governing body for charitable purposes" may conceivably have raised a doubt, and if they intend to raise that doubt the matter requires some consideration.
    Sir W. ROBSON: I think the words substituted by the Government are rather more favourable to the contention of the Noble Lord than those deleted. The words are: "The expression 'governing body constituted for charitable purposes' in eludes any person or body of persons who have the right of holding, or any power of government of, or management over, any property appropriated for charitable purposes."
    Mr. STUART-WORTLEY: The hon. and learned Gentleman has said he agrees as to the effect of the words, and he has promised a further statement as to the intentions of the Government. I expressly refrained from arguing the merits, and I must warn him that should it appear not to be the intention of the Government to include clergymen in the exemption I shall

    1019
    be prepared to show that there is not only a strong case for their inclusion, but that it would be particularly hard not to bring them within the exemption.
    Mr. WALTER GUINNESS: The right hon. Gentleman stated that this is really only a formal Amendment, but, if it is accepted, it cuts out all chance of any discussion of exempting all charitable bodies from the operation of the Increment Duty. If this Amendment is accepted it will be quite impossible to raise that question. I have got down a series of Amendments on behalf of the London County Council to extend this exemption. They are concerned very much in this Increment Value Duty which may be charged on charitable institutions, because in a large number of cases they will have to make up the deficiency. They subscribe £80,000 per year to polytechnics and nearly £40,000 per year to secondary schools, and if these bodies are mulcted in these various duties and their revenue proves insufficient the whole of the loss will practically be borne by the county council. That would be a very serious burden on the future ratepayers of London. Then, again, there are cases where schools wish to move, and in which great hardship will result. At present Archbishop Tenison's School, St. Martin's High School, and Owen's School, Islington, are anxious to move, but they can only afford to do so if the sale of their valuable sites bring in enough money to enable them to build on a more suitable space outside the County of London. If these institutions are to be made liable to Increment Value Duty it would be quite impossible for them to sell their present sites and retain enough money to replace the schools they are leaving. For these reasons I think it is most important to exempt these charitable organisations from the duty. I am obliged to raise the point now, because I am afraid there will be no other opportunity of raising it at all.
    I quite realise this exemption would not only apply to charitable institutions, and I do not wish it solely to apply to charitable institutions. I am also anxious to make it possible to exempt friendly societies from the operation of these Land Taxes. Under the Amendment of the Chancellor of the Exchequer registered societies are to be considered bodies for charitable purposes, and, unless we can prevent the narrowing of the Clause to the exemption of only that land actually in occupation, it will be quite impossible later on to raise the ques-
    1020
    tion of the exemption of friendly societies. At present the friendly societies will practically get no benefit from the exemption. In most cases they only have one set of offices in their actual use and occupation. The vast majority of the local lodges meet in the local public-houses or some other premises, and they have no abiding home. Those organisations will get no benefit whatever from the Government proposals unless they consent to widen the scope of the Clause and include in the exemption not only land which they have in their use and occupation, but also land whose revenues they are enjoying for their own purpose. We have been told by the President of the Board of Trade that in future the tax collector is not only going to say, "How much money have you got?" but also, "How have you got your money?" I do not think anybody could have a greater claim on the Government than these friendly societies who have raised their money from the contributions of working men.
    The DEPUTY-CHAIRMAN (Mr. Caldwell): There is a Government Amendment dealing with friendly societies on this Clause.
    Mr. WALTER GUINNESS: I do not wish to raise the question now, if you will allow it to be raised later, but I consulted you about it, and I understood that unless it was raised at the beginning we could only discuss the definition of friendly societies and not the question whether they should be exempted from the taxation in respect of land of which they were not in actual occupation.
    The DEPUTY-CHAIRMAN: The Amendment is, after the word "No," to insert the words "Reversion Duty or Undeveloped land." There is a Government Amendment which deals afterwards with registered friendly societies.
    Mr. WALTER GUINNESS: The Government Amendment does not deal with the amount of exemption. They are to get the same exemption as charitable bodies.
    The DEPUTY-CHAIRMAN: The hon. Member will notice that here we are just dealing with the question of whether we should insert after the word "No" the words "Reversion Duty or undeveloped land."
    Mr. WALTER GUINNESS: If this Amendment is accepted by the Government it will rule out an Amendment I have to exempt them from the Increment Value

    1021
    Duty. I am anxious to raise the question of exempting friendly societies not only in respect of the land they have in their use and occupation, but also in respect of land which is not in their use or occupation.
    The DEPUTY-CHAIRMAN: The effect of the Amendment before the Committee is to limit the exemption to Reversion Duty and Undeveloped Land Duty, thereby excluding the Increment Duty, so that the Amendment of the hon. Member later on in the Clause to include the Increment Duty in the exemption will be out of order if this Amendment is carried.
    Mr. JAMES HOPE: May I point out that the effect of the Government Amendment will be to limit the exemption to the Reversion Duty and the Undeveloped Land Duty, except in the case of Increment Duty paid by corporate bodies once in 15 years? I wish to ask whether we cannot argue against the limitation of that exemption on the ground that it would shut out from the purview of the Committee the case of various bodies, such as friendly societies, which have special claim upon exemption not only from the Undeveloped Land Duty, but also from the Increment Value Duty. Otherwise their case will be restricted in discussion to the question of the tax once every 15 years, and the matter in its full aspect will never be brought before the Committee unless it is possible to raise the Debate now.
    The DEPUTY-CHAIRMAN: This Amendment restricts the exemption to the Reversion and Undeveloped Land Duty. It is a very narrow point.
    Mr. WALTER GUINNESS: I think I understand your point, and I will limit my remarks to the Amendment I have down. I feel it is necessary to mention this in view of the speech which the President of the Board of Trade made at Leicester, in which he stated that next year it was hoped to bring in, on the policy of this Budget, a far-reaching plan of social organisation giving a greater field of security to the labouring classes, and that it was proposed working through the friendly societies by means of substantial subventions to give a steady workman and his family aid which would enable provision to be made against sickness, etc. I should like to point out how absurd are these proposals of the Government, if you are going to give back to friendly societies the amounts which you have taken from them. If they have already invested their
    1022
    money and are getting increased value for it, surely it would be very much better to leave that increment in their hands rather than the consolation of a rather distant prospect of a large dole from the State. We know that there are many slips in politics, and I really think that friendly societies would prefer to have their present state left to them than trust to the fortunes of a future Session of Parliament. I am sorry I cannot now raise the whole question which I intended to. I think some justification is needed from the Government in regard to restricting the exemptions to friendly societies so far as regards lands in their use and occupation is concerned, and levying Land Duties on revenues which they derive from land they have bought for investment.
    Sir W. ROBSON: I am anxious to at once deal with a case which illustrates an unfortunate misapprehension prevailing with regard to the scope of this Bill. Mention has been made of the cases of three schools which wish to remove, and it is said they will be unable to remove if they are to be subject to this very heavy tax. But I must point out that hon. Gentlemen, judging from the speeches they have made, still fail to appreciate the nature of this Increment Value Duty. Take the case of the three schools referred to. The hon. Member forgets that they would be valued as on 30th April, 1909—their existing value, in fact. The idea seems to be that the Increment Value Duty would be assessed as between the price of the property if sold and the price originally given for it. That is not the case. The price originally given is wholly ignored for the purposes of this Clause. I cannot repeat too often that for the purposes of the Increment Value Duty the existing values are exempt, so that there is no substantial danger with regard to these schools. The hon. Member also referred to the case of friendly societies which hold land for the purposes of investment, which may be undeveloped land, and would therefore be subject to Increment Duty. We went into this subject very fully on a previous Amendment. I think it would be giving an unfair preference to those societies which might think it their business to deal in land to relieve them from this increment. In my opinion, we have gone as far as we ought to in exempting lands which they themselves occupy.
    Question put, "That those words be there inserted."
    The Committee divided: Ayes, 190; Noes, 54.

    Division No. 736.]

    AYES.

    [9.45 p.m.

    Agnew, George William

    Hardie, J. Keir (Merthyr Tydvil)

    Pearce, Robert (Staffs, Leek)

    Alden, Percy

    Hardy, George A. (Suffolk)

    Pease, Rt. Hon. J. A. (San. Wald.)

    Allen, A. Acland (Christchurch)

    Harmsworth, Cecil B. (Worcester)

    Pickersgill, Edward Hare

    Allen, Charles P. (Stroud)

    Harmsworth, R. L. (Caithness-sh.)

    Pirie, Duncan V.

    Ashton, Thomas Gair

    Hart-Davies, T.

    Pointer, J.

    Atherley-Jones, L.

    Hazel, Dr. A. E. W.

    Pollard, Dr. G. H.

    Balfour, Robert (Lanark)

    Hedges, A. Paget

    Power, Patrick Joseph

    Barker, Sir John

    Helme, Norval Watson

    Rea, Rt. Hon. Russell (Gloucester)

    Barnard, E. B.

    Henderson, J. McD. (Aberdeen, W.)

    Rea, Walter Russell (Scarborough)

    Barnes, G. N.

    Higham, John Sharp

    Roddy, M.

    Barran, Sir John Nicholson

    Hobart, Sir Robert

    Richards, T. F. (Wolverhampton, W.)

    Barry, Redmond J. (Tyrone, N.)

    Hodge, John

    Ridsdale, E. A.

    Beauchamp, E.

    Hope, W. H. B. (Somerset, N.)

    Roberts, Charles H. (Lincoln)

    Bell, Richard

    Horniman, Emslie John

    Roberts, G. H. (Norwich)

    Benn, W. (Tower Hamlets, St. Geo.)

    Howard, Hon. Geoffrey

    Robertson, Sir G. Scott (Bradford)

    Berridge, T. H. D.

    Hudson, Walter

    Robson, Sir William Snowdon

    Black, Arthur W.

    Hyde, Clarendon G.

    Roch, Walter F. (Pembroke)

    Boulton, A. C. F.

    Idris, T. H. W.

    Rogers, F. E. Newman

    Bowerman, C. W.

    Jackson, R. S.

    Rose, Sir Charles Day

    Bramsdon, Sir T. A.

    Jenkins, J.

    Rowlands, J.

    Branch, James

    Jones, Sir D. Brynmor (Swansea)

    Russell, Rt. Hon. T. W.

    Brigg, John

    Jones, Leif (Appleby)

    Rutherford, V. H. (Brentford)

    Bright, J. A.

    Jones, William (Carnarvonshire)

    Samuel, Rt. Hon. H. L. (Cleveland),

    Brodie, H. C.

