HC Deb 05 March 1919 vol 113 cc451-63

Motion made, and Question proposed,

"That a sum, not exceeding £210,310,000, be granted to His Majesty, on account, for or towards defraying the charges of the following Civil Services and Revenue Departments for the year ending on the 31st day of March, 1920, namely:

Ministry of Munitions 100
Class I.
Royal Palaces 35,000
Osborne 6,000
Royal Parks and Pleasure Gardens 75,000
Houses of Parliament Buildings 35,000
Miscellaneous Legal Buildings, Great Britain 25,000
Art and Science Buildings, Great Britain 51,000
Diplomatic and Consular Buildings 50,000
Revenue Buildings 270,000
Ministry of Labour, Employment Exchange, and Insurance Buildings, Great Britain 300,000
Public Buildings, Great Britain 1,628,000
Surveys of the United Kingdom 120,000
Harbours under the Board of Trade 3,000
Peterhead Harbour 10,000
Rates on Government Property 750,000
Public Works and Buildings, Ireland 95,000
Railways, Ireland 18,000
Class II
United Kingdom and England:—
House of Lords Offices 23,000
House of Commons 110,000
War Cabinet 20,000
Treasury and Subordinate Departments 80,000
Home Office 200,000
Foreign Office 110,000
Colonial Office 37,000
Privy Council Office 5,000
Board of Trade 1,300,000
Department of Overseas Trade 100,000
Mercantile Marine Services 70,000
Bankruptcy Department of the Board of Trade 4
Interim Forest Authority 45,000
Board of Agriculture and Fisheries 1,500,000
Charity Commission 17,000
Government Chemist 19,000
Civil Service Commission 27,000
Conciliation and Arbitration Board 2,000
Exchequer and Audit Department 50, 000
Friendly Societies Registry 15,000
Local Government Board 655,000
Board of Control 100,000
Mint, including Coinage 4
National Debt Office 8,000
Public Record Office 13,000
Public Works Loan Commission 6,000
Registrar-General's Office 25,000
Stationery and Printing 3,000,000
Woods, Forests, etc., Office of 12,000
Works and Public Buildings, Office of 125,000
Privy Seal Office 3,000
Secret Service 150,000
Secretary for Scotland, Office of 14,000
Board of Agriculture 100,000
Fishery Board 11,000
General Board of Control 18,000
Registrar-General's Office 5,000
Local Government Board 50,000
Lord Lieutenant's Household 1,200
Chief Secretary's Offices and Subordinate Departments 30,000
Department of Agriculture and Technical Instruction 190,000
Charitable Donations and Bequests Office 1,000
Congested Districts Board 100,000
Local Government Board 70,000
Public Record Office 4,000
Public Works Office 22,000
Registrar-General's Office 7,000
Valuation and Boundary Survey 19,000
Class III.
United Kingdom and England:—
Law Charges 90,000
Miscellaneous Legal Expenses 32,000
Supreme Court of Judicature, Etc. 150,000
Land Registry 25,000
Public Trustee 5
County Courts 120,000
Police, England and Wales 800,000
Prisons, England and the Colonies 500,000
Reformatory and Industrial Schools, Great Britain 220,000
Criminal Lunatic Asylums, England 30,000
Law Charges and Courts of Law 40,000
Scottish Land Court 4,000
Register House, Edinburgh 20,000
Police 140,000
Prisons 75,000
Law Charges and Criminal Prosecutions 27,000
Supreme Court of Judicature, and other Legal Departments 55,000
