HC Deb 29 September 1909 vol 11 cc1264-341

(1) No Reversion Duty shall be charged on the determination of a mining lease, and no Increment Value Duty shall be charged on the occasion of the grant of a mining lease or in respect of minerals which are comprised in a mining lease, or are being worked, except as a duty payable annually in manner provided by this Act.

(2) Increment Value Duty shall not be charged in the case of any minerals which were, on the thirtieth day of April, nineteen hundred and nine, being worked whether by the proprietor or by a lessee so long as the minerals are for the time worked: Provided that the exemption under this Section shall continue to apply in the case of any minerals, although they cease, for a temporary period, to be worked, so long as the period does not exceed twelve months.

(3) Increment Value Duty in respect of the increment value of minerals which are Comprised in a mining lease or are being worked shall where that duty is chargeable be charged annually, and the increment value shall, instead of being estimated as a capital sum, be taken to be the sum (if any) by which, in each year during which the tenancy under the lease continues or the minerals are being worked, as the case may be, the rental value on which Minerals Rights Duty is charged in respect of the right to work the minerals exceeds the annual equivalent 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, as the case may be; and the annual equivalent of any such capital value of the minerals shall be taken to be two twenty-fifth parts of that capital value.

(4) Increment Value Duty payable annually under this Section shall, instead of being collected as provided by this Act in other cases, be recoverable in the same manner as Mineral Rights Duty, with the same right of deduction.

(5) Any proprietor or lessor of any minerals who pays Increment Value Duty in pursuance of this provision shall be entitled to be relieved in any year from the payment of Mineral Rights Duty, as such proprietor or lessor, up to the amount paid by him in that year in respect of Increment Value Duty.

For the purposes of this provision a deduction of any amount from the rent payable to the lessor on account of Mineral Rights Duty shall be deemed to be a payment of that duty, and the relief may be given either by allowance or repayment, or both of those means, as the occasion may require.

(6) Where minerals cease to be comprised in a mining lease or to be worked within the meaning of this Section, the capital value of the minerals at the time shall be specially ascertained in accordance with the provisions of this Act, and the capital value as so ascertained shall be treated as the original capital value of the minerals.

(7) Nothing in this Section shall apply to minerals which are exempt from Mineral Rights Duty under this Act.

Question proposed, "That the Clause be now read a second time."

Mr. CLAVELL SALTER

This Clause purports to apply the principle of increments to minerals, and it will no doubt raise large questions of policy as regards the advisability of proposing this further duty in addition to the Mineral Rights Duty, as to the capacity of trade to bear it, and as to its effects upon industries. I do not desire to go into large matters of policy of that kind, but as this duty is a wholly novel duty I wish mainly to call the attention of the Committee to its actual working and to the direct results which it will produce, because while I do not deny it may be possible, though I think it would be rather difficult, to apply the principle of the taxation of increment of which we heard so much to minerals, I submit to the Committee that this so-called duty on minerals has nothing to do with the principle of the taxation of increment as has been so often explained to the Committee and the House, but that it is an arbitrary tax founded upon no principle at all, which would act in a most capricious and arbitrary fashion.

This duty is not concerned with minerals in current work. I therefore ask the Committee to take a case to which it would apply, which is the case of future leasing or working of minerals hitherto unworked. What tax will that impose upon a man letting or working his minerals? He has to pay an annual duty, which, roughly speaking, amounts to between the rent and two-twenty-fifths of the capital value. What will the duty be which the lessor of minerals will have to pay under this Clause? He will have first of all to start with the capital value of these minerals. It will be observed that in the addition which the Chancellor of the Exchequer proposes to make to Clause 15 he proposes to enact that in preparing the 1909 register no value at all shall be attached to any minerals which are not returned and valued by the owner of the soil in which they are. What position will that put the owner of the land in, in which there are or are supposed to be minerals? He will be put in this dilemma, that he must either go on the off-chance that he will some day have an opportunity of letting these minerals—he must go to the expense of testing his land, and fighting the matter out with the Com- missioners—or else the land will stand with the minerals unvalued in the 1909 register. It is somewhat of a hardship to call upon him to take the first course and go through all the cost of valuing his minerals. If he does not take that course, how will this Increment Duty on working minerals affect him? What will he have to pay? In the first year he will, of course, pay no duty, because it is payable on the last year's working. In the second year he will have to pay the difference between the rent he received in the first year and two-twenty-fifths of the capital value. He will, therefore, have to pay increment value in the second year on the whole of the rent he received in the first year at the rate of 4s. in the £, and that will apply year by year. The effect of this tax is that whenever minerals are let for the first time the owner will have to pay four shillings in the £ on the mineral royalties he receives. That appears to me to be a gross injustice, and I really doubt whether this Committee desires to impose on one special kind of owners of property any such burden as that without any reason and without any principle whatever. This charge will have to be paid quite apart from the Increment Duty, whether there is any increment or not.

I will now take the case of a mineral lease, such as the Chancellor of the Exchequer took as an illustration when he moved this Resolution. He took a mineral lease with an assumed capital value of £12,500, which is a convenient sum to take. I want to call the attention of the Committee to the amazing difference which his proposal introduces between the burden upon a man who lets his minerals and the burden upon the man who sells them. It is a commonplace to say that a mining lease is nothing but a sale of minerals. It is really a sale of minerals piecemeal. A man who has a seam may sell it for a lump sum down or he may sell it on a lease under which the lessee may take the minerals to any extent he pleases, paying for them at so much per ton. That is really a sale. I will take the Chancellor of the Exchequer's illustration and apply this Clause to it. How will it work? Supposing the man who owns a particular vein of minerals sells it out and out. I will assume there is an increment on the capital value of £2,500. The property has risen in value from £12,500 to £15,000, and it is sold at that price. The vendor will pay Increment Value Duty upon it—that is, he will pay one-fifth, amounting to £500. That is his position if he sells. Let us compare that with his position under this Clause, if instead of selling those minerals out and out he sells them piecemeal under a mining lease. I do not think "mining lease" is a good term to use. I will suppose he leases those minerals at £15,000, by which I mean he leases them at so much per ton as will bring in royalties by the time the mine is worked out to the amount of £15,000. What duty will he have to pay upon this income of £2,500, as compared with the £500 paid in the case of sale? That will all depend upon how soon his minerals are worked out, and it will not depend upon any question of increment at all. Supposing they are worked out in three years, and that the royalties work out at £5,000 in each year. What duty will have to be paid in that case? He will have to pay each year the difference between £5,000, the rent he received the year before, and £1,000, which is the annual equivalent of the capital value. He will have to pay £800. Therefore he will have to pay during the three years these minerals are being got, and during which time he is receiving £15,000, the sum of £2,400 in Increment Value Duty.

Let us take a more extreme case. Let us suppose that the lessee is able to work out the whole sum in one year and pay his £15,000. The only difference between the two is that in the one case the man is called the purchaser and pays in a lump sum, whereas in the other case he is called a lessee and pays by instalments. In each case the owner receives £15,000 and the community causes an increment of £2,500. The duty which the owner will have to pay if the seam is worked out in one year is £2,800. These are matters to which I wish to call the attention of the Chancellor of the Exchequer. I can hardly believe that I have correctly read this Section, and I should be very glad to hear that I have not read it correctly. That is quite possible, because I can hardly conceive such a result would be intended. The two questions I address to the Chancellor of the Exchequer are, in the first place, am I right in my reading of this Section; and, secondly, if I am right, are these conclusions really desired by the Committee? I will assume a case in which there is no increment. The only increment I can conceive in the case of a wasting property like some of those which are being worked is where the price of the commodity rises so fast as to more than counterbalance the abstraction from the corpus. That is the only possible increment I can understand as applying to a wasting estate. Take the case where there is no increment at all. During the whole time the lease is running the minerals are being worked, and there is no rise in the price of coal. I will take the capital value at £12,500. What is the Increment Value Duty—as the Chancellor of the Exchequer has had the courage to call it—which will be paid by the lessor in that case? It depends not so much on the kind of work as upon the regularity with which the work is conducted. Now, £12,500 is the capital value, and £1,000 is the annual equivalent of the capital value. If that seam is worked out in 12½ years with regularity, so that the royalties paid are £1,000 a year, no duty will be paid at all. If the seam is worked out in five years with regularity, so that the annual payment of royalties is £2,500, then the duty will be £300 a year, or £1,500 in all. If the seam is worked out in one year, the duty will be £2,300. I will not say it makes no difference to the lessor. He gets his money sooner, of course, and he gets the interest the money earns, but that is a trifle compared with these enormous differences of duty. He pays in all these cases the same amount in Mineral Rights Duty. The faster his property is taken away, the faster he gets his purchase money, and the larger the Mineral Rights Duty he has to pay.

I do hope some one will explain on what principle of reason or justice you are going to tax a lessor who leases his minerals at a given price nothing if it takes 12½ years to work them, and £2,300 if they are worked out in a year. It is quite obvious this is not a tax on increment at all. The case I have just put to the Committee is a case where there is no increment. It is not a tax upon increment; it is on the face of it a tax which has no connection with the price or the value of the coal. It applies equally whether the price rises or falls. It is a tax on irregularity of work, and on nothing else. If, in the case I last put, instead of the working during the 12 years being regular at £1,000 a year, it had been worked so that a small sum was obtained in one year and a large amount in the next, a large amount of duty would have been paid. If the working takes 12 years, and is regular, no duty is paid; but if the working is irregular a large amount of duty is paid, and the greater the irregularity the larger the amount of duty this extraordinary tax will impose upon the owner. That, as it appears to me, is the meaning of this Clause, and that is the irregular way in which it will work. I shall be very glad to hear if I am right in; my reading of the Section. If I am right, it appears to me, first of all, that this is not an increment tax at all, and that at has no relation to those theories, right or wrong, of an increased value accruing to a man's property for which he does not pay or work. It is a tax on the working of minerals, and it is a most arbitrary, fantastic, and unjust tax. I shall listen with great interest to hear what is to be said about it by the party opposite, and whether it is possible anything can be said for imposing upon the owners of a particular kind of property a tax so arbitrary and so absurd.

Mr. BALFOUR

I do not know whether the Chancellor of the Exchequer proposes to rise at once or shortly to deal with the arguments of my hon. and learned Friend, but I would put in an appeal on behalf of the lay Members of the Committee that on this occasion of the second reading of the Clause the Chancellor of the Exchequer should give us some general explanation of its working and of its principles, which I am sure would lead to a legitimate discussion of its provisions. I do not blame the Chancellor of the Exchequer or the draftsman, but everyone will agree that the difficulties are very great. I defy any man without very detailed and profound study to say exactly what it does and what exactly it is intended to do. I am sure the Chancellor of the Exchequer would perform great service to the Committee if he would give us a general account of the principles underlying the Clause.

Mr. LLOYD-GEORGE

I do not propose to reply now to the very detailed questions put to me by the hon. and learned Gentleman opposite, but I will do so later on. If I were to follow a detailed consideration, it might take me away from the general consideration of this Clause. The right hon. Gentleman was not here when I explained the general summary of my view of what this Clause really means. I agree it is very complicated, but any clause dealing with mineral rights must necessarily be complicated. This is how it is proposed to work. In the case of a sale, it would be quite easy to charge on the capital amount of increment, but, in the case of a lease, it will be almost impossible. In the case of a lease with a royalty of sixpence per ton, and a dead rent of £1,000, no one can say at the time the lease is signed with any approach to accuracy what that really represents, be cause the amount depends exactly upon the yield of coal, and you cannot tell what the yield will be. There is, therefore, a difficulty in arriving at the increment on which you ought to impose the tax at the date the lease is signed. The Government consequently propose an Increment Duty in the shape of an annual tax. I will take the figure of £12,500, which is the very figure given by the hon. and learned gentleman. We first of all value all the minerals in England—

Mr. E. G. PRETYMAN

I do not interrupt except for the purpose of getting information. According to Clause 15, and an Amendment standing in the name of the Chancellor of the Exchequer, minerals are not to be valued unless the owner declares. The Chancellor of the Exchequer does not mean that all minerals which may exist in the country are at once to be valued. Value is only to be placed on what the owner declares.

Mr. LLOYD-GEORGE

That is purely a method of valuation, and we shall come to that point later on. That is the method we propose to adopt in arriving at the valuation. It does not matter from the State point of view what the valuation is, because there is no charge of a ½d. in the £ upon it. We invite the owner to declare whether he has got minerals, and what value he places upon them. Let us assume he values them at £12,500. We divide that by 12½, because that is the number of years' purchase which you place upon a mining property. I am advised that 12½ years is the average. Therefore, a mining property of £12,500 capital value, is worth £1,000 a year. You reduce your £12,500 to an annual value of £1,000. Let us assume that the owner of that mineral property leases it. There is a royalty of 6d. per ton and a dead rent of £2,000. The first year he only gets his £2,000. The royalties do not come up to £2,000, and he therefore simply draws his dead rent. The Increment Duty will be calculated in this way: You take £1,000 from £2,000, and that represents the annual increment for that year, and you charge 20 per cent. upon it. The Government will take duty of one-fifth on that £1,000. Next year the royalties run up to £3,000. You still deduct the £1,000, your original equivalent of site value, and for the second year you have an increment of £2,000, and you take a fifth on that. If the royalties go up to £10,000 you still deduct the £1,000, and there is £9,000 on which you take a fifth. If the minerals peter out there is an end of the colliery and of the increment. Supposing the increment were in any year to fall below £1,000 there would be no Increment Duty. We are charging the Increment Duty year by year on the difference between the annual increment site value and the mineral rents of that particular year. We charge one-fifth upon the difference between the anual equivalent of the original site value and the rents and royalties. On that we charge 20 per cent., and that is the proposition which we are substituting for the valuation of the increment at the date of the lease. But suppose the owner sells his mineral property for £15,000. There will be an increment of £2,500. The original value was £12,500; the property is sold for £15,000. We take the increment on the difference. I hope I have made the point clear.

Mr. PRETYMAN

Is there to be any subsequent occasion for valuation? Suppose the owner does not know he has got minerals on his land and does not consequently declare; but at some subsequent date he discovers the minerals. Will he have an opportunity of declaring the value later on?

The ATTORNEY-GENERAL (Sir W. Robson)

The declaration of value is as from 30th April, 1909. Should an owner think he has no minerals worth declaring, and subsequently discover that he has, then of course he will not get the benefit of the original capital value, which, in the case of minerals, is equivalent to the original site value.

Mr. PRETYMAN

How long a period will be allowed him within which to declare the value as from April, 1909? He may not know he has minerals on his land. In such a case, will the Increment Value Duty be one-fifth of the entire rental?

Sir W. ROBSON

The original capital value will be calculated. The number of these cases will be somewhat restricted. All minerals being worked on 30th April, 1909, will pay 5 per cent. duty. The Increment Value Duty does not apply to them at all. It is very important to keep that in mind, for then we shall see exactly the scope of the duty. The Increment Value Duty only applies to minerals which are not on 30th April being worked, and the expression "being worked" is defined very widely. It is assumed that minerals in the process of being worked are a waning, and not an improving, estate, and generally speaking that is true, although there may be some few exceptions where the increment is considerable. But you must proceed in these cases on general lines. The owner, however, must make up his mind to declare whenever the valuation is made as from 30th April, 1909.

Mr. PRETYMAN

There are two points which, in my opinion, do not agree. There is mention of a State valuation, which is to be all-embracing; and, again, the valuation is to be fixed except where the owner declares. These two do not seem to quite agree. We want to know whether there is to be a specific occasion, and, if so, when, when the State is to make an all-embracing valuation? Are the owners to approach the State in the first instance or is the State to approach the owner?

4.0 P.M.

Sir W. ROBSON

I think the hon. and gallant Gentleman is rather troubling about a difficulty which is not likely to arise in the working of the Act. Take the case of the owner who ignores minerals on his land and the case of the owner who thinks there are minerals and wishes to declare their value. In the case of the first owner he simply values the land, and if he chooses to make no separate valuation for minerals he gets no benefit from the original capital value when afterwards the minerals come to be developed. If he wishes to get his exemption he will declare the value of his minerals when the valuation comes to be made on 30th April, 1909. Of course, as to the date of that valuation one cannot describe it as an exact point of time; no doubt there will be some considerable time, and we have already discussed this matter on the antecedent clauses. Whenever that time comes he will either say he has mineral ground or he will say nothing about it. If he says nothing about minerals, then he does not secure himself the exemption if afterwards he discovers minerals and begins to work them. If he says, "I have minerals," then they will be taken into account, and for the purposes of valuation will be separately treated. The minerals will be treated as if they were a separate class, and they in each case will each take its own course. Of course, the interest of the mineral owner will be to declare minerals if he has them. He will be checked from putting on a very high original value by the Commissioners, but if he desires to have the original capital value fixed, of course he will move the Commissioners to that effect. If he does not desire to have the capital value fixed, having regard to the Death Duties, then the calculation will be made elsewhere.

Mr. PRETYMAN

So far as I understand the case I think it is quite clear, and from what the hon. and learned Gentleman and the Chancellor of the Exchequer have said, as far as I am concerned, their intention is perfectly clear. The point I did not gather, and which I see now, is that this Clause is to be referred back to the original increment value clauses, and the value which is referred to here is part of the valuation which we have passed in Committee on the other clauses. I mean the general clauses deal with the general value of the land, and this is only a special method of valuation which refers back to the valuation on the Increment Value Duty at the beginning of the first part of this Bill. That is so, is it not?

Sir W. ROBSON

Yes, as I have defined it.

Mr. PRETYMAN

Then that clears up that point. I should like, if I may, to make one or two comments upon it. The learned Attorney-General tells us that it would only apply to a very small portion of the minerals, and that, I think, gives away the whole case for the tax. The hon. and learned Gentleman also told us that it would not apply to any minerals which were being worked, and as to them there will be an Amendment later, of which I have given the Chancellor of the Exchequer notice, which deals with that point, because it is quite obvious that the principle of Increment Value Duty cannot equitably apply to the lessor who has already parted with his rights before 30th April, 1909, to a lessee for a fixed sum. That does appear to me to be a principle which the Committee cannot equitably depart from. A man has parted with his property on definite terms already agreed to, the rate at which that property is going to be worked has entirely passed out of his hands, and he has no further control over it. The whole of that has been handed over to the existing lessee and it cannot increase in value to the lessor, and how can there be an increment to him when he has already sold his rights under a mineral lease? The word "lease" in the ordinary sense of the term does not apply to minerals at all. It is merely a popular phrase, and it is not a lease in any proper sense of the word; it is an absolute sale out-and-out over a period of years for the whole of the minerals in a certain area of land, and when a man grants a mining lease it is just as much a definite sale of minerals under that land as when a man sells a piece of land. [HON. MEMBERS: "No."] Yes, of the minerals qua minerals, although there are certain differences due to the character of the article. He may not get minerals, and if he does not that is his look-out. If he does not get minerals there is no duty, but so far as any minerals which the lessee does get the duty is to be paid out of them. Where minerals are got the duty is paid, and I am quite sure that it will not be maintained for a moment that, having regard to those minerals which are got, there has been anything but an absolute sale from the so-called lessor to the so-called lessee.

