Motion made, and Question proposed,
That a Select Committee be appointed to inquire into the proposal to impose a tax on war-time increases of wealth and to report whether such a tax is practicable; and, if so, what form it should take."—[Colonel Gibbs.]
§ Sir D. MACLEAN
I beg to move, at the end, to add the words:Further, to inquire into the practicability of a capital levy for the specific purpose of reducing the National Debt, and to report.9.0 P.M.
I found my Amendment on two main grounds, which I will deal with shortly. But before doing so I think I may as well state at once that I propose to keep myself as strictly as possible within the limits of order, and I presume I shall not be entitled to go into the general question of the merits of a levy on war fortunes or the larger question of a capital levy. The first ground I want to suggest to my right hon. Friend for his acceptance of the Amendment is this, that it is desirable to have an authoritative pronouncement on the practicability of a levy on capital as speedily as possible. The matter has become a party question on 648 wholly inadequate information on the merits of the proposal, which is of a most serious kind. Nobody can doubt, and I think indeed everyone will admit, that the question is of a most complex nature, not one to be dogmatised about without very careful inquiry as to how it can be brought into operation, and if and when brought into operation, what would be its effects upon the commerce of the nation as a whole and the justice or injustice to the individuals concerned. I have heard it claimed in one quite recent by-election to be an infallible remedy for sweeping away the whole of the National Debt, and on the other hand we have it denounced as a national misfortune to the commerce of the country and the spoliation and robbery of the individual. No fair and reasonable opportunity should be lost of getting this question into perspective and placing it on reasoned and if possible reasonable grounds. It cannot be accepted or dismissed without inquiry. Of course, the main body of what one calls high finance is against it, but it cannot be denied that there are high authorities in commerce and in the general range of the financial world, and also accepted authorities in the theory of economics, who favour it.
The second ground upon which I move my Amendment is that the problems connected with the levy on war fortunes and the levy on capital are in the main identical, and therefore this opportunity should not be lost of getting a report on both proposals. The intention of the Amendment is not to ask for a report on the question of the capital levy at the same time that a report would be required on war fortunes, but simply that this Committee should first of all make its report on the question of the taxation of war fortunes and having done that, with all the accumulated data which they have at their disposal, proceed with all convenient speed to give their opinion upon the practicability or otherwise of the capital levy. What are the questions which the Committee would have to address themselves to with regard to the proposal contained in the Motion, and how far are they relevant to the question of an inquiry into a capital levy? These inquiries inevitably overlap, or in other words one telescopes into the other, and when you go into an inquiry with regard to the ascertainment of war fortunes, the 649 major portion of your investigations are as applicable to founding a reasoned opinion on a capital levy as they are on war fortunes. I presume the Committee will first of all endeavour to find out what was the total of the war wealth. Can you estimate it, and if you can what does it amount to, because obviously you must know what your total is before you can propose to levy a percentage upon it. Therefore I presume the first question the Committee will address itself to is what was the broad position in 1914. You must have the datum line first and, after that, ascertain what the position is in 1919, and then the difference between those two presumably would be the war increase of wealth which, if the Chancellor of Exchequer adopts an affirmative view by the Committee, he would propose to tax. My first point is that an inquiry into the position in 1914 and the position in 1919 for the purpose of war fortunes leaves you in possession of the necessary information for the capital levy, as to what was the position in 1919. Presumably for the capital levy you will not want to go further back than the actual position in the given year at the time the levy is to be presumed to be made.
