§ (1) For the purpose of local loans, there may be issued by the National Debt Commissioners the following sums, namely:—
- (a) For the purpose of loans by the Public Works Loan Commissioners, any sum or sums not exceeding in the whole the sum of four million pounds:
- (b) For the purpose of loans by the Commissioners of Public Works in Ireland, any sum or sums not exceeding in the whole the sum of four hundred thousand pounds.
§ (2) The sums so issued shall be issued during a period ending on the day on which a further Act granting money for the purposes of those loans comes into operation, and in accordance with the provisions of the National Debt and Local Loans Act, 1887.
§ Sir. F. BANBURY
I beg to move, in Sub-section (1), paragraph (a), to leave out the word "four, "and to insert instead thereof the word "two."
I am not sure that that is the right amount to insert, but at any rate that point can be determined when we are deciding whether "four" shall stand part. This Clause provides that the National Debt Commissioners may issue "For the purpose of loans by the Public Works Loan Commissioners any sum or sums not exceeding in the whole the sum of four million pounds." This is not the proper time to give power to the National Debt 1425 Commissioners to issue to local authorities such a large sum as £4,000,000. The Treasury have appointed a Committee to supervise new issues, and one of the references to that Committee is that they shall issue no money as advances to anyone except that which is necessary for the purpose of carrying on the War, or public health. Now the Treasury are asking for power to lend £4,000,000 to local authorities from now until next year. I have looked back for five years, and I have found that the sums mentioned in the Public Works Loans Bill have varied between £5,000,000 and £6,000,000. It seems to me that the lower sum of £4,000,000 is not in any way an adequate reduction in view of the circumstances of the moment. There can be no doubt that the most extravagantly minded people at the present time are the public authorities. They do not seem to know that any war exists, and they are desirous of spending money on electric light undertakings, wash-houses, and all sorts of extraordinary things, just the same as in the past. There is one thing which is likely to tend to prevent them, and that is the dearness of money. When the State has to borrow at 4½per cent., it is perfectly evident that local authorities will have to pay considerably more for their money.
The Chancellor of the Exchequer comes down to us in the city and tells us that we ought to be economical. The Prime Minister at the Guildhall also tells us that we ought to be economical. Gentlemen below the Gangway say, "You ought to put down your motor cars and not have any chauffeurs. "Yet, at the very moment when all this is going on the Treasury come and propose that £4,000,000 shall be lent to the local authorities. First of all, it is evident that the Treasury have got to get that £4,000,000, and they can only get it by issuing local loans, which will be in competition to the War Loan. That is an evident fact which the Financial Secretary to the Treasury, who is conversant with these things, will not deny. Therefore, I am not at all sure that I ought not to insist that nothing is put in at all, and that no money whatever during the continuance of the War should be lent to the local authorities. If they want money, let them go into the market and get it at the ordinary rate. Do not let them come and ask the House of Commons to pledge the credit of the nation for this money. In any event, the sum of £4,000,000 is absolutely absurd when it is compared with the sum 1426 lent to local authorities in ordinary times. If we can get the word "four" left out, we can then determine what we shall put in.
§ Mr. MONTAGU
I do not think it was obvious from the hon. Baronet's speech that this is not a proposal that the local authorities should spend £4,000,000. All it is is that the National Debt Commissioners may, not shall, issue a maximum of £4,000,000 to finance the loans which are approved by the Public Works Loans Commissioners. That is all. It is permissive, and the raising of the money depends upon the activities of a perfectly independent body, the Public Works Loans Commissioners, who are very rarely discussed in this House, but about "whom I should like to take this opportunity of saying that they do their work voluntarily, without pay, at infinite cost to themselves of labour and of time. They are all, as the House will see by the list, well known and busy men, and they are in accord as closely as the hon. Baronet would wish with the Treasury and with the public opinion of the country at the moment in trying to save money and to economise. They are not likely to grant loans out of this £4,000,000 save in particular cases where the demand appears to them to be absolutely irresistible. Last year new loans granted between 1st April and 9th July were £1,380,743.
§ 9.0 P.M.