Mr. MARKHAM

I think the hon. Member is quite wrong in that assumption. There may be cases where the owner may receive very large sums of money where no coal is got at all.

Mr. PRETYMAN

There might be a dead rent on minerals which are to be gotten, but I believe it is universal that where there is a dead rent overpaying the amount of minerals obtained the sum may be made up in subsequent years. If only £1,500 worth of minerals are got, and there is a dead rent of £2,000, the balance can be made up in subsequent years.

Mr. MARKHAM

In South Wales the general practice is six years to recover, in the Midlands over the whole of the lease, in the North of England a short time, and in Scotland a shorter time.

Mr. ARNOLD LUPTON

It is three years in South Wales in many cases.

Mr. PRETYMAN

That is merely a detail; the point is this in regard to the whole question as to minerals to be sold and gotten that where there is a dead rent, and it is in excess of the minerals gotten, the amount can be made up under a fair bargain. Of course there are cases where the lessee or purchaser has made a bad bargain—nothing more nor less—and you may come upon any vendor or seller and tax him upon the ground that the lessee happens to make a bad bargain. That does not touch my argument one way or another. The point is this: that an actual sale has taken place of minerals, of course at the risk of the purchaser, from the vendors or their agents, and under the name of a lease the so-called lessee buys the minerals, and the lessor has parted with them, and has no interest in them whatever, and no power of saying how they shall be worked. How can there be increment in such a case?

Mr. LUPTON

He has powers of regulating the working.

Mr. PRETYMAN

There are no doubt certain minor regulations which may be made, but at present it is in the interest of the vendor, as well as of the purchaser, that these minerals shall be worked as soon as possible. Will any hon. Member tell me of any condition inserted in a mining lease in which the lessee has been limited in the amount which he may work in the year? No one can tell me of such a case. What is going to happen under this tax, taking the Chancellor of the Exchequer's own case, is clearly that you are putting an immense handicap on the people who are going to take minerals in future, and the owner of those minerals is going to have an interest in asking that they should not work more rapidly than will enable him to avoid the payment of the Increment Value Duty. Another point will arise on that. Does the owner have the same interest as he had before in getting his minerals worked as rapidly as he can? What he will do and what it will be the owners' interest to do will be to say to the lessee, "The annual equivalent of these minerals is £1,000, so long as you do not work over that I shall have to pay no Increment Value Duty, and, if you do go over that, you will have to pay me some portion of that duty which I shall have to pay." I think when the hon. Member for the Mansfield Division (Mr. Markham) takes his next mineral lease, if this duty is passed, he will have to meet this. I do not say that the lessor will be able 60 extract the whole 20 per cent. from him, but he will be able to extract something, and that will depend upon the state of the market at the moment, how eager the vendor is to sell, and how eager the hon. Member is to buy, but there will be a tendency on the part of the owners or their agents to regulate the output so that the Increment Duty will not fall upon them. That is the view which is pressed upon me by one of the most capable men in the Kingdom in regard to these matters, and here the Government are giving a direct incentive —we do not put it higher than that—and making it to the interest of the vendor to take the course which I have suggested, and is that, I ask, to the advantage of the industry? Will that tend to the increase of the output of minerals, and will that increase labour? To my mind, it is a direct handicap and must act as such, and certainly those who are interested in minerals and who have negotiated with the Chancellor of the Exchequer understood that the Mineral Rights Duty was in substitution of all those fantastic duties which they could never understand. I do not accuse the Chancellor of the Exchequer of bad faith for a moment, but that was the understanding in the minds of those who have been negotiating these Mineral Duties. The Chancellor of the Exchequer has stated in this House that he has given up the Reversion Duty and the Undeveloped Land Duty. The Undeveloped Land Duty he could not collect from minerals because it is obviously impossible to value upon that basis.

Mr. LLOYD-GEORGE

That is not what I said. I said I would give up the Reversion Duty and the Increment Duty on existing mines.

Mr. PRETYMAN

The Undeveloped Land Duty has been transferred into this duty but it has been doubled, and it has been doubled, the Chancellor of the Exchequer says, in consideration of his having given up the increment value on minerals now worked. There could never be any Reversion Duty upon an expiring mineral lease.

Sir W. ROBSON

It by no means follows that when a mineral lease expires the minerals are all worked out. They may be left there with the machinery and valuable equipment.

Mr. PRETYMAN

I can hardly suppose that the Attorney-General will suggest that the minerals in the mine can be worth more at the end of the lease, having been partly worked out, than at the beginning.

Sir W. ROBSON

The question put was not whether they were worth more, but were worth enough to give a Reversion Duty.

Mr. PRETYMAN

The Reversion Duty is on the difference in value between the property at the end of the lease and the property at the beginning of the lease, and in order to get the Reversion Duty the Treasury will have to show that the value of the minerals in the mine is greater at the end of the lease than at the beginning. I can imagine such a case, but it must amount to almost nothing. Surely the Treasury cannot attach much value to that. The giving up of Reversion Duty cannot surely be considered as a boon. In order to assume that, you have to assume that the lessee will take the minerals in the mine for such a short period and on such terms that he is going to leave a greater value of minerals in the mine, including the value of his plant and shaft, at the end of his lease than he has got out during the whole currency of his lease. That is really inconceivable. You cannot have a more businesslike, capable body of men than mining lessees, and I cannot imagine that any mining lessee will tell us that that is the principle on which he works a mining lease.

Mr. J. S. AINSWORTH

It is often the case that, while you are working a mine, you go on and open it up, and at the end of your lease there is a much larger amount of minerals opened and ready for working than at the commencement, and that adds to the value of the mine. It is frequently the case that a mine is worth a great deal more at the end of the lease.

Mr. PRETYMAN

I am certain the hon. Member's facts are accurate. The Reversion Duty, however, is on the lease, and not on the mine. In the particular case that the hon. Member states, the Reversion Duty will be charged not upon the value of the mine or the actual minerals which are discovered after the first lease has been worked, but on the value of the property actually the subject of the first lease. Does the hon. Member suggest that the particular minerals which were the subject of the first lease, having been worked out, would be worth more at the end of the lease than at the beginning, or does he suggest that if the other minerals were included in the lease the lessee would leave them there for the lessor?

Mr. AINSWORTH

You can only work minerals at a certain rate, and it is very often the case that a larger extent of minerals is opened up and prepared for output at the end of a lease than at the commencement, and if a man spends money in opening up a colliery that is probably what will happen. Take the position of the lessor. He will have a largely developed mine which has been opened up well, which he can, of course, let on better terms for himself. He is in a much more satisfactory position for making a good bargain for himself at the end of the lease.

Mr. PRETYMAN

I agree with that, but I do not think it touches the point. The point was whether Reversion Duty would be payable, and in such a case as the hon. Member has suggested there would be no Reversion Duty.

Mr. AINSWORTH

It is exactly the same case as that of a ground landlord who, at the end of the 50 or 60 years for which the land has been let on a building lease, finds himself the owner not only of the site but of the site with a house on it. So at the end of the first lease, instead of being the owner of an undeveloped royalty, the lessor is the owner of the developed mine.

Mr. PRETYMAN

That may be morally the case, but it would not be the fact. Reversion Duty would not be payable for this very simple reason, that in the first case what fell in for the landlord in the case of a house would be the actual subject of the original lease increased in value, therefore Reversion Duty would be payable upon this increased value at the end of the lease as compared with its value at the beginning. What falls in in the case of a mine is not the subject of the original lease. What was leased in the original lease is a certain proportion of the minerals in that mine, and in opening up those minerals other minerals are discovered, but they were not the subject of the lease. I agree that the position of the lessor would be greatly improved, but he would not have to pay Reversion Duty. It is my opinion that the Reversion Duty would at any rate be extremely small which has been given away, and the Increment Value Duty has been surrendered already on mines which are being worked, and it is now proposed to adopt this extremely complicated and difficult method of charging it only on mines which are to be opened up in the future. I think it is a very unnecessary proceeding. According to the Attorney-General it is going to produce very little.

Sir W. ROBSON

I have not said so.

Mr. PRETYMAN

The hon. and learned Gentleman said there would be very few cases.

Sir W. ROBSON

No, I was merely dealing with them in comparison with mines which are being worked.

Mr. PRETYMAN

If there are a great many cases it will be a very great hardship, and it will certainly act as a factor in preventing people from developing their minerals, and a very considerable factor. I do not say it will prevent a man who has very valuable minerals. He would naturally like to develop them, and receive a rental for them, but you cannot look upon this tax by itself. A man who is going to develop minerals will look over the whole field, and will ask himself what he is going to get by developing the minerals on the one hand, and what disability and liabilities he will incur on the other. On the one hand he will get his mineral rents, but he will have to pay upon them Death Duties, Income Tax, and this new Increment Value Duty, which will amount in itself to 4s. in the £. There must be a very large area of land where the owners are not at all sure they have minerals. If they only think they have minerals it will be a good number of years before they can be worked at all, and it lies under their own control whether these minerals are ever worked or not, and until they can see that they are really going to get some advantage out of it they will not have their property spoilt. If they declare the minerals they might have to pay heavy Death Duties upon sums which they have never received, and later on if they do declare them they will have to pay 4s. in the £ on whatever is received as Increment Value Duty. In addition to that they will be liable to Death Duties and to a 1s. 2d. or 1s. 8d. Income Tax, and on the whole, in a good many cases, the man who would develop minerals now will not develop minerals in future. It must act as a deterrent. When a man is considering whether he will work minerals or not his mind is on the balance, and he has certain considerations in one scale and certain considerations in the other. You are putting into the scale against the working of the minerals a very considerable weight which is going, to my mind, to do a great deal more to check the development of the mineral industry than it is going to bring to the Exchequer, and in that way it will lose the Exchequer more revenue. You cannot have all your taxes over and over again on the same money, and if, by putting this tax in one form, you are checking the industry, you are by that very means reducing the yield of other taxes which the profits of that industry would pay, and you are so injuring the Exchequer as well as the trade and industry of the country. I believe, from the point of view both of industry and of the Exchequer itself, the tax is a very unwise one, and the Chancellor of the Exchequer will be very wise to drop it.

Mr. LLOYD-GEORGE

The hon. and gallant Gentleman is so very well informed about the development of agricultural land and building land—in fact, there is no Member in the House who knows more about it, and no one better entitled to speak on these subjects—that really I think the only excuse for the speech he has delivered on mineral royalties is that he knows absolutely nothing about mines and quarries, otherwise I cannot imagine an hon. Member of his ability and genius making some of the observations he has made. He has said this tax is going to prevent these people from developing their mines. Here you have property which for agricultural purposes, as a rule, is almost worthless. It is generally poor hill country in Wales at from 10s. to 12s. an acre. But let us assume that it is rich agricultural land worth £2 an acre. The owner will get for 1,000 acres of that land, let us say, about £2,000. If, on the other hand, it is in our part of the country, he gets something like £700 or £800. He has got minerals underneath, and someone comes and says, "I am prepared to spend a quarter of a million in opening up this property. I shall probably be able to raise coal which will give you £5,000, £10,000, or perhaps £60,000." But the landlord says, "I would rather have my £800 a year as an agricultural landlord than £48,000 a year because I have to pay something to the State." If the hon. and gallant Gentleman owned mineral properties I do not think that is the view he would take of their development. Let us take other cases, which show how really absurd the argument of the hon. and gallant Gentleman is. He is a keen business man, and the proposition he puts is this: Supposing that you spread the production of the coal over 50 years, and if you say to a man that he must not put out more than 40,000 tons a year he escapes duty altogether. Who is going to do it? Is it the owner who is going to say to a man that he will give him a lease, but that he will not allow him to produce more than 40,000 tons a year? Can he find any man in the country who would be prepared to sink shafts, put up machinery, lay down railways, and incur the whole of the equipment cost, which might run to £250,000 or £500,000, and all for the privilege of raising at the outside 40,000 tons a year and not a grain beyond that? I think I have shown to the hon. and gallant Gentleman how grotesque an argument of that kind is.

Mr. PRETYMAN

May I protest against the Chancellor of the Exchequer's perpetual parodies of the arguments used on this side of the House? What I said was that if the royalties were more than £1,000 the landowner would have to pay in respect of Increment Value Duty, and from that point of view it would be his interest to limit the output of the minerals, but that from the general point of view it would be his interest to have a large output. That would induce him to take the action I suggested, and to say to the lessee, "If you put out more than 40,000 tons, you will have to pay something of the Increment Value Duty."

Mr. LLOYD-GEORGE

The hon. and gallant Gentleman said that this tax will act as a factor to prevent the de-development of minerals properties. That is a point which he elaborated at great length and endeavoured to drive home. He said that if the lessee simply spread the output over 50 years, there would be nothing to pay. No one would take a mine on such a condition, for the simple reason that it would not pay him. What is the royalty? Sixpence. Is the lessee going to do what is suggested in order that the landowner may avoid a tax of one-fifth of sixpence? To produce only 40,000 tons would not pay the winding alone. Really the hon. and gallant Gentleman does not know enough about minerals and royalties to discuss the economic effect of this tax. If he would pay a casual visit to the mining estates and ascertain the real facts, he would never embark in criticism of this ludicrously irrelevant kind. His proposal is one which no business man would say should carry the weight of a feather with anyone who is supporting the imposition of this duty.

Mr. BALFOUR

The Chancellor of the Exchequer has reproached my hon. and gallant Friend (Mr. Pretyman) for having a more limited acquaintance with mining than he has with urban land development and agriculture. That may be true. I am afraid that if my hon. and gallant Friend is ignorant, I am still more ignorant. I have not even the qualification which the right hon. Gentleman kindly attributed to my hon. and gallant Friend of being a business man. I am afraid I cannot claim any such title. I have listened to the Debate, and I must say frankly that I think the right hon. Gentleman has not met my hon. Friend's point. What he has done is to take the extreme case which was suggested, I admit, by my hon. Friend, and to say to him that the motive in that case for not raising minerals would not be sufficient. That really is the whole of his argument. It is no answer to the point raised by my hon. Friend. What the Chancellor of the Exchequer has got to answer are the two points which have been raised this afternoon. One was raised by my hon. and gallant Friend (Mr. Pretyman), and the other by my hon. and learned Friend behind me (Mr. Salter). An answer was promised by the right hon. Gentleman, but no answer has yet been given. The two points are: You are here imposing a tax which, in so far as it acts as a motive at all, win act as a motive against the rapid development of minerals, and will be a motive which will enable the lessor of minerals to throw part of the burden of the tax on the lessee, which I do not believe to be the object of the Government. My hon. Friend's argument was somewhat different. He pointed out that actually the same mine leased by the same lessees, and tinder the same conditions, would pay a totally different tax according as it was worked regularly or irregularly, fast or slow. Why should it pay an entirely different contribution to the Exchequer when worked in a different fashion by people who do not have to pay the tax? You might have said to the lessee, "If you choose to work the property in this way you must take the risk yourself." I think that would be a wise provision.

Mr. LLOYD-GEORGE

The proposition which the right hon. Gentleman lays down is that the contribution will be different according as the mine is worked regularly or irregularly. Will he explain how that arises?

Mr. BALFOUR

I am afraid that my knowledge of the subject is not so intimate as that of others who have taken part in the Debate. My hon. Friend's argument was this: There is an Increment Duty charged on the difference between what a man gets from a mine as compared with some initial rent called the annual equivalent, which is arrived at by one of those hypothetical calculations with which we have become so extremely familiar in this Bill. There is a supposed annual equivalent of the value, and if in any year the value exceeds that data line it count's as increment on which taxation has to be paid. If the initial value was £1,000, and if nothing more than that sum was ever got, the owner of the mine would never pay the tax at all. Remember the property is precisely the same, and he ultimately gets the same value for it. It is a property for which the Government admit the owner will ultimately get the same value in cash. If the annual value does not reach £1,000 he pays no tax, but if in the second year he gets £3,000 he suddenly finds himself liable to a heavy tax, and if in the following year the value goes back to £1,000, he pays no tax. In this way you find that the sum paid for taxation on the same property would be different if it be worked regularly or irregularly, quickly or slowly. I never heard of a tax being laid on in this manner. Why should a man who has parted with his property be liable for a larger or a smaller tax because, having let that property, somebody else for his own purpose, or possibly by the hard necessity of his own position, works the mine sometimes slowly and sometimes fast, according as he chooses to work slowly or fast? That is the point which was put to the Chancellor of the Exchequer. I hope I have made it clear. It is no reply, I venture to say, for the Chancellor of the Exchequer to take the extreme case which was put by my hon. and gallant Friend and say that it is a case which cannot occur, because the motive of the lessee would prevent it from occurring, and to dismiss the whole argument with a few gibes of that description. The case is far more substantial than the Chancellor of the Exchequer seems to think, and so far he has made no attempt to reply to it.

Mr. A. B. MARKHAM

I think the Leader of the Opposition lost sight of the Super-tax on incomes. You might as well say that it is not for a man's advantage to have £6,000 if by keeping his income under £5,000 a year he will be able to escape the Super-tax. The same argument applies in that case as in the case of the limited output of the mine. When it is said that a man's income is within his own control, I would point out that it is within the power of a landlord to say to a lessee, "You must work the minerals as rapidly as possible." In most mining leases there is a provision as to the way in which the minerals are to be worked.

Mr. BALFOUR

I am sure the hon. Member opposite knows far more than I do on the subject of mining. But surely, when coal is worked slowly, it is the same thing to the owner, except in so far as the loss of interest is concerned.

Mr. MARKHAM

I think that in many cases the burden of the Increment Duty will fall upon the lessees, who will put it upon the general public. That will entirely depend on the feeling of the market at the particular moment. If several men have coal to sell, and if several people require it, the sellers will be able to make better conditions. The landlord may say to the lessee, "You must pay all the Lloyd-George taxes if you wish to get the mining lease, or to get an extension of your lease." That undoubtedly will be so. Whether the lessor will be able to get a higher price depends entirely on the state of the market, and it is very doubtful whether the landlord can get that extra amount. The hon. Member has stated that this Bill would tend to be a handicap on rapid working, and would be a hindrance to the trade. I can only speak for myself. I do not know a single case where any man would refuse to take a lease of minerals on account of a tax of a penny a ton. There is no case within my knowledge of where anyone has broken off a negotiation on account of a tax of a penny. The Bill provides that no Increment Duty shall be paid in the case of mines which were being worked on 30th April this year. There are no doubt many oases where mines or minerals were leased prior to 30th April, but which are not being worked. In those cases, according to the Bill as it at present stands, the lessor will have to pay the Increment Duties because those mines are not being worked. In the Definition Clause, which is a very curious Clause, certain mines within a radius of a certain rent, as far as I understand, are excluded, and will not pay the Increment Duty. There are many cases in this country where a mine has a large area, and in these large areas of coal there may be sandwiched in certain areas of coal which cannot be worked for 20 or 30 years. The value of those minerals is very small, but when they are reached the increment then will become a reality, and, of course, the landlord will then begin to receive large sums by way of royalties in respect of this coal, and increment will accrue. But under the Bill he does not pay duty, save on the mines which were worked prior to 30th April.