§ The next question, I presume, would be how in the valuation to be made? That is perhaps the greatest difficulty of all. Here, again, it is impossible for the Committee to consider the best return of the value for war fortunes without at the same time considering what would be the best form of return for the ascertainment of capital for the purposes of the capital levy also, and, indeed, we really come to it that the whole basis upon which you work finally is the basis of the 1919 return. Having got your 1914 datum line you have the information also for dealing with the question of the capital levy. I should like to give the House specimens of a probable return which would have to be made. Take the 1914 return. I will give the totals as they have been estimated for me. Take land and houses, Consols, and other commercial investments. Take £17,000 as being the total subject to be taxed for 1914. Take the return B for 1919. Take the land, and new houses with fresh furniture and other commercial investments, and investments in War Loan to be a total of £102,000. That would leave an increase during the war period of, say, £85,000, but, of course, 650 there must be deducted from that, as inevitably arises in all taxation proposals, claims for exemption. First you would allow an amount up to the line which you were not going to tax. It might be the first £500 or the first £1,000. I do not know what it is. In most of the orations on this subject I have noticed that the amount of the exemption varies very much according to the class of audience the speaker happens to be addressing. Whatever it may be, you would have to ascertain what was the normal saving of the man during a particular period at so much a year. If a man put on one side £1,000 a year, you must allow that to him, because that is obviously not a war accretion. Then you come to the business items, such as expenditure on capital account. If it is a rubber estate, there is the amount spent on planting trees. Obviously you must allow for these capital expenditures which have produced the increase of the wealth. Again, suppose that the person about to be taxed has rendered exceptional service to the State, you probably would not include that in his assessment for the purpose of this special tax. Again, you must allow for money which has been inherited. Whether it is £250 or £50,000, it is not a part of his war profits. He did not make that out of the War, and obyiously that has to be dealt with in a way which is fair and just.
§ Suppose we put the whole of these things, on the figures I have given, at £34,500. That leaves the War profits to be taxed, on the figures I have given, at about £50,000. It is therefore perfectly obvious that, given the datum line of 1914, all the while you are steadily working to the 1919 figure, which is the really important figure. You have the exemptions granted and the datum line 1914 fixed. Then you have your valuation for 1919, and you have your position ready for the Chancellor of the Exchequer, who is going to lop off a portion of the War fortune, on which there is absolutely common agreement that it should be done. The point I am trying to drive home is that the 1919 return is the real working figure. Having done all this for the purposes of the War fortune levy, you have your figure ready for handling your levy on capital, if you desire so to do. I hope I am making a somewhat complicated question fairly clear to those who are doing me the honour to listen to me. Take the kind of wealth which would have 651 to be valued. I suggest to the Chancellor of the Exchequer that the kind of wealth he would have to value for the purposes of the War fortunes tax would be almost identical with the kind of wealth he would have to value for the purposes of the capital levy. I suppose that, in classes, it would run something like this: Stocks, funds, and shares; cash at home and in the bank; money on mortgage and mortgages; insurance policies: trade assets, book debts, and things of that kind; household goods on a big scale naturally would come in; agricultural land, house property, business premises, and ground rents; and then the all-embracing term "other property." The real difficulties arise, of course, around such items as trade assets and the last item, other property. The point I am making is that you have to value these things for the War fortunes tax, and that you have to go through precisely the same operation for the capital levy. Having set it up for one, at any rate you are fully qualified to express an opinion on the other. Let me try to make another point on the question of collection. That, of course, is always a very difficult matter. Once you have your data on the lines I have already indicated, assuming that I am fairly correct, I do not see much difference in the trouble of collection between collecting for a capital levy and collecting for a war fortunes levy. They appear to me to be practically identical.
§ My final point is the question of the desirability as distinguished from the possibility of the matter. The Chancellor of the Exchequer and the Board of Inland Revenue always have to consider the question of possibility. Desirability is a very difficult question and one which causes every Chancellor of the Exchequer and the Board of Inland Revenue the gravest concern. Apart from the great question of the shaking of commercial credit by a capital levy in its broad aspect, the difficulties which are anticipated by the subject who is to be taxed, and the deflation of credit which is bound to follow from either proposal—we must face that; the taxation of war fortunes is bound to exercise a very disturbing effect upon important kinds of credit—it is all a question of the balance of advantage. It is the old question, as the right hon. Gentleman well knows, is it worth while? You may have your tax and all 652 the machinery, but is it worth the disturbance? That is one of the most important questions every Chancellor of the Exchequer has to address to himself. I am suggesting to the Chancellor of the Exchequer that under the imposition of taxation on war fortunes there must be a large amount of disturbance, as, of course, he knows. The enquiry into that, except as to scale, would be precisely the same kind of enquiry which the Committee will address themselves to in regard to the capital levy.