    Jowett, F. W.

    Schwann, Sir C. E. (Manchester)

    Brunner, J. F. L. (Lancs., Leigh)

    Joyce, Michael

    Sherwell, Arthur James

    Brunner, Rt. Hon. Sir J. T. (Cheshire)

    Keating, M.

    Shipman, Dr. John G.

    Burns, Rt. Hon. John

    Kekewich, Sir George

    Simon, John Allsebrook

    Byles, William Pollard

    Kilbride, Denis

    Snowden, P.

    Clough, William

    Laidlaw, Robert

    Stanger, H. Y.

    Cobbold, Felix Thornley

    Lamb, Edmund G. (Leominster)

    Stanley, Albert (Staffs, N. W.)

    Collins, Stephen (Lambeth)

    Lamb, Ernest H. (Rochester)

    Steadman, W. C.

    Compton-Rickett, Sir J.

    Layland-Barratt, Sir Francis

    Stewart, Halley (Greenock)

    Corbett, A. Cameron (Glasgow)

    Lea, Hugh Cecil (St. Pancras, E.)

    Stewart-Smith, D. (Kendal)

    Corbett, C. H. (Sussex, E. Grinstead)

    Lehmann, R. C.

    Straus, B. S. (Mile End)

    Cotton, Sir H. J. S.

    Lever, A. Levy (Essex, Harwich)

    Summerbell, T.

    Cross, Alexander

    Lever, W. H. (Cheshire, Wirral)

    Taylor, John W. (Durham)

    Cullinan, J.

    Levy, Sir Maurice

    Thomas, Sir A. (Glamorgan, E.)

    Dalziel, Sir James Henry

    Lloyd-George, Rt. Hon. David

    Thompson, J. W. H. (Somerset, E.)

    Davies, Timothy (Fulham)

    Lough, Rt. Hon. Thomas

    Thorne, G. R. (Wolverhampton)

    Davies, Sir W. Howell (Bristol, S.)

    Lundon, T.

    Toulmin, George

    Dewar, Arthur (Edinburgh, S.)

    Lupton, Arnold

    Trevelyan, Charles Philips

    Dickinson, W. H. (St. Pancras, N.)

    MacNeill, John Gordon Swift

    Verney, F. W.

    Duckworth, Sir James

    MacVeigh, Charles (Donegal, E.)

    Vivian, Henry

    Duncan, C. (Barrow-in-Furness)

    M'Callum, John M.

    Wadsworth, J.

    Duncan, J. Hastings (York, Otley)

    M'Laren, H. D. (Stafford, W.)

    Walsh, Stephen

    Dunn, A. (Camborne)

    M'Micking, Major G.

    Ward, John (Stoke-upon-Trent)

    Dunne, Major E. Martin (Walsall)

    Maddison, Frederick

    Wason, Rt. Hon. E. (Clackmannan)

    Edwards, Sir Francis (Radnor)

    Mallet, Charles E.

    Wason, John Cathcart (Orkney)

    Essex, R. W.

    Marnham, F. J.

    Waterlow, D. S.

    Evans, Sir Samuel T.

    Massie, J.

    White, Sir George (Norfolk)

    Everett, R. Lacey

    Masterman, C. F. G.

    White, J. Dundas (Dumbartonshire)

    Falconer, James

    Menzies, Sir Walter

    White, Sir Luke (York, E. R.)

    Ferens, T. R.

    Molteno, Percy Alport

    Whitehead, Rowland

    Ferguson, R. C. Munro

    Mond, A.

    Whittaker, Rt. Hon. Sir Thomas P.

    Findlay, Alexander

    Muldoon, John

    Wiles, Thomas

    Foster, Rt. Hon. Sir Walter

    Murray, James (Aberdeen, E.)

    Wilkie, Alexander

    Fuller, John Michael F.

    Nannetti, Joseph P.

    Williams, J. (Glamorgan)

    Fullerton, Hugh

    Nicholson, Charles N. (Doncaster)

    Wilson, Hon. G. G. (Hull, W.)

    Gibb, James (Harrow)

    Norman, Sir Henry

    Wilson, Henry J. (York, W. R.)

    Glendinning, R. G.

    Nuttall, Harry

    Wood, T. M'Kinnon

    Glover, Thomas

    O'Brien, Patrick (Kilkenny)

    Yoxall, Sir James Henry

    Goech, George Peabody (Bath)

    O'Connor, John (Kildare, N.)

    Gulland, John W.

    Parker, James (Halifax)

    TELLERS FOR THE AYES.—Captain Norton and Sir E. Strachey.

    Hall, Frederick

    Partington, Oswald

    Harcourt, Robert V. (Montrose)

    NOES.

    Acland-Hood, Rt. Hon. Sir Alex. F.

    Craik, Sir Henry

    Guinness, Hon. R. (Haggerston)

    Anson, Sir William Reyneil

    Dalrymple, Viscount

    Hamilton, Marquess of

    Balcarres, Lord

    Dickson, Rt. Hon. C. Scott

    Hardy, Laurence (Kent, Ashford)

    Baldwin, Stanley

    Doughty, Sir George

    Helmsley, Viscount

    Banbury, Sir Frederick George

    Douglas, Rt. Hon. A. Akers-

    Hope, James Fitzalan (Sheffield)

    Baring, Captain Hon. G. (Winchester)

    Duncan, Robert (Lanark, Govan)

    Hunt, Rowland

    Butcher, Samuel Henry

    Faber, George Denison (York)

    Kimber, Sir Henry

    Carlile, E. Hildred

    Fletcher, J. S.

    Lambton, Hon. Frederick William

    Carson, Rt. Hon. Sir Edward H.

    Forster, Henry William

    Law, Andrew Bonar (Dulwich)

    Cecil, Evelyn (Aston Manor)

    Gardner, Ernest

    Lowe, Sir Francis William

    Cecil, Lord R. (Marylebone, E.)

    Goulding, Edward Alfred

    M'Arthur, Charles

    Clyde, J. Avon

    Gretton, John

    Magnus, Sir Philip

    1024

    1025

    Mildmay, Francis Bingham

    Ratcliff, Major R. F.

    Talbot, Rt. Hon. J. G. (Oxford Univ.)

    Morpeth, Viscount

    Rawlinson, John Frederick Peel

    Walker, Col. W. H. (Lancashire)

    Oddy, John James

    Remnant, James Farquharson

    Winterton, Earl

    Parker, Sir Gilbert (Gravesend)

    Roberts, S. (Sheffield, Ecclesall)

    Wortley, Rt. Hon. C. B. Stuart-

    Parkes, Ebenezer

    Rutherford, Watson (Liverpool)

    Pretyman, E. G.

    Salter, Arthur Clavell

    TELLERS FOR THE NOES.—Mr. Lane-Fox and Mr. W. Guinness.

    Randies, Sir John Scurrah

    Staveley-Hill, Henry (Staffordshire)

    Mr. RAWLINSON Mr. RAWLINSON moved, after the word "held" ["shall be charged in respect of land or any interest in land held"], to insert the words "occupied or used."
    This is a very small Amendment, and probably the Chancellor of the Exchequer will accept it. The exemption which is granted by the Clause from Reversion Duty or Undeveloped Land Duty is in respect of land which is held by any person or body of persons for public or charitable purposes while the land is occupied and used by that person or body for those purposes. This Amendment is to meet the case of land which is let by the university, for instance, to Trinity College, or vice versa, and both being charitable bodies, one lets the land to the other for the purposes of the other.
    Mr. LLOYD-GEORGE: The word "held" will cover that.
    Mr. RAWLINSON: No; "held" only applies to the owner here. It would be held by the owner of the university, but it would be occupied by the college which leases it from them, and I think it is necessary to insert the words "occupied or used" in this place also.
    Mr. LLOYD-GEORGE: I quite see the kind of case which the hon. and learned Gentleman has in his mind, but I am not quite sure about inserting his words. I can see no objection to his proposal, and we certainly do not mean to cut out the nature of the exemption he suggests; but I do not think his words would quite carry it. If he will withdraw his Amendment I will see if I can devise words to meet this special case, but I think his words go beyond the case he makes.
    Amendment, by leave, withdrawn.
    Mr. JAMES HOPE (in the absence of Sir William Anson)Mr. JAMES HOPE (in the absence of Sir William Anson) moved, after the word "by" ["interest in land held by any person"], to insert the words "or in trust for."
    On the face of it I do think it is necessary to insert these words, but I am not quite certain whether they would not be sub-stanitally covered by the words later in the Clause. I would ask the right hon.
    1026
    Gentleman to assure me on that point, but it is not worth while pressing if the Government accept the intention.
    Mr. LLOYD-GEORGE: I should think that land held in trust for charitable purposes would be included, and that would be governed by the words "or charitable purposes." If the hon. Member will look at the words later on he will see that they are "any person or body of parsons carrying on any undertaking or institution" for charitable purposes. They certainly govern the case put, but if the words proposed were inserted they might defeat the words already in, and be unnecessary.
    Amendment, by leave, withdrawn.
    Amendment proposed, to leave out the words, "person or body of persons carrying on any undertaking or institution without any view to the payment of any dividend or profit out of the revenue thereof, for purposes which in the opinion of the Commissioners are public purposes or charitable," and to insert instead thereof the words "governing body constituted for."—[Mr. Lloyd-George.]
    Question, "That those words ['persons or body of persons,' etc.] stand part of the Clause," put, and negatived.
    Mr. PRETYMAN: Is the word "governing" necessary? It seems to limit it without any good ground.
    Mr. LLOYD-GEORGE: I should have thought it was necessary, because there is a definition of the words "governing body" later on, and it is a very comprehensive definition. It depends so much more upon the definition than upon the words here.
    Mr. JAMES HOPE Mr. JAMES HOPE moved, as an Amendment to the proposed Amendment, after the word "body," to insert the words "club or society."
    My first reason is that the words "governing body," when you come to define them, are limited to governing bodies for charitable purposes, and there are certain bodies which hold land for useful purposes which I am not sure will be covered by the word "charitable." The sort of thing I have in my mind is this: An

