HC Deb 11 August 1913 vol 56 cc2145-50

"(1) Where the Treasury are satisfied with respect to any class of persons in receipt of any salary, fees, or emoluments payable out of the public revenue that such persons are obliged to lay out and expend money wholly, exclusively, and necessarily in the performance of the duties in respect of which such salary, fees, or emoluments are payable, the Treasury may fix such sum as in their opinion represents a fair equivalent of the average annual amount laid out and expended as aforesaid by persons of that class, and in assessing the Income Tax on the salary, fees, or emoluments of persons of that class, there shall be deducted from the amount thereof the sums so fixed by the Treasury."

Clause brought up, and read the first time.

Sir RUFUS ISAACS

I beg to move the Clause in this form, which will bring it within the Rules of Order, and not deprive any person of any right to which he might be entitled.

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

Mr. CASSEL

This Clause is really the result of an endeavour to make special legislation in favour of Members of Par- liament. In the first place, there was to be a uniform deduction of £100 from the salaries of Members of Parliament, and I pointed out that that was not authorised by any provision in any Statute. At first the right hon. Gentleman combated that proposition, and referred me to various Acts of Parliament. He is now driven to the conclusion that this was a wholly un-authorised and illegal privilege to be conferred on Members of Parliament. He now proposes to give the Treasury this dispensing power set forth in the Clause. Personally, I am not quite sure that if Members of Parliament receive this benefit, it should not be extended to any class, for certainly it would be a monstrons injustice if it were not extended to every class. Members of Parliament are now to have it both ways. If their expenses are less than £100 they will get the benefit of the £100 deduction, and if they are more than £100 then they claim on what they have actually spent. But how are the Treasury going to give this privilege to Members of Parliament without extending it to every other Civil servant in the Kingdom? I say it would be a monstrous and outrageous thing if they did not extend a similar provision to all other Civil servants. On that ground, indeed, I do not think I shall raise any objection to this Clause. I think it is such that the Treasury either must exercise it in no case or must exercise it in every case.

I do think this is an illustration of the dangerous pitfalls which beset us when there is an endeavour to make special legislation in our own favour. If the same thing were contemplated in regard to any class of Civil servant, or officers of the House, or even the reporters in the Gallery, or the clerks of this House, it is doubtful whether such a privilege would have been granted. But simply because it was found inconvenient or too much trouble for Members of Parliament to make out their return like any other subjects of His Majesty, first of all it was sought to strain the law in their favour, and then to alter it when it was found that it could not be so strained. It is a wholly vicious principle, and whatever may be thought now about the payment of Members, whether it is right or wrong, it was done in a wrong way; it was done by mere Resolution, indefinite, vague and unintelligible. Yet the proposal of the right hon. Gentleman in this Clause I really think, after all, is harmless and useless, and on that ground I do not intend to oppose it. I do hope, however, that the Treasury will exercise their powers in the matter quite impartially and not merely confine the privilege to Members of Parliament, but to extend it to all Civil servants. At present none but. Members of Parliament have the right to deduct personal expenses. Directors of companies, clerks who go to the city, or anyone who has to go to a particular place to carry on his business, have not the same privilege which it is proposed to give to Members of Parliament. If the Clause is to be passed in its present form, I think it would be unjust if the Treasury extended the privilege to Members of Parliament alone. Either they should extend it to none or extend it to all.