§ I sum up what I have endeavoured to put before the House by saying this: Upon all these points the Committee now to be set up could ascertain this data and other data, all of which are applicable to the ascertaining of the data necessary to form a considered and responsible report upon the subject of a capital levy. I suggest to the Chancellor of the Exchequer that it would be very unwise in the present state of the public discussion of this question of a capital levy to leave out the consideration of it by the Committee. This question has become a veritable football between the contending parties at bye-elections. On the one side people are discussing it as a sort of infallible, swift-moving remedy, almost of a quack nature. [HON. MEMBERS: "Hear, hear."] I am not expressing my opinion on it. Personally, I do not think it is. My view is that it is a very serious proposal and must be considered as such. On the other hand, you have an unthinking denunciation of the whole thing. You cannot have anything much worse than that sort of position. I am certain that a report from this Committee, composed of hon. Members who combine amongst themselves all the qualities which have distinguished responsible Committees in this House in the past, and such a Report delivered after they have reported on war fortunes would have an educative effect on the whole country and would be most valuable in the discussion of this subject, because the discussion is going to continue. There is no doubt about that. It cannot be dismissed by a mere denunciation, nor will the people of this country allow it to be applied without proper discussion. Here is an opportunity for considering it which I urge upon my right hon. Friend. It will be a good thing for the body politic in all respects that this Committee should apply their minds and use the informa- 653 tion which will speedily be at their disposal for giving this House and the country a considered Report not only on the taxation of war fortunes, but also on the practicability or other wise of a capital levy.
§ Mr. ADAMSON
I beg to move, as an Amendment to the proposed Amendment, after the word "Further," to insert the words "after submitting the foregoing report."
It has been frequently stated from these benches that the Labour party are in favour of a capital levy. I do not think that the country will be able to come through its financial difficulties except by the imposition of some such levy. I have no objection, therefore, to the Amendment that has been proposed provided that it is made perfectly clear that its acceptance by the Chancellor of the Exchequer will not be used as an excuse for holding up the Report of the Committee on war profits. The Amendment does not make that clear, and it is so vital that it should be made clear that I have moved my Amendment on the point. Unless my Amendment is accepted, it is possible that the Amendment of the right hon. Gentleman may be used as an excuse for holding up the Report on war profits for an indefinite period. That would be a mistake. I do not know whether the Committee to inquire into war profits will be able to get through their work in time to enable the Chancellor of the Exchequer to deal with the Report in the next Budget. I hope they will; but if they were to inquire into the possibilities of a capital levy and not to submit any Report until they had inquired into that question, there would be no chance of the Chancellor of the Exchequer bringing more grist to his mill in the shape of a con siderable portion of the profits that have been made during the war. My Amendment makes the position perfectly clear, and will not endanger the issuing of the Report of the Committee on war profits at the earliest possible moment.
§ Amendment to the proposed Amendment agreed to.
Motion made, and Question proposed,
That those words, as amended, be there added.
§ THE CHANCELLOR OF THE EXCHEQUER (Mr. Chamberlain)
My right hon. Friend (Sir D. Maclean) has rightly said that the proposal on which he desires that inquiry should be made by this Committee is one of great gravity, raising large and most important issues, profoundly affecting not merely our national finance in the narrower sense, but the whole structure of our credit upon which our national enterprises and our ability to carry our burdens and face our difficulties depend. Like him I hope to confine myself strictly within the rules of order, and I am therefore precluded from going into the merits of the proposal at the present time, but I am glad to have the recognition on his part that this is a very serious proposal, and I recognise that he has never committed himself to this, that he has never expressed an opinion one way or the other on the merits of the proposal, but has only said that it should be the subject of inquiry by this Committee. My right hon. Friend (Mr. Adamson) who followed him, of course, adopts a different attitude. He has no objection to an inquiry, but has made up his mind beforehand. I am not complaining of my right hon. Friend, because I also have admitted to the House that I have made up my mind. I do not suppose that my right hon. Friend any more than I has made up his mind without giving the matter the best consideration which he could, but obviously the plea for inquiry comes with much more force from a gentleman who has no convictions than from a gentleman like the right hon. Gentleman, who, whatever be the result of the inquiry, has reached a foregone conclusion which will not be altered by the Report of the Committee. That is the only difference between my two right hon. Friends in regard to this particular matter. My right hon. Friends who moved the Amendment asks for the inquiry to be held into the possibility and desirability of a general levy on capital for a specific purpose, namely, to reduce the National Debt. My hon. and right hon. Friend does not ask it for that purpose only. He does not limit the capital levy to making a reduction in our War debt, but he and the party to which he belongs—if I am misrepresenting him he can correct me—at any rate many members of the party to which he belongs are in favour of a capital levy, not once but repeatedly, not merely for the specific 655 purpose of reducing the National Debt, but for the purpose of finding funds to carry out various large and costly schemes which they desire to see undertaken by the State.