The hon. Member seemed to think that the royalty would only be payable on coal worked. He is quite wrong in that. I gave the case of the Duke of Newcastle. What I said was that there was a very large mine on the Duke of Newcastle's estate, and the minimum rents in respect of that area amounted to £10,000 a year. A hundred thousand pounds represents the sum the landlord has received over and above what he would have been paid if the royalty had been taken on a poundage royalty. I do not know what the rent is in this particular case, but if you take it at 6d. a ton then the mineral rent is £10,000 a year, and they continue to pay an additional 6d. for every additional ton. I say that in this case the landlord has received £100,000 over and above what would be represented by the amount of coal raised. I think I am quite right in saying that 50 per cent. of all the mining leases in this country are overpaid in their royalty. In my experience of mining leases I do not know one case of a colliery owner with overpaid royalties who has not paid for more coal that he has actually been able to get, because the lease always reserves a higher rent. It reserves the maximum rackrent he is able to get.

But the point I want to raise now is an entirely different one, and one which was not mentioned by the Chancellor. When a lease is taken it is in most cases taken for a particular seam. When that seam is worked out after the lease expires, the landlord has the shaft and the rights of purchasing the machinery, and there is a certain amount of Increment Value, not a very large one, which arises in respect of this. What I want to know now is what does "minerals" mean under this Bill? I do not want to be pulled up by the Chairman and to be told that it is a matter for the Definition Clause. But I wish to know, Does it mean all seams of coal or only one particular seam of coal comprised in a mining lease? Are all the others excluded? I do not know any case in my experience where there is not a number of seams. You will in all cases have several seams. All these secondary seams which are being worked to-day had no value 40 years ago; and it is only according as the seams above are worked out that the lower seams come into the market. When this valuation comes to be taken, am I to understand that in all the mines in England a valuation will have to be made for seams of all kinds in those mines which are not under leases, because I think it naturally follows that if the Chancellor does not do that he will lose a great deal of the tax? There are some cases, but not many, where the lessee has all the seams. In Wales it is a general practice to lease most of the seams, but in the whole of the Midlands, in Warwickshire, Derbyshire, Nottinghamshire, and Staffordshire, it is the specific seams which have to be leased. Perhaps a second seam is included in the lease. But all these other seams are excluded. In many cases there are as many as 10 and 15 seams of coal under the seam areas which have been let and are worked by the owners. Are all these cases to be valued—because it is impossible to put a value on any of these seams—and, if so, is each particular seam going to be valued?

How can you value all these different seams when you do not know the distances? Will the owners of the minerals be entitled to say, "I am going to assume the value of the coal for a particular seam," because it must be for a particular seam? He will give a reason in many cases by saying, "There will be a seam of coal underlying my property which, according to mining experience and according to what I have been able to gather from adjoining proprietors, should have a certain amount of coal there." What I want to know is whether the owner of the minerals will be entitled to say, "For the purpose of my valuation I claim that there is a seam of coal lying 300 or 400 yards below the present seam and I want a valuation made?" Has the Government to value four or five different seams of coal below and put a certain specific value on each? And if any of those seams do not prove valuable, the landlord may say, "I will not put a valuation on it at all." But if he does, will he be taxed in respect of the particular seam of coal which he has valued and paid Death Duties on, which, if the seam does not prove to exist, he will have paid wrongly to the State? Because, if so, I do not think you have a right to tax a man on increment value on a seam of coal which does not prove. There are so many different seams of coal underlying all properties that I would like to know whether, after the passing of this Bill, all the seams in the United Kingdom are to have a valuation made of them except the ones under lease? It is a very important point, which perhaps the Chancellor will reply to when he has considered the matter. So far as the quantity of the minerals leased is concerned, I think there is a certain mistake about it. I was not in the House at the time, but I understand that there was a statement made that the bulk of the minerals of this country were leased. I do not think that of the various seams of coal 1 per cent. of the minerals of this country are leased; and probably 99 per cent. of the minerals of the country have yet to be leased, because only one seam out of 10 or 20 is comprised in the ordinary mining lease over the whole of the United Kingdom. I should be much obliged to the Chancellor if he would answer these points which I put to him in respect of the new valuation.

Mr. F. W. LAMBTON

I have some difficulty in replying to the hon. Member opposite, because my knowledge is only secondhand, but if the Committee will remember that the hon. Member only represents the coal mining industry in one part of the country, and that the practice differs in different parts of the country, they will not attach so much weight to his words as they otherwise would do. He says that the seams only are let in mining leases. With confidence I can say that in the counties of Durham and Northumberland all the coal is let in mining leases, and the remarks of the hon. Member must not be taken to apply in these counties, which produce a large quantity of the coal of this country. He said that most royalty owners paid more in royalties than they received in coal.

Mr. MARKHAM

I did not say so.

Mr. LAMBTON

I thought he did say that very often they did pay more than they received.

Mr. MARKHAM

What I said was that I know of cases where the lessee has overpaid dead rents in respect of mining leases for more coal than was produced.

5.0 P.M.

Mr. LAMBTON

In the counties of Durham and Northumberland the dead rents are always merged in the royalty, and it is quite the exception for the lessee to pay for more coal than he has got. We have also had remarks from hon. Friends on this side of the House about the working of coal which are hardly practicable. The output of coal does not depend upon working fast or upon working slow. The lessee takes into consideration in the working of his mine what shall be the output when the price of coal is low. The output depends upon that and other considerations, and it is on these considerations that depends whether a colliery is worked fast or slow. The right hon. Gentleman the Attorney-General told us that all the minerals of the country were to be valued, and that it would be in the interests of the owners of minerals to return a high value. He said it did not matter about the Death Duties.

Sir W. ROBSON

No, I did not say that.

Mr. LAMBTON

The hon. and learned Gentleman said that it would be to the advantage of the proprietor to return a high value for his minerals. I want to ask him about quarries. I have myself a property which I should return, if I valued it for minerals, as nil. There are some stone quarries which may be used, and I have myself occasionally used them, for the purpose of obtaining stone to build farmhouses or cottages on the estate. I want to ask the Attorney-General whether, when I open the quarry for the purpose of obtaining stone for the purpose of building these farmhouses and cottages, I shall have to pay 20 per cent. to the State for working the quarry? Under this Clause I am not sure that would not be the case. For the Chancellor of the Exchequer to get up and say that this tax will not be a hardship on anybody in this country would surely be a mistake. Twenty per cent. is taken by the State from the proprietor who chooses to work his own minerals.

Mr. LLOYD-GEORGE

Twenty per cent. on what?

Mr. LAMBTON

Twenty per cent. on the value, I suppose. The proprietor who works his own minerals is not exempt under this Clause, and the right hon. Gentleman acknowledges that he is in exactly the same position as the lessee, therefore any man who works a quarry or any other mineral, whether for sale or for the purpose of his own estate, will have 20 per cent. to pay to the State. That will be a handicap on the production and development of minerals in this country. I maintain that under this Increment Value Duty the man who works his own minerals, whether for sale or for the purposes of his estate, will have to pay 20 per cent. to the State.

Mr. LAURENCE HARDY

I wish to ask the Chancellor of the Exchequer one or two questions on matters which seem to be in doubt, especially that which relates to the Reversion Duty. As far as everybody understood his statement, the Reversion Duty was given up altogether; there was to be no charge for Reversion Duty in future in connection with this tax, unless, of course, Parliament decided otherwise. But on reading the report of the Chancellor of the Exchequer's speech the other night, I saw that he said that it was only in respect of existing leases the Government had decided to eliminate the provision with regard to Reversion Duty. I only want it made quite clear whether the Reversion Duty has been given up entirely or whether it is intended to apply to leases which could be included in future or leases which have not been at present worked. It was generally understood that the Reversion Duty was entirely given up, and I would be glad to have an answer on that question. With reference to the much debated question of the annual equivalent value, I would like it to be made quite clear. It is a very difficult subject. Taking the case the learned Attorney-General gave us earlier in the day, supposing that the owner does not declare any value at the present time in connection with the valuation when a new lease is made, will the return of the annual value be nothing? It really is not generally understood that through all future leases the actual annual equivalent value, where no value has been put on minerals, shall be taken as nothing, and, therefore, be exempt from the one-fifth payment to the State. If that be so, I think that we will have to consider all those cases which were mentioned yesterday, because it is quite clear now, from the fact that the Government have excluded from Mineral Rights Duty certain minerals, that in other clauses they will be treated as minerals. The fact of stating an exclusion from one clause only means that they are included in other clauses dealing with minerals. Therefore we have the curious fact that whereas the Chancellor of the Exchequer gives away at once on a present lease, say like chalk or the clay industry, which are imperilled by the tax, the one-twentieth, yet they do not admit that in future they imperil those industries by the tax of one-fifth. We were rather led astray by the illustration given by the right hon. Gentleman when he took £80,000; we have to take smaller cases, and not cases of such serious amount, and in regard to future leases we have to consider that one-fifth of the whole period of that lease will have to be given as tax to the State. In these circumstances I think many will consider in regard to future contracts to be arranged between the lessor and the lessee, that there will be a great fear in the industries concerned, especially those put forward last night, namely, that there will undoubtedly be a burden thrown on industries in connection with the tax that I mentioned of 20 per cent.

I should like to get some assurance from the Government as to the exact meaning of "a mine being worked." I will take a case which is known to me in the county of Kent, where I live. Some people have doubt about the collieries in Kent. I am not going to give an opinion upon them, but undoubtedly the fact is that a very large amount of money has been spent in developing the new coalfield. That coalfield has not been worked in the sense that minerals have been got out of it at the present time, but development has been going on, the landlords for some years have made their bargains as to their rents, the whole machinery is being developed, and it may be only a month or two before coal is going to be got, and it seems to me rather a hard thing that you are to put this new tax upon these contracts already made. We should like to have an explanation as to bow far this provision carries us in connection with some of the cases I have mentioned, and it would be satisfactory to have it clearly laid down.

Sir JOHN RANDLES

I was glad to hear the hon. Member for Mansfield (Mr. Markham) in his interesting speech agree that the tax would fall on industry. He went on to say that in the case of coal it only amounted to 1d. The Debate, so far as it has gone, has been in terms of coal, but coal is not by any means the only mineral which has got to carry the burden of this tax. I myself would suggest that it would be of advantage, perhaps, to think about it in terms of iron ore, on which the burden would be very much more onerous, in consequence of the tax that may be imposed on royalties. As a steel manufacturer using a very large amount of coal, and raising both coal and iron ore, I find, calculating as well as I can, that the tax on my manufacture would be about eight times as much in respect of the iron ore as it is in respect of the coal that we use; so that you must multiply by about eight when dealing in terms of iron ore with the tax which that mineral will bear compared with that borne by coal. Clearly, the tax in the case of iron ore becomes very serious, because instead of being 1d. it may be very considerably more than 1d. On hematite ores in this country the royalty ranges from 1s. 6d. to 2s. a ton, and up to 4s. and 5s., and even more, where the market price is very high. Therefore, we have to consider this question from the point of view of the burden which it imposes. I entirely agree with the Member for Mansfield in his suggestion that the lessee will have to pay, particularly in the case of new leases, and in that way it will be a burden, as the Royalty Tax must always be, in my opinion, upon industries. This particular form of tax seems to me to be very unsatisfactory in relation to the article of which I am speaking, iron ore. It is not like coal, which is found in seams, with considerable regularity, and a great amount of certainty, after boring operations have been conducted. Iron ore is found in veins and in pockets. It may very well be that after working a lean mine for a longish period you may come to a pocket of ore which will give an enormous return in a short period. That is the reward which the royalty owner and the lessee and those who are interested in the working of the mine occasionally get. But as against that there are long periods of lean working.

The Chancellor of the Exchequer at the outset of the discussion this afternoon took some trouble to make clear to us how the tax would operate. I think so far as he went he was clear. I quite understand that if there were an out and out sale of a property, say, of £12,500, for £15,000 as the capital value, it would show exactly what the increment value would be. But in the case of minerals, where the charge is spread over some years, I do not think that the method is satisfactory. Where you have a mineral such as I have been describing, and which is found perhaps in large quantities for a time, and then for a period in small quantities or even none at all, a considerable further expenditure of money is needed, so that this method of levying the tax—which is so burdensome so far as its amount is concerned—in certain cases, at any rate, is not a good system, and almost amounts to a gamble as to what will have to be paid, or what the burden may be in any given year. I have arbitrarily put down for my own satisfaction a set of figures as to possible payments over a period of 12 years. Take the figures of the Chancellor of the Exchequer at £1,000 a year, which he bases on the site value. Supposing that next year you had £2,000, then another £2,000, then another £1,000, you get £500; then you get nothing at all, then it only carries £500 up to £2,000, then £2,000 and £1,000, taking the figures arbitrarily like that it might be rendered so that in the increment years you would have paid on an increment of £5,000, when you really should have only paid, if you had taken it over an average of years on £3,000, that is 20 per cent. of excess, taking as the basis the period of your lease, more than you should have paid. That arises owing to the system by which the tax is levied, and you have to pay £400 which you would not have paid except by reason of this particular method of taxation. Therefore, I think the system is not a good one, but it is perhaps capable of being rectified. If the same system were adopted in reference to the collection of this tax as is adopted in the payment of dead rent where a royalty merged into dead rent is recoverable by the working of what is called "shorts" in an absolute period. If the Government could make it that a person paying for a period of 12½ years only paid at the end of the 12½ years on the average increment spread over that there might be some alleviation, at any rate, of the hardship based on these figures. I think it is quite clear, owing to the method in which this tax is levied, it may very well be the case that the lessee will have paid more royalty than the terms that the Government have laid down prescribed. That is to say, he will have paid on more increment than he has really been entitled to pay on, and he ought in all fairness to have some consideration in that respect. With regard to where this extra burden will go, that is with me a very strong point. I feel very strongly that it must find its way to the backs of the worker. I object strongly to the tax, but I think that in these respects it might be improved, and I hope that the Government will see, in these respects if not in others, their way to meet the request I put before them.

Mr. NEWDEGATE

I wish to ask a question as to a point which is not clear to a good many people interested in minerals outside the House, and which, I think, is not clear to a good many Members in the House. Sub-section (2) states, "Increment Value Duty shall not be charged in the case of any minerals which were on 30th day of April, 1909, being worked, whether by the proprietor…" and Sub-section (3) provides "Increment Value Duty in respect of the increment value of minerals which are comprised in a mining lease or are being worked. …" The point I want to put is this, where there are a number of properties lumped together in order to form a mineral area, and where working is being done on one property, does it mean only that property on which the actual working is taking place should be exempted from Mineral Duty because the working was being done before the 30th April in this year, or does it apply to all the various properties which are included in the mining lease. I would point out, unless it is guaranteed to the people who work the minerals, whether the properties are large or small, that they will find it will not pay them to sink the cash and develop the minerals.

Sir W. ROBSON

I think, on the whole, the Government may congratulate itself that the criticisms which have been directed against this somewhat novel tax, and somewhat novel machinery, have been such as meet with no great difficulty. The points put by the right hon. Gentleman the Leader of the Opposition, though ingenious points, I think have already been answered in substance—indeed, if I may say so, with great respect to him, the answer to them was fairly obvious to those who followed the speech. He complained that the lessor would have to pay this tax according to the regularity of the working on behalf of the lessee. He said the lessor has parted with his property and he cannot control the working, that it is another person who controls the working, but that this tax is made dependent on the working, and therefore this burden is made dependant on the acts of a person over whom he has no control. That seemed to be a plausible objection, until one considers the case of the Income Tax which was put by my hon. Friend the Member for Mansfield (Mr. Markham). Every person whose income depends on investments he has made in commercial companies has put his money where he has no immediate or individual control. His income depends upon the vigilance and skill and good fortune with which other persons use his capital in order that they may pay from dividends, and he pays his Income Tax upon the regularity or irregularity, on the skill or stupidity, upon the good or ill-fortune of the persons to whom he has entrusted the use of his property. That is exactly the same case. There is nothing at all abnormal about it. It differs only in this respect, that the owner of the royalty has a much more effective and much more direct control over the lessee to whom he has permitted the use of his property than the ordinary investor has over the director to whom he has entrusted his money.

The right hon. Gentleman went further, and said that we now made it the interest of the lessor in some cases to limit the output in order to make his annual profit small. That I venture to say is an inconceivable case in practice, though it is not an inconceivable case in argument. It is like so many of the cases which seem powerful in debate, but which are never heard of again once the debate closes. It is a case which would be very unwelcome to the lessee. No lessee would endure such restriction of working, and certainly it would not be profitable to the lessor. He would be a very foolish person indeed if he said to the lessee, "I do not want you to work the property to its utmost capacity. I do not want you to utilise your means of output and production as economically and as thoroughly as you ought, because it would give me too much this year, and I would have an income in excess of my original capital value, and therefore I would have to pay Increment Duty. Do not work it this year; work it, maybe, five or ten years hence." What a foolish speculation on the part of the lessor! He not only sterilises a large part of the lessee's efforts, but he puts himself at the mercy of the market. Of course, there is a chance that the market may go up, and that the trade may be more profitable ten years hence, but that is a chance, while there is the certainty on the other hand of the year under consideration. He will certainly prefer to have the coal sold when he knows there is a demand than to keep it back on a very speculative chance, and for a time when there might be a less amount. So that the case, though controversially good, is a case which in practice need be scarcely considered at all. The hon. Member for the Ashford Division (Mr. Laurence Hardy) asked whether the Reversion Duty was absolutely given up. One can only refer to the words which are within the Clause, and which are unconditional. They are, "No Reversion Duty shall be charged on the determination of a mining lease."

There was a good deal of discussion as to whether we have really given up any thing in giving up Reversion Duty. It was pointed out in the case of a mineral property, if it is worked to the very best of its use, or if the lessee is thoroughly capable and tries to get out all the coal, that therefore there is very little chance of Increment Duty. But there might very well arise a case where that would not be so. Mineral leases, as the hon. Member knows well, run generally for a period of about 60 years. There were many mineral leases granted 60 years ago, and granted before the property was developed at all. The value actually then would be a small value; but take what happened in the South Wales coalfield within my own recollection. In the South Wales coalfields the best seam, and, I think, the uppermost seam, seemed to be No. 3 seam. I am speaking now of Merthyr district. It was the purest coal, an admirable steam coal, and thought at that time to be the best, but afterwards the 4-foot seam was discovered, and was found to be of the greatest possible value, so that South Wales coal rose in estimation all over the world, and there was a big demand for it for naval purposes. Those lower seams, which originally were not worth much, rose enormously in value. You may, therefore, very well have a lease which 60 years ago was of small value, but which may now be of very much more value, and with the coal not completely worked out, because there are many good seams yet to be developed, and with all the equipment standing there. Reversion Duty in a case like that would be a very valuable duty. So that I do not think in giving up Reversion Duty we are giving up nothing. We have in the case of the Royalty Duty put on a substantial burden, but in putting that duty on we are entitled to have it remembered that we have exempted the mineral royalty-owner from Reversion Duty, which falls upon surface owners when they deal with their property in a particular way. So I think the House ought not to take as quite correct the statement of the hon. and gallant Gentleman that we are to be thanked for nothing when we have given up the Reversion Duty. The next point put by the hon. Member for Ashford (Mr. L. Hardy) was whether, when no value has been put upon the minerals originally, is the Increment Tax all through the lease to be calculated as from zero. I think I dealt with that sufficiently at the beginning of the Debate.

