§ In lieu of the duty of excise payable in respect of beer brewed in Great Britain or 1756 Ireland there shall, as from the first day of May, nineteen hundred and nineteen, be charged, levied and paid—
|For every thirty-six gallons of worts of a specific gravity of one thousand and fifty-five degrees the duty of||3||10||0|
|For every thirty-six gallons of beer of an original gravity of one thousand and fifty-five degrees the drawback of||3||10||3|
§ Motion made, and Question proposed, "That the Clause stand part of the Bill."
§ Colonel GRETTON
This Clause raises the whole question of the duty on beer. The Government propose the very large increase of £1 per standard barrel. Before the War the duty was 7s. 5d. per barrel, with an additional Licence Duty of 8s. During the War the duty has been successively raised from 20s. to 50s. per standard barrel, and the Government now propose that it shall stand this year at 70s. per standard barrel. I do not know whether it is quite realised what this means. I think it was the President of the Board of Trade (Sir A. Geddes) who the other day, in a speech made outside this House, said that the Government were collecting under the Resolution which the House is confirming by this Clause approximately £250,000 per day by the taxation of beer. As a brewer, I am not complaining of the taxation levied upon beer. It is for the public to decide whether it is right. My view is that an increase was to be expected, and the brewing trade is not surprised that a very large contribution towards the cost of the War and the clearing up of the War is demanded from it and from the public who drink beer. In this matter, the brewing trade is very largely the collector of taxes for the Government, and they collect a vast sum exceedingly cheaply. This matter has been involved with a great number of regulations which have been issued by the Government during the War, and which have been changed from time to time. Owing to the shortage of cereals and other materials in this country during a certain period of the War, brewing was cut down by order of the Minister of Food to one-third the quantity which took place before the restrictions in the year 1915–16, which is called the standard year, and the quantity has been gradually Increased as materials have become avail- 1758 able. The Government have been always reluctant to release additional quantities of material for the production of beer, although well aware of the urgent public demand, and the great dissatisfaction which the regulations and the restrictions upon brewing have caused to the general public. It has been only public pressure, sometimes with threats of something more drastic outside, that has induced the Government very reluctantly, and in some cases with bad grace, to give way. I am quite sure my right hon. Friend the Chancellor of the Exchequer will not think I am in any way associating him personally with remarks of this kind. They are entirely impersonal. I am dealing only with the policy of the Government.
The Government has, by this increased taxation of £1 per barrel, practically increased the cost of beer, by preventing the reduction of 1d. a pint which the brewer would have had otherwise to make in order to satisfy the public. Although it has been announced that the restrictions on quantity are to be removed, the Government have retained the restrictions on the quality of the beer which is allowed to be brewed, and there is still the greatest dissatisfaction in the country among beer drinkers as to the weak, washy, and unsatisfactory beer which the Government still prescribes and the brewing of which it still enforces. It is true that an increase in gravity of 1 degree in the classes of beer shown in the scale of prices in the Orders of the Ministry of Food has been announced, and the average gravity is to be increased by 4 degrees in the same way; but that is only playing with the subject after all. It is a slight improvement, but if, so far as the workers are concerned, the Government consider they have settled the question, or that people are going to be satisfied by this reluctant and long-delayed concession to public opinion, from my experience of the brewing trade I warn them that they will be disillusioned. The public are not going to be satisfied. Working people and other beer drinkers are entitled to have the quality of beer which they want without any restrictions whatsoever, and they will ultimately demand it and force it from the Government if it is not given to them spontaneously, as it ought to be now. There are grievances in the brewing trade itself owing to this contiuance of the restrictions. It forces the brewer to continue unnecessarily the damage to the reputation of the article which he turns 1759 out. He cannot produce the standard article with which his name has been for many years associated. He has sacrificed his reputation willingly enough during the War, but it ought to be returned to him at the earliest moment now that the War is over. This grievance is a very wide one. It is a great grievance among the London brewers, who had a great reputation for their stout, which owing to these restrictions they can only produce now in very small quantities. They are not able to restore the reputation which has been associated with the London brewing trade for so many years. These questions are all associated with this taxation, because it is linked up with the Orders of the Ministry of Food. These grievances are really urgent and definite matters of public importance. The Government are deluding themselves if they think the public are going to be satisfied with this question as it stands now. They will demand not only all the beer they want, but beer of a quality for which they are ready to pay. I maintain that the public ought to have what they want. There is no reason for continuing these childish restrictions any longer now that the War has come to an end. After the next harvest, when materials will be abundant, there will not be a shadow of excuse for trying to force the public to drink beer of a quality they do not like, of which they continue to complain and which they will insist will have to be altered before the winter comes upon us. I am not here to oppose this increase of taxation. I leave that to others. There is one aspect of the increased taxes on beer which should be borne in mind. So far as beer is heavily taxed, that heavy taxation leads the public to resort to spirits and other forms of stimulants which are not the national habit, and which, in the opinion of many competent authorities are less wholesome and desirable as drinks. Beer is the old English beverage. [HON. MEMBERS: "What about Scotland?"] I do not associate beer with Scotland, which, perhaps, is more famous for another form of drink. If the Scottish nation demanded more beer they might derive more benefit from it than from the immature spirits which are allowed to some extent to be brewed under the preceding Clause which has been passed by the Committee. I do not propose to carry this subject further, 1760 but this Clause should not be agreed to by the Committee without very careful consideration of the public policy which is involved and without full appreciation of the great dissatisfaction which still exists outside, which may easily become boiling discontent with the quality of the beer forced upon the people by the Government.