§ Mr. CHAMBERLAIN
It was one of the right hon. Gentleman's followers sitting behind him who, when challenged by me when we were discussing this, affirmed by repeated cheers that the object of himself and his friends was not a single capital levy but that when they had once proved that it could be done they meant to come again and have a follow. They saw no reason for discontinuing until such time as wealth had been redistributed according to the best Socialist or Communist model, and my right hon. Friend knows that that is commonly supported by those who support him with more or less warmth throughout the country. The proposal of a capital levy for the specific purpose of my right hon. Friend the mover is one thing. The desirability of using capital to meet your current expenditure is quite a different proposition. If ever this matter should be inquired into I do not think that you ought to have the limiting words of my right hon. Friend, but you ought to consider the whole possibility and the consequence to which it is likely to give rise. I pass to consider the specific argument which my right hon. Friend addressed to the House for referring the matter to this Committee. It was—I think I summarise it fairly—that the issues involved in the two forms of tax were so similar that an inquiry into one covered at least the major portion of the ground of an inquiry into the other.
§ Mr. CHAMBERLAIN
That the data that it was necessary to ascertain in the course of an inquiry into one were practically the same data that were required for the inquiry into the other. I do not want to prejudge the course which the Committee may think it right to adopt. They may follow the programme which my right hon. Friend has sketched for them. I confess that as I thought about that inquiry it has seemed to me that they 656 would proceed rather differently. To that extent, if I am right, my right hon. Friend's hypothesis would not hold good. But, grant for the sake of argument that a great deal of the inquiry conducted into the taxation of War profits would be useful for an inquiry into the advisability of a general capital levy. In so far as that is so, if the House at some future time desires to hold an inquiry into a general capital levy, all that information will be available. It will not be lost. It will not disappear into space and the new Committee, whenever a new inquiry is started, will have before it at its start all the information collected by its predecessor. What I am chiefly concerned with at the present time is to get immediately the results of inquiry into what is certainly the more generally agreed proposal and the more immediately urgent proposal and what is in itself a sufficiently extensive and sufficiently difficult subject to take all the time that this Committee can give before the moment comes when, if we wish to legislate this Session, that legislation must be proposed. My right hon. Friend has appealed on public grounds, but I regret greatly that he has felt compelled to put down this Amendment, and that owing to this Amendment on the Paper we were unable to get the Committee going before the House rose. The House knows—I make no secret of it—that I am opposed to a general capital levy. The House knows that for reasons which it will recognise, such us my own personal honour as a public man, I could not be the instrument of a general capital levy, and if the House wants it it must find another instrument But I do want to make the levy on War wealth.