A good deal has turned during the Debate upon the proper definition of the expression "being worked." I do not myself regard that expression as a highly satisfactory one, but I do not think we can entirely avoid its use in some cases. We might substitute for it the expression "comprised in a mining lease" when we are dealing with lessees, but we could not avoid the expression when dealing with collieries which are being worked by the owners themselves. But it is well worth consideration, especially when we look at the Amendments on the Paper, whether we might not amend Sub-section (2) in the way I will now read. Unless it should be thought that I am making a spontaneous suggestion, I may say that the matter has been carefully though out. Undoubtedly, in adopting the phraseology which I am about to suggest, we may be giving up something, though not much, in the way of the tax in certain rather rare cases, but we are gaining a great deal in simplicity of statement. If the Sub-section is amended in the way I suggest, it would read "Increment Value Duty shall not be charged in the case of any minerals which were on the 30th day of April, 1909, either comprised in a mining lease or being worked by the proprietor …" The somewhat vague expression "being worked" would then be confined to the one case in which we cannot avoid it, that is to say, the case of minerals being worked by the proprietor.

Mr. WATSON RUTHERFORD

Has the Attorney-General's attention been called to the description of this particular matter in the new Definition Clause in connection with the mineral provisions?

Sir W. ROBSON

I am, of course, quite familiar with that. I wish, however, to make this clear. It will be seen that I am using in regard to a large majority of cases a phraseology which is much easier for the purposes of administration. The hon. Member for Mansfield (Mr. Markham) has on the Paper several Amendments, nearly all of which would in substance be met by the changed phraseology. We will deal with that, however, when we come to consider the Amendments. This alteration will leave the definition of the somewhat vague phrase "being worked" applicable to a smaller number of cases in which it is much easier to apply. The moment you have to apply the test whether the minerals are comprised in a mining lease you avoid many difficulties. The hon. Member for Mansfield referred to certain difficulties in regard to the under seam, and so forth. All these difficulties are practically swept aside by the plain expression "comprised in a mining lease." If the hon. Member thinks not, we will deal with the point later on.

The hon. Member for Cockermouth (Sir J. Randles) said it would be difficult to apply the tax to minerals irregularly worked. I do not think there is any difficulty in such cases. The hon. Member may be of opinion that there is some unfairness in applying the tax in those cases, because no allowance is made for decree- ment. That is a matter for argument, but there is no administrative difficulty. The hardship which arises in these cases arises also in the case of Income Tax, where the State does not trouble itself about the years during which the struggling subject is perhaps making no income at all.

Sir J. RANDLES

There is the three years' average.

Sir W. ROBSON

I mean apart from the three years' average, which, after all, by no means meets the whole of the difficulty. The State only takes its tax on the profits. It makes no allowance except in the three years' average. The whole matter was fought out when we were dealing with the question of land values on the surface, and we declined in regard to the Increment Value Duty to make any allowance for decrement.

Sir J. RANDLES

It is the irregularity of working the minerals which differentiates this case from others, and is a reason why minerals should not be treated in the same way as land.

Sir W. ROBSON

I am sure the hon. Member has some good reason for his argument, though I confess I do not see it very clearly. A man sometimes makes a profit; then the State comes upon him. He sometimes makes no profit, and the State ignores him. He sometimes makes a loss, and the State pays no attention to it. The State is a fair-weather friend; it only visits a man when he is prosperous, and I do not think you can alter its habits in this regard. The duty is not one which can be said to be incapable of application by reason of the irregularity of working, although that irregularity may give rise to argument under other heads. The hon. Member for South-East Durham (Mr. Lambton) put the case of an owner who uses for the purpose of building cottages stone which he finds on his own property. He said, "There is an Owner who suddenly develops his mineral property: is he to pay 20 per cent. on the value of that stone?" Let us take the case exactly as it would work out in practice. The Committee must remember that the Bill does not put a tax on stone. We are not now, in the strict sense, taxing minerals; we are taxing the rental value of mineral rights. What would the owner have to pay in such a case as that put by the hon. Member? He has some stone on his property. No one will give him a penny for the privilege of working it. If it really has a rental value, if there is a market consisting of persons who are willing to give the owner a certain amount of money per annum for the privilege of working that stone, the owner will, of course, pay the tax on that rental value; but if there is no such market—and I think in the case put by the hon. Member one may assume that there would be no such market—the owner has merely taken out the stone; he has not really developed the mineral, he has not given the stone any particular rental value, and in all probability he will pay nothing at all.

Mr. LAMBTON

There is no certainty.

Sir W. ROBSON

I cannot promise absolute certainty. I have given certainty in regard to chalk, limestone, and a few other commodities, but stone is rather beyond the limits of our generosity. The particular case put may be one of extreme hardship, but I do not think the hon. Member need trouble much about it. I do not promise in regard to this tax or any other that it will not fall on some persons or in some circumstances with hardship. That would be disingenuous. But I contend that in a tax of this kind you have fewer cases of hardship than in the general run of taxes. You have a tax on an increment which is at the moment unvalued by the owner of the property. He can declare the present value of his mineral rights, and that present value is exempt from the taxation of this part of the Bill. It is only the increment upon that value that comes under taxation. Therefore one cannot say that a tax of this kind is likely to involve much hardship. It may involve some cases of inequality, like any other tax, and it may fall on one person under circumstances not very different from those of another person who may claim exemption; but do not let us confuse a few cases of possible inequality with any very general sense of hardship. It is a tax which will take its place among taxes as imposing less hardship upon the subject than almost any other tax.

Mr. MARKHAM

Will the Attorney-General answer my question with regard to the lower seams of mines which are not being worked?

Sir W. ROBSON

If I understood the hon. Member rightly, he said that lower seams, if they are not comprised in a lease, and are not being worked, would not come under the provisions as to Increment Value Duty, but under the provision as to the 5 per cent. on royalties. That would be so I think. If they are not comprised in a mining lease, and if they are not being worked, they would come under other provisions of the Bill. I think that should make the hon. Member a little more favourable to the expression which I am proposing to put into the Clause, namely, "comprised in a mining lease." I think the Clause, when amended, will remove my hon. Friend's difficulty about mining leases. You have, in most cases, one or two seams which are being worked; the other seams are waiting their working. They would still, I think, be exempt from the Increment Value Duty under the definition we have already got of the words "being worked," which is as follows:— Where any minerals are at any time being worked by means of any colliery, mine, quarry, or open working, all the minerals which belong to the same proprietor, if the minerals are being worked by the proprietor, or which the lessee has power to work if the minerals are being worked by a lessee, and which would, in the ordinary course of events, be worked by the same colliery, mine, quarry, or open working, shall be deemed to be minerals which are being worked at that date. So that on the Bill as it stands an under-seam would probably come under the expression, "being worked by the proprietor, or which the lessee has power to work if the minerals are being worked by a lessee, and which would in the ordinary course of events be worked by the same colliery." The hon. and gallant Gentleman said, "Oh, well, the cases are different." I am afraid they are. Our system of valuation both in regard to minerals and the surface is no doubt quite safeguarded by the fact that sometimes the subject must come to an end, and then valuation is made, which, of course, operates as a check on the valuation which a man may have made during his life. But if he has not leased either seam, and is not working them, then, of course, he stands by the Increment Value Duty from the excess over their value from the 30th April, 1909. I think now the position of the Bill has been made fairly clear. It looks complicated at first sight, but I believe the House will find when they come to consider its provisions in detail that it presents a simple working scheme. So far as the justice of the tax is concerned, that, of course, is a matter of argument.

Mr. BONAR LAW

The right hon. Gentleman the Chancellor of the Exchequer in answering my hon. Friend beside me laid down a new canon. He spoke of my hon. Friend professing to speak on this subject without knowing as much about it as he does of other subjects. If that rule were to be applied to us all our Debates would be very much shorter. I am perfectly certain that even the Chancellor of the Exchequer himself would have taken a much smaller part in the discussions of this Finance Bill. The hon. and learned Gentleman the Attorney-General congratulated himself that the criticisms which have been made on the Bill were not so vigorous as he expected. I am bound to say, however, from the little study I have made of the matter, and from what I can make out of his speech, that he has great reason to congratulate himself on the fact that the number of persons acquainted with this particular trade on the critical side of the House is extremely limited, and that we are all too jaded to take the trouble which under ordinary circumstances we do take to come into contact with people who can give us the information we desire. I myself am convinced that this particular Clause, instead of being a simple and a workable scheme, is the most fantastic proposal ever presented to the House of Commons. It only needs to be examined by experts to have its follies laid bare to the Government. There is one example of what I mean in the reply given by the Attorney-General as to what is to be done with all the under-seams in all the collieries which are being worked now. So far as I can judge, the Government have never thought of them. I judge that by the answer of the Attorney-General.

Sir W. ROBSON

Have I said anything to show that the Government have never thought of the matter?

Mr. BONAR LAW

The right hon. Gentleman said that the alteration now made in the Clause met all the objections which had been put by the hon. Member for Mansfield (Mr. Markham), when it was perfectly obvious to anyone that they did not meet those objections in the least.

Sir W. ROBSON

I did not say all objections.

Mr. BONAR LAW

Well, main objections. It comes to the same thing. They do not meet them in the least. I only repeat, that what we want in regard to this measure is what we are not able to get—that is, expert examination. But we can touch the subject as laymen. The hon. and learned Gentleman dealt with two arguments put by my right hon. Friend the Leader of the Opposition. He was good enough to say in regard to these arguments that there seemed to be something plausible in them. No one who heard the hon. and learned Gentleman's, reply would be able to say that the answer that he gave was even plausible. He absolutely failed to meet the case put by my right hon. Friend. The case was this: "Here you have the same kind of tax put on exactly similar products. If the coal is worked out at one rate in the one colliery, you put on no tax at all; if it is worked out at a quicker rate in the adjoining colliery, you put on a very heavy Increment Duty." How, asked the right hon. Gentleman, can that be justified? The hon. and learned Gentleman in reply said: "Everyone who invests in stocks and shares makes an income which he does not control, and he pays Income Tax on that income." Does it not occur to the hon. and learned Gentleman that, taking the whole life of a mine, the amount of income which the lessor gets is precisely the same in the one case as the other; while in the one case he pays a very heavy Increment Tax, and in the other case none. Obviously, that argument is no answer to that part of the case. The hon. Gentleman the Member for Cockermouth pointed out the obvious unfairness of the application of the tax. The hon. and learned Gentleman replied to the hon. Member, "that is what you do with income, you charge it similarly." It is not. You take an average of years, so that your bad year is averaged by your good year. There is another reason which differentiates this even from the case he gives. He said the same subject had been, debated in regard to ordinary Land Tax. But it is not the same subject at all. The point raised was, if a man made a profit on one transaction and a loss on another, the two are to be equalised. Here it is the same transaction throughout, and it is simply a question of the rate at which you are working. Surely in common fairness you ought to take an average of years, and estimate the real and not the imaginary profit? The next point made by the Leader of the Opposition was that the tendency of this tax would be to prevent the coal being worked out in a rapid manner. The hon. and learned Gentleman replies that it is absurd to suppose that a man will work out the coal in 50 years when he can do it in 20. But nobody claims to put an extreme case like that. I do not pro fess to have any special knowledge of this industry, but I am bound to say this, to put it to the Attorney-General, or hon. Gentlemen opposite, must there not be many cases of mineral leases where the total amount of coal is known very accurately, or pretty accurately—must there not be cases of that kind where the rate at which it is taken out does not affect the case to any very great extent? In other words—possibly I am putting an absolutely wrong case—but is it not the case that there might be coal in a mine, which in any case is limited, and which could be taken out in 10 years, but which might be taken out in 20 years? And the cost of taking it out between the two periods is a matter of calculation, and might not be very large. Of course it depends upon many things. It depends upon the market. There obviously that is simply—

Sir W. ROBSON

It would be much larger than any royalty.

Mr. BONAR LAW

I do not think that follows.

Sir W. ROBSON

No, it does not.

Mr. BONAR LAW

I do not profess to understand the coal industry as the right hon. and learned Gentleman seems to, but I have been connected with people all my life who know a great deal about it, and it is quite a common thing when the market is not good to work three days instead of six by agreement. It is quite a common thing to work short time, and I have always been told—

Mr. W. E. HARVEY

I would like the hon. Gentleman to give the House one case where by agreement the men have worked three days in the week.

Mr. BONAR LAW

Does the hon. Member mean to say that it is not so?

Mr. W. E. HARVEY

Not by agreement, Sir.

Mr. BONAR LAW

What difference does that make? The point that I make is this: That the amount of coal to be taken out is limited, and that in this industry it is certainly not true to the same extent as other industries that the rate at which you take out the coal regulates the cost of taking it out.

Mr. A. B. MARKHAM

More than in any other industry.

6.0 P.M.

Mr. BONAR LAW

Well, in spite of what the hon. Member says, I believe I am right. There is nothing like the same amount of cost and capital expenditure and machinery as there is in many other industries with which I am acquainted. For that reason it certainly is the case that it might be a matter of calculation. Given a limit to the amount of coal, if you have this heavy tax it would pay a man better to take the coal in 10 years instead of 20 years. The real point of this has to be considered, I think, from two points of view. The one is on whom is this burden going to fall? I am not going into that aspect of the question at all, because it practically amounts to the same kind of arguments as were applied yesterday to the point. I am quite willing to take the statement of the hon. Member for Mansfield. He said few coalmasters, in his experience, taking a mine on a lease, would allow the lease to fall through for the sake of 1d. a ton. That, so far as he is concerned, is giving the whole case away which I wish to make, which is that the thing will be settled by ordinary market transactions—by the ordinary buying and selling. In some cases the tax will be borne by the lessor, in some by the lessee, and to some extent part of the tax will become a burden upon the coal, and will be added to the price. The other aspect of the case which I wish to direct attention to was the argument put by my hon. and gallant Friend behind me: that this will tend to some extent to prevent coal being worked. Here again the Chancellor of the Exchequer scoffed at the idea. He said it is inconceivable that a man willing to take £60,000 over and above what he is receiving now would decline to take it because he had to pay £12,000 to the State. Of course, that is an extreme case. In that case any man would refuse to work the coal, and it is not the only way, in my opinion, that this tax is going to prevent the rapid development of the coal. If you look at the other side of the picture, if you look at a man who is putting his capital in coal, and going to work it, what will be the effect of the Government's proposal? The proposal is this: the business is a risky one in itself, if a man sinks a lot of money in it and finds he has made a loss, as often happens, he bears the loss entirely himself. If, on the other hand, he makes a big profit, the State immediately steps in and takes a twentieth part of the profit. I should like to give an actual example given to me by a gentleman who was a Member of this House in the last Parliament, and which occurred in his own experience. There was a colliery in Wansbech, near which he had a piece of land. All the experts advised him that there was plenty of coal there, and it was simply a calculation of how much it was worth. Acting upon that advice, he spent £60,000 in opening up that colliery, and when he had opened it up he never got back a single penny of his money.

The next case is a different one, also occurring in the same districts and to the same gentleman. He was told in this instance that the coal was probably unworkable, because water was coming into the pit. He had bought a large colliery, so far as the mineral rights were concerned, for £20 an acre, which, as everyone knows, was almost for nothing. He sank a shaft, found the experts were all wrong, and that this was an exceedingly valuable colliery. In this case the Government would step in and say, "Where you made a mistake we do not help you, but where you have made a profit we will take a very large percentage." Does anyone pretend that the effect of that will not be to make the coal industry enterprise one that is less attractive to the capitalists than if you had not adopted that course? It is not only in that way you are going to interfere with the man who develops coal; you make it apply not only to the owners of the lease of the coal, but also to the coal-master, and I think you make it apply in an extremely harsh way. Take the case given by the Chancellor of the Exchequer where the mineral property was worth £12,500. Supposing if it is valued at that figure that it is sold to a coal-master for £15,000, I understand the principle upon which you take the increment upon the £2,500, but it does not stop there. You say to the man who has bought the property and risked his money, and his industry, and his energy, you say to him, that as you develop the coal and find it gives a greater annual return the Government will step in and charge on the profit. I put it to anyone, is it not inevitable that the Government in that way putting this tax annually upon the man, not the man who originally had the mine, but the man who bought it, and is going to work it, that that tax would tend to make the coal industry less profitable, and tend to make people invest less of their money in it?

Mr. JOHN JOHNSON

I listened very patiently to this Debate, and the drift of the Debate from the point of view of those who oppose this tax is that this additional penny or so is going to ruin the whole industry. There seems to me to be great misapprehension as to what is meant by the working of a mine. We are told that the lessor is going to put some proportion of the tax upon the lessee, and on the men who work the mine, and that no man is going to take a lease under conditions like that. When you talk about working a mine and about the produce of a mine you are talking about something that is very different from work upon the surface. People talk as if a man could come down and lock up a mine as you would lock up a factory. I may know very little about the meaning of leases and lessees, but I do know what it is to work coal. I have had the advantage of 30 years' experience in the coal-pit. A man may have a large area of coal for which he pays so much royalty. If there is nothing to interfere with the working of the mine all is well, but there are questions of slack trade, there are questions of difficulties in the mine itself, and there is the question of water getting in. A man may come across a rough seam in a mine, which may cost a large amount of money to cut through, or he may have to consider the set of the roof, and it may be that for one cause or another that seam in the mine may have to be abandoned two or three months, and, indeed, possibly it may never be worked again.

I remember our strike in Durham in 1892. For many months after that strike, and indeed to this day, I believe some of the seams in the mines have not been opened up, because the water got in where you have a soft sandy floor through which the water percolates and undermines the timber, and down comes the roof. Therefore, it is not within the caprice of the lessee to work his mine when he likes and to shut it up when he likes until he has worked it out. If, as I said, it was a factory in which you could turn the key for a few months and come back and renew operations, it would be quite a different thing altogether. I had an explanation the other day from an expert authority who stated that the fact that a pit which he knew had lain idle for some time increased the cost by a sum of 3d. per ton. The lessee of a mine has such considerations as wayleaves, mining royalties, engines to be looked after, ponies to be maintained, and many other considerations to induce him to keep his mine open.

To talk about working the coal out in 10 or 20 years is beside the question altogether. Such talk may be suitable as a piece of dialectics in debate, butt it is not practical common-sense, and if anything is going to contribute to legislation for the benefit of this country it is the exercise of a little common-sense. The business of this House is not to be carried on on a display of dialectics, or as if the House of Commons was a mere debating society, but it is to be carried on by the exercise of practical knowledge on the part of men who understand what they are talking about. The hon. Member for Cockermouth said this was going to be a very terrifying thing, because, besides crippling industry and ruining industry, he said the ultimate cost will be thrown upon the worker. I am glad to think that the Government are making as strenuous an effort as possible in order to limit this to the lessor; and as to the statement that the industry is going to be ruined because of an extra cost which amounts to about 1d. in the £ on the royalty, I think all practical miners can go to bed and sleep easy with the knowledge that there is not much to fear. I am entirely in favour of this tax. I may not clearly understand what the Attorney-General's Amendment means, his legal mind is better adapted to that than mine, and I do not question the legality of the form in which he puts this Clause; but I say that the statements made by some hon. Members about irregular working, and things of that kind, ought not to influence the Committee at all, and I hope the Government will adhere to their Clause.