    1027
    archæological society holds a rum with land around it for a public purpose, but I do not think it could be described as a charitable purpose. An agricultural society may have grounds for an annual show. There is no question of any dividend or profit, but it is for the encouragement of agriculture and so on. That again is a public purpose, but I do not think it could be deemed to be a charitable purpose. I am not sure the National Trust is not a case in point. They hold certain beautiful spots or interesting monuments for a public national purpose. I do not think that again is a charitable purpose. Therefore, I think other words are necessary to be inserted which cover rather wider ground than the words "governing body" as defined in the section. Then I would ask the Government to give a short statement as to the position of their various Amendments with regard to recreation grounds. I know they have a Clause with regard to that subject.
    The DEPUTY-CHAIRMAN: That would not be in order on this Clause.
    10.0 P.M.
    Mr. JAMES HOPE: This will have to be read with a later Amendment of my own "for public or recreative purposes," and this is a general exemption of land where there is a public advantage. I know that recreation grounds are to be excluded under certain conditions from Increment Duty by a later Clause, but there is also the question of Undeveloped Land Duty, and that point has so far been passed in the Bill, and the Amendments which were certainly adumbrated on that point have never been discussed. There are two cases to be borne in mind. There are the cases where the ground is owned by a club for the purpose of recreation, such as Lords or certain county cricket grounds, and there is the case where it is leased by a club from the owner. I understand the position is this: That where it is owned by the club for the purpose of recreation they will be exempt from Increment Duty under the later Clause, unless, of course, they sell their land, in which case Increment Duty will very properly be paid.
    Mr. LLOYD-GEORGE: Will the hon. Member give me the sort of case he has in mind?
    Mr. JAMES HOPE: I wish to know what is the Government position with regard to these grounds where no profit is
    1028
    made, because it is rather difficult to trace it through the different Clauses.
    Mr. LLOYD-GEORGE: Cricket grounds clearly do not come into this Clause but into Clause 11.
    Mr. JAMES HOPE: That is only for Undeveloped Land Duty.
    Mr. LLOYD-GEORGE: Clause 25 has nothing whatever to do with them. I want to know what other kind of societies the hon. Member has in view.
    Mr. JAMES HOPE: I was trying to argue that this was a public purpose in certain cases, and that this was the only Clause under which the whole position of these grounds could be discussed, because, otherwise, they could only be discussed on one Clause for Increment Duty and another for Undeveloped Land Duty. There is also the distinction between grounds owned and grounds leased for the purposes of recreation. As I understand, they will be exempted from the Increment Duty. In the case of the Undeveloped Land Duty the case is not clear, and I wish to know a little more of the intentions of the Government with regard to those societies and the Undeveloped Land Duty. Will they be exempted or not, and especially where they do not own the ground, but only take a short lease of it, or from year to year? Of course, there is a certain amount of discretion vested in the Commissioners in deciding as to whether the use for this purpose is a bonâ fide use or not. There was a similar question raised under Clause 14 as to public parks. The Committee decided that the Commissioners should say in the first instance whether those parks satisfied the conditions which would allow them to be exempted, and that there should be an appeal, but it has not been decided what the nature of that appeal should be. Some hon. Members suggested that it should be to a special referee, and others that it should be to the Local Government Board. I wish to know whether if there is a bonâ fide use of land for recreation purposes—
    Mr. LLOYD-GEORGE: On a point of Order. There is a Clause on the Paper, on page 39 by the Government dealing with this specific point, and therefore it cannot arise at present.
    The DEPUTY-CHAIRMAN: I would point out also that Clause 11 deals with exemptions from the Undeveloped Land Duty. Sub-section (3) says that the duty

    1029
    shall not be charged on land which is used for the purpose of games or other recreation, where the Commissioners are satisfied that the use of the land is for the benefit of the public or of the inhabitants of the locality." That being so, this Amendment provides for something which we have already done under Clause 11.
    Mr. JAMES HOPE: I understand from what the Under-Secretary for the Home Department said it is the intention of the Government to override it.
    The DEPUTY-CHAIRMAN: They cannot override it as regards undeveloped land. There is a specific Sub-section dealing with that.
    Mr. JAMES HOPE: I have done my best to get a specific declaration, but on account of the raising of points of Order and the disinclination of the Chancellor of the Exchequer to discuss the matter on this occasion I am afraid I have failed. I am afraid also that the persons interested in these grounds are as much in a fog as ever. I wish to know whether the words of this Amendment, or the words of the Clause, would cover land used by an agricultural society, land vested in the National Trust, or land possessed by an archaeological society—all of which are bodies using land for public purposes, though I do not think they are charitable purposes. I beg to move.
    Mr. PRETYMAN: Perhaps it would be as well if the Chancellor of the Exchequer or the Solicitor-General would tell us how far they are satisfied that these words will cover associations of that description, because clearly, I take it, it is not the intention of the Government that they should be taxed. A good deal of land is held by agricultural societies for experimental purposes, such as manurial experiments and things of that sort, and these are public purposes. There are such things as experimental farms, which are used for the purpose of scientific investigation in regard to agriculture.
    Mr. LLOYD-GEORGE: By whom?
    Mr. PRETYMAN: I think they are generally held by agricultural societies, but I have not any actual cases in my mind.
    Mr. STUART-WORTLEY: There is the case of the National Trust, who have vested in them ruins of probably no undeveloped land value. They possess a head-
    1030
    land in Cornwall, which they acquired at a price for the purpose of preventing its being built upon. They acquired also the side of a lake in Cumberland to prevent its being built upon. I do not know whether that would come under the definition of "charitable purposes." The object of my hon. Friend is to raise that question. We can hardly be expected to know without the guidance of the Government.
    The SOLICITOR-GENERAL (Sir Samuel Evans): It is difficult to answer questions put in this way as to whether the lands held by a club or a society are held for charitable purposes. "Charitable purposes" is a phrase well known to the law, but it is not easy to apply it to a particular institution. I do not know myself of the National Trust. My right hon. Friend the Attorney-General has quoted the definition which is now the classical definition. He divided charities into four classes. Three of them were perfectly clear and distinct, and the fourth was a more general one, namely, that where the object was to benefit the community it could be properly described as a charitable object. I do not pretend that it is clear. It is obviously impossible to say without knowing the object of a particular body whether the land held is, or is not, for charitable purposes. I know of no particular case in which I could give an opinion.
    Earl WINTERTON: I may give two cases which as the Clause stands would be affected, and which ought properly to come under the definition of my hon. Friend. One is the case of the experimental farm at Rothamsted, which, I believe, is held by a trust under the Royal Agricultural Society. The other is that of a large common and some land adjoining, which is not common land in the practical sense of the word, at Hindhead in Surrey. For the benefit of the public that land was acquired by a syndicate of people, and the deed was drawn up by which the land was held in trust by four trustees for the benefit of the public for ever. It would not, I think, come within the definition of open spaces under the Act, as it includes not merely common land, but a large amount of private land as well. About 1,000 acres of land were acquired by this syndicate for the purpose of preventing it being built over or spoiled. It is certainly land which would acquire an increment value. It is very valuable building property. I would ask the Government to promise to con-

    1031
    sider the matter and, if necessary, to add words which would prevent cases of the kind I have mentioned being included within the scope of this Clause.
    Sir SAMUEL EVANS: With regard to the case of Rothamsted, that is clearly a case of an institution for an educational purpose, and I am certain that it would come under one of those definite headings which I have stated are to be found in Lord Macnaghten's judgment?
    Mr. BALFOUR: I should think I am right in saying that Rothamsted is a case of purely agricultural research.
    Sir SAMUEL EVANS: I am certain that the experiments might very well come under the head of education. With regard to the other question put by the Noble Lord, I think it quite likely that that would be a case coming under the fourth heading of beneficial to the community, which, therefore, might be held to be for a charitable purpose.
    Sir JOHN RANDLES: The statement of the learned Solicitor-General is satisfactory, as far as it goes, but it does not deal with cases I have in my mind in the constituency of Penrith adjoining my own, which Mr. Speaker knows. Large subscriptions were given by the public for the purpose of preventing very large spaces adjoining Lake Derwentwater and Lake Ullswater from being built over, and the properties are held by trustees, and they consist, no doubt, largely of land which by its position, owing to its contiguity to the lakes, might become exceedingly valuable from a building point of view; and yet it is one of the objects of the trust to prevent building in that particular locality in the interests of the public. And, in view of the great importance of cases of this kind, I think we ought to have some definite promise that such cases would be absolutely considered and dealt with in the Bill, and not left over to the decisions of a court of law. I think that the Chancellor of the Exchequer might give us a promise which would reassure us on this particular case.
    Mr. LLOYD-GEORGE: I quite agree that cases such as the hon. Member has just spoken of ought not to be subject to doubts that can be avoided. Where it is obviously desirable, in order to preserve the picturesque character of the landscape in the general interests, that it should not be built on, it is plainly unlikely that you
    1032
    should apply to it the Undeveloped Land Tax, which might have the effect of driving it into the market. Therefore unless we are very clear that these words do not affect the case we shall certainly introduce words.
    Mr. LANE-FOX: There is one further question as to whether the case of rifle clubs will be affected through this Clause, and whether horticultural societies will be included.
    Sir SAMUEL EVANS: With regard to land held by a horticultural society, I should, of course, require to know the circumstances to see whether they brought the land within the term "charitable" as understood by the law. The Chancellor of the Exchequer has undertaken to meet cases where it is clear that an object of public utility is served, and? hope that under the circumstances the Amendment will be withdrawn.
    Mr. REMNANT: Would the Botanical Gardens be included?
    Amendment to the proposed Amendment, by leave, withdrawn.
    Mr. CLAVELL SALTER: Before the matter goes to a vote, I wish to ask the Chancellor of the Exchequer what change we are to understand him to make in the Clause as printed. The right hon. Gentleman has struck out five lines, and inserted "governing body constituted for." The Clause as it stands establishes three tests before giving the benefits it provides. There must be no profit-making, and there must be either a public or a charitable object. The Chancellor of the Exchequer has struck out altogether the test as to profit, and I take it now that if the profit made is for a charitable object it would not be disentitled to the benefit. With regard to the distinction between public and charitable, are we to understand that the substitution of four words for five lines makes no difference in the substance of the Clause? I should be glad if the Chancellor of the Exchequer will tell us what beneficiaries who might have been benefited by this Clause as it stands will now be excluded.
    Mt. LLOYD-GEORGE: By eliminating these words and confining the Clause to purely charitable institutions we are, at any rate, getting rid of two conditions which might have affected certain objects and certain societies which otherwise ought to be able to claim exemption, and undoubtedly it widens the area of exemp-