If I can find a practicable, just and manageable way of doing it I want it. I think we all want it; I am not passing any moral judgment on accretions of wealth to any particular individual during the War. In some cases those accretions of wealth were unavoidable, if the individuals did their immediate duty to the country in the circumstances of the time. In a large number of cases, in my oinion in the vast majority of cases, there is no possible moral stigma attaching to them. There are a few cases where wealth may have been acquired by evasion of the intentions of Parliament when it imposed the Excess Profits Duty, or cases which are under 657 moral censure. The justification of this proposal is that at a time of great stress and when great sacrifices are demanded of everyone, certain people, those people who have had an unexpected accretion of wealth, may rightly be asked to contribute not merely in proportion to the contributions of their fellow-citizens who have had no such accretions, but to make an additional and a special contribution. I think it is perfectly fair. I think that so stated the proposition, if practicable, if contained within limits which will not shake credit and which will not lead to a disturbance of our general position—reference has been made to the effect of deflation; let me say, therefore, that it should not lead to deflations of so sudden a kind as to be catastrophic—if it is practicable in point of machinery, if it can be carried out with reasonable security that those who are made subject to the tax have to pay the tax; in other words, if you can make your law effective when you have passed it, and if you can do these things without inflicting so much individual hardship in other cases as to counterbalance all the advantages, then it is very desirable that we should do it; and if we are to do it it is very desirable that we should do it at the earliest possible moment, and put an end to all the uncertainty which will continue as long as the matter is still in doubt.
I want to be able to deal with it in the next Budget. I think hon. Members must feel for themselves that the difficulties surrounding such a proposal are immense. I think they are greater than the difficulties surrounding any fiscal proposal which has ever come before this House. My right hon. Friend discussed not a few of them. I am not going to elaborate them. There is work for this Committee sitting almost de die in diem for such a time as we can allow if they are to report a practical scheme to the House in time for embodiment. I do not want them to be distracted. I do not want them half-way-through to say "Well, after all, would it not be easier to tax all capital than to face these difficulties?" and though you may order them to report on the one subject first and defer the other report until later, if you remit both subjects to them I venture to say there will be such an extension of their inquiry as would make it prolonged and our chance of being able to legislate in the coming Budget would be very much less. Even if the difficulty be 658 exaggerated in my own mind, I am going upon the assumption that the Committee, who will find ready very able and rather intricate memoranda prepared by the Board of Inland Revenue, will be able to recommend the taxation of war-wealth to the House in all its main outlines. I should like to see them produce the clauses of the Bill, because that is the real test for a proposal of this kind.
I am going on the assumption that they will be able to do that, and that we shall find ourselves in possession of a scheme which is practical, and which we shall immediately set ourselves to carry through the House and pass into law. If we do that the work of the Inland Revenue will be only just beginning. The task of putting them into execution will be infinitely difficult, and to ask, at the very moment when the Budget is going through the House and I shall require, in all probability, all the assistance of the Inland Revenue here in connection with the Budget proposal, as is always the ease, that they should also be in attendance on this Committee, and that when the Budget is through and their first business is to put this new machinery of taxation into order and gather the very considerable sum which all of us hope to get—to ask them to go into the intricacies of another method, is really, I think, to risk your success with the war profits taxation while you are chasing the shadow of a capital levy. We shall have quite enough to do, and it would be better to concentrate upon that on which we are all agreed and to make that a success before we embark on new inquiries and wider and perhaps more difficult proposals.
The whole world is suffering to-day from want of capital: for the immediate needs of the world there is insufficient capital. You cannot create more capital except by saving, and it is therefore urgent hero and everywhere that the people, the Government and the individual, should check extravagance in all forms and wherever possible reduce unnecessary expenditure, avoid the purchase of unnecessary articles and save capital, to be a solid backing behind the inflated credit which the War has left to us, and provide a means for that great expansion of industry and of production without which the world cannot carry the vast burden which the War has laid on it. I cannot put too high the importance of 659 this country in particular, though, as I say, the problem is one common to the world as a whole, of encouraging saving. It is not an easy task. During the War, under the impulse of a great national necessity and the patriotism, public spirit and determination of all citizens to do what they could each in his own sphere and in every manner possible, prodigious efforts were made in this direction. With the cessation of War comes a natural relaxation of effort, and here as elsewhere a natural disposition to allow ourselves those luxuries and freedom from which we had been either unavoidably cut off or from which we had unavoidably cut ourselves off. Even in the matter of a levy upon War wealth, one of the considerations which must be present to this Committee is that it is vital that they should do nothing to discourage saving, and that they should do nothing in the case of those who made a special effort to respond to the appeals made by the Government of the day that they should reduce expenditure or forgo luxuries in order to place their money at the disposal of the country, which would make those people feel that they had been induced to save so that thereafter' their pockets might be picked. I think that can be avoided in a levy on War wealth. I believe you can make an allowance and you must make an allowance, though I do not mean to say that the allowance will give justice to each individual case, but you must make an allowance on a generous scale in order to protect yourself against the injury which would be done if you penalised those who were thrifty during the War.