Land Commission 345,000
County Court Officers, etc. 50,000
Dublin Metropolitan Police 110,000
Royal Irish Constabulary 900,000
Prisons 80,000
Reformatory and Industrial Schools 60,000
Dundrum Criminal Lunatic Asylum 5,000
Class IV.
United Kingdom and England:—
Board of Education 15,000,000
British Museum 90,000
National Gallery 23,000
National Portrait Gallery 4,000
Wallace Collection 5,000
London Museum 2,000
Imperial War Museum 16,000
Scientific Investigation, etc. 50,000
Scientific and Industrial Research 80,000
Universities and Colleges, United Kingdom, and Intermediate Education, Wales 300,000
Universities, etc., Special Grants 200,000
Serbian Relief Fund 12,500
Public Education 1,750,000
National Galleries 4,000
Public Education 1,350,000
Intermediate Education 1,000
Endowed Schools Commissioners 400
National Gallery 1,500
Science and Art 35,000
Universities and Colleges 44,000
Class V.
Diplomatic and Consular Services 600,000
Colonial Services 138,000
Telegraph Subsidies 8,000
Cyprus (Grant-in-Aid) 49,000
Class VI.
Superannuation and Retired Allowances 390,000
Miscellaneous Expenses 20,277
Hospitals and Charities, Ireland 16,000
Temporary Commissions 90,000
Repayments to the Local Loans Fund
Ireland Development Grant 280,000
Government Hospitality 90,000
Expenses under the Representation of the People Act 300,000
Development Fund
Road Improvement Fund
Repayments to the Civil Contingencies Fund
Class VII.
Old Age Pensions 7,000,000
National Health Insurance Joint Committee 400,000
National Health Insurance Commission (England) 1,900,000
National Health Insurance Commission (Wales) 180,000
National Health Insurance Commission (Scotland) 350,000
National Health Insurance Commission (Ireland) 162,000
Ministry of Labour 1,500,000
National Insurance Audit Department 65,000
Treatment of Tuberculosis (Special Grants) 150,000
Highlands and Islands (Medical Service) Board 1,000
Friendly Societies' Deficiency
Unclassified Votes.
Ministry of Munitions (Ordnance Factories) 10
Ministry of Pensions 27,000,000
Ministry of Food 1,300,000
Ministry of Shipping 900,000
Ministry of National Service 120,000
Ministry of Reconstruction 27,000
National War Aims Committee
Ministry of Blockade
Ministry of Information
Ministry of Labour (Civil Demobilisation and Resettlement Department) 19,000,000
Bread Subsidy 20,000,000
War Trade Department 29,000
Restriction of Enemy Supplies Department 1,000
National War Savings Committee 50,000
Treasury Securities Deposit Scheme 950,000
Imperial War Graves Commission 467,000
Central Control Board (Liquor Traffic) 200,000
Loans to Dominions and Allies 37,500,000
Railway Agreements 30,000,000
Canal Compensation 350,000
Military Service (Civil Liabilities) Department 2,250,000
Property Losses Compensation (Ireland) 90,000
Purchase of Housing Materials
Royal Patriotic Fund
Commission International de Revitaillement 30,000
Miscellaneous War Services (Foreign Office) 1,750,000
Revenue Departments:—
Customs and Excise 2,000,000
Inland Revenue 1,820,000
Post Office 16,000,000
Total for Civil Services and Revenue Departments £210,310,000
Mr. BALDWIN (Joint Financial Secretary to the Treasury)