§ The CHAIRMAN
I would point out to the Committee that there is nothing in this Clause, or indeed in this Bill, dealing with the quantity of beer brewed or with the gravity of the beer. Those are matters that come within the province of the Food Controller and not that of the Chancellor of the Exchequer. We are concerned here mainly with the question of taxation.
§ Sir GEORGE YOUNGER
What you, Sir, say is perfectly true. There is nothing in the Bill referring to those two points, but the justification for the whole of this charge rests upon the quantity of beer which should be allowed to be produced, and that is the reason given by the Chancellor of the Exchequer for increasing the duty by 20s. a barrel. It is impossible to dissociate the two things. We are entitled to take into consideration the reason for imposing a charge, although that reason may not be mentioned in the Bill.
§ The CHAIRMAN
I think in this sense, as far as the cumulative burden on the brewer goes and therefore affecting the justice of the tax, that is certainly correct But I do not want the Debate to run into a matter which it may be for the Food Controller to answer.
§ Sir G. YOUNGER
I think the Food Controller would find it difficult to answer. I want to say a word about the Treasury calculations and their effect. I do not think the Chancellor of the Exchequer has attempted to meet the difficulty in the right way. If I could have had my say in the matter I should have said rectify the Treasury calculation and take it out not in money but in quality, in a way that would have got rid of the difficulty. By increasing the gravity the complaints of quality would have been lessened and at the same time he would have got a bit of additional revenue. He would have got rid of a great deal of objection to the very thin beer produced in the last year or two, a beer, which has caused a great deal of the unrest from which we have been suffering in this country. I can speak from two 1761 points of view—as a brewer who knows something about brewing and as the political organiser of the Unionist party who gets numbers of letters every morning from all parts on the subject of the unrest caused by the poor beer. These satisfy me that if the Chancellor of the Exchequer had taken the advice I should have liked to have given him—to put the whole charge on the quality—it would have been better. I am not sure of the correctness of the Treasury calculation. They, I believe, took the values as they then were. Is not my right hon. Friend aware that two or three days after the announcement about the extra quantity of beer to be brewed the price of the only barley that was available went up 15s. a quarter? The Treasury seemed to think that the values are unalterable, like the laws of the Medes and Persians. They forgot that they might go up any day. The new burden which will be placed on some beers only adds to the seriousness of the position. I should like to support what has fallen from my hon. and gallant Friend as to his objection to the restriction of gravity which severely handicaps a certain class of brewers. The new standard will not handicap me in anyway, but I should like to put this question to my right hon. Friend: He restricts the gravity on Messrs. Bass' and Messrs. Guinness' beer and some London beers—special articles for which people are prepared to pay and which they ought to get, bat he puts no restriction on the alcoholic strength of champagne, port, sherry, or claret He only puts on the article produced in this country a restriction of alcoholic strength. How can he justify that? I am certain he cannot. He has justified a good many things to-night. He has knocked the bottom out of a good many arguments against some of his taxation, but he cannot answer that question, and I should like to hear him try. Why a rich man who is prepared to pay for his port, sherry, or champagne can get what he likes, and why one who is not so rich, and probably drank wine before but cannot afford it now, cannot get a glass of Bass or Guinness, I cannot understand. It is a most inconsistent and impossible restriction, and there ought to be no restriction at all. The Government says, quite rightly, it is very desirable to encourage the drinking of light beers. They make it perfectly certain that light beers will be drunk by the ordinary man by fixing the price of 1762 those beers at 5d. and 6d. The ordinary working man is not going to pay 9d. and 10d. for a higher class of beer. They are bound to buy these beers, and they obtain their object by the fact that they fix the prices of gravities, which are very light, and do not compare in any degree with the beers which were produced before the War. It is no light matter to have a tax increased from 7s. 9d. to 70s. a barrel. The brewer has to finance the whole of that money, to collect the duty, and guarantee the payment, and if he makes a loss or a bad debt or anything of that kind, it is a very serious matter indeed. Take an ordinary small brewery which used to turn out perhaps 100,000 barrels before the War. It has to-day to find £350,000 a year for the Government instead of £40,000, and to take the whole risk of collecting and paying it. My right hon. Friend took no notice of that. His predecessor gave them a little extra credit. I do not ask for that. It is not desirable that they should have it, but he never even acknowledged the fact that he was going to get a very large sum of money.