    1033
    tion. I could not give the hon. and learned Gentleman straight away the classes of societies that would come in, but I am perfectly certain that they run less risk of being deprived of the benefit of this Clause than if they had to comply with three conditions precedent instead of one. To that extent the Amendment is an advantage, and it widens the area and scope of the Clause.
    Mr. PRETYMAN: I agree generally with the Chancellor of the Exchequer reducing the number of words is, generally speaking, reducing the limitations. I do not quite follow his reason for eliminating the word "public." That is clearly an extension. The word "public" was included in the original draft, "charitable or public." I do not see why he is now reinserting the word "charitable" and not inserting "public." In order to clear up the matter I will move that after the word "charitable" to insert the word "public."
    The CHAIRMAN: We have not got the Chancellor of the Exchequer's words in. We have left the words out that he proposed to leave out. Therefore no words can be put in after "charitable" until after we have got those words in. Further, we have agreed to eliminate the words "public purposes," and I do not see, therefore, how we can replace them.
    Lord ROBERT CECIL: May I very respectfully suggest there will be nothing wrong in striking out "public purposes" in front of "charitable" for the purpose of adding "public" after charitable?
    The CHAIRMAN: The only way in which that could be done would be on the plea that the words "governing body constituted for" introduced a new consideration as applied to "public purposes."
    Mr. PRETYMAN: May I adopt that plea?
    Question, "That those words ['governing body constituted for'] be there inserted," put, and agreed to.
    Mr. PRETYMAN: May I now move to add "public purposes"?
    Mr. LLOYD-GEORGE: That seems to me to be raising the whole issue over again.
    Mr. PRETYMAN: If that is so, I will not press it.
    Amendments made: To leave out the words "person or" ["land is occupied and
    1034
    used by that person or body"]. To leave out the word "those" ["used by that person or body for those purposes"], and to insert instead thereof the word "the."—[Mr. Lloyd-George.]
    Mr. LLOYO-GEORGE Mr. LLOYO-GEORGE moved to leave out from the word "purposes" ["used by that person or body for those purposes, but nothing"], to the end of the Clause, and to insert instead thereof the words "of that body, and Increment Value Duty shall not be collected on any periodical occasion in respect of the fee simple of or any interest in any land held for the purposes of such a body, whether it is occupied or used by that body or not, without prejudice, however, to the collection of the duty on any other occasion.
    "The expression 'governing body constituted for charitable purposes' includes any person or body of persons who have the right of holding, or any power of government of, or management over, any property appropriated for charitable purposes (including property appropriated for the purpose of any of the naval or military forces of the Crown)."
    The object of this Amendment, which specifically raises the question of the Increment Duty, is to confine it to the duty paid on sales and leases. The second part is to define the governing bodies constituted for charitable purposes.
    Mr. PRETYMAN: I think the Chancellor of the Exchequer has admitted that there is not going to be any great exemption under this Clause for property held for development by a university which desires to realise it for the purposes of their institution. It is quite clear they can only realise any building value from the property they may possess either by selling it or leasing it, and the moment they sell or lease it they become liable for the Increment Value Duty. I do not think the Chancellor quite fully expressed the position in what he said in the Debate on this Clause. He said quite accurately that they were exempt from Corporation Duty, but being exempt from Corporation Duty upon this Clause only means that the particular occasion for taking the duty is only passed over. The duty is still accruing. For instance, a university which owns property which it is developing would be passed over on periodic occasions, but a year or two later, when the property is ripe and is sold, then the whole of the duty which would be payable on periodic occasions, plus any additional duty that accrued since the periodic occasion, would

    1035
    have to be paid. So there is no real escape. I do not say there is no advantage. There is an advantage, but when there is a sale or lease there is a realised asset from which the duty will be paid.
    Mr. LLOYD-GEORGE: It is an enormous advantage.
    Mr. PRETYMAN: The Chancellor says it is an enormous advantage. When he says that I hope he will realise the enormous disadvantage which other property it put to in having to pay this duty when they have not the asset to pay out of. The measure of advantage in one sense is the measure of the disadvantage in another. It is a very hard case upon a charitable body which has very small funds available for its purposes that it should have to pay this Increment Value Duty although exempt on periodic occasions. That will be a very heavy burden upon these transactions.
    Mr. LLOYD-GEORGE: They will have the cash.
    Mr. PRETYMAN: They will have the cash less 20 per cent. There is no doubt with regard to this duty the escape will be very much less than in regard to Undeveloped Land Duty.
    Mr. LLOYD-GEORGE: I do not know whether the hon. and gallant Gentleman is trying to minimise the great benefit which this proposal will confer upon institutions which depend upon a regular annual income for carrying on their business. Take the illustration which has been put forward of property worth £500,000 being £500,000 over and above its agricultural value. That is a kind of increment which might very well take place in a London suburb. Surely it would be more advantageous to the college or university concerned that they should be allowed to pay the tax as the cash comes into their hands. Undoubtedly they have to pay the same in the end, but this plan is more convenient. They have not to pay as a corporation who have to raise money in the form of debentures or by loan to conduct their ordinary operations. Therefore, it is an enormous benefit that they should be exempt from this periodic payment of a sum upon the increment of their property.
    Sir W. ANSON: They are not gaining very much by this concession.
    Question, "That the word 'but' stand part of the Clause," put, and negatived.
    Question proposed, "That those words be there inserted."
    Mr. CLAVELL SALTER Mr. CLAVELL SALTER moved, in the proposed Amendment, to leave out the words "on any periodical occasion."
    The omission of those words would extend the benefits of this exemption and make it a reality. Does the Committee realise how illusory is the benefit which this Clause proposes to give to charities? We are not only discussing charities, but we shall have in a moment the next Amendment of the Chancellor of the Exchequer dealing with friendly societies, and whatever measure we mete out to charities we are meting out also to friendly societies.
    The CHAIRMAN: May I ask the hon. and learned Member how this Amendment, taken in conjunction with his consequential Amendment, differs from the point we have already discussed at the beginning of the Clause?
    Mr. CLAVELL SALTER: This is an Amendment which could not be raised until the Chancellor of the Exchequer's Amendment, in its amended form, was before the Committee, and I now desire to amend the amended form by striking out some of the words and adding others. Obviously my point could not be raised until now. This is not the point which was raised before. This attempt to distinguish between the payment of Increment Duty on any periodical occasion and the wider exemption has not been raised before, and I respectfully desire to raise it now.
    The CHAIRMAN: What happened before was that an Amendment was moved by the hon. Member for the London University (Sir Philip Magnus), and on that it was argued that the Increment Value Duty should not be levied upon property of educational bodies and universities. This Amendment of the hon. Member, it seems to me, would go back upon the decision arrived at as regards educational bodies and universities. I cannot see any way out of it unless he can show me one. Having negatived the narrow point, we cannot deal with the larger one.
    Mr. CLAVELL SALTER: I think it will have that effect.
    The CHAIRMAN: Then it would not be in order.
    Mr. F. B. MILDMAY: I propose to move to leave out the words "without prejudice, however, to the collection of the duty on any other occasion."
    The CHAIRMAN: I am afraid that is the same, point.
    Mr. MILD MAY: My object is to provide that on the occasion of the sale the duty shall not be payable. I do not think that point has been exclusively debated.
    The CHAIRMAN: What happened was that, with regard to one large class of institutions—educational institutions—we decided this should not apply. Having decided that, the hon. Member cannot move an Amendment which would have the effect of giving that advantage to educational institutions.
    Mr. CLAVELL SALTER Mr. CLAVELL SALTER moved to leave out of the proposed Amendment the words "whether it is occupied or used by that body or not, without prejudice, however, to the collection of the duty on any other occasion," and to insert instead thereof the words, "and such Increment Value Duty shall be deemed to have been paid on every occasion on which such duty would have been payable but for the provisions of this Section."
    It will be plain that this is a very substantial matter. Increment Value Duty, by the decision of the Committee, is now being paid by all charitable bodies and all friendly societies upon their property. They are not, as the Clause of the Chancellor of the Exchequer stands, exempted from any penny or farthing of the Increment Value Duty. The only difference made is that, instead of making them pay as any other owner of land, in fractions at stated intervals, you wait until they have got the increment and then make them pay Increment Value Duty from the beginning of the 1909 register. They will therefore gain nothing at all. They will not gain a single farthing by the so-called concession of the Chancellor of the Exchequer. We are dealing with land which is the endowment of charities and which is the ordinary property and investments of the members of the friendly societies. It is land which they can only use to make profit out of either by letting it or selling it. If they let it, as the Clause stands, they pay the increment value on the lease or the Reversion Duty at the end of the lease. If a time comes when they want to sell the land they will have to pay the same Increment Duty as the private owner. If they have not parted with it they are in no better position than those who have no exemption and no benefit whatever. The point I venture to make is this, that when a friendly society or charity leases its lands the duty shall be deemed to have been
    1038
    paid, so that then when they sell they will only have to pay the Increment Duty on the last occasion, and that would probably be a very small matter. This will make it a real concession to charitable bodies as well as to friendly societies. I think this is a concession the right hon. Gentleman might well make.
    Mr. LLOYD-GEORGE: It is true no Amendment has been made which has been narrowed to this one issue, but at the same time this point has already been debated twice, and I gave my answer to the hon. and gallant Member for Chelmsford. I can quite understand the desire of the hon. and learned Member for North Hants to enter his protest on this point in the form of an Amendment, but I cannot possibly accept the proposal as it would render absolutely nugatory the whole of our proposal.
    Mr. T. M. HEALY: Let me put one point to the right hon. Gentleman. Supposing land is sold for the purpose of exchange. A charity or a friendly society may have held on to certain land for a long period, and then circumstances may have changed, and it may have been found desirable to acquire new land, which may already have borne the extra burden for the purposes of the Estate Duty, and have acquired increased value which would have to be paid in the shape of purchase money. Would it not be fair to say there shall be no heavier burden borne by a charity in effecting an exchange of land than there would have been provided that this increment value had not been imposed? I think there is a great distinction between a transaction for purposes of profit, and for the purpose of exchange, and it does seem to me that if the right hon. Gentleman will consider it from that point of view he may see his way to give effect to it.
    Mr. LLOYD-GEORGE: The difficulty about that is if an exception were made in this case there would be really a danger of getting rid of the duty altogether. If the Increment Duty were very substantial and exchanges were left out altogether, or, rather, included in the protective operation of the Clause, they might first of all effect an exchange and then sell the property. I shall, however, consider the point as the hon. Member has put it.
    Question put, "That the words proposed to be left out stand part of the proposed Amendment."
    The Committee divided: Ayes, 199; Noes, 72.

    Division No. 737.]

    AYES.