With the permission of the Chair, I think it might be well that I should say a few words on the Accounts as a whole, because in their present form they are not easy to understand, and it is almost impossible to make any comparison either of the Accounts as they have stood during the War, or of the Accounts as they were before the War. It will be remembered by hon. Members that these are the first Estimates since the pre-War Estimates which were presented for the year 1914—for the financial year ending 31st March, 1915—where the whole expenditure has been properly allocated, because as soon as the country entered into a state of war all excesses over the normal expenditure of the Civil Departments directly attributable to a state of war were charged to the Votes of Credit. I do not think it is necessary to say anything here and now as to the reason for that course. It is sufficient to state that it was the only practical course that could be suggested by the Government, and was recognised as such by the then House of Commons. My purpose, therefore—using figures very roughly—is to dwell for a minute or two only on the difference between the Estimates of this year and those of last year, and then to explain as simply as I can at a little greater length, but still I hope shortly, the main lines of difference between the expenditure of the Estimates of to-day and the pre-War Estimates of 1914–15 to which I have alluded.

4.0 P.M.

The first thing that strikes anyone on examining these Accounts is the enormous increase between the total Estimate for this year and the same Estimate at the corresponding period of last year. The reason for that, of course, is that for the first time since the War we have in these Estimates total charges—all the charges that have been taken out of the ordinary Estimates and concealed very largely inside the Vote of Credit. If hon. Members will throw their minds back to a White Paper, or rather a White Book, that was produced in April of last year they will remember that there was set out as accurately as it could be at that time the estimated expenditure that would fall on Votes of Credit scheduled to the various Departments, and if you take out of those Estimates the provision as specified for the fighting Services, there appears a sum of £640,000,000 approximately charged against the Vote of Credit, all of amounts which, had the Estimates been prepared in the ordinary way, would have appeared in the Civil Service Estimates similar to those which we are presenting to-day. If you add to that £640,000,000 the amount actually provided in the Estimates you get a total last year of Estimates, which may be taken on all fours with these Civil Service Estimates, of no less a sum than £736,000,000. So that if you compare these figures with the figures you have before you to-day you will find there is a decrease of £240,000,000, which represents this fact, that although these accounts are of such abnormal dimensions, we can yet see that the flood has reached its height and that the ebb of the tide has begun. I would say here that the main changes to which we have looked in getting that decrease, and the main changes to which we must look in the coming year, are the items towards the end of the Votes which are in the hands of hon. Members, and those are the unclassified Votes representing amounts which are directly due to the state of war. They represent amounts some of which will be permanent and some of which are temporary, using the word "temporary" in the most elastic form that is possible. Some I hope may be extinguished in a year or two, others may last for some years. I hope to say a few words on the unclassified Votes before I sit down.

The comparison I have made is a very wide one, and I do not say that it is a very useful one at the moment. What we think is much more useful is to make such comparisons as we can—and they can only be very rough ones, until the accounts have standardised themselves, when we have got rid of all direct war charges—to make comparisons between the accounts as they are presented to-day and the Estimates for 1914–15, the last Estimates belonging to the pre-War period. Those Estimates come to about £88,000,000. The Estimates to-day are £495,000,000. There is a difference of £407,000,000, and it is on that difference that I would beg the Committee for a few minutes to devote their attention. If they look at these Estimates to-day, on the last page, they will see that no less than £325,000,000 is accounted for. In these items, as I have said, lies our only chance of making really considerable saving, I have said that some of these items will be permanent and some tem- porary. Of the temporary ones which will extend to a permanency for the lifetime of a great many of us here we have that very considerable item of pensions. That amounts, in this Vote, to £73,000,000, and I am afraid that that amount has not yet touched the high-water mark. But though it may rise within the next few years it is an amount which soon must touch the highest point and must then begin to fall. The day will come when that item will be gradually diminished until, in time, it is extinguished. The Estimates that are down for the Food and Shipping Departments are temporary, I hope, in the literal sense of that word. I hope a very short time may see the end of these Votes, as of the large Vote at the top of the last page, which includes unemployment donations and sundry expenses in connection with demobilisation. Then the bread subsidy, which appears for the first time as a separate Estimate, is an amount of which I hope we may very soon see the end. The same remark applies to substantial but still considerably reduced items for loans to the Dominions and Allies. The amounts down for civil liabilities and miscellaneous war services must also disappear at a very early date.