Mr. W. E. HARVEY

People in the mining world and others besides, when they read the startling declarations which we have heard made by the hon. Member for Dulwich (Mr. Bonar Law) will have a smile brought to their faces to think that such statements could be made upon the floor of this House. For any man at this date to assume that a colliery may be worked successfully and at the same profit in 20 years as it could be in 10 years, or that the amount of coal turned out in 20 years could be turned out in 10 years without any loss to the estate, is to show that he has no knowledge whatever of mining life. It is essential, after all, that there should be some people in this House who know what they are talking about, and have some practical experience of this question when it comes up for consideration. Hon. Members may be interested to know that there are such things as roofs and floors to be looked after, that water inundations have to be coped with and prevented, and that other great difficulties arise. People in mines might be living in the broad, bright sunlight of heaven and doing their work under such conditions for all some people appear to know. Any man who has gone into a mine and who has worked there knows that there is no day in the year but grave difficulties may arise which cause large expenditure to the management, and very often loss of wages to the working man, and which generally interferes with the profits. The hon. Member for Dulwich says it makes no difference whether a colliery is worked out in 10 years or in 20 years. The hon. Member for Gateshead has made a very clear and well-defined statement as to this absurdity. The startling statement has also been made that this proposal will retard trade and in some inconceivable way prevent the development of mines. In other words, we are told that a pit which could be worked out in 50 years is going to last 100 years. What lessees would agree to an arrangement of that kind with regard to the working of their mines? Any of those employers of labour in mines who have had practical experience will tell you that if a colliery works only three days per week instead of six it will put up the cost of production. The reason is that there are standing charges to be taken into account, and unless the coal is worked out quickly it must put up the cost of production. I think it would have been well if the hon. Member for Dulwich had consulted some experts before making his statement. Any colliery which is worked regularly can produce coal at a lower price per ton than if it were only working two or three days per week. Those who have read the evidence given before the Royal Commission which inquired into this question will be aware that the Report stated that we have coal enough in this country at our present rate of production to last over 500 years. That is to say, if we go on producing annually 260,000,000 tons of coal per annum we have a sufficient stock of known coal to last us 500 years. Of course, there is coal which is not known. I know a district where they have been working the top seam for a good many years, in fact they have been working it the whole of my life, and it is only now getting nearly exhausted. I know there are five other seams under that.

Mr. LLOYD-GEORGE

Are they in the same lease?

Mr. W. E. HARVEY

That is what I want to know.

Mr. LLOYD-GEORGE

I want to know whether the other seams have been actually leased, and whether they are leased to the same person who works the top seam?

Mr. W. E. HARVEY

No, they are not leased, and I want to know how these other scams which remain are going to be valued? Is it within the wit of man to declare what is the Valuation of those seams? That is all I want to know. One of those seams has lasted the whole of my lifetime, and the others may last five more lifetimes. How is it possible to put a value on those seams. They vary in thickness and in other respects, and if there is a value surely it will be a fictitious one. I am bound to say that I cannot for the life of me see how any man can put a real value on that which is not known. That is a point that I want cleared up. How can you value these seams that are not proved? Those are the points upon which I want some information. With regard to the taxes in general I support them whole-heartedly, because I believe royalties have been too long neglected, and, in my opinion, they ought to contribute to the State. I think this is a source of taxation that will prove of value not only to this Parliament, but to Parliaments yet to come.

Mr. ROBERT DUNCAN

We have had a frank and outspoken statement from the hon. Member for Gateshead (Mr. John Johnson). He saw very clearly the difficulties which arise in the working of coal mines, and how they may arise in future. The whole point of the argument is that the value is entirely unknown and you can only arrive at anything like a fair valuation by taking a number of years together, and not by taking isolated years. If a fair average of years is not taken, not

only will an injustice be done, but the business will get on the rocks in the bad years. It is argued in this matter that you have to consider the profits and not the losses, but you ought to take a wider view of this business, and if you do not, as the hon. Member for Dulwich has already pointed out, you will add to the already large army of unemployed in the country.

Mr. LUPTON

I think this Debate has shown how ingenuity and cleverness can make a great deal of very little. This is only, after all, a very trifling tax, and yet hon. Members have been trying to show that it will have a great effect in impairing the working of mines. The only doubt in my mind is whether there will be much to tax at all, because under the Clause the owner of the mine is entitled to deduct capital expenditure, and when that has been deducted there will in a great many case be very little to tax. I think it is rather premature at the present time to discuss whether this tax will amount to one penny per ton or one-fifth part of a penny per ton on the average. There are many points in the definition which makes it doubtful whether existing mines will be taxed with Increment Duty at all. Perhaps other Amendments will be brought in to make this point clear. A good deal has been said to the effect that there was no value in the Reversion Duty which has been given up, but in the days when the Cornish mines flourished it was constantly the practice when a lease' fell in and a renewal was sought to pay a substantial fine for granting the renewal of the lease upon the same terms as before. That was not a case of discovering a new mine, but it was simply the granting of a further lease for a short period. I think we ought to understand that this tax is so trifling that no person would think of altering his mode of working on account of it, and no lessor would try to place any conditions on the lessee which would prove onerous.

Question put, "That the Clause be now read a second time."

The Committee divided: Ayes, 223; Noes, 81.

Division No. 746.] AYES. [6.30 p.m.
Abraham, William (Rhondda) Baker, Sir John (Portsmouth) Bethell, Sir J. H. (Essex, Romford)
Acland, Francis Dyke Balfour, Robert (Lanark) Birrell, Rt. Hon. Augustine
Agnew, George William Barker, Sir John Boland, John
Ainsworth, John Stirling Barnes, G. N. Boulton, A. C. F.
Allen, A. Acland (Christchurch) Barry, Redmond J. (Tyrone, N.) Bowerman, C. W.
Allen, Charles P. (Stroud) Beauchamp, E. Brigg, John
Ashton, Thomas Gair Beaumont, Hon. Hubert Bright, J. A.
Asquith, Rt. Hon. Herbert Henry Beck, A. Cecil Brunner, J. F. L. (Lancs., Leigh)
Atherley-Jones, L. Bennett, E. N. Brunner, Rt. Hon. Sir J. T. (Cheshirs)
Burns, Rt. Hon. John Isaacs, Rufus Daniel Rees, J. D.
Burt, Rt. Hon. Thomas Jenkins, J. Rendall, Athelstan
Buxton, Rt. Hon. Sydney Charles Johnson, John (Gateshead) Richards, T. F. (Wolverhampton, W.)
Byles, Wm. Pollard Jones, Sir D. Brynmor (Swansea) Richardson, A.
Carr-Gomm, H. W. Jones, Leif (Appleby) Roberts, Charles H. (Lincoln)
Causton, Rt. Hon. Richard Knight Jowett, F. W. Roberts, G. H. (Norwich)
Channing, Sir Francis Allston Joyce, Michael Robson, Sir William Snowdon
Clough, William Keating, M. Roch, Walter F. (Pembroke)
Cobbold, Felix Thornley Kekewich, Sir George Roe, Sir Thomas
Collins, Stephen (Lambeth) King, Alfred John (Knutsford) Rogers, F. E. Newman
Collins, Sir Wm. J. (St. Pancras, W.) Laidlaw, Robert Rose, Sir Charles Day
Compton-Rickett, Sir J. Lamb, Edmund G. (Leomister) Runciman, Rt. Hon. Walter
Corbett, A. Cameron (Glasgow) Lamb, Ernest H. (Rochester) Russell, Rt. Hon. T. W.
Corbett, C. H. (Sussex, E. Grinstead) Lambert, George Rutherford, V. H. (Brentford)
Cornwall, Sir Edwin A. Lamont, Norman Samuel, Rt. Hon. H. L. (Cleveland)
Cotton, Sir H. J. S. Layland-Barratt, Sir Francis Scanlan, Thomas
Craig, Herbert J. (Tynemouth) Lehmann, R. C. Schwann, Sir C. E. (Manchester)
Crossley, Wiliam J. Lever, A. Levy (Essex, Harwich) Seaverns, J. H.
Davies, Ellis William (Eifion) Lever, W. H. (Cheshire, Wirral) Seely, Colonel
Davies, Sir W. Howell (Bristol, S.) Levy, Sir Maurice Shackleton, David James
Dewar, Arthur (Edinburgh, S.) Lewis, John Herbert Shaw, Sir Charles E. (Stafford)
Dickinson, W. H. (St. Pancras, N.) Lloyd-George, Rt. Hon. David Sherwell, Arthur James
Duckworth, Sir James Lupton, Arnold Silcock, Thomas Ball
Duncan, C. (Barrow-in-Furness) Mackarness, Frederic C. Simon, John Allsebrook
Duncan, J. Hastings (York, Otley) Macnamara, Dr. Thomas J. Snowden, P.
Dunne, Major E. Martin (Walsall) Macpherson, J. T. Stanley, Albert (Staffs, N.W.)
Edwards, Sir Francis (Radnor) MacVeagh, Jeremiah (Down, S.) Steadman, W. C.
Elibank, Master of M'Callum, John M. Stewart, Halley (Greenock)
Essex, R. W. M'Laren, Sir C. B. (Leicester) Stewart-Smith, D. (Kendal)
Esslemont, George Birnie M'Micking, Major G. Strachey, Sir Edward
Evans, Sir S. T. Mallet, Charles E. Straus, B. S. (Mile End)
Everett, R. Lacey Markham, Arthur Basil Summerbell, T.
Ferens, T. R. Marnham, F. J. Taylor, John W. (Durham)
Ferguson, R. C. Munro Masterman, C. F. G. Tennant, H. J. (Berwickshire)
Fiennes, Hon. Eustace Meagher, Michael Thomas, Sir A. (Glamorgan, E.)
Foster, Rt. Hon. Sir Walter Menzies, Sir Walter Thorne, G. R. (Wolverhampton)
Fuller, John Michael F. Middlebrook, William Tomkinson, James
Fullerton, Hugh Molteno, Percy Alport Toulmin, George
Gibb, James (Harrow) Mond, A. Trevelyan, Charles Philips
Gladstone, Rt. Hon. Herbert John Montagu, Hon. E. S. Ure, Rt. Hon. Alexander
Glendinning, R. G. Morse, L. L. Verney, F. W.
Glover, Thomas Murray, Capt. Hon. A. C. (Kincard.) Wadsworth, J.
Goddard, Sir Daniel Ford Myer, Horatio Walker, H. De R. (Leicester)
Gooch, George Peabody (Bath) Nannetti, Joseph P. Walsh, Stephen
Greenwood, G. (Peterborough) Nicholson, Charles N. (Doncaster) Ward, W. Dudley (Southampton)
Gulland, John W. Nugent, Sir Walter Richard Wardle, George J.
Gwynn, Stephen Lucius Nuttall, Harry Wason, Rt. Hon. E. (Clackmannan)
Hall, Frederick O'Brien, Patrick (Kilkenny) Wason, John Cathcart (Orkney)
Harcourt, Robert V. (Montrose) O'Connor, John (Kildare, N.) Waterlow, D. S.
Hardie, J. Keir (Merthyr Tydvil) O'Connor, T. P. (Liverpool) Watt, Henry A.
Hardy, George A. (Suffolk) O'Donnell, C. J. (Walworth) White, J. Dundas (Dumbartonshire)
Harmsworth, Cecil B. (Worcester) O'Grady, J. White, Sir Luke (York, E. R.)
Hart-Davies, T. O'Kelly, Conor (Mayo, N.) Whittaker, Rt. Hon. Sir Thomas P.
Harvey, W. E. (Derbyshire, N. E.) O'Kelly, James (Roscommon, N.) Wiles, Thomas
Haslam, Lewis (Monmouth) O'Malley, William Wilkie, Alexander
Hazel, Dr. A. E. W. O'Shaughnessy, P. J. Williams, J. (Glamorgan)
Hazleton, Richard Partington, Oswald Williamson, Sir A.
Hedges, A. Paget Pearce, Robert (Staffs, Leek) Wilson, P. W. (St. Pancras, S.)
Helme, Norval Watson Philipps, Owen C. (Pembroke) Wilson, W. T. (Westhoughton)
Henderson, J. McD. (Aberdeen, W.) Pickersgill, Edward Hare Winfrey, R.
Hobart, Sir Robert Pollard, Dr. G. H. Wood, T. M'Kinnon
Hodge, John Ponsonby, Arthur A. W. H. Yoxall, Sir James Henry
Holland, Sir William Henry Power, Patrick Joseph
Hope, John Deans (Fife, West) Price, C. E. (Edinburgh, Central)
Hope, W. H. B. (Somerset, N.) Priestley, Sir W. E. B. (Bradford, E.) TELLERS FOR THE AYES.—Mr. Joseph Pease and Captain Norton.
Horniman, Emslie John Rea, Rt. Hon. Russell (Gloucester)
Illingworth, Percy H. Reddy, M.
NOES.
Acland-Hood, Rt. Hon. Sir Alex. F. Cecil, Lord John P. Joicey- Faber, George Denison (York)
Arkwright, John Stanhope Cecil, Lord R. (Marylebone, E.) Fell, Arthur
Balcarres, Lord Clyde, J. Avon Fletcher, J. E.
Baldwin, Stanley Coates, Major E. F. (Lewisham) Forster, Henry William
Balfour, Rt. Hon. A. J. (City, Lond.) Cochrane, Hon. Thomas H. A. E. Gooch, Henry Cubitt (Peckham)
Banbury, Sir Frederick George Courthope, G. Loyd Goulding, Edward Alfred
Banner, John S. Harmood- Craig, Captain James (Down, E.) Guinness, Hon. R. (Haggerston)
Baring, Capt. Hon. G. (Winchester) Craik, Sir Henry Hamilton, Marquess of
Bowles, G. Stewart Dalrymple, Viscount Hardy, Laurence (Kent, Ashford)
Bull, Sir William James Davies, David (Montgomery Co.) Harris, Frederick Leverton
Carlile, E. Hildred Dickson, Rt. Hon. C. Scott Harrison-Broadley, H, B.
Carson, Rt. Hon. Sir Edward H. Douglas, Rt. Hon. A. Akers- Helmsley, Viscount
Cave, George Duncan, Robert (Lanark, Govan) Hermon-Hodge, Sir Robert
Hills, J. W. Meysey-Thompson, E. C. Stanier, Seville
Mope, James Fitzalan (Sheffield) Mildmay, Francis Bingham Starkey, John R.
Hunt, Rowland Morrison-Bell, Captain Staveley-Hill Henry (Staffordshire)
Kennaway, Rt. Hon. Sir John H. Newdegate, F. A. Stone, Sir Benjamin
Keswick, William Nicholson, wm. G. (Petersfield) Thomson, W. Michell-(Lanark)
Kimber, Sir Henry Oddy, John James Tuke, Sir John Batty
King, Sir Henry Seymour (Hull) Pretyman, E. G. Valentia, Viscount
Lambton, Hon. Frederick William Ratcliff, Major R. F. Willoughby de Eresby, Lord
Lane-Fox, G. R. Remnant, James Farquharson Wilson, A. Stanley (York, E.R.)
Law, Andrew Bonar (Dulwich) Renwick, George Wortley, Rt. Hon. C. B. Stuart-
Lockwood, Rt. Hon. Lt.-Col. A. R. Roberts, S. (Sheffield, Ecclesall) Wyndham, Rt. Hon. George
Lonsdale, John Brownlee Ropner, Colonel Sir Robert Younger, George
Lyttelton, Rt. Hon. Alfred Rutherford, John (Lancashire)
M'Arthur, Charles Rutherford, Watson (Liverpool) TELLERS FOR THE NOES.—Sir J. Randles and Mr. Clavell Salter.
Magnus, Sir Philip Smith, Hon. W. F. D. (Strand)

Question, "That those words be there inserted," put, and agreed to.

Mr. LLOYD GEORGE moved, in Subsection (2), after the word "nine" ["thirtieth day of April, nineteen hundred and nine"], to insert the words "either comprised in a mining lease or."

Mr. MARKHAM

I did not move my Amendment because these words very well meet the suggestion, but I would like to ask what would happen if a mining lease expires and a new lease is entered into. Would this Clause cover any continuation of a lease? All minerals comprised in a mining lease entered into prior to 30th April are excluded from the operations of the Bill so far as Increment Value Duty is concerned, but, assuming there is a lease which expires, say, in five years' time, and which the present lessee renews, would the minerals in that case come under the operations of the Clause, Sub-section (1) or remain under Sub-section (2)?

Mr. LLOYD-GEORGE

What I understand the hon. Member to put to me is this: Supposing a lease of 60 years granted before the date of the Act expires in three or four years and there is a renewal, would it be taken as if it was worked or in working? It would certainly be excepted.

Sir E. CARSON

It is very difficult to follow the alteration. Might we have the words of the Amendment again?

Mr. WATSON RUTHERFORD

Will you read the words of the next Amendment also?

The CHAIRMAN

I will read the Subsection as it is proposed to be altered: Increment Value Duty shall not be charged in the case of any minerals which were, on the thirtieth day of April, nineteen hundred and nine, either comprised in a mining lease or being worked by the proprietor, so long as the minerals are for the time either comprised in a mining lease or being worked by the proprietor. That, I think, comprises the whole of the alteration.

Sir JOHN RANDLES

In iron ore mining it is customary to have tack-notes for three and sometimes five and seven years. A tack-note is really a licence, to be followed by a lease, if it is asked for. Would that be included?

Sir W. ROBSON

If I understand, the document would have the same effect as a lease and give the lessee the right to work minerals for some years—

Sir JOHN RANDLES

It gives him a right to call or ask for a lease at the end of a fixed period. He searches during a period of, say, three years, and then at the end he has a right to ask for a lease of 21 years.

Sir W. ROBSON

If it is an agreement for a lease it would be included.

Mr. J. W. HILLS

It is not quite the same thing as an agreement for a lease; it is an option for a lease. The lessee has a right to explore for a certain time, and then, if he likes, at the end of that time he can get a lease. I do not think a tack-note is an agreement for a lease.

Mr. MARKHAM

The Attorney-General, I think, was out of the House when I addressed a question to the Chancellor of the Exchequer on a point which is considered of very great importance to the Mining Association of Great Britain. The Chancellor of the Exchequer answered my question in the affirmative. His intention may be right, but I do not think, reading the Clause as a layman, that he is quite correct in the answer he gave. The question I asked the Chancellor of the Exchequer was this: There are mines which are at present comprised in a mining lease. That mining lease expires. Will Increment Value Duty then become payable on those mines, and will they be treated as being comprised in a lease entered into after April, 1909? That is a question to which the Mining Association of Great Britain attach great importance, and I have been asked to mention it because their solicitors are of opinion that it is not covered by the Clause as it now reads, and that some other words are necessary to make it quite clear that any lease of the same mineral entered into after the expiration of a lease, although made after 30th April of this year, should be exempt.