§ Mr. MONTAGU
Yes. The corresponding figure for this year, instead of being £1,380,743, is £189,503. I give that figure as an example of the fact that the Public Works Loans Commissioners have the very same objects and ends in view as animate the hon. Baronet in moving this reduction. As to the reduction itself, I do not think the hon. Baronet, if he will forgive me saying so, will be doing any good service by striking out the Clause altogether, because if he made the local authorities go upon the market for their loan they would pay a higher rate of interest. It would not do the money market any good, and it would not do public economy any good. But we do not want to keep a higher figure than is necessary. The commitments at the present time are about £2,255,000. If no new policy which leads to the issue of local loans is adopted by this House, after consultation with the Public Works Loans Commissioners, I think it would be safe to put in the figure of £3,000,000. If that 1427 has to be exceeded later on, then it will be necessary to introduce another Bill, and the hon. Baronet will be able to exercise his judgment as to its merits, but for the moment if he would withdraw his Motion to leave out £4,000,000 and substitute £2,000,000 I should be quite prepared to let him move, or to move myself, to leave out £4,000,000 and to insert £3,000,000.
§ Sir F. BANBURY
I think we had better leave out the £4,000,000 first, and then, when we have left that out, we can decide what we shall put in. I may possibly accept the right hon. Gentleman's suggestion.
§ Mr. J. SAMUEL
I think it would be a mistake this year to take out £4,000,000, because no local authority now is really undertaking any new work.
§ Sir F BANBURY
I am a member of the Treasury Committee, and therefore I know what the local authorities are doing.
§ Mr. J. SAMUEL
The hon. Baronet is mistaken in the sense that they are not undertaking any new work. They are economising the same as the House of Commons is economising upon its civil expenditure, but local authorities have undertaken under their private Bills to construct certain work They are now making very gigantic water-works, perhaps sewerage works, and other public works which they have undertaken to do under private Bills many years before the War commenced. If we were to stop them borrowing, it would be a very serious matter for them. Moreover, if you were to prevent the local authorities from borrowing during the construction of the works many of them perhaps would be in a very serious position. They cannot go now, as they did in former years, and borrow upon their own security; they cannot go into the open market; they are bound to come to the Public Works Loan Commissioners this year, and I hope my right hon. Friend w ill not even take out the £4,000,000 and insert £3,000,000, though if he says that later on he might amend it by increasing the amount, then there would be no serious injury, but I am afraid, if 1428 we were this year to curtail and restrict local authorities who are executing these big works we should do them very serious injury. I can assure the hon. Baronet that if he will watch the proceedings of the local authorities he will see that they are now all restricted. It is, in fact, proved this year by the number of Bills presented. I am sitting upstairs on the Local Legislation Committee, and there are very few Bills coming before Parliament. Next year I think there will be fewer still. They are economising in the same way as we are attempting to economise in this House.
§ Sir J. D. REES
I hope the right hon. Gentleman will not be led away by the hon. Member who last spoke, but will adhere to his excellent intention. It only needs to be an ordinary member of the public to realise that local bodies are still engaged in extravagances of all kinds. They are putting up buildings that are not required, they are making excellent roads perfect, and they are otherwise spending money of which at the present moment every penny is wanted for the War. The right hon. Gentleman in his speech rather overlooked one thing. He said that if public bodies were deprived of this means of getting money they would upset the market, as they would have to pay higher rates. I only wish that they would find it necessary to pay so much that it would make it impossible for them to go on with many of their projects. Some step is necessary to make local bodies exercise greater restraint and adopt a policy of economy.
§ Mr. GEORGE THORNE
We have just listened to a speech made by an hon. Gentleman who knows nothing whatever about what is happening. I have long been associated with municipal corporations, and I know what they are doing. I say the speech just delivered entirely misrepresents them.
§ Mr. KING
I must dissociate myself entirely from the views of the hon. Member for East Nottingham (Sir J. D. Rees). My experience is that the local authorities are exercising the greatest possible amount of restraint and economy, and even parsimony, for they are neglecting necessary work in order to save money at the present time. There are many cases where new expenditure is absolutely necessary. I live in a parish of which the normal population is 4,000. We have 1429 water supplied by the local authority. At the present moment the population exceeds 30,000, because we have a camp with j over 28,000 soldiers in the parish, and, in consequence, we need an immediate expenditure of £2,000 in order to supply the camp with water; yet the hon. Member for East Nottingham will not allow us the necessary money to give our soldiers decent water to drink and decent water to wash in. There has been the greatest possible difficulty in the matter. I have myself tried to assist in getting a loan of £2,000, in order to carry water to this
§ Question, "That the word 'two' be there inserted," put, and negatived.
§ Word "three" there inserted.—[Sir F. Banbury.]