There is one very large item in these amounts—I cannot say, of course, whether it will appear in the accounts permanently or not—in connection with the railways. By far the largest portion of this amount is represented by increased wages to the railwayman, and there is no doubt that in some form or another this will be a permanent charge on this country. Time alone will show whether it will be a charge direct on the Exchequer or whether it will be spread over the country as a whole in the form of increased railway fares and charges for goods. The Committee will remember the figure which I have given for these unclassified Votes amounting to £325,000,000. They will see that we have left still a difference of £80,000,000 between the Civil Service Estimates of the last year before the War and those of to-day. How can we account for this £80,000,000? Here, again, I should like to put before the Committee certain items in the shape of lump sums which are included in these Votes and which I think will meet with the approval of the Committee. Having done that, there will be a residuum representing an increase in the actual cost of the Departments which I am afraid will for the most part remain with us. Out of this £80,000,000 we have an increase of about £3,500,000 on the Votes for public works and buildings, and I would say that that is quite sufficiently explained by the increased cost of the works which have been done and by the amount of work held over owing to the closing down of all repairs and of all buildings which were not absolutely necessary during the War. Then, under the Vote which includes law and justice, there is a substantial increase of about £4,000,000, the greater part of which—I am sure the Committee will not grudge it—has gone to the police forces throughout the United Kingdom and for the improvement in the pay of the staffs connected with the prisons.

Then, education has made a large call on the Government for assistance, a call which accounts for something approaching an extra £20,000,000, the larger part of which must be a permanent increase. There are two items in the non-effective Vote that help to swell this £80,000,000, although they are items which I hope will not occur again. A million has been put down for Development Fund, to be used for purposes of reclamation, and £8,250,000 towards £10,000,000 which is to be provided for the improvement of roads. The Committee will notice that these sums are put down in toto in the accounts, but nothing is included for them in the Vote on Account. They are both new services, and as such must be introduced later on a full and substantive Estimate, when opportunity for discussion will arise. In Class VII. we have another permanent increase in old age pensions, where the extra 2s. 6d. given to the old age pensioners amounts to £6,000,000. That is an admirable instance of how a very small increase, and one for which a good deal is to be said, when spread over a large number of people, can amount to a total which makes a substantial difference on an estimate, and I think it must make the Committee realise that there must be some limit to the permanent increases that are put on the Estimates if this country is to continue in the long run solvent. There is also a special Grant on this Class VII. This is a sum, which is only temporary, of £3,000,000 in connection with the training of non-commissioned officers and men. These various amounts which I have touched on come to £46,000,000 out of the £80,000,000 I alluded to, leaving £34,000,000 unaccounted for. I would remind the Committee that £34,000,000 represents an increase of something like 40 per cent. only on the Vote which was taken in 1914–15,and I would contend that, when you remember that out of this sum the bonus which has been paid to the staffs in the Departments, which amounts as nearly as I can calculate to something in the neighbourhood of £10,000,000, and when you remember that included in the Departments in this estimate are the Revenue Department, I do not think we can express much surprise that the Revenue Department are showing a necessarily large increase over and above the increase which they have to bear in common with all Departments for the war bonus to which I am alluding. The amount of taxes they have to collect is infinitely greater than it was before the War. Their staffs must grow; the collection is getting more expensive, and I am not sanguine that they have yet reached the limit of charge for which we shall have to account for these great revenue collecting Departments. I am fully conscious how brief and how sketchy my remarks have been, but I was most anxious to try and put something before the Committee in a few words that might make the points clear to them. I knew that if I made any attempt to deal with details, I should take up much too much time of the Committee, and I am not at all sure that I, and the Committee, too, might not have lost ourselves in a mass of details. But I hope the information I have given may be of use and that it may provide some kind of key to the Estimates which are before us.