Sir W. ROBSON

The words of the Clause are that Increment Value Duty shall not be charged in the case of any minerals which were on the given date either comprised in a mining lease or being worked. That is an absolute exemption of all minerals which are comprised in the mining lease on that date, no matter whether the mining lease subsequently expires. If the lease subsequently expires and it is renewed they will still have the benefit of the exemption.

Mr. CLAVELL SALTER

Are they not limited by the later words of the Sub-section?

Sir W. ROBSON

That relates rather to a different case. It relates to the case where the minerals now being worked cease to be worked for 12 months. Of course, if they are taken out of a mining lease altogether so that no royalty is paid upon them at all, then in that case they come under a different footing. They are either worked by the proprietor or not worked at all. If they are not worked at all he escapes Royalty Duty, but he does not escape the possibility of Increment Value Duty if he chooses not to work them.

Sir E. CARSON

I find a good deal of difficulty in following the point put by the Attorney-General. It is not easy to understand unless you have the whole of the words before you. As I understand the point put by the hon. Member for Mansfield (Mr. Markham), it is this: If a lease expires three or four years after the date of the Act and a new lease is made, will the minerals then be exempt? I understood the Attorney-General to say they would be. I do not think, on a construction of the Sub-section that would follow. This was only meant to relate to existing leases. The moment a lease expires and the reversioner becomes entitled to the minerals, they are no longer included in the lease. The freehold intervenes, and the words of the Section could not possibly apply to such a case. I do not know anything about the merits or the demerits of the matter; but, on the point of construction, I venture to take an entirely different view from that of the Attorney-General.

Mr. LUPTON

There is another Clause which bears upon this definition. It says: "Where any minerals are at any time being worked by means of any colliery, mine, quarry, or open working, all the minerals which belong to the same proprietor, if the minerals are being worked by the proprietor, or which the lessee has power to work if the minerals are being worked by a lessee, and which would, in the ordinary course of events, be worked by the same colliery, mine; quarry, or open working, shall be deemed to be minerals which are being worked at that date." It appears as if all the minerals connected with that colliery were deemed to be minerals if worked at that date. Will the Attorney-General tell us how far that affects the matter we are now discussing?

Mr. J. S. HARMOOD-BANNER

May I put this case to the Committee? When a mining lease expires, the tenant has not worked out the whole of the coal for which he has paid. The landlord says you may work up to the royalty which you have paid without paying me any more royalty. The State will have got its full Increment Duty on the whole of the royalty. What will happen? Again, what would happen in the case of a sub-lease? The position of the original lessor and lessee is clear, but what will happen if there is a sub-lease?

Mr. LAURENCE HARDY

I was very glad to hear the construction put upon the Sub-section by the hon. and learned Gentleman, but I do not know how it will read with Sub-section (6). I understood the Attorney-General to say that, when minerals were included in the lease, they would be exempt, but Sub-section (6) says that when they cease to be comprised in a mining lease then the capital value is to be taken. It is rather difficult to follow the words, but I think the words read were "so long as the minerals are comprised in a mining lease or for the time worked." If those are the words, does it mean the alternative is given, or do the words "for the time worked" apply to the proprietor? If that is so, he seems to be under a disadvantage compared with the lessee. The lessee may stop working for a time, and yet be under no penalty, whereas the proprietor must always continuously work if those words are put in.

Mr. LLOYD-GEORGE

I think it is quite clear, and I do not think there is any difficulty and complication at all. "Increment Value Duty shall not be charged in the case of any minerals which were on the 30th day of April, 1909, either comprised in a mining lease or being worked by the proprietor." Then it goes on to say: "So long as the minerals are for the time worked: Provided that the exemption under this Section shall continue to apply in the case of any minerals, although they cease, for a temporary period, to be worked, so long as the period does not exceed twelve months." Here we have an entirely new position. Sub-section (6) refers to cases of that kind. It says: "Where minerals cease to be comprised in a mining lease or to be worked within the meaning of this Section the capital value of the minerals at the time shall be specially ascertained in accordance with the provisions of this Act, and the capital value as so ascertained shall be treated as the original capital of the minerals." It becomes a new lease, and, therefore, in order to calculate the increment value, instead of going back to April this year, you simply say you ascertain what the value is at a particular date.

Mr. CLAVELL SALTER

It is quite obvious the point raised by my right hon. Friend is one of the most important, and it ought to be clearly dealt with. Probably this is one of the few occasions on which the much despised lawyer may, for the moment, be of some use to the House. I confess I feel very strongly on the point taken by my right hon. Friend below me, and I have no doubt that the Attorney-General and the Chancellor of the Exchequer see that the matter is by no means clear. The Section does not end where the Chancellor stopped a moment ago. This duty is not to be paid on minerals comprised in the mining lease on a certain date. The Section goes on to say that so long as they "are comprised in a mining lease." It is only so long that they are so comprised, and no one will deny that where there is an interval between the lease, be it for a moment or a month, there is a period during which these minerals are not comprised in any lease. Now these minerals under the Clause as it stands will lose this exemption.

Mr. LLOYD-GEORGE

I think the hon. and learned Gentleman has overlooked the words at the end, which are intended especially to cover cases of this kind. I quite agree it is very important you should not, merely because a lease is not signed for three days after the expiration of the original lease, deprive it of the benefit of this Section.

Mr. CLAVELL SALTER

Those words do not cover the case at all. They are intended merely to cover minerals which are being worked after the expiration of the lease. Even if a new lease is signed before the old lease expires there must be a moment of time when there is no lease. The matter can be very easily put right, and I rose for the purpose of making a practical suggestion. I would suggest it might be practical to enact that no break which does not amount to a year should involve exemption. Why should we not enact that minerals subject to a current lease may continue? Let it be provided there shall not be a break for more than 12 months. We cannot be satisfied with this Clause as it stands. The intention of the Government is the same as our own. They desire to have complete permanent protection for the working of the lease, and I say that in order to get that in a proper manner they must add some words which will protect minerals now in a current lease when they come under a subsequent lease.

7.0 P.M.

Mr. LLOYD-GEORGE

The hon. Member has not explained to the Committee why the words I have quoted do not cover the case. They certainly are intended to cover it. They are as follows: "Where minerals cease to be comprised in a mining lease or to be worked within the meaning of this Section, the capital value of the minerals at the time shall be specially ascertained in accordance with the provisions of this Act, and the capital value as so ascertained shall be treated as the original capital value of the minerals." This is the interval between the expiry of the old lease and the granting of the new lease. You work under the old lease until the new lease is granted. If it is worked under a new lease, it is subject to a mining lease, and, if it is worked under the old terms, it is under the old lease. If it is worked under the old lease or the new lease, it is subject to a lease. I should like to know whether these words do not meet the case, and merely saying they do not is not enough. If the hon. Gentleman will tell me where it fails, I shall be very glad to consider the matter.

Sir E. CARSON

I admit that I do not quite understand what the right hon. Gentleman wants to do. What is the point which he has just made? He says minerals must be continued to be worked under the old lease or under the new, and, therefore, the definition applies. But, supposing the lessor, when the lease falls in himself works them, he is not working under any lease at all and the minerals have gone out of leases, and that is why I think the proposal does not carry out what was the intention of the Chancellor of the Exchequer. Sub-section (6) deals with cases "where minerals cease to be comprised in a mining lease," and, therefore, it is possible for minerals to cease to be comprised in a mining lease quite apart from the question of working. In what case could that be applied except to the case under Sub-section (2)? When the lease falls in the minerals cease to be any longer applied to by a mining lease.

Mr. LLOYD-GEORGE

That is the alternative. If he looks at the Clause, he will see that is given in the alternative. They must either be comprised in a mining lease or they must be worked under the terms of such a lease although the lease has expired. The case is made specifically in words which can be understood by anybody.

Mr. MARKHAM

This Amendment has rather been sprung upon us, and I do not know whether the right hon. Gentleman intends to insert these words "comprised in a mining lease." Will he give the matter his consideration and deal with it, if necessary, on Report, because when a distinguished Law Officer of the Crown and another eminent barrister have a different opinion we should be careful.

Mr. LLOYD-GEORGE

If the Committee would prefer that the words should not be moved now, I will undertake to put down a fresh Amendment on the Report stage.

Sir J. RANDLES

I quite understand the Chancellor's intention is to free all existing leases. I am not a lawyer, but I wish to put a question to him about the restriction of working. There are certain mines which are closed down not for twelve months, but for two, three, four, or five years, such as the lead or plumbago mines in Cumberland, which supply a particular quality of lead used for pencils. How will they be affected? These mines only work at spasmodic intervals, because the supply of lead will last a considerable number of years.

Mr. LLOYD-GEORGE

There is the lease.

Sir J. RANDLES

No, they take it up and work out the lease, and it is not taken up again until more lead is wanted. I admit that it is an exceptional case, but these exceptional cases do arise.

Mr. LAMBTON

May I draw the right hon. Gentleman's attention to an Amendment drawn up by a distinguished person, and standing in my name. It runs, "or are comprised in any mining lease held by the proprietor or lessee of such colliery, mine, quarry, or open working." Would not the words "held by the proprietor or lessee" meet my hon. Friend's objection?

Sir W. ROBSON

There is only the difficulty which has been suggested in the course of the discussion. We are dealing with two cases. One is the case of minerals which are comprised in a mining lease which would mean all mines except those worked by the proprietor, and the other is the case where the mine is worked by the proprietor. If they come under a mining lease they are exempted from the duty. That is the effect of Sub-section (2) and it is proposed further to provide that "Minerals shall be deemed to be comprised in a mining lease if the right to work the minerals is the subject of a mining lease, or if the minerals are being worked under the terms of such a lease, although the lease has expired." In case any objection should be left it would be met completely by the wording of the proviso as amended, "Provided that the exemption under this Section shall continue to apply in the case of any minerals, although they cease for a temporary period, either to be comprised in a mining lease or being worked by the proprietor, so long as the period does not exceed 12 months."

Amendment made: In Sub-section (2), to leave out the word "worked" ["minerals are for the time worked"], and to insert instead thereof the words "either comprised in a mining lease or being worked by the proprietor."—[Sir W. Robson.]

Sir W. ROBSON moved, in Sub-section (2), after the word "period" ["although they cease for a temporary period"], to insert the words "to be comprised in a mining lease or to be worked by the proprietor."

Sir E. CARSON

I should like to ask the Attorney-General whether he has considered the effect of putting in these words value fixed upon it of which the annual myself, but you are limiting the Clause, and if the minerals are not leased within 12 months the owner loses the benefit of the exemption and will become liable to the duty. The Amendment of the Attorney-General is really a limiting and not a widening.

Mr. J. W. HILLS

I am inclined to think that if these words are inserted it would have the effect that if the mine were to cease for 12 months the proprietors would lose the benefit of the Sub-section and of the exemption.

Mr. LLOYD-GEORGE

I will consider that point.

Amendment proposed, at the end of Subsection (2), to insert the words "or such further period as the Commissioners may consider reasonable."—[Mr. Laurence Hardy.]

Mr. LLOYD-GEORGE

I am not so sure there ought not to be some possibility of extending the period, but these words will put the Commissioners in a very awkward position. This really confers upon the Commissioners a power of exempting for all time the landowners of certain collieries from a very considerable tax. I do not think the Commissioners ought to be quite put in that position. I will, however, consider the point put by the hon. Gentleman.

Mr. MARKHAM

I know a colliery in Yorkshire which has been on strike for three years. What would happen in that case?

Mr. LLOYD-GEORGE

I should hardly have thought that that would be considered as coming within the exemption.

Mr. LAURENCE HARDY

I only wanted that there should be a little elasticity and that we should not be bound absolutely by a statutory limit of 12 months.

Amendment, by leave, withdrawn.

Mr. WATSON RUTHERFORD moved, in Sub-section (3), to leave out the words "capital value of the minerals on the last," and to insert instead thereof the words "highest rental value of any."

The point of this Amendment is this, That in calculating the Increment Duty upon such minerals as will have to pay Increment Duty it is obvious that only minerals which are being worked to-day are to be exempt, and that is only for a certain limited period and under limited conditions. There are, of course, outside these existing workings, a vast quantity of minerals in this country to which the Increment Duty would still apply, and the Increment Duty is to be applied under the Sub-section that we are now considering. I have read this Clause and have submitted it to a number of others who have had far more experience than I have had, and we all differ as to the precise meaning of it. But if I understand the Clause aright it amounts to this, that there is to be an Increment Duty in respect of these other minerals paid every year, and it has got to be the amount by which the rental actually received during the current year exceeds one or other of two things, either the original site value or the last payment. If I have understood the meaning of the Clause the suggestion is this, that instead of that being a fair way to impose this duty, what you ought to do is to take the analogy of the other Land Taxes, and when you have got in some previous years a high rental, upon which duty has actually been paid, you only ought in subsequent years to take the amount by which your new rental exceeds that highest point. What we did on the Land Clauses was this: Where property which is not mineral property has got up to a certain price on an occasion when it pays Increment Duty, on no subsequent occasion can it be asked for further Increment Duty until it has got to a higher point than the point upon which, on some previous occasion, it paid duty. What I want to do in my Amendment is to apply the same principle to this annual assessment of duty in the case of minerals, and wherever you have reached a point upon which the highest duty has been paid you have paid your duty up to that point, and you ought not to be asked for duty again until your rental exceeds the highest point upon which you previously paid duty. I certainly understood when the right hon. Gentleman himself was explaining the meaning of the Clause originally that that was what he intended to do, and that Increment Duty is only to be charged and paid in so far as it has not been paid before. What I mean is this. Here is a little property. It is not exempted under the Clauses we have got to so far. It is going to pay Increment Duty if and when it is opened up. That property, we will say, had an original value fixed upon it of which the annual equivalent, taken on the basis provided for in this Clause, would be £1,000 a year. Now we understand the position in regard to the initial stage. Supposing in the first year that the property is actually worked you get £1,200 a year. I take it £200 for that year will be the increment, and it would have to pay duty. Supposing the next year you would have £1,400. I want to know whether the duty is on £200 or whether it has then to pay upon £400. Then supposing in the third year the royalty went down to £500, and subsequently became £1,500. The suggestion in my Amendment is that it should never pay Increment Duty again unless the figure it has to pay upon is upwards of £1,400. I do not think that is the effect of the Clause as it stands.

Mr. LLOYD-GEORGE

We could not possibly accept the Amendment. The hon. Member has treated the annual value as if it were the capital value. Supposing a colliery worked up gradually from £10,000 to £60,000 a year. The effect of the Amendment is that when it got to £20,000 you would only pay duty on the difference between £10,000 and £20,000. Having got to £20,000, you take that as the starting point, and pay on the difference between £20,000 and £40,000. I am not going to assist the hon. and learned Gentleman to do that, because it means that he treats the annual value as if it were the capital value. We have treated 12½ years' purchase as the value of mineral property, so that your original value is £12,500. If the colliery is worked up to £60,000, the capital value is £750,000. The real increment there is not the difference between £1,000 and £60,000, but between £12,500 and £750,000, so that the capital increment is an increment of £740,000. The hon. and learned Gentleman says if he pays on £60,000 he has discharged the whole of his obligations. We could not possibly accept that. It would put the Increment Duty for mines on a totally different basis from the Increment Duty on any other property.

Mr. WATSON RUTHERFORD

Am I right, on the interpretation of the Clause, in saying that if the rental value for the purpose of paying the duty does not exceed what was paid last year there is no increment?

Mr. LLOYD-GEORGE

No; the hon. and learned Gentleman is quite wrong. You refer back always to the original site value, or, if you are paying on capital, to the last occasion on which you paid capital Increment Duty. Supposing you own a mine of the value of £100,000, and someone buys it and pays a capital sum for it. From that date onward the £100,000 will be the figure from which you will compute your increment value. If the royalty amounted to £10,000, Increment Duty would only be paid on £2,000. Does the hon. and learned Gentleman follow me?

Mr. WATSON RUTHERFORD

No, I cannot understand it at all. The Clause reads in this way: "The increment value shall, instead of being estimated as a capital sum, be taken to be the sum (if any) by which, in each year during which the tenancy under the lease continues or the minerals are being worked, as the case may be, the rental value on which Mineral Eights Duty is charged in respect of the right to work the minerals exceeds the annual equivalent 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, as the case may be; and the annual equivalent of any such capital value of the minerals shall be taken to be two twenty-fifth parts of that capital value." From that it appears to me that what you have to pay upon in 1912 is one or other of two things. It is either the amount which, in the year 1912, the rental exceeds the original site value, or exceeds what has been paid upon in 1911, and in order to ascertain what that annual value is, as compared with the capital value on the last preceding occasion, it is stated that you have to take the rental value at two twenty-fifth parts of that capital value.

Mr. LLOYD-GEORGE

I can see where the hon. and learned Gentleman has gone wrong. I can see where he has branched off. He treats the annual increment value as if it were an occasion for Increment Tax. The occasions for Increment Tax are mentioned in Clause 1. They are sale, lease, or death. If you have a sale, or a death, and if Increment Value Duty is collected, then the capital value is the amount paid on the sale or the valuation at death. That is an occasion, and you refer back to that in order to ascertain the increment value. The last occasion must be one of the occasions mentioned in Clause 1, where there is a capital sum paid, or, in case of death, where there is a capital valuation.

Mr. WATSON RUTHERFORD

In asking to withdraw the Amendment, I would ask the Chancellor of the Exchequer in all seriousness to believe that I did not read the Clause in the way he says it is capable of being read. Gentlemen who are paid fees to read Clauses of this kind and to give opinions as to what they mean have read this Clause in different ways, and none of them agree either with me or with the Chancellor of the Exchequer. Therefore, I think the moving of this Amendment has been useful in eliciting from the ment has been useful in eliciting from the matter. Whether the Clause is clear to the right hon. Gentleman or not, it is capable of being read in different ways by a considerable number of other people.

Mr. LLOYD-GEORGE

I would say at once, as the hon. and learned Gentleman has some confusion in his mind as to the meaning of the Sub-section, and as he thinks it is desirable to look at the matter from the drafting point of view, that I will see whether it is necessary to introduce words to make it still clearer. The hon. and learned Gentleman sees that it is clear what the intention of the Sub-section is.

Mr. WATSON RUTHERFORD

What I understand is that the occasion referred to in line 22 ["on the last preceding occasion on which Increment Value Duty has been collected"] refers back to the first Clause of the Bill, and that it is not one of those occasions referred to in the Clause at all.

Mr. LLOYD-GEORGE indicated assent.

Amendment, by leave, withdrawn.

Mr. LAURENCE HARDY

I beg to move, in Sub-section (3), after the word "be" ["as the case may be"], to insert the words "provided that where Increment Value Duty has been paid under this Section, and where in any subsequent year the rental value is a sum less than the annual equivalent; of the capital value of the minerals, the amount of such difference shall be added to the capital value and so on from year to year, and no Increment Value Duty shall be charged unless or until the rental value exceeds the annual equivalent of the capital value of the minerals as so amended."