    [11.2 p.m.

    Agar-Robartes, Hon. T. C. R.

    Glover, Thomas

    Pearce, Robert (Staffs, Leek)

    Agnew, George William

    Gooch, George Peabody (Bath)

    Pease, Rt. Hon. J. A. (Saff. Wald.)

    Alden, Percy

    Gulland, John W.

    Pickersgill, Edward Hare

    Allen, A. Acland (Christchurch)

    Gwynn, Stephen Lucius

    Pirie, Duncan V.

    Allen, Charles P. (Stroud)

    Haldane, Rt. Hon. Richard B.

    Pointer J.

    Ashton, Thomas Gair

    Hall, Frederick

    Pollard, Dr. G. H.

    Asquith, Rt. Hon. Herbert Henry

    Harcourt, Robert V. (Montrose)

    Ponsonby, Arthur A. W. H.

    Atherley-Jones, L.

    Hardie, J. Keir (Merthyr Tydvil)

    Price, Sir Robert J. (Norfolk, E.)

    Balfour, Robert (Lanark)

    Hardy, George A. (Suffolk)

    Rea, Rt. Hon. Russell (Gloucester)

    Barker, Sir John

    Harmsworth, Cecil B. (Worcester)

    Rea, Walter Russell (Scarborough)

    Barnard, E. B.

    Harmsworth, R. L. (Caithness-sh.)

    Rees, J. D.

    Barnes, G. N.

    Hazel, Dr. A. E. W.

    Richards, T. F. (Wolverhampton, W.)

    Barran, Sir John Nicholson

    Hedges, A. Paget

    Ridsdale, E. A.

    Barry, Redmond J. (Tyrone, N.)

    Helme, Norval Watson

    Roberts, Charles H. (Lincoln)

    Beauchamp, E.

    Henderson, J. McD. (Aberdeen, W.)

    Roberts, G. H. (Norwich)

    Beck, A. Cecil

    Henry, Charles S.

    Robertson, Sir G. Scott (Bradford)

    Bell, Richard

    Higham, John Sharp

    Robson, Sir. William Snowdon

    Belloc, Hilaire Joseph Peter R.

    Hobart, Sir Robert

    Roch, Walter F. (Pembroke)

    Benn, W. (Tower Hamlets, St. Geo.)

    Hobhouse, Rt. Hon. Charles E. H.

    Roe, Sir Thomas

    Berridge, T. H. D.

    Hodge, John

    Rogers, F. E. Newman

    Black, Arthur W.

    Hope, W. H. B. (Somerset, N.)

    Rose, Sir Charles Day

    Boulton, A. C. F.

    Horniman, Emslie John

    Rowlands, J.

    Bowerman, C. W.

    Howard, Hon. Geoffrey

    Russell, Rt. Hon. T. W.

    Bramsdon, Sir T. A.

    Hudson, Walter

    Rutherford, V. H. (Brentford)

    Branch, James

    Hyde, Clarendon G.

    Samuel, Rt. Hon. H. L. (Cleveland)

    Brigg, John

    Idris, T. H. W.

    Schwann, Sir C. E. (Manchester)

    Brignt, J. A.

    Jackson, R. S.

    Seely, Colonel

    Brodie, H. C.

    Jenkins, J.

    Sherwell, Arhur James

    Brunner, J. F. L. (Lancs., Leigh)

    Jones, Sir D. Brynmor (Swansea)

    Simon, John Allsebrook

    Brunner, Rt. Hon. Sir J. T. (Cheshire)

    Jones, Leif (Appleby)

    Snowden, P.

    Burns, Rt. Hon. John

    Jones, William (Carnarvonshire)

    Stanger, H. Y.

    Byles, William Pollard

    Jowett, F. W.

    Stanley, Albert (Staffs, N. W.)

    Causton, Rt. Hon. Richard Knight

    Kilbride, Denis

    Stewart, Halley (Greenock)

    Cawley, Sir Frederick

    King, Alfred John (Knutstord)

    Stewart-Smith, D. (Kendal)

    Charming, Sir Francis Allston

    Laidlaw, Robert

    Straus, B. S. (Mile End)

    Clough, William

    Lamb, Ernest H. (Rochester)

    Summerbell, T.

    Cobbold, Felix Thornley

    Lamont, Norman

    Taylor, John W. (Durham)

    Collins, Stephen (Lambeth)

    Layland-Barratt, Sir Francis

    Thomas, Sir A. (Glamorgan, E.)

    Compton-Rickett, Sir J.

    Lehmann, R. C.

    Thompson, J. W. H. (Somerset, E.)

    Cooper, G. J.

    Lever, A. Levy (Essex, Harwich)

    Thorne, G. R. (Wolverhampton)

    Corbett, A. Cameron (Glasgow)

    Levy, Sir Maurice

    Toulmin, George

    Corbett, C. H. (Sussex, E. Grinstead)

    Lloyd-George, Rt. Hon. David

    Trevelyan, Charles Philips

    Cotton, Sir H. J. S.

    Lough, Rt. Hon. Thomas

    Verney, F. W.

    Dalziel, Sir James Henry

    Lupton, Arnold

    Vivian, Henry

    Davies, Timothy (Fulham)

    Mackarness, Frederic C.

    Wadsworth, J.

    Davies, Sir W. Howell (Bristol, S.)

    Maclean, Donald

    Walsh, Stephen

    Dewar, Arthur (Edinburgh, S.)

    Macnamara, Dr. Thomas J.

    Ward, John (Stoke-upon-Trent)

    Dickinson, W. H. (St. Pancras, N.)

    McVeigh, Charles (Donegal, E.)

    Wason, Rt. Hon. E. (Clackmannan)

    Duckworth, Sir James

    M'Callum, John M.

    Wason, John Cathcart (Orkney)

    Duncan, C. (Barrow-in-Furness)

    M'Micking, Major G.

    Waterlow, D. S.

    Duncan, J. Hastings (York, Otley)

    Maddison, Frederick

    White, Sir George (Norfolk)

    Dunn, A. Edward (Camborne)

    Mallet, Charles E.

    White, J. Dundas (Dumbartonshire)

    Dunne, Major E. Martin (Walsall)

    Marnham, F. J.

    White, Sir Luke (York, E. R.)

    Edwards, Sir Francis (Radnor)

    Massie, J.

    Whitehead, Rowland

    Elibank, Master of

    Masterman, C. F. G.

    Whittaker, Rt. Hon. Sir Thomas P.

    Essex, R. W.

    Menzies, Sir Waiter

    Wilkie, Alexander

    Evans, Sir S. T.

    Molteno, Percy Alport

    Williams, J. (Glamorgan)

    Everett, R. Lacey

    Mond, A.

    Williamson, Sir A.

    Falconer, J.

    Muldoon, John

    Wilson, Hon. G. G. (Hull, W.)

    Ferens, T. R.

    Murray, Capt. Hon. A. C. (Kincard.)

    Wilson, Henry J. (York, W. R.)

    Ferguson, R. C. Munro

    Murray, James (Aberdeen, E.)

    Wilson, P. W. (St. Pancras, S.)

    Findlay, Alexander

    Nicholson, Charles N. (Doncaster)

    Wood, T. M'Kinnon

    Foster, Rt. Hon. Sir Walter

    Norman, Sir Henry

    Yoxall, Sir James Henry

    Fuller, John Michael F.

    Nuttall, Harry

    Fullerton, Hugh

    O'Connor, John (Kildare, N.)

    Furness, Sir Christopher

    Parker, James (Halifax)

    TELLERS FOR THE AYES.—Captain

    Gibb, James (Harrow)

    Partington, Oswald

    Norton and Sir E. Strachey.

    Glendinning, R. G.

    Paulton, James Mellor

    NOES.

    Acland-Hood, Rt. Hon. Sir Alex. F.

    Butcher, Samuel Henry

    Dickson, Rt. Hon. C. Scott

    Anson, Sir William Reynell

    Carlile, E. Hildred

    Doughty, Sir George

    Arkwright, John Stanhope

    Carson, Rt. Hon. Sir Edward H.

    Douglas, Rt. Hon. A. Akers-

    Balcarres, Lord

    Cecil, Evelyn (Aston Manor)

    Duncan, Robert (Lanark, Govan)

    Baldwin, Stanley

    Cecil, Lord R. (Marylebone, E.)

    Faber, George Denison (York)

    Balfour, Rt. Hon. A. J. (City, Lond.)

    Clive, Percy Archer

    Fell, Arthu

    Banbury, Sir Frederick George

    Clyde, J. Avon

    Fletcher, J. S.

    Baring, Captain Hon. G. (Winchester)

    Craik, Sir Henry

    Forster, Henry William

    Bull, Sir William James

    Dalrymple, Viscount

    Gardner, Ernest

    1040

    1041

    Goulding, Edward Alfred

    Law, Andrew Bonar (Dulwich)

    Roberts, S. (Sheffield, Ecclesall)

    Gretton, John

    Lockwood, Rt. Hon. Lt.-Col. A. R.

    Rutherford, John (Lancashire)

    Guinness, Hon. W. E. (B. S. Edm'ds.)

    Lowe, Sir Francis William

    Rutherford, Watson (Liverpool)

    Hamilton, Marquess of

    M'Arthur, Charles

    Smith, Abel H. (Hertford, East)

    Hardy, Laurence (Kent, Ashford)

    Magnus, Sir Philip

    Starkey, John R.

    Harris, Frederick Leverton

    Mildmay, Francis Bingham

    Staveley-Hill, Henry (Staffordshire)

    Harrison-Broadley, H. B.

    Morpeth, Viscount

    Talbot, Rt. Hon. J. G. (Oxford Univ.)

    Healy, Timothy Michael

    Newdegate, F. A.

    Walker, Col. W. H. (Lancashire)

    Helmsley, Viscount

    Nicholson, Wm. G. (Petersfield)

    Warde, Col. C. E. (Kent, Mid)

    Hermon-Hodge, Sir Robert

    Parkes, Ebenezer

    Willoughby de Eresby, Lord

    Hill, Sir Clement

    Pease, Herbert Pike (Darlington)

    Wortley, Rt. Hon. C. B. Stuart-

    Hope, James Fitzalan (Sheffield)

    Pretyman, E. G.

    Wyndham, Rt. Hon. George

    Hunt, Rowland

    Randies, Sir John Scurrah

    Younger, George

    King, Sir Henry Seymour (Hull)

    Ratcliff, Major R. F.