If you are going to talk not merely of this taxation of War wealth but to keep before the eyes of the people, now that the inducement to save is much less—though the need is as great as ever—this idea of a capital levy, once to please my right hon. Friend opposite and repeated thereafter by another party sitting behind him if they ever become responsible, then you are going to strike a blow at investing. Let me say the danger is not imaginary. I do not think anybody could hold my position and sees all that I see and hears all that I hear without feeling that high taxation and, on the top of it, this vague talk of a levy on accumulated wealth are one of the causes of extravagance, and one of the reasons why people 660 are not saving as it is in the nation's interest that they should save. You want to get that behind us and done with, not that they may be rich, but so that you leave people with no excuse for not accumulating their wealth or adding to their wealth in order that the country may command the resources which are necessary to its development, and through that development be the means by which all our burdens will be lightened and by which we shall eventually find that we have faced our difficulties and met them with much less sacrifice and much less difficulty than some people are now inclined to suppose. Anything which prevents the accumulation of capital is a disaster. It is nothing less and to set up this kind of enquiry now would, I am quite certain, encourage the tendency to spend rather than to lay by, and encourage the tendency, too, in forms which cannot easily be traced, and I have seen signs of that, and encourage all those actions which are least in the interests of the State and least helpful to us in the course we have to pursue.
I have only one other observation to make. My right hon. Friend the Leader of the Labour party said that we should have to have a capital levy sooner or later, and that without it we could not face our difficulties. Is he not a little over hasty in forming a judgment of that kind? I do not know whether his information is better than mine, but I, at any rate, am not driven to the conclusion that we shall have to resort to any such expedient in order to meet the liabilities, great as they are, with which we are confronted. I think the signs of the time are reassuring. Trade is good; the export trade is reviving; the very fall in the exchange, which in many ways hits us very hard as great purchasers of American produce, is in itself a great bounty on our export trade, and is bringing orders to our doors which otherwise would never have come here. We want to take full advantage of that; we want to expand all our means of production to the utmost of our capacity. That is the way we have met the difficulties of the past. That is is the way we overcame difficulties generation after generation, and difficulties which to the generation which incurred them seemed out of proportion to our capacity to bear, and difficulties which they thought had laid us low and destroyed our prosperity for all time. It is 661 not by rash experiments of a dangerous kind, but by sound methods of finance, encouraging the recuperative powers of the country itself, we shall find our salvation. I believe those measures wisely, courageously and presciently employed will be quite sufficient to carry us through our difficulties and prove once again that the obligations which we undertook we can fulfil, and that the burdens which we shouldered we can carry, so that we, as well as those who look on us from a distance, will be astonished a generation hence at the ease with which we shall have faced the enormous burdens of this War.
§ 10.0 p.m.
§ Mr. LAMBERT
The Chancellor of the Exchequer has, I think, struck the right note of optimism, that we shall carry our burdens, but the immediate object of my rising is to support the principle of an inquiry into a capital levy, and I do so for a reason which I think may appeal to my right hon. Friend the Chancellor of the Exchequer. He spoke of the vague talk of a capital levy and that it was doing a considerable amount of damage to the saving habits of the country. I quite agree with him, and therefore I want to get rid of all this vagueness. I want the thing to have a thorough, impartial, and clear inquiry into its merits and its practicability. I can express no opinion about it, but there has been, no doubt, a great deal of loose talking during the past few months about a capital levy. It has been advocated on a large number of platforms, and these platforms have had a considerable amount of success. My Labour Friends have advocated openly, as one of the main planks of their programme, a levy on capital. Well, I do not think it is possible that with their success at the polls you can dismiss the idea of a levy on capital from the future financial operations, but I do want at this moment, while the whole matter of war fortunes is being inquired into, that in addition to that, and after the Chancellor of the Exchequer has had the report of this Committee on war fortunes, that that information shall be used as a basis for the inquiry into the capital levy. I quite agree with the Chancellor of the Exchequer that we want an immediate report on the war fortunes, but I think the Chancellor of the Exchequer was speaking somewhat on the Amendment of my right hon. Friend, but the Amendment has been amended, and at the pre- 662 sent moment the report on the war fortunes must come first. Therefore, I think that part of the Chancellor's argument rather falls to the ground.