§ 11.0 P.M.
My two hon. Friends who have spoken have made interesting speeches. My hon. Friend who opened the discussion took no exception to the tax we are placing on beer, and I do not think my hon. Friend (Sir G. Younger) took any serious exception to it. He only mentioned that when the tax was last raised extended credit was given to the brewer, and that I had not given still further extended credit on this occasion, but he himself did not think it would have been proper for mo to do so. Therefore as far as the actual proposal embodied in the Clause is concerned there is no attack and no criticism except that my hon. Friend (Sir G. Younger) thinks, unlike my hon. Friend opposite, that the Treasury rather overrated the amount of the additional tax which it levied. It is true there has been an increase in the price of barley since, but not such an increase as measured per standard barrel as at all vitiates the calculations on which the tax was imposed. The result of the Budget statement was not a fall in brewery shares. I carry it no farther. The discussion has really turned much more on the question of gravity. That is not settled by this Clause. I do not know that I ought to dismiss it now, and if I say a few words upon it it is in order 1763 that I may not appear discourteous to my hon. Friends. My hon. Friend (Sir G. Younger) has admitted that he can brew beer which is palatable and satisfactory to his customers and not unfavourable to himself. His exact words were that he was not incommoded by the average gravity now fixed. If he is not incommoded that means that he can brew beer which is palatable to his customers on that average gravity. If all the brewers of the country only wanted to brew beers of moderate gravity there would be no washy beer. The real difficulty is that certain brewers have a special trade which is dependent upon high gravity, and in order to bring their average down to the average permitted by the Government they must brew what they are fond of speaking of as "Government wash." They brew that in order that they may brew other beer at a very high gravity. I quite admit that the average gravity does not work out and cannot work out fairly and equally as between all the trade. I sympathise with those who have a special trade—the Burton trade, the London trade, Guinness' trade are most affected. I sympathise with them. But if you want to reduce the high gravity of pre-war beers, which can be done without rendering them unpalatable, then you must have some check, and I am afraid such check cannot work without inequality as between trader and trader. Nothing has been more remarkable than the success of the brewers in conforming to the necessities imposed by war, and producing palatable beers at depths of gravity at which they would have thought to be impossible.
I regret that my hon. Friend descended to that argument, which I am quite certain, in another connection, he would have been the first to refute. It is very unfair and misleading It has been the object of Government ever since I have known anything of Government policy, no matter what the Government was, to tax alcohol of every kind to as high a point as possible without interfering with the revenue. There are particular reasons why we should not interfere with the Wine Duties at this time. Any interference with the Wine Duties would strike our Allies more than anyone else.
§ Sir G. YOUNGER
I never for a moment suggested interfering with the duties. What I said was that you restrict the brewing of beer here, and I knew you could not restrict the importation of the other.
The two things are not comparable. Following the hon. Member's argument, he says why is the rich man's champagne allowed to be imported and the poor man's beer is limited here?
§ Sir G. YOUNGER
I expressly said those people who probably now could not drink wine, but were prepared to drink a better class of beer but could not get it.
My hon. Friend's argument was in two stages His first stage was, why is no limit put on the gravity of the rich man's champagne, while a limit is put on the gravity of the workman's beer. In the second stage of his argument he pointed out that the workman could not afford to buy the higher class beer, ho could not afford to pay 8d., 9d., or 10d., and it is not the workman who is injured by the lower gavity of the beer.