    Lambton, Hon. Frederick William

    Rawlinson, John Frederick Peel

    TELLERS FOR THE NOES.—Mr. C. Salter and Mr. Remnant.

    Lane-Fox, G. R.

    Renton, Leslie

    Question put, "That, those words be there added."
    Lord ROBERT CECIL: Perhaps the Attorney-General can answer the question whether the definition in regard to governing bodies constituted for charitable purposes includes "incumbent."
    Sir W. ROBSON: I think it does.
    Proposed words there added.
    Sir W. ROBSON: I beg to move to add the following Sub-section to the Clause: "(2) This Section shall apply to the fee simple of or any interest in any land held by a registered society as if the purposes of the society were charitable purposes.
    "In this provision the expression 'registered society' means any society or body of persons who are registered, or whose rules are certified or registered, by a Registrar of Friendly Societies in pursuance of any Act of Parliament, and who by their rules make provision for benefits set out in Section eight, Sub-section one, of the Friendly Societies Act, 1896, and where the contract between the society and the member is of a permanent character."
    I move this Amendment in a more expanded form, and perhaps a more limiting form, than that which appears on the Paper. To the Amendment as it appears on the Paper there are notices of something like 55 Amendments by hon. Members belonging to all sections of the House. We have accepted the substance of the Amendments with some slight alteration of the words. The effect of the Amendment is to confine the benefits of the exemption to those friendly societies which make provision for the purposes set out in Section (8), Subsection (1) of the Friendly Societies Act of 1896, which is the object of the Amendment of which such extensive notice has been given. In order that the friendly societies might avail themselves of that, they would be obliged to satisfy the Registrar of
    1042
    Friendly Societies that by their rules they have, in fact, accumulated adequate reserves. That would be a new duty, and one which I do not think the Registrar of Friendly Societies has proper machinery to discharge. I am quite sure, therefore, that the friendly societies would be quite satisfied to accept an alteration of these words so as to remove the necessity for that inquiry and get the substance of the definition.
    The words I propose to add are as follow: "And who by their rules make provision for the benefits set out in Section (8), Sub-section (1) of the Friendly Societies Act, 1896." That is to say, if the rules are such as to make provision for all the various benefits which I have indicated, then that will suffice and the limitation will then apply. There are some words at the end which I do not think of much importance, "and where the contract between the society and the member is of a permanent character." Hon. Members know there are some kinds of societies called dividing societies who at the end of the year divide up the benefits. I do not think that these taxes could possibly be of much importance to them. Clause 25 is a Clause which exempts from any duty property held by bodies for charitable purposes, or with the care of friendly societies used and occupied by them for the purpose for which the society was founded. The dividing societies desire to come within that exemption and under the Amendment as it stands. I think they will do so. But as they divide up nearly all their property at the end of the year, of course they do not have any land subject to Undeveloped Land Duty, nor have they other property subject to Increment Duty because what they get is annually divided. But they do preserve some property, for instance, the premises on which they meet. They are not of any great value, but they preserve the continuity of the society, and therefore the words of the Amendment do not exclude dividing societies, though they are

    1043
    not of any great importance. Under these circumstances, I think that the Government Amendment is improved as compared with its original form.
    Lord ROBERT CECIL: As I understand, the Attorney-General is moving an Amendment to add words at the end of an Amendment which has been put from the Chair?
    Sir W. ROBSON: I am moving my Amendment in this form.
    Mr. WALTER GUINNESS Mr. WALTER GUINNESS moved to add at the end of the first paragraph of the proposed Amendment the words: "Provided that no exemption under this Sub-section shall apply to any premises used for trading purposes."
    The Committee will readily understand the necessity of some such Amendment. I am sure all sides of the House welcome the exemption of friendly societies so far as it goes; we only regret that it does not go very much further and apply also to those lands the revenues of which they enjoy. But registered societies, in many cases, may include co-operative societies for the purposes of trade, and of course they will get a very much greater benefit than friendly societies, which, in most cases, have only one headquarters, or one house, probably, in their sole occupation; whereas these co-operative trading societies, many of them may have branches all over the country—perhaps a branch in each town. I think this exemption will be of far greater value to them than to bonâ fide friendly societies. Unless this restriction is just in limiting it to real friendly societies, who give benefits in sickness and in circumstances of stress, these co-operative trading societies will be placed in a very much better position. It would be very hard on a small tradesman, who will have to pay Land Value Duty, that a co-operative store should come and establish a store next to his own, and that the latter should escape the duty altogether. I think this is a very necessary Amendment because there are a great many businesses carried on with so small a margin of profit that the starting of a co-operative store next door, free from all liability to this tax, might mean the end of the private enterprise altogether. I think that if the Government wish to avoid a grave sense of injustice on the part of small traders they will probably see their way to accept the Amendment.
    Sir W. ROBSON: I think the hon. Member's words are unnecessary owing to the addition now being made by the Government. That was an Amendment to restrict the benefits of this exemption to real friendly societies and not to let them extend to trading societies. The effect of the Government Amendment is that the exemption can no longer be claimed by a friendly society, but only by such societies as are formed for the purpose of carrying out the objects of Section 8, Sub-section (1) of the Friendly Societies Act, 1896. The exemption no longer applies to trading societies.
    Mr. T. M. HEALY: If the hon. and learned Gentleman is correct he has met the point—the very valuable and substantial point—of the hon. Gentleman (Mr. Walter Guinness). At the same time this new system of drafting is so obnoxious because it prevents any Member of the Committee from really judging of the effect because it incorporates an older statute. The point raised by the hon. Member is a good and valid one. The Attorney-General says he has met the point. It is a serious responsibility for him to say that he has met it, but I accept his statement. The point is one that requires looking into. All over Ireland you have these societies. There is a so-called friendly society coming over from Manchester under the guise of what is called "co-operation," and it is going into competition with us in every sense in dealing in butter and eggs. It is merely a trading society, and why that should get any advantage such as is complained of here I do not understand. When the Attorney-General says he has met the point we are not able to judge; we have not seen the words; we have not had time to consider the earlier statute. I am quite disposed to accept the hon. and learned Gentleman's statement, but I do think there is a substantial and serious point in what the hon. Gentleman (Mr. Walter Guinness) raised.
    Mr. PRETYMAN: I think we have some reason to complain of the way in which this Clause has been dealt with. I think I am right in saying that the Clause now on the Paper is in substitution for a previous Clause, so that this matter has gone through a good many phases. The question of what was to be done with friendly societies has now been a question of discussion for months. The Chancellor of the Exchequer put a Clause on the Paper, and after considerable con-

    1045
    sideration withdrew it, and substituted this Clause. At the last moment we are faced with a very substantial alteration of this particular Clause, so that I must say it is a very difficult thing for us to follow all these changes which are made so rapidly and on such short notice. As we have the assurance of the learned Attorney-General that this point is met we can be absolutely certain that it is met; and as I think it is met, I do not think we need press the matter to a division.
    Lord ROBERT CECIL: I wish to ask the Attorney-General whether he has considered whether it is possible that a friendly society might have two objects? It may have one of the objects set out in Sub-section (1) Section 8 of the Friendly Societies Act, and it may also be carrying on for trading purposes. I admit I have not referred recently to the Sub-section. It is evidently very desirable that the point should be met. In that case it would be well to insert the proposed words, and put it beyond doubt that trading premises are not to be exempted.
    Mr. T. M. HEALY: I have now the words of the Friendly Societies' Act, and it seems to me that no harm would be done by the insertion of some such words as the hon. Member (Mr. W. Guinness) suggests. We are all in agreement as to what we want, and when the hon. Member is seeking to bring in more taxes I cannot see why the Government should object. When a man and a society go into trade they ought to start level.
    Sir W. ROBSON: It is clear that friendly societies under this Act cannot trade. If they do, they do so contrary to law. After all, the criticism levelled against this proposal is not against the Government's original Amendment, but against the Amendment standing in the names of 55 Members. It is that which proposes legislation by reference. There is no doubt that the objects under the Section referred to are purely philanthropic, and a friendly society, when seeking registration under the Act, has to show that those are its objects. It is not entitled, as a friendly society, to trade. You may register as other societies under other Acts.
    Sir W. BULL: Surely a great number of building societies are registered under the Friendly Societies Act?
    Sir W. ROBSON: They do not come under this Section.
    Mr. J. GRETTON: My information is that a large number of co-operative societies are, as a matter of fact, registered as friendly societies.
    Sir W. ROBSON: Not under this Section.
    Mr. GRETTON: The difficulty is got over in this way. They pay a duty or bonus to their members, and they usually set aside a portion of their profits for charitable, educational, and mutual improvement purposes, for the benefit of their members. If it is the intention of the Government that trading societies which are only to a limited extent charitable societies should not partake of the benefits of the contemplated exemption, I think a further Amendment will be required on Report.
    Mr. LLOYD-GEORGE: If on examination hon. Members opposite come to the conclusion that other words are necessary—that they will strengthen the drafting of the Bill—very well, our object is exactly the same, and the words shall be inserted.
    Mr. WALTER GUINNESS: Can it be put right on Report?
    Mr. JOHN WARD: I think there is some misapprehension as to what friendly societies are. It is quite true that there are certain societies that do trading as suggested by the hon. Member who spoke above the Gangway just now, but who yet leave a certain surplus of their funds for some social purposes, either charitable or otherwise. But those societies have never, in my career, registered as friendly societies, but under the Provident Societies Acts, which are the Acts for the purpose of allowing trading co-operatively by societies. If the words suggested by the hon. Member for Bury St. Edmunds were inserted I am afraid that something serious might happen. For instance, even the ordinary friendly society had to do a little bit of trading. It has to sell its rules and to bargain for and buy its emblems. I do not know whether that would be considered as trading. At any rate, some sort of definition would be required if this buying and selling is to be considered trading, as it usually is. Unless there was some limitation attached to the words of the hon. Member for Bury St. Edmunds, I think they would be extremely dangerous.
    Mr. LLOYD-GEORGE: On the point raised by the hon. Member opposite (Mr.