Mr. HICKS BEACH

I should like a little further explantion of this Clause in order to see what it really means. It refers to "any salary, fees, or emoluments, payable out of the public revenue." Does that apply to soldiers and sailors, and to all Civil servants? If it does, then the Civil servant, the soldier, the sailor, may, as well as the Member of Parliament, deduct a certain specific sum from their income, laid down as expended "exclusively and necessarily in the performance of the duties in respect of which such salary, fees, or emoluments are payable, etc.," I want to know what justification there is for this proposal. We all know perfectly well that it only arises from the fact that the Chancellor of the Exchequer put an illegal interpretation on the Income Tax Act in order that a certain sum should be deducted in respect of expenses of Members of Parliament. If it is done in that case, I do not think it is fair either to exclude part of the salary paid to any Civil servant, or any military or naval officer. Why should Civil servants and those who are paid by the Crown receive more favourable treatment than other classes of individuals? There has been no justification offered for the Clause. If this Clause means what I think it means I shall certainly vote against it, and if it only means to refer to the salaries of Members of Parliament I shall vote against it with even greater vigour, because I see no justification for special treatment of Members of Parliament. I believe it is quite unnecessary to introduce it whichever way you look at it.

Mr. LLOYD GEORGE

The hon Member may perhaps be interested and pleased to know that this Clause is in order to regularise an order which was made by Lord St. Aldwyn when he was Chancellor of the Exchequer with reference, not to Members of Parliament, but to revising barristers, and also to regularise a proceeding with regard to another class which I mentioned on a previous occasion, and which the hon. and learned Gentleman may recollect.

Mr. CASSEL

The other case mentioned by the right hon. Gentleman was the case of Army and Navy officers.

Mr. LLOYD GEORGE

The Public Accounts Committee came to the conclusion that both ought to be regularised and this Clause has been drawn to regularise the case of officers, revising barristers, and Members of Parliament as-well. The hon. and learned Gentleman referred to Civil servants. Whenever they are travelling on business their expenses are paid. They do not pay out of their own pockets, and, therefore, this does not apply. If Civil servants run down to Yorkshire or the North of England or Ireland in connection with their business their expenses are paid. In the other case, the servant of the country has got to pay expenses out of his own pocket, and all we say is that those should be deducted out of Income Tax. The hon. and learned Gentleman says he has no objection if this is extended to other people. The Clause is not only for Members of Parliament, but is one of general application. It gives the Treasury power to do it in every case just on the same basis as that of those, to which I have referred.

Mr. HICKS BEACH

The Clause refers not to travelling expenses but to any money expended wholly, exclusively and necessarily for the purpose of their duties. Surely that refers to more than travelling expenses, and could it not be held to refer to a Member for Parliament or a Civil servant taking a house in London? To the plain, ordinary layman the Clause seems to bring in more than travelling expenses, and I suggest, if there is any doubt about the matter, that the words "travelling expenses" ought to be put in. I really think the definition as it is is too wide, and that the Government ought to alter it.

Mr. PRETYMAN

I would like to know what would be the effect of the words "where the Treasury are satisfied." We had similar words in the Revenue Bill, and we were told they were subject to appeal in a Court of Law. This is a very important point. Do these words in an Act of Parliament entitle the subject to question the decision of the Treasury in a Court of Law?

Mr. LLOYD GEORGE

Even now I should say that the decision of the Treasury can be challenged on a point of law.

Mr. PRETYMAN

I said in a Court of Law.

Mr. LLOYD GEORGE

It can. The subject can challenge the decision in a Court of Law, and many cases have been challenged in a Court of Law. On this very issue there have been some very interesting cases on the point of law, and the subject is entitled, and it has been done in many cases, and I should say it can be done in this as in other cases.

Mr. PR ETYMAN

May I point out what a tremendous door this opens to litigation? This Clause has never existed before, and nothing in the nature of it has ever existed. It simply is, I understand, to regularise primarily the allowance made to Members of Parliament, and certain other small exemptions which have previously been granted. Therefore, instead of this being allowed as it previously was, merely administratively in special cases, it is now, owing to the action of the Chancellor of the Exchequer in extending the allowance to Members of Parliament, to become statutory, or will become so if this Clause passes.

Mr. LLOYD GEORGE

I do not think the hon. and gallant Gentleman has quite realised the point. This does not alter the law except in one respect. It enables the Treasury in a case of that kind to fix the amount, instead of putting the subject o the trouble and expense of proving each item every year. That is all it does. It does not alter the general law.

Clause read a second time, and added to the Bill.