There is only one more thing I should like to say before the Debate resumes its normal course, and the first item on this Vote is taken. There has been, very naturally, a great deal of criticism about the preparation of Estimates. I have now had some little experience of the Department in which I have had the honour of serving. I have been there two years. My experience has taught me that these Departmental Estimates are prepared in the Departments with immense care, and that they are subject to a very careful scrutiny and examination by the Treasury. I do not think that any member of the Committee who is familiar with the form of our accounts would deny broadly the truth of that statement. But neither the Treasury nor the Department can perform the impossible, and it is not in the scrutiny of these various accounts, as they come before the House, that the country is going to save money. The big money is not here. The only avoidable expenditure is the expenditure that is incurred in carrying out the policy of the Government for the time being, and that expenditure must be governed by the attitude of the Government for the time being in carrying out the expenditure. If a Government is extravagant, no Chancellor of the Exchequer and no Treasury is going to save it. The Government is dependent on the House of Commons. If a House of Commons does not attempt to hold a Government in check, that Government will go on spending money. But the House of Commons is dependent on the people of this country, and, therefore, you come down to this, that the ultimate arbiter of expenditure is neither the Government nor the House of Commons, but the individual voter who makes up the mass who send the representatives to this House. Until the people can realise the importance to every man in this country of saving money in these days, and of guarding the resources of this country, we shall never be able to check expenditure as it should be checked, and until the time comes when the ordinary man, instead of asking himself, "What can I get out of the State?" will ask himself, "What can I do for the State?" we shall never be able to put that drag on Governments which is absolutely essential in the interests of sound finance.


My hon. Friend, with that shining honesty which distinguishes him, has made some very interesting and useful remarks. In anything I have to say, of course I shall not entrench for one moment on the particular item with which the Debate is supposed to start off. I might just intervene for one moment to make one or two comments on the general position which my hon. Friend has set forth. First of all, let me say as to his interesting scheme of devolution of responsibility, I should be very sorry to make answer to a question from my own Constituency as to why the Government is so extravagant, by saying, "That is your fault for sending me to the House of Commons." I do not think that would be accepted by my Constituency as a proper answer. They can say—and I am sure they will say—"What have you done to ensure that these thousands of millions—because that is what it amounts to—which have been poured out, are being efficiently and honestly spent?" What can I say? My only reply will be this: "On a certain afternoon, I sat in the House of Commons, and heard the Financial Secretary to the Treasury tell what was in truth a tale of millions, and he did his best to let us know, on general lines, what it meant. But I, in common with every member of the Committee, entirely failed to grasp with any degree of particularity what the position was." You cannot do it. I will only say this. Something might have been done. We had before us a Report from the Financial Expenditure Committee, and they made a suggestion which was a practical business one. My hon. Friend the Member for the Wrekin Division (Sir C. Henry) was one of the members of it, as was also the right hon. Baronet the junior Member for the City of London (Sir F. Banbury). They suggested that a Committee should be set up which would have power to call witnesses, to have professional assistance and to go over such a document as this, and before it came down to the House they would have been able to give us some guidance with regard, at any rate, to the main items of the suggested expenditure. That proposal was refused by the Government, and instead of it the Estimates are to be sent upstairs and come down here on Report. Here we have a clear-cut instance of how foolish it was to reject that practical suggestion, and we are left here wandering in a maze of hundreds of millions with no means of checking it.

The Debate this afternoon, I am quite sure, will run upon lines not of saving money, but rather of spending more money, if anything. That is what is going to happen, we all know. I venture to say that is not the real business of the House of Commons in its control over expenditure. There is not a single business man in the country who is not every day filled with apprehension as to what his position is to be within the next three months. He will take up his paper tomorrow, and he will read what our proceedings are this afternoon. One can talk for a long time, but there it is. And what is the Government going to do? Is it really going to grapple with expenditure? Is it or is it not? We are heading straight for national bankruptcy. Sooner or later we shall be found out by the impact of the fact. How long will the nation's credit continue? I believe that, in the face of Estimates such as these, the financial situation, which is not only casting its shadow over us, but has already got us in its grip, will very speedily bring us to an issue which, to some extent, we might have avoided. Is it too late now? I do not think it is, but the longer we defer, the worse our fate will be. Is there anything I can do, or anybody here can do, to assist the Government in coming to a full stop? Cannot some strong committee be formed amongst Members of this House, within the next two or three days, to meet the Government, and to talk as business men over a grave financial situation? Is it too late? It cannot be too late. We set up Commissions for dealing with things when we are in the middle of a disaster. I make that suggestion to the Government. Let us all do what we can now to see if we cannot meet with the Government officials to suggest some business, common-sense way of stopping this terrible rot which has set in our finances.