    1047
    Walter Guinness), if the rules of the House will not allow the Amendment on Report, we will see that the Clause is made clear before it leaves the House.
    Amendment, by leave, withdrawn.
    Mr. LLOYD-GEORGE Mr. LLOYD-GEORGE moved to add at the end of the Clause the words: "(2) This Section shall apply to the fee simple of or any interest in any land held by a registered society as if the purposes of the society were charitable purposes. In this provision the expression 'registered society' means any society or body of persons who are registered, or whose rules are certified or registered, by a Registrar of Friendly Societies in pursuance of any Act of Parliament."
    Mr. PRETYMAN: A great deal has been said as to confining the exemptions to friendly societies. As a matter of fact, the exemptions can amount to very little, because apparently the thing is governed by what is occupied and used for their own purposes. I want to have it perfectly clear that this would only apply in the case of friendly societies to their offices or such a thing as a foresters' hall. The Corporation Tax would apply to their property, but so far as Increment and Undeveloped Land and Reversion Duty are concerned it would only apply to such things as a hall or the offices of the society where the business was done, and it would not apply to any of their invested property which they own for the purposes of their fund in which their money is invested. In regard to Increment Value Duty, I take it they would be exempt from Death Duties or Corporation Duty, but they would be liable to Reversion Duty on the expiration of a lease and on the regranting of that lease, if for over 14 years, or if they sold any property, which is not very likely. Friendly societies are owners of ground rents and of property which they are not likely, except on exceptional occasions, to sell. I should like to know if that is the clear interpretation of the Bill, because there has been some dispute about it and there have been a good many inquiries as to what the effect would be upon their property. I should be glad to have some confirmation from the Government Bench.
    Mr. LLOYD-GEORGE: They are quite in the same position as other charitable institutions. They are exempt from Reversion Duty and the Undeveloped Land Duty in respect of property which they occupy.
    1048
    They pay Undeveloped Land Duty upon property which they let for profit.
    Mr. PRETYMAN: On their investments?
    Mr. LLOYD-GEORGE: Yes, and they are exempt on their property in respect of periodic payment, but if they sell and there is any increment upon the sale they are liable.
    Mr. F. B. MILDMAY: I do not think the question of Undeveloped Land Duty would fall heavily upon the friendly societies, but undoubtedly the information which the Chancellor of the Exchequer has given to the effect that Reversion Duty would be chargeable upon land not occupied must come upon the funds of the friendly societies. I think friendly societies are entitled to greater protection from taxation under this Bill, and it is most important to safeguard those societies in every way. I know there are a good many people who think that the thrift of the individual should be guarded in the same way as friendly societies, but I have always held that commercial thrift is more individual. I am sorry that the Chancellor has not thought fit to protect those societies more fully than he has done.
    Mr. RAWLINSON: Will the Chancellor of the Exchequer give us an estimate of the monetary value which he attaches to this concession to friendly societies? To me it appears to be no concession at all, and only applies as far as taxation is concerned to land occupied and used by friendly societies. The Chancellor of the Exchequer says that land occupied and used by friendly societies will be exempt from the Reversion Duty and the Undeveloped Land Tax. Of what value is an exemption of that kind? How can you possibly have a reversion upon property you are occupying yourself? The reversion can only occur when the lease falls in, and how can you get any benefit from an exemption from the Reversion Duty on a house you are using yourself. The value of such exemption may be put at something under 1s. As far as land is occupied and used by friendly societies it is practically nil, because they occupy and use no undeveloped land of any sort or kind. The right hon. Gentleman tells us that in respect of land which friendly societies do not occupy and use they will be liable just the same as any other individual. The only concession made to us in regard to land which they do not occupy as far as the increment is

    1049
    concerned is that they are not liable to the 15 years' assessment under the Corporation Tax. They are not liable to have that totted up at the end of 15 years, and they will only have to pay when they have a lease for more than 14 years. If the Chancellor of the Exchequer gives us the figure relating to the loss which he estimates this concession will entail, it will not work out at a very large figure. Friendly societies as a rule do not occupy a large amount of their property, the bulk of it being land which they neither occupy nor use. We know as far as the Undeveloped Land Duty is concerned, they are only liable to pay when they sell land. This concession to place friendly societies on the same footing as educational bodies is not of any large pecuniary value.
    Mr. GEORGE TOULMIN: May I say a word as to the Amendment which wag put down in identical terms by 55 Members? I am informed by the Stationery Office that the number of pages of printed matter occupied by the Amendments to the Finance Bill is 70,000. This is rather a straining of the ordinary custom and practice of the House, and if this precedent is followed for the future—
    The CHAIRMAN: Order, order. I must remind the hon. Member that the point he is raising does not arise upon the Amendment before the Committee.
    Mr. GRETTON: In the country districts friendly societies have no premises of their own which they occupy. In places like London and Manchester the friendly societies have registered offices. Friendly societies stake their stability upon their investments. It is very usual with the smaller branches and districts to invest their savings in house property and building land. There is no concession whatever in this Amendment for the invested savings of friendly societies, on which they depend to ensure their financial stability and the benefits they have promised their members. I contend this Amendment will not meet the case of friendly societies. It is not the concession friendly societies have been urging for, and when they come to understand it there will be a feeling of universal disappointment that the Government have not taken up their case.
    Question, "That those words be there added," put, and agreed to.
    Question, "That the Clause, as amended, stand part of the Bill," put, and agreed to.

  PART VIII.—NATIONAL DEBT.

    CLAUSE 71.—(Reduction of Permanent Annual Charge.)
    The amount of the permanent annual charge for the National Debt under Section 1 of the Sinking Fund Act, 1875, shall, during the current and every subsequent financial year, be the sum of twenty-five million instead of twenty-eight million pounds.
    Sir F. BANBURY: I should like to say a few words on this Clause before the Committee decides to pass it.
    Mr. T. M. HEALY: I understood the Government promised a new Licensing Clause. I do not see it on the Paper.
    The CHAIRMAN: This deals with the Sinking Fund, and has nothing to do with the Licensing Clauses.
    Mr. T. M. HEALY: We had it promised.
    The CHAIRMAN: That is another point.
    Mr. LLOYD-GEORGE: These are purely postponed Clauses.
    Sir F. BANBURY: This Clause, which was postponed till to-day, deals with the Sinking Fund, and proposes to reduce the sum set aside for the services of the nation from £28,000,000 to £25,000,000. I think we should not acquiesce in this proposal, because I believe, from a financial point of view, it is one of the worst proposals in a very bad Bill. When the Party opposite came into power five years ago they stated all over the country that their desire was to re-establish the finances of the country upon a sounder basis. This is a proposal to disestablish the present sound basis of the Sinking Fund and to put in its place a proposal which from the financial point of view is of the very worst description. When the Party opposite came into power the National Debt was, roughly speaking, £730,000,000. Since then they have added something like £300,000,000 to the National Debt. I am prepared to substantiate that statement. They have devoted some £9,000,000 to Old Age Pensions, and that capitalised will represent £300,000,000. That is a simple fact, and why hon. Members below the Gangway laugh at it passes my comprehension It is unremunerative expenditure, and it is exactly the same whether the money is devoted to Old Age Pensions or to payment of interest on the National Debt.

    1051
    What have the Government done, to reduce the amount of the Debt? They have gone about the country declaring that they have reduced it by £40,000,000 sterling. I do not want to use an unparliamentary phrase, or one calculated to give offence to hon. Members, but the most moderate expression I can apply to that statement is that it is quite inaccurate. What the Government have done is that they have taken the £28,000,000 devoted to the service of the Debt by the late Chancellor of the Exchequer. They have taken the old Sinking Fund. But they could not help themselves. The money went automatically to the reduction of debt. The only thing they can plume themselves upon is that their estimates have been so wrong that they got a large surplus which they were obliged to apply to the reduction of debt. The fact is that what reduction of debt there has been has been effected by the Government without any desire on their part, and simply in consequence of the position in which the finances of the country were left by the Unionist Government, and also through the bad budgetting of the Chancellor of the Exchequer and his immediate predecessor the Prime Minister. The fact remains that by their policy they have increased the national indebtedness at a time when the finances of the country are in a very bad state, and when Consols stand lower than at any date during the last 20 years, while the expenditure is increasing on all sides.
    12.0 P.M.
    I venture to say that from a financial point of view a more foolish proposal never was made, and as the right hon. Gentleman has consented to waive his first proposal to abolish the Sinking Fund, I trust that he will waive this proposal and allow the Sinking Fund to take its natural course. I may say that when this sum was originally set aside by Sir Stafford Northcote his idea was that a temptation to alter it should not be present to the mind of the Chancellor of the Exchequer, whoever he might be. He was aware that human nature, being frail, the temptation to use this money for other purposes would assail all Chancellors of the Exchequer to whichever party they belonged, and he endeavoured to set aside a fixed sum. That sum has never been altered except in cases of national emergency, such as war or in one case, I believe, the necessity of adding largely to the Navy. These are the only occasions on which it has been
    1052
    altered, and I trust the Chancellor of the Exchequer will see that his true policy is to leave the Sinking Fund in the position in which it is now.
    Mr. LLOYD-GEORGE: The hon. Baronet is the only financial authority of any position in this country who has challenged the wisdom of the Government in the course taken in regard to the Sinking Fund. So far as to our being criticised for reducing the Sinking Fund by three millions, I think it will be a matter of astonishment to many people that we have not taken another million. Lord Cromer, another financial authority, proposed to the Government that they should reduce the Fund by four millions, and that is the criticism which has been directed from every quarter except the hon. Baronet. The right hon. Gentleman (Mr. Austen Chamberlain) frankly admitted, in his speech immediately after I had made my Budget statement, that it was an agreeable surprise that I had not taken more. I do not want merely to indulge in a tu quoque, but I would remind the hon. Baronet that I am not sure that he did not vote for the reduction of the Sinking Fund to 25 millions under Lord Goschen when that sum would provide for a smaller reduction of the National Debt than it does now.
    Sir F. BANBURY: But the National Debt was much lower.
    Mr. LLOYD-GEORGE: Yes, I know; but the sum available for the payment of debt was smaller because of the rate of interest. The hon. Baronet also afterwards assented to a proposal of Lord St. Aldwyn for the reduction of the Sinking Fund from 25 millions to 23 millions, and that was at a time when there was no heavy liability upon the Exchequer, and no necessity for new taxation. I am not sure that Lord St. Aldwyn had not a surplus, and still the hon. Baronet supported a proposal to reduce the Sinking Fund from 25 millions to 23 millions. Now we have to raise £16,000,000 this year, and something over £20,000,000 next year, and the hon. Baronet says this is a ludicrous proposal that we should reduce it to £25,000,000 when Lord St. Aldwyn reduced it to £23,000,000. The position of the hon. Baronet is rather inconsistent. Supposing I left the Sinking Fund exactly where it was after the gigantic efforts of my predecessor to pay off debt, and proposed to raise this extra three millions by increasing the taxation of the country, the whole