I think the Government should devise some means by which we should be enabled to meet the question of what is called "shorts." I will give an illustration of what I mean. Supposing that in the first year of a lease, as is very probable, there is a short, there would be only, say, £600 paid to the royalty owner. In subsequent years, when there was a larger output, the royalty would go up above the level of the annual equivalent of the capital value. I think there should be some means of setting off against that the amount which was paid below that amount during the other years of the lease. It is a difficult matter to frame an Amendment to meet the ease, and I would ask the Chancellor of the Exchequer if he cannot accept my words to devise some Amendment by which the royalty owner will not be called upon to pay on what he has not received.

Sir W. ROBSON

This appears to be our not unfamiliar friend detriment appearing in a somewhat new guise in connection with the Mineral Rights Duty. Whatever might be done in order to give some relief to the mineral royalty owner where he is not receiving what in other circumstances he would receive, I am sure this particular Amendment could scarcely be adopted. What the hon. Member proposes is that when there is a year where the royalty owner has made a loss we should allow him to add what loss to the original capital value—in other words, to raise the data line above that upon which Increment Value Duty can be charged.

Mr. LAURENCE HARDY

I am willing to admit that my words may not be satisfactory, but I think my meaning is quite clear.

Sir W. ROBSON

I think the plan the hon. Member is suggesting, as far as I can follow the matter, which is very complicated, is asking a great deal too much. If I understood his suggestion, he would allow the shortage on a particular year to be added to the capital value until the whole of it was made up by deductions of duly.

Mr. LAURENCE HARDY

Not deductions of duty, but the amount duty is taken upon.

Sir W. ROBSON

I do not know how he proposes to do it. We cannot possibly accept this Amendment. We shall have to adopt in this case the principle we have adopted in other cases, of not making allowances for decrement when putting a tax on increment.

Mr. LAURENCE HARDY

asked leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. LAMBTON

I beg to move, in Subsection (3), to leave out the words "two twenty-fifth parts" ["value of the minerals shall be taken to be two twenty-fifth parts"], and to insert instead thereof the words "one equal tenth part."

I do not think you can take the same number of years' purchase for coalfields which are not developed as you take in respect of existing rich coalfields. I am told by some valuers in the North of England that if they had to value coalfields which are not seams of good coal, and where the coal is not easily got at, they would adopt 10 years' purchase, and not 12½ years. I think there is a strong probability that many of the new mines to be opened up will be less rich than the existing mines, and there ought to be some deduction made in regard to capital value. I am told that 10 years' purchase would be a fair valuation. In South Yorkshire, if these valuers had to value coalfields, they would not put them at 12½ years' purchase, but at 10 years' purchase, because of the chances of wash-outs and faults.

Sir W. ROBSON

The hon. Member who moved the Amendment has taken the opinion of some experts as to what would be the fair average number of years for valuing unworked minerals. I think they have given rather a low figure in saying that they would put it at 10 years' purchase. Remember, there is no rental value at all. In all the great mineral districts of England the royalties are taken on a much greater number of years' purchase than the profits, and 12½ years is nearer a fair average than 10 years' purchase. A reduction would mean a substantial difference, and the Government cannot agree with it.

Mr. LAMBTON

The learned Attorney-General talks about these coalfields which have been opened out fetching a much higher rate than 10 years' purchase. What I referred to is future leases of mines. In these rich coalfields all the coal is already let. Can the right hon. Gentleman point out any place in Northumberland and Durham where the coal is not let? Only poor coalfields which are difficult to get at will be opened up in the future, and in those cases the possible capital value will be 10 years, and not 12½.

Mr. BALFOUR

We have been told earlier in the evening by the hon. Member for Mansfield (Mr. Markham) that only 2 per cent. of the coal minerals of this country were under lease. I was very much astonished at the statement, but my hon. Friend (Mr. Lambton) tells me that all the coalfields in England worth working are leased. It may be that only 2 percent. of the minerals of this country will count as minerals which were being worked under the definition of the Bill, and that the vast majority of the minerals are future minerals which would come under the new scheme. I very much question that, and I should like to know whether the Government have got any views themselves—I do not mean precise figures—as to the amount of mineral wealth of the country which is to come under Mineral Duty? It is an important point, because the Exchequer will be helped in a very different manner if there is a great deal of mineral wealth unleased in this country or very little. I would like to ask also whether the Government have quite made up their minds as to whether it is fair to work on an average? They have chosen an average, after consultation with their experts, of 12½ years' purchase on which to base the annual equivalent value of a mine. I should have thought I confess that the annual equivalent of a mine should be decided in respect of each mine separately. How it is accurate to deal with mines which can only be leased on a 10 years' basis as if they were leased on a 12½ years' basis I do not know, nor do I see that the individual injustice is got over by the statement that an average of 12½ years' purchase is just. It may be just, but we are not dealing with averages, but with individual owners of individual mines. It may be the best that the Government can do, but nobody can persuade me that it is equitable. It may be as near equity as with the imperfection of this imperfect world we can get, but manifestly it cannot be right to deal with a great many different individuals on an average for property whose value depends on each individual case. No answer, so far as I know, has been given to that. What my hon. Friend (Mr. Lambton) proposes is to substitute what he thinks is a better average; but still, it is only an average, and I cannot think it is the right way to deal with it.

Mr. LLOYD-GEORGE

This figure is really not an average. It is much nearer a minimum than an average. There are many parts of the country where 20 years and even a larger number of years' purchase of the mineral profits would be the rule. I would not like to say what the maximum would be, but I am perfectly certain you would get a higher figure throughout the country than 12½ years' purchase. I should be very much astonished to hear of any case where you could get less than 12½ years' purchase for mineral property. This is for the advantage of the taxpayers, because it puts the basis of the figure much higher than it otherwise would be, and I am perfectly certain that, so far from being an injustice to the owner, we have on the whole really taken the lowest possible figure rather than an average. Can the right hon. Gentleman tell me a case, or can anyone give me a number of cases from any district showing that the years' purchase have been 10 or 11? Therefore, really we have taken the lowest figure to meet the justice of the case. The right hon. Gentleman knows that there has been a great deal of controversy on the subject of the unleased minerals which may be available in this country in future. All I hope is that the estimate of my hon. Friend (Mr. Markham) is the correct one. Of course, if it is, there is untold wealth for some future Chancellor of the Exchequer in this new tax which we are setting up. If there is only 2 per cent. leased now, 40 times that would be £320,000,000, and 20 per cent. of that would be £64,000,000, and that would be a magnificent revenue for some Chancellor of the Exchequer. I hardly like to controvert it—it is so much better to believe it—but I am afraid that my faith is scarcely equal to that. I think what my hon. Friend has in his mind is rather the quantity of coal which is unworked. But probably the best of these coalfields have been let.

Of course, we cannot tell, but they may discover very valuable coalfields where we know nothing about them now. Undoubtedly in the last few years there have been some very remarkable discoveries. I am not sure that my hon. Friend the Member for Mansfield (Mr. Markham) is not responsible for a remarkable discovery himself in a district which was not worked before. Then there is the case of the Dudley Collieries, where, although the expert advice was that there was no coal at all, the owner insisted on making investigations, and he found a most valuable coalfield. And what may actually happen is that coalfields will be found in places where they are not suspected now. It is not so long ago since they discovered gold in Wales. I think most of that gold was really brought from the City of London. I think there was more gold cast into those mines than gold extracted from them, on a balance; but no one can tell, but if a mine had been discovered it would be paying its way. But until there is better evidence I cannot accept the theory of my hon. Friend that 2 per cent. represents the actual mines leased at the present moment; and we do not know the amount of the coal not yet discovered, yet alone leased. Take the coalfields in Wales. There is a great deal of coal there which is difficult to get at, and it cannot be worked at the present moment until the present mines are exhausted, because it would not pay working, and it will not pay until the coal becomes much more expensive than it is, as I have no doubt it will the moment all these mines are exhausted. The steam coal now being worked brings a cheaper price compared with what it would bring once you get from the leased end of the valley to the other end of the valley, which must then be worked, and at that moment we shall be deriving our 20 per cent. at the other end of the valley. I do not know when, but no doubt some future Chancellor of the Exchequer will bless the work which we are doing to-night, and derive considerable revenue from it.

Mr. STUART-WORTLEY

I do not think that the Chancellor of the Exchequer quite understands the meaning of my hon. Friend's Amendment, which is, that whether there are new discoveries of coal made or not, the general tendency is that all coal discovered must necessarily lie deeper and be found only in conditions which make it more difficult and more expensive to work.

Mr. LAMBTON

The right hon. Gentleman has said just now that coal in Wales, which is not at present worked, would in future be more expensive to get at and to work and give less in the royalties.

Mr. LLOYD-GEORGE

That I agree would make a difference in taxable value, but why it should make a difference in number of years' purchase I cannot understand. You might pin your faith on £50,000 for the capital value of mineral rights which you know perfectly well are worth leasing, but you would not give £5,000 for mineral rights on a property where it is very speculative and very doubtful whether it would pay. The circumstances referred to would simply reduce the capital value, but they would make no difference in the estimate at all.

Mr. LUPTON

In putting it down here as 8 per cent. the Chancellor of the Exchequer has been very liberal. I have been able myself to negotiate 5 per cent., which is a very much higher price. With regard to the question raised by the hon. Member for Durham (Mr. Lambton), of course, as the Chancellor of the Exchequer has pointed out, that has to do with valuation, but has nothing whatever to do with the rate which is proposed and is part of the capital value. With regard to the amount of coal in the country, it

may interest the Chancellor to know that the amount of coal is as nearly as possible 330,000 million tons, and at the rate of 300 million tons a year that supply would last over a thousand years. The exact figures are not very important, except to show we have practically inexhaustible resources.

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

The Committee divided: Ayes, 199; Noes, 62.

Division No. 747.] AYES. [8.0 p.m.
Abraham, W. (Cork, N.E.) Glover, Thomas Nolan, Joseph
Abraham, William (Rhondda) Goddard, Sir Daniel Ford Norman, Sir Henry
Acland, Francis Dyke Greenwood, G. (Peterborough) Nugent, Sir Walter Richard
Agnew, George William Hall, Frederick Nuttall, Harry
Ainsworth, John Stirling Harcourt, Robert V. (Montrose) O'Donnell, C. J. (Walworth)
Allen, A. Acland (Christchurch) Hardy, George A. (Suffolk) O'Kelly, James (Roscommon, N.)
Allen, Charles P. (Stroud) Harmsworth, R. L. (Caithness-shire) Partington, Oswald
Atherley-Jones, L. Hart-Davies, T. Pearce, Robert (Staffs, Leek)
Baker, Sir John (Portsmouth) Harvey, W. E. (Derbyshire, N.E.) Pickersgill, Edward Hare
Balfour, Robert (Lanark) Haslam, Lewis (Monmouth) Ponsonby, Arthur A. W. H.
Barker, Sir John Hazel, Dr. A. E. W. Power, Patrick Joseph
Barnes, G. N. Hedges, A. Paget Price, C. E. (Edinburgh, Central)
Barry, Redmond J. (Tyrone, N.) Helme, Norval Watson Priestley, Sir W. E. B. (Bradford, E.)
Beauchamp, E. Henderson, J. McD. (Aberdeen, W.) Rea, Rt. Hon. Russell (Gloucester)
Beck, A. Cecil Hodge, John Reddy, M.
Bennett, E. W. Hope, John Deans (Fife, West) Rees, J. D.
Berridge, T. H. D. Hope, W. H. B. (Somerset, N.) Rendall, Athelstan
Bethell, Sir J. H. (Essex, Romford) Horniman, Emslie John Richards, T. F. (Wolverhampton, W.)
Boulton, A. C. F. Hyde, Clarendon G. Richardson, A.
Bowerman, C. W. Illingworth, Percy H. Roberts, Charles H. (Lincoln)
Brigg, John Isaacs, Rufus Daniel Roberts, G. H. (Norwich)
Brunner, J. F. L. (Lancs., Leigh) Jenkins, J. Robson, Sir William Snowdon
Brunner, Rt. Hon. Sir J. T. (Cheshire) Johnson, John (Gateshead) Roch, Walter F. (Pembroke)
Burns, Rt. Hon. John Jones, Leif (Appleby) Roe, Sir Thomas
Burt, Rt. Hon. Thomas Jones, William (Carnarvonshire) Rogers, F. E. Newman
Buxton, Rt. Hon. Sydney Charles Jowett, F. W. Rose, Sir Charles Day
Byles, William Pollard Joyce, Michael Russell, Rt. Hon. T. W.
Clough, William Keating, M. Rutherford, V. H. (Brentford)
Cobbold, Felix Thornley Kekewich, Sir George Samuel, Rt. Hon. H. L. (Cleveland)
Collins, Stephen (Lambeth) King, Alfred John (Knutsford) Seely, Colonel
Collins, Sir Win. J. (St. Pancras, W.) Laidlaw, Robert Shackleton, David James
Compton-Rickett, Sir J. Lamb, Edmund G. (Leominster) Shaw, Sir Charles E. (Stafford)
Corbett, A. Cameron (Glasgow) Lamb, Ernest H. (Rochester) Sherwell, Arthur James
Corbett, C. H. (Sussex, E. Grinstead) Lamont, Norman Shipman, Dr. John G.
Cornwall, Sir Edwin A. Layland-Barratt, Sir Francis Silcock, Thomas Ball
Cotton, Sir H. J. S. Lever, A. Levy (Essex, Harwich) Snowden, P.
Cowan, W. H. Levy, Sir Maurice Steadman, W. C.
Cross, Alexander Lewis, John Herbert Stewart, Halley (Greenock)
Crossley, William J. Lloyd-George, Rt. Hon. David Stewart-Smith, D. (Kendal)
Cullinan, J. Lundon, T. Strachey, Sir Edward
Dalziel, Sir James Henry Lupton, Arnold Straus, B. S. (Mile End)
Davies, Ellis William (Eifion) Macnamara, Dr. Thomas J. Summerbell, T.
Davies, Sir W. Howell (Bristol, S.) Macpherson, J. T. Taylor, John W. (Durham)
Dewar, Arthur (Edinburgh, S.) MacVeagh, Jeremiah (Down, S.) Tennant, H. J. (Berwickshire)
Duckworth, Sir James MacVeigh, Charles (Donegal, E.) Thomas, Sir A. (Glamorgan, E.)
Duncan, C. (Barrow-in-Furness) M'Callum, John M. Thorne, G. R. (Wolverhampton)
Duncan, J. Hastings (York, Otley) M'Laren, Sir C. B. (Leicester) Tomkinson, James
Dunn, A. Edward (Camborne) M'Laren, H. D. (Stafford, W.) Toulmin, George
Dunne, Major E. Martin (Walsall) Mallett, Charles E. Trevelyan, Charles Philips
Edwards Sir Francis (Radnor) Markham, Arthur Basil Verney, F. W.
Elibank Master of Marnham, F. J. Vivian, Henry
Essex, R. W. Masterman, C. F. G. Wadsworth, J.
Esslemont, George Birnie Meagher, Michael Walker, H. De R. (Leicester)
Evans, Sir S. T. Menzies, Sir Walter Walsh, Stephen
Everett, R. Lacey Middlebrook, William Wardle, George J.
Falconer, J. Molteno, Percy Alport Warner, Thomas Courtenay T.
Ferens, T. R. Mond, A. Wason, John Cathcart (Orkney)
Fiennes, Hon. Eustace Morse, L. L. Watt, Henry A.
Fuller, John Michael F. Muldoon, John White, J. Dundas (Dumbartonshire)
Fullerton, Hugh Murphy, John (Kerry, East) White, Sir Luke (York, E. R.)
Gibb, James (Harrow) Myer, Horatio Whitehead, Rowland
Gladstone, Rt. Hon. Herbert John Newnes, F. (Notts, Bassetlaw) Whittaker, Rt. Hon. Sir Thomas P.
Glendinning, R. G. Nicholson, Charles N. (Doncaster) Wiles, Thomas
Wilkie, Alexander Wilson, P. W. (St. Pancras, S.) Yoxall, Sir James Henry
Williams, J. (Glamorgan) Wilson, W. T. (Westhoughton)
Williamson, Sir A. Winfrey, H. TELLERS FOR THE AYES.—Mr. Joseph Pease and Captain Norton.
Wills, Arthur Walters Wood, T. M'Kinnon
Wilson, Henry J. (York, W.R.)
NOES.
Acland-Hood, Rt. Hon. Sir Alex. F. Forster, Henry William Morrison-Bell, Captain
Balcarres, Lord Gardner, Ernest Powell, Sir Francis Sharp
Baldwin, Stanley Gooch, Henry Cubitt (Peckham) Randles, Sir John Scurrah
Balfour, Rt. Hon. A. J. (City, Lond.) Goulding, Edward Alfred Ratcliff, Major R. F.
Banbury, Sir Frederick George Guinness, Hon. R. (Haggerston) Remnant, James Farquharson
Banner, John S. Harmood- Hardy, Laurence (Kent, Ashford) Renwick, George
Barrie, H. T. (Londonderry, N.) Harris, Frederick Leverton Roberts, S. (Sheffield, Ecclesall)
Carlile, E. Mildred Harrison-Broadley, H. B. Ropner, Colonel Sir Robert
Carson, Rt. Hon. Sir Edward H. Hay, Hon. Claude George Rutherford, Watson (Liverpool)
Cave, George Helmsley, Viscount Salter, Arthur Clavell
Clyde, J. Avon Hills, J. W. Starkey, John R.
Coates, Major E. F. (Lewisham) Hope, James Fitzalan (Sheffield) Staveley-Hill, Henry (Staffordshire)
Cochrane, Hon. Thomas H. A. E. Hunt, Rowland Stone, Sir Benjamin
Courthope, G. Loyd Kimber, Sir Henry Thomson, W. Mitchell- (Lanark)
Craig, Captain James (Down, E.) King, Sir Henry Seymour (Hull) Valentia, Viscount
Craik, Sir Henry Lane-Fox, G. H. Willoughby de Eresby, Lord
Dalrymple, Viscount Law, Andrew Bonar (Dulwich) Wortley, Rt. Hon. C. B. Stuart-
Douglas, Rt. Hon. A. Akers- Lockwood, Rt. Hon. Lt.-Col. A. R. Younger, George
Duncan, Robert (Lanark, Govan) Lowe, Sir Francis William
Faber, George Denison (York) Lyttelton, Rt. Hon. Alfred TELLERS FOR THE NOES.—Mr Lambton and Mr. Newdegate.
Fell, Arthur Meysey-Thompson, E. C.
Fletcher, J. S. Mildmay, Francis Bingham

Mr. NEWDEGATE moved to insert, after Sub-section (4): "(5) Where Increment Value Duty has been paid under this Section and thereafter the capital value of the minerals is diminished or destroyed from any cause other than the working or getting of the minerals the capital value of the minerals shall be forthwith specially ascertained in accordance with the provisions of this Act, and the proprietor of the minerals, where the proprietor is working the minerals, or the immediate lessor of the working lessee, as the case may be (or, where any mining lease has been granted subsequent to the first ascertainment of the original capital value of the minerals, in such proportions, respectively, as the Commissioners think fit), shall be entitled to recover from the Commissioners the sums paid for Increment Value Duty under this Section, so, however, that no greater sum shall be recoverable from the Commissioners than the difference between the original capital value of the minerals and the capital value of the minerals specially ascertained as aforesaid."