In that case I fail to follow my hon. Friend's argument, and I carry it no further. You cannot deal with wines and beers by the same test of gravity. It is absurd. I would be very glad to see more raised from wine as well as from beer and spirits, if it were not, in the first place, that any increase in wine duties would be viewed with great regret, and some resentment by our Allies, whose products would be chiefly hit, and in the second place, I feel that an increase in the wine duties would give rise to a troublesome controversy, and I am not satisfied that by raising the duty I should get substantially any more money. It is not that we desire to spare the rich man's champagne—which is not always drunk by the rich man—that we do not increase the wine duties, but for reasons which are peculiar to those duties.
Mr. J. JONES
Up to now we have had expressions of opinion from speakers 1765 about a drink which very often they do not consume. I am going to speak as one deeply interested in the subject, as an ordinary consumer of beer, and one who must condole with the hon. Gentlemen who introduced this subject, because evidently they have suffered very considerably by the efforts of the Government to restrict the consumption of beer, considering the fact that during the past three years the brewing industry of this country has never been so successful financially as during that period. Possibly their appetite grows by what it feeds on. The Government have increased taxation, and the man who drinks beer is the principal sufferer. He has had to drink dirty water and pay exorbitant prices for it, and the brewer stands up in this House trying to make the public outside believe that he is the victim while the real victims are the customers, the people who have had to drink dirty water and pay big prices for it. Special traders have been mentioned. These firms have done better than they have ever done before financially. What right have they to grumble about taxation? It is the people who have paid the taxes who have the right to grumble, not the people who have been the tax collectors and have been making a profit out of the deal. I ask the Chancellor of the Exchequer why he has been so gentle with these gentlemen? The working people are discontented because the State has entered into a kind of unholy alliance with the trade to rob the public, and in this particular instance there has been an alliance against the people who happen to drink beer. What has been the consequence? That if you go into an ordinary public-house—owned generally by a brewer—it has been almost a condescension on the part of those behind the counter to serve you with a glass of beer, and in some cases you have had to pay sixpence for the loan of a glass; and if you were not careful in the way you spoke to those behind the counter you went without your beer and you went without your sixpence also. You were told, moreover, that if you did not like any kind of stuff at exorbitant prices you could clear out. There has been no trade where there has been more profiteering. Even men who have occupied licensed houses have had to pay more in taxation on barrels for the right to get supplies. Those of us who represent the workers are not going to play the brewers' game. We are not going to attend this funeral; it is 1766 not ours, it is the other people's. All I wish for the class I represent is that we shall have an opportunity of enjoying some of the results that hon. Members have complained so much about. An hon. Member opposite said he had telegrams from all over the country about the discontent that exists. Is it not a fact that public-houses have been kept closed deliberately when they have had plenty of supplies? Is it not a fact that in the industrial areas—the East End of London is the place I have in mind at the moment—there has been an arrangement between the various people concerned not to open their houses even though they may have had supplies?
No. The hours of opening have been fixed, and they have not opened when they could. They have never had such a time as during the period that the Control Board has been in existence. I believe in neither of them. The Board has been the best thing that the publicans and the trade have had to help them in. robbing the public. As an ordinary workmen's representative I want to say that the sooner we get rid of all these various interests that control the people the better. We want a substitute. We have found you both out. We want real public control of the liquor traffic.
§ The DEPUTY-CHAIRMAN (Sir E. Cornwall)
I would remind the hon. Member that it is taxation we are considering, not the general control of the liquor trade.
Taxation simply means transferring to the public all the responsibility. Our views are that the public shall own the trade and get the results of the trade, and we shall not have to tax the public to get those results.
§ Mr. HAILWOOD
I should like to draw attention to the fact that since the Budget was originally introduced the Ministry of Food have given permission for an increase in the barrelage of beer. Consequently, there must be an increased revenue to the Chancellor of the Exchequer from beer. I do not in any way wish to deprive the Chancellor of the Exchequer of any increased revenue he may get. but in these circumstances I think there is an unfair taxation on those who drink beer. The Chancellor of the Exchequer has 1767 budgeted for a certain amount from beer, but it is obvious that if the trade is permitted to brew an increased quantity of beer and the tax is per barrel, there must be an increased revenue from beer. if double the quantity of beer is brewed in the next twelve months the Chancellor could halve the tax per barrel and still have the same revenue. If the tax remains as it is the beer drinker will be taxed higher than the Chancellor intended when he introduced his Budget.