    1053
    House of Commons would have thought it was pure brigandage on my part. It means very nearly another 2d. on the Income Tax by the time all the concessions have been added. Do we want another 1½d. on the Income Tax in order to save the Sinking Fund?
    The hon. Baronet must also remember that certain charges which used to be treated as capital charges are now put on the Estimates of the year—considerable sums of money which, under the old order, we should have borrowed and added to the floating liabilities of the country, so that the £25,000,000 does not nearly represent what we are doing in preventing debt from being piled up, and the amount that we get out of this £25,000,000 will be a clear reduction of debt, whereas under the old system it was by no means a clear reduction, because what we paid out of Sinking Fund was piled up by means of borrowing for purposes for which we now pay. We are paying our way now. That is the difference between the finance which the bon. Baronet now opposes and the finance which he used to support.
    Sir F. BANBURY: I believe on one occasion I voted for the reduction of the Sinking Fund. The National Debt was then £630,000,000, as against £735,000,000 now. Consols were then 111. They are now 83.
    There was a question whether it was wise to redeem Consols when they were at such a high price. The expenditure of the country was certainly at 20 or 30 millions a year less than now, and under these circumstances a reduction of the Sinking Fund was on the whole wise and could be supported. But the circumstances are totally different. We have an expenditure of £162,000,000—a thing we have never had before in time of peace. The financial position is quite changed, and though I was right in voting for the reduction then, I am equally right in opposing it now.
    Mr. T. M. HEALY: The Chancellor of the Exchequer has made an important admission of which we ought to take note, namely, that he was pressed to take £4,000,000 instead of £3,000,000 out of the Sinking Fund. I think it is important that those who represent Irish constituencies should remember that the right hon. Gentleman was pressed to take an extra million out of the Sinking Fund instead of out of the taxes.
    Question put, "That the Clause stand part of the Bill."
    The Committee divided: Ayes, 164; Noes, 48.

    Division No. 738.]

    AYES.

    [12.15 a.m.

    Agnew, George William

    Dickinson, W. H. (St. Pancras, N.)

    Hope, W. Bateman (Somerset, N.)

    Allen, A. Acland (Christchurch)

    Duckworth, Sir James

    Howard, Hon. Geoffrey

    Allen, Charles P. (Stroud)

    Duncan, C. (Barrow-in-Furness)

    Hudson, Walter

    Balfour, Robert (Lanark)

    Duncan, J. H. (York, Otley)

    Hyde, Clarendon

    Barker, Sir John

    Dunne, Major E. Martin (Walsall)

    Jones, Leif (Appleby)

    Barnard, E. B.

    Edwards, Sir Francis (Radnor).

    Jones, William (Carnarvonshire)

    Barnes, G. N.

    Elibank, Master of

    King, Alfred John (Knutstord)

    Barran, Sir John N. (Hawick B.)

    Essex, R. W.

    Laidlaw, Robert

    Beauchamp, E.

    Everett, R. Lacey

    Lambert, George

    Beck, A. Cecil

    Falconer, James

    Lamont, Norman

    Belloc, Hilaire Joseph Peter R.

    Ferens, T. R.

    Layland-Barratt, Sir Francis

    Berridge, T. H. D.

    Ferguson, R. C. Munro

    Lehmann, R. C.

    Black, Arthur W.

    Findlay, Alexander

    Lever, A. Levy (Essex, Harwich)

    Boulton, A. C. F.

    Fuller, John Michael F.

    Levy, Sir Maurice

    Bowerman, C. W.

    Fullerton, Hugh

    Lewis, John Herbert

    Bramsdon, Sir Thomas A.

    Furness, Sir Christopher

    Lloyd-George, Rt. Hon. David

    Bright, J. A.

    Glendinning, R. G.

    Lundon, Thomas

    Brodie, H. C.

    Glover, Thomas

    Lupton, Arnold

    Brunner, J. F. L. (Lancs., Leigh)

    Gooch, George Peabody (Bath)

    Mackarness, Frederic C.

    Burns, Rt. Hon. John

    Guest, Hon. Ivor Churchill

    Maclean, Donald

    Byles, William Pollard

    Gulland, John W.

    Macnamara, Dr. Thomas J.

    Causton, Rt. Hon. Richard Knight

    Gwynn, Stephen Lucius

    MacVeagh, Jeremiah (Down, S.)

    Cawley, Sir Frederick

    Hall, Frederick

    M'Callum, John M.

    Cecil, Evelyn (Aston Manor)

    Harcourt, Robert V. (Montrose)

    M'Laren, H. D. (Stafford, W.)

    Channing, Sir Francis Allston

    Harmsworth, Cecil B. (Worcester)

    M'Micking, Major G.

    Clancy, John Joseph

    Harmsworth, R. L. (Caithness-shire)

    Maddison, Frederick

    Clough, William

    Haze, Dr. A. E.

    Marnham, F. J.

    Cobbold, Felix Thornley

    Healy, T. M. (Louth, North)

    Massie, J.

    Collins, Stephen (Lambeth)

    Hedges, A. Paget

    Masterman, C. F. G.

    Cooper, G. J.

    Helme, Norval Watson

    Montagu, Hon. E. S.

    Corbett, A. Cameron (Glasgow)

    Henry, Charles S.

    Muldoon, John

    Corbett, C. H. (Sussex, E. Grinstead)

    Higham, John Sharp

    Murray, Capt. Hon. A. C. (Kincard.)

    Cotton, Sir H. J. S.

    Hobart, Sir Robert

    Nicholson, Charles N. (Dancaster)

    Cullinan, J

    Hobhouse, Rt. Hon. Charles E. H.

    Norman, Sir Henry

    Davies, Sir W. Howell (Bristol, S.)

    Hodge, John

    Nuttall, Harry

    Dewar, Arthur (Edinburgh, S.)

    Holland, Sir William Henry

    O'Connor, John (Kildare, N.)

    O'Connor, T. P. (Liverpool)

    Roch, Walter F. (Pembroke)

    Wason, Rt. Hon. E. (Clackmannan)

    Parker, James (Halifax)

    Roe, Sir Thomas

    Wason, John Cathcart (Orkney)

    Partington, Oswald

    Rogers, F. E. Newman

    Waterlow, D. S.

    Pearce, Robert (Staffs, Leek)

    Rose, Sir Charles Day

    White, Sir George (Norfolk)

    Pease, Rt. Hon. J. A. (Saffron Walden)

    Rowlands, J.

    White, J. Dundas (Dumbartonshire)

    Philipps, Owen C. (Pembroke)

    Russell, Rt. Hon. T. W.

    White, Sir Luke (York, E. R.)

    Pickersgill, Edward Hare

    Rutherford, V. H. (Brentford)

    Whitehead, Rowland

    Pirie, Duncan V.

    Samuel, Rt. Hon. H. L. (Cleveland)

    Wiles, Thomas

    Pointer, Joseph

    Seely, Colonel

    Wilkie, Alexander

    Pollard, Dr.

    Sherwell, Arthur James

    Williams, J. (Glamorgan)

    Ponsonby, Arthur A. W. H.

    Stanley, Albert (Staffs, N. W.)

    Williamson, Sir Archibald

    Price, Sir Robert J. (Norfolk, E.)

    Summerbell, T.

    Willoughby de Eresby, Lord

    Rea, Rt. Hon. Russell (Gloucester)

    Taylor, John W. (Durham)

    Wilson, Hon. G. G. (Hull, W.)

    Rea, Walter Russell (Scarboro')

    Thomas, Sir A. (Glamorgan, E.)

    Wilson, Henry J. (York, W. R.)

    Rees, J. D.

    Thorne, G. R. (Wolverhampton)

    Wilson, P. W. (St. Pancras, S.)

    Richards, T. F. (Wolverhampton)

    Toulmin, George

    Wood, T. M'Kinnon

    Ridsdale, E. A.

    Trevelyan, Charles Philips

    Roberts, Charles H. (Lincoln)

    Verney, F. W.

    TELLERS FOR THE AYES.—Captain

    Roberts, G. H. (Norwich)

    Walsh, Stephen

    Norton and Sir Edward Strachey.

    Robson, Sir William Snowdon

    Ward, John (Stoke-upon-Trent)

    NOES.

    Acland-Hood, Rt. Hon. Sir Alex. F.

    Guinness, Hon. R. (Haggerstan)

    Remnant, James Farquharson

    Ashton, Thomas Gair

    Hamilton, Marquess of

    Renwick, George

    Balcarres, Lord

    Harris, Frederick Leverton

    Rutherford, John (Lancashire)

    Baldwin, Stanley

    Harrison-Broad, H. B.

    Rutherford, Watson (Liverpool)

    Carlile, E. Hildred

    Helmsley, Viscount

    Salter, Arthur Clavell

    Carson, Rt. Hon. Sir Edward H.

    Hermon-Hodge, Sir Robert T.

    Smith, Abel H. (Hertford, East)

    Cecil, Lord R. (Marylebone, E.)

    Hill, Sir Clement

    Starkey, John R.

    Clyde, James Avon

    Hunt, Rowland

    Staveley-Hill, Henry (Staffordshire)

    Cochrane, Hon. Thomas H. A. E.

    King, Sir Henry Seymour (Hull)

    Walker, Col. W. H. (Lancashire)

    Dalrymple, Viscount

    Lane-Fox, G. R.

    Warde, Col. C. E. (Kent, Mid)

    Dickson, Rt. Hon. Charles Scott

    Lockwood, Rt. Hon. Lt.-Col. A. R.

    Wortley, Rt. Hon. C. B. Stuart-

    Doughty, Sir George

    Mildmay, Francis Bingham

    Wyndham, Rt. Hon. George

    Douglas, Rt. Hon. A. Akers-

    Nicholson, Wm. G. (Petersfield)

    Fell, Arthur

    Oddy, John James

    Fletcher, J. S.

    Pease, Herbert Pike (Darlington)

    TELLERS FOR THE NOES.—Sir

    Forster, Henry William

    Pretyman, Ernest George

    Frederick Banbury and Mr. Walter Guinness.

    Goulding, Edward Alfred

    Ratcliffe, Major R. F.

    Gretton, John

    Rawlinson, John Frederick Peel

    Committee report Progress; to sit again to-morrow (Tuesday).

HEALTH RESORTS (IRELAND) BILL.
Order for second reading read and discharged; Bill withdrawn.
Whereupon Mr. SPEAKER, in pursuance of the, Order of the House of 20th August, adjourned the House without Question put.
Adjourned at Twenty minutes after Twelve o'clock.