The object of this Amendment is that where somebody has paid Increment Duty on a value that for some cause or other does not exist, he should be reimbursed the money which he ought not to have paid. Supposing that a property is originally valued at £12,500. A mine is then opened, and the value of the property becomes £25,000, so that Increment Duty has to be paid on £12,500. The vendor then leases his property, and for the first three years he will receive £500 in mine rents, on which he will pay Mineral Duty. The next three years he may receive £2,000 in royalties. He has thus paid Increment Duty on a £1,000 per annum—that is, £3,000 for three years—and the duty which he pays will be £600. Then, owing to "faults" which cannot be got over, or fires, or floods, or what is called the act of God, the mine is closed down. The owner would only in that time have received £7,500, whilst all the time he has been paying the duty on £12,500 increment on the original value. What I ask is that if, owing to any "fault" or misfortune of the kind I have described the mine ceases to work, the owner of the minerals who has paid Increment Duty on more than he has received at the time when the mine ceased to work, should be reimbursed to that extent. I think it is only fair and just that he should be reimbursed. The valuation is to be taken in a somewhat arbitrary manner under this Bill, and when it is found out that it is not correct and that through no fault of the owner the mine has come to grief, and he has paid in Increment Duty a sum which he has not received, then I think that the owner ought to be recouped the sum he has overpaid. I hope I have made my meaning clear. It is rather a complicated question, but I do trust that the Attorney-General will see his way to give relief in this case, because otherwise I think a very great injustice will be done. I have put this Amendment down at the request of those who are interested in mines in this country.

Sir W. ROBSON

I am sorry that the Government cannot accept this Amend- ment. The hon. Gentleman who has moved it made perfectly clear its object, and he stated the case as forcibly as it could be stated. He has given us the case of the royalty owner who has come under Increment Value Duty by reason of some great increase of royalty he has got over and above the original capital value of the mine. Then by some misfortune he ceases to receive that increment. Under these circumstances he would, of course, cease to pay, because the increment is collected in each year. The hon. Member would go rather further than was suggested in the case of surface value, and would entitle the mine owner in that case to recover the increment that he might have paid during the preceding year, even although he had received that increment before the Exchequer had got duty thereon. That would be going much further than was suggested in the case of surface value. We have endeavoured to make mineral rights as nearly analogous to surface value as we can, but instead of capital value we have made the comparison between annual value, so that the owner pays on annual value whenever there is an increment, and he ceases to pay whenever there is a decrement or no increment. But to ask us to allow the owner to recover sums by way of duty on increment which he has actually pocketed is going much further than was suggested in the other case, and much further than the Government feel inclined to go.

Mr. AINSWORTH

I would like to call the attention of the Government to one point, and that is whether the mining owner who works his own mine should not be treated with more consideration than in the case of a mine which is leased and worked.

The DEPUTY-CHAIRMAN (Mr. Caldwell)

That question does not arise on this Amendment.

Mr. AINSWORTH

With all respect, may I say, I see the words "where the proprietor is working the mineral."

The DEPUTY-CHAIRMAN

How does that bring in the other question?

Mr. AINSWORTH

If I am out of order I will say no more except to hope that the Government will give the matter some attention.

Question, "That those words be there added," put, and negatived.

Amendment made: In Sub-section (5) to leave out the word "the" ["payable to the lessor"], and insert instead thereof the word "a."—[Mr. Newdegate.]

Mr. WATSON RUTHERFORD moved to leave out Sub-section (6).

What the Sub-section says is this: "Where minerals cease to be comprised in a mining lease, or to be worked within the meaning of this section, the capital value of the minerals at the time shall be specially ascertained in accordance with the provisions of this Act, and the capital value as so ascertained shall be treated as the original capital value of the minerals." I know we have had before to-day explanation as to the meaning of some of these Clauses. The meaning of this Sub-section which suggested itself to me was this, that this original capital value that is to be arrived at at the end of the lease was really for the purpose of making the next lease. I cannot conceive any possible reason why, at the end of a lease, you should then start to get at the original capital value unless that original capital value was to lead to a new transaction and then it is intelligible. There is no other possible explanation of the Sub-section. Neither myself nor two or three others who have interested ourselves in this have been able to make out any reason at all for the insertion of this Sub-section, unless it has got some hidden meaning of the kind I have suggested. I do not wish seriously to ask that this Subsection should be absolutely omitted if it means anything, or if it has got any raison d'être. I think I am entitled, until I hear some good reason to the contrary, to ask that it should be omitted from this very complicated Clause, which is quite sufficiently complicated without it.

Sir W. ROBSON

I think I can satisfy the hon. Member that the Sub-section is necessary. He has not suggested in what respects it could very well be improved. Sub-section (2) of this Clause deals, as has been so often pointed out, with the two cases of minerals comprised in mining leases and where minerals are being worked, and it gives those two cases certain exemptions. We have to contemplate the cases of minerals ceasing to be comprised in mining leases or ceasing to be worked. They have a period of 12 months' grace in either of those two events. I think the hon. Member was quite wrong in supposing that the Subsection means that there must be at the end of the lease an original valuation.

Mr. WATSON RUTHERFORD

It says so.

Sir W. ROBSON

Not necessarily. What happens if there is no fresh lease, if they cease to be comprised in any lease? The owner, if he choose, may either go on working or lease afresh. If he goes on working or leases afresh, then the exemption, such as it is, is continued in his favour. If he leaves it alone, and neither leases it nor goes on working it, then, at the end of the twelvemonth, the Subsection comes into operation. We must have something dealing with that case, and that is why the Sub-section is necessary.

Mr. WATSON RUTHERFORD

I understand, but what happens then?

Sir W. ROBSON

Under those circumstances the exemption ceases to apply. We have got to the limits of the exemption, and the Sub-section says you are then to ascertain the capital value of the minerals at that time, because he, then having lost the benefit of the exemption, comes under the ordinary Increment Value Duty, and you have therefore to ascertain the original capital value at that time. I do not think he is likely to pay much increment in the ease supposed, because we are dealing with a wayleave estate; but that is why the Sub-section is there, and I think it is intelligible.

Mr. WATSON RUTHERFORD

There is no doubt that the explanation of the Attorney-General is satisfactory up to a point. We understood that whether property was comprised in a lease or not at the present moment it was to be valued now. But if all the present collieries that are being worked and all the minerals comprised in existing leases are to be exempted from the valuation of 1910, and if that valuation is not to be made until the period when it comes within Sub-section (6) in the manner the Attorney-General has explained, that would be an answer to the Amendment. If, however, they had to be valued now, the Sub-section would be absolutely unnecessary, because we should have the original capital value. I shall certainly press my Amendment unless it can be shown in the Bill that all existing mines and minerals, if they are actually being worked, are not to be valued at once.

Sir W. ROBSON

The valuation next year, in any event, is to be in the interest of the taxpayer. The hon. Member has not pointed out where working mines are put under the necessity for that valuation.

Mr. WATSON RUTHERFORD

Everything is to be valued.

Sir W. ROBSON

That is a wider question.

Mr. BONAR LAW

Surely the Attorney-General knows whether or not existing mines are to be valued. He has treated it as a question which is still sub judice.

Mr. WATSON RUTHERFORD

Unless the Attorney-General can point to something in the Bill which has escaped our attention, there can be no doubt whatever that all existing mines and minerals, whether being worked or not, are to be valued. If I understand the hon. and learned Gentleman aright, that valuation for the purposes of this taxation is not to come into force as long as these properties are being worked; but when they cease to be in a lease or to be worked, and they become liable to the duty, there is to be a new valuation. That is the valuation referred to in Sub-section (6), and the valuation so ascertained is to be treated as the original capital value of the minerals. If that is so, I am glad to know it. It will be a great boon to mine-owners as regards Increment Value Duty, because, instead of their being started on a datum line comparatively low, they will be started on a datum line at a considerably higher point of development. If, on the other hand, the minerals have been entirely or nearly worked out, it will provide a new basis of duty, and be an advantage in that respect. In any case when I see a Clause of this kind which is quite contradictory to the general run of the other provisions of the Bill, I think I am justified in asking for an explanation. If I am right in the conclusions I have come to, I should be quite willing to withdraw the Amendment.

Mr. BONAR LAW

Nothing can be more pertinent to the Bill than that we should know whether or not all existing mines are to be valued. I understood the Attorney-General just now to suggest that that was a question of little moment.

Sir W. ROBSON

I did not say so. I merely wished to refrain from going into matters beyond the scope of the Amendment. If the hon. Member will look at Clauses 1 and 17 he will see the scope of the valuation. The question does not arise on this Amendment.

Mr. STEPHEN WALSH

There is a strong reason for the existence of this Sub-section. Coal is not always worked out year by year in accordance with what may be the theoretical annual value. There are large mineral properties which in their working do not keep pace with what may be held to be the annual value of the lease. When the lease is determined it often happens that very large values have been overpaid. It may be that the lessor refuses to let the lessee work up his "shorts," and tens of thousands of pounds may be overpaid by the lessee in consequence of the practical working not keeping pace with the actual rent paid. When the lessor puts an end to the lease there is often still a very great value which, if it is due to anybody at all, is really due to the working colliery owner. In those cases it is necessary in the interests of equity that the State should take a new valuation, because in the womb of the earth there are comprised values for which the lessor has been paid but for which the lessee has not got a real equivalent. If every year the working was in exact proportion to the rent, there would be little reason for this Sub-section. But the facts are quite otherwise, and it is necessary that there should be a new valuation in order that the State may get its rights. That is the reason for this Sub-section, so far as I can see, and so far as I am able to understand. There is a reason for this Sub-section, notwithstanding the original valuation, because the working does not keep pace with the yearly rent. When that is the case it is necessary that a later valuation should take place in order to determine the interest of the State and of

the lessor. I feel strongly that this Subsection should be retained.

Amendment, by leave, withdrawn.

Mr. MARKHAM

I understand during the time I was out of the House yesterday that the right hon. Gentleman the Leader of the Opposition referred to certain remarks I made with regard to the leased portion of the coal of this country. I should like to say that when I stated incidentally that only 1 per cent. of the minerals in this country were leased, I was not speaking perhaps so carefully as I ought to have done. What I meant to say was that only a very very small proportion of it was. I do not think certainly that 95 per cent. of the minerals—the total coal supplies—of this country are comprised in mining leases. In my calculation I estimated that the time mining leases in this country would run was on an average of about 30 years. The Report of the Royal Commission on our Coal Supplies was not worth the paper it was written on, because, to my knowledge, innumerable seams of coal were not taken into account. Further, in my opinion, there are enormous areas where coal is likely to be found which were not even scheduled by the Royal Commission in their Report. Let me give an instance: A coalfield in Warwickshire where, after two years' boring, I proved that in that one coalfield alone there were 60,000,000 tons of coal. Of this the Royal Commission have not put clown a single ton.

Question put, "That the Clause, as amended, be added to the Bill."

The Committee divided: Ayes, 188; Noes, 44.

Division No. 748.] AYES. [8.40 p.m.
Abraham, W. (Cork, N.E.) Brunner, Rt. Hon. Sir J. T. (Cheshire) Edwards, Sir Francis (Radnor)
Abraham, William (Rhondda) Burns, Rt. Hon. John Essex, R. W.
Acland, Francis Dyke Burt, Rt. Hon. Thomas Esslemont, George Birnie
Agnew, George William Buxton, Rt. Hon. Sydney Charles Evans, Sir S. T.
Ainsworth, John Stirling Byles, William Pollard Everett, R. Lacey
Allen, A. Acland (Christchurch) Clough, William Ferens, T. R.
Allen, Charles P. (Stroud) Cobbold, Felix Thornley Fiennes, Hon. Eustace
Atherley-Jones, L. Collins, Stephen (Lambeth) Fullerton, Hugh
Baker, Sir John (Portsmouth) Compton-Rickett, Sir J. Gibb, James (Harrow)
Balfour, Robert (Lanark) Corbett, A. Cameron (Glasgow) Gladstone, Rt. Hon. Herbert John
Barker, Sir John Corbett, C. H. (Sussex, E. Grinstead) Glendinning, R. G.
Barnes, G. N. Cornwall, Sir Edwin A. Glover, Thomas
Barry, Redmond J. (Tyrone, N.) Cowan, W. H. Goddard, Sir Daniel Ford
Beauchamp, E. Crossley, William J. Greenwood, G. (Peterborough)
Beck, A. Cecil Cullinan, J. Gwynn, Stephen Lucius
Benn, W. (Tower Hamlets, St. Geo.) Davies, Ellis William (Eifion) Hall, Frederick
Bennett, E. N. Davies, Sir W. Howell (Bristol, S.) Harcourt, Robert V. (Montrose)
Berridge, T. H. D. Dewar, Arthur (Edinburgh, S.) Hardy, George A. (Suffolk)
Bethell, Sir J. H. (Essex, Romford) Duckworth, Sir James Harmsworth, R. L. (Caithness-shire)
Boulton, A. C. F. Duncan, C. (Barrow-in-Furness) Hart-Davies, T.
Bowerman, C. W. Duncan, J. Hastings (York, Otley) Harvey, W. E. (Derbyshire, N.E.)
Brigg, John Dunn, A. Edward (Camborne) Haslam, Lewis (Monmouth)
Brunner, J. F. L. (Lancs., Leigh) Dunne, Major E. Martin (Walsall) Hazel, Dr. A. E. W.
Hedges, A. Paget Molteno, Percy Alport Silcock, Thomas Ball
Helme, Norval Watson Mond, A. Snowden, P.
Hobart, Sir Robert Morse, L. L. Steadman, W. C.
Hodge, John Muldoon, John Stewart-Smith, D. (Kendal)
Hope, John Deans (File, West) Myer, Horatio Strachey, Sir Edward
Hope, W. H. B. (Somerset, N.) Newnes, F. (Notts, Bassetlaw) Straus, B. S. (Mile End)
Horniman, Emslie John Nicholson, Charles N. (Doncaster) Summerbell, T.
Hyde, Clarendon G. Nolan, Joseph Taylor, John W. (Durham)
Illingworth, Percy H. Norman, Sir Henry Tennant, H. J. (Berwickshire)
Jenkins, J. Nugent, Sir Walter Richard Thomas, Sir A. (Glamorgan, E.)
Johnson, John (Gateshead) Nuttall, Harry Thorne, William (West Ham)
Jones, Leif (Appleby) O'Connor, John (Kildare, N.) Tomkinson, James
Jones, William (Carnarvonshire) O'Donnell, C. J. (Walworth) Toulmin, George
Jowett, F. W. O'Kelly, Conor (Mayo, N.) Trevelyan, Charles Philips
Joyce, Michael O'Kelly, James (Roscommon, N.) Verney, F. W.
Keating, M. Partington, Oswald Vivian, Henry
Kekewich, Sir George Pearce, Robert (Staffs, Leek) Walker, H. De R. (Leicester)
Kilbride, Denis Pearson, Sir W. D. (Colchester) Walsh, Stephen
King, Alfred John (Knutsford) Pickersgill, Edward Hare Wardle, George J.
Laidlaw, Robert Ponsonby, Arthur A. W. H. Warner, Thomas Courtenay T.
Lamb, Edmund G. (Leominster) Price, C. E. (Edinburgh, Central) Wason, John Cathcart (Orkney)
Lamb, Ernest H. (Rochester) Priestley, Sir W. E. B. (Bradford, E.) Watt, Henry A.
Lambert, George Rea, Rt. Hon. Russell (Gloucester) White, J. Dundas (Dumbartonshire)
Lamont, Norman Reddy, M. White, Sir Luke (York, E. R.)
Layland-Barratt, Sir Francis Rees, J. D. Whitehead, Rowland
Lever, A. Levy (Essex, Harwich) Rendall, Athelstan Whittaker, Rt. Hon. Sir Thomas P.
Levy, Sir Maurice Richards, T. F. (Wolverhampton, W.) Wiles, Thomas
Lewis, John Herbert Richardson, A. Wilkie, Alexander
Lundon, T. Roberts, Charles H. (Lincoln) Williams, J. (Glamorgan)
Lupton, Arnold Roberts, G. H. (Norwich) Williamson, Sir A.
Macnamara, Dr. Thomas J. Robson, Sir William Snowdon Wills, Arthur Walters
Macpherson, J. T. Roch, Walter F. (Pembroke) Wilson, Henry J. (York, W.R.)
MacVeagh, Jeremiah (Down, S.) Roe, Sir Thomas Wilson, P. W. (St. Pancras, S.)
MacVeigh, Charles (Donegal, E.) Rogers, F. E. Newman Wilson, W. T. (Westhoughton)
M'Callum, John M. Rose, Sir Charles Day Winfrey, R.
M'Laren, H. D. (Stafford, W.) Russell, Rt. Hon. T. W. Wood, T. M'Kinnon
Markham, Arthur Basil Rutherford, V. H. (Brentford) Yoxall, Sir James Henry
Marnham, F. J. Samuel, Rt. Hon. H. L. (Cleveland)
Masterman, C. F. G. Shackleton, David James TELLERS FOR THE AYES.—Captain
Menzies, Sir Walter Shaw, Sir Charles E. (Stafford) Norton and Mr. Fuller.
Middlebrock, William Shipman, Dr. John G.
NOES.
Acland-Hood, Rt. Hon. Sir Alex. F. Fletcher, J. S. Newdegate, F. A.
Baldwin, Stanley Forster, Henry William Powell, Sir Francis Sharp
Banbury, Sir Frederick George Gardner, Ernest Randles, Sir John Scurrah
Barrie, H. T. (Londonderry, N.) Gooch, Henry Cubitt (Peckham) Ratcliff, Major R. F.
Carlile, E. Hildred Colliding, Edward Alfred Renwick, George
Cave, George Hardy, Laurence (Kent, Ashford) Roberts, S. (Sheffield, Ecclesall)
Cecil, Lord R. (Marylebone, E.) Harris, Frederick Leverton Salter, Arthur Clavell
Clyde, J. Avon Helmsley, Viscount Stone, Sir Benjamin
Coates, Major E. F. (Lewisham) Hills, J. W. Thomson, W. Mitchell- (Lanark)
Courthope, G. Loyd Hope, James Fitzalan (Sheffield) Valentia, Viscount
Craig, Captain James (Down, E.) Kimber, Sir Henry Wortley, Rt. Hon. C. B. Stuart.
Craik, Sir Henry King, Sir Henry Seymour (Hull)
Dickson, Rt. Hon. C. Scott Lambton, Hon. Frederick William TELLERS FOR THE NOES.—Mr. Watson Rutherford and Mr. R. Duncan.
Douglas, Rt. Hon. A. Akers- Law, Andrew Bonar (Dulwich)
Faber, George Denison (York) Lockwood, Rt. Hon. Lt.-Col. A. R.
Fell, Arthur Lowe, Sir Francis William

Question, "That the Clause stand part of the Bill," put, and agreed to.