It is a very easy matter to go on a political platform and advocate a capital levy, especially with the contrast and the senseless extravagance we see going on all round us to-day. We see on the one hand vulgar, flaunting wealth wasted, and we see on the other hand grinding poverty, and it is a very easy matter to influence public audiences, that whereas on one side many people have got too much, on the other there are thousands who have got too little. People who can give 5,000 guineas for a motor car—well, I would make them walk for the rest of their lives. My right hon. Friend talked about saving. I am sure that his advice was right, that saving is absolutely essential, but it is not practised all over the country. It is not practised even in my right hon. Friend's own native town of Birmingham. I have a little quotation here which I cut out from this morning's paper, as I thought it might come in handy to-day. Here is a gentleman who describes his experiences in Birmingham last Saturday He says:The thought of how much champagne is being consumed in the North and Midlands almost makes me reel. On Saturday evening I was dining in Birmingham. I watched the champagne drinkers. It seemed to me that brand and vintage were secondary considerations. The great thing was to pay £2 a bottle.Those are not the saving habits, I am sure, which the Chancellor of the Exchequer wishes to inculcate.
§ Mr. LAMBERT
I am quite aware of that, but my point is that when people have only 10s. a week to live upon, and others can give £2 a bottle for champagne, the suggestion of a capital levy readily finds favour with those who are poor. I want this thing gone into. I feel sure my friends of the Labour party do not know how much capital is conscribed at the present moment. A man has to pay 6s to 10s. income tax and 40 per cent. death duties. That is an enormous tax at the present moment; it is a very high tax upon industry. But to me it is a question of what is best for the nation, whether you should tax income or capital. I 663 know full well that this matter of a capital levy is causing a great deal of apprehension amongst many of our most responsible financiers. I heard a gentleman say yesterday, "Why should I save? The Government proposes to take it from me." I think we really ought to go into this matter thoroughly and carefully. I am not sure I agree with the suggestion of a Committee of the House of Commons. I am not sure that Members of Parliament are a right tribunal for enquiring into these very intricate matters. Members of Parliament come here without any test. It might be a good thing to have a test for Members of Parliament, who should have to pass an examination in economics. This question of a capital levy, to me, bristles with difficulties. A valuation has to be made. I should like to have an enquiry as to whether it would be possible to make the valuation, and how long it would take. It would certainly take a very long time. I also agree with an hon. Friend opposite who says it would take a very large number of officials. Land, houses, factories, machinery, ships—everything would have to be valued. Is it practicable? Is it possible? Then there is the question of evasion, which could well form a subject of enquiry. It would afford every opportunity of evasion and penalise the honest. Then I want this question settled from the point of view of national thrift. If you have a capital levy you penalise the man who has saved, and you let off the man who has spent. I came across a ease on Saturday of a schoolmistress who had worked all her life and saved £4,000. She was going to get £200 a year—not very much after a life's hard work—and she asked me, "Am I to have part of this capital taken from me?" I think such people should know exactly what are the intentions of the Government. I am not a skilled financier. It is imperative that we should pay our debts, but whether we should pay them by a capital levy or a tax on income is, of course, a matter which financial experts must decide. But I do press upon my right hon. Friend opposite the necessity of some sort of enquiry. I know he has made up his mind, but if an enquiry by competent people takes place and my right hon. Friend is right, he will be doubly fortified. I do hope he will allow this matter to be gone into. I want to have the 664 trained minds of men—not wealthy men—applied to it.
There is another question on which this matter of a capital levy and the threat of it may have very grave consequences until it is cleared up, and that on bank deposits. Nothing is more mobile than capital. It can be moved from town to town, and from county to county. Unless this question of a capital levy is cleared up it may have a very disastrous effect upon banking deposits. What would be the first thing to happen from the threat of a capital levy—that the person who wished to avoid it would withdraw his banking deposit.
§ Mr. LAMBERT
I do not want to enter into argument with my hon. and gallant Friend, but I do say there is a danger, as expressed to me only recently by a gentleman who is very high in the banking world. He feared what might be the consequences on bank deposits unless this question was settled. I want it settled. I have no desire to pre-judge the matter, and if the Chancellor of the Exchequer has made up his mind that he will not have this inquiry, of course, the majority of this House will no doubt support him. I shall regret it, because I am certain that while this question is a main plank in the platform of the Labour party in the country—and great successes have of late been very prominently exemplified—so long, I say, as the question remains a main plank, this threat will be hanging over the country. I should like very much to have it cleared up as soon as possible. I am quite, certain that every man in the House will agree that there is nothing that will discourage thrift so much as insecurity. I hope my right hon. Friend will consent, if not now, to an inquiry. If my right hon. Friend near me goes to a division I shall vote for the Amendment. I hope, however, my right hon. Friend will give us an inquiry into this matter, which has become a burning 665 question and one of great political importance in the country.
§ Sir RYLAND ADKINS
The hon. Member who has just sat down said that he imagined every Member of the House would agree with him on one point. We find him concluding by saying that personally he will vote with my right hon. Friend who moved the Amendment, and who preserved a judicious reticence, and my right hon. Friend who seconded, and who if his mind is made up had it even more hermetically sealed. And a resolution of this kind, whatever be its merits, whether it be timely or not, I agree it has a Parliamentary advantage to ask for an inquiry. It enables the asker to defend himself from critics from every point of view. To the devotee of the capital levy he says: "I am asking the Government to grant an inquiry." To opponents of the capital levy he says: "I have asked for an inquiry because, of course, it will show what nonsense the thing is." So he passes on, armed at all points against all critics and all constituents. Although this may be of enormous dialectical importance, is it for the good of the country that at this time, in connection with the War, there should be added an inquiry into war fortunes and an inquiry into a capital levy? Most of us, probably all of us, believe that a capital levy is not in itself and on every occasion wrong per se, but if there is one, time that a capital levy may well seem to be wrong it is after a war like that we have just survived, for the inevitable characteristic is to make large sections of the public richer and other large sections poorer. Those who have been made richer by the War are appropriately a subject for inquiry, but what about those who, through no fault of their own, and owing to the operations of war, have become poorer? We all know of case after case during those five terrible years of people who have had to live upon their capital, who have had to draw out and dispose of their own savings. Those persons who have not been living within very narrow limits cannot be so much impressed by the misery which has come upon those sections of the community which, in ordinary times, are not the least distinguished for thrift or carefulness, or stability of social temperament. Those are the people who have dwindled capital at the end of the War period, just as those who have been concerned with the pro- 666 duction of new articles have become much more wealthy owing to the War. The moment you put together the proposal for inquiry into the taxation of War wealth and the proposal for the inquiry into a general capital levy, you are mixing up indiscriminately classes who can afford to pay additional taxation, and classes who are in a worse position now than ever to have their capital taken by the State. That is inevitably the effect if the Amendment, with its many-sided charms, is added to the Resolution.
We have been told that there is wide unrest and uncertainty, and that the question of extending War taxation demands to be settled. If you add this Amendment to the Resolution you are largely widening the area of anxiety and unrest and fear, because the moment the House of Commons, with the sanction of the Government of the day, appoints a Committee with the width of reference which my right hon. Friend opposite desires, it will and must be taken as notice to the poorest person who still has a little capital after the War that their little all may be subject to depredations by the State. [HON. MEMBERS: "Oh, oh!" and "No, no!"] I understand the rather painstaking humour of some hon. Gentlemen opposite because it is part of their cue to suggest that no poor person is to suffer. It has already been said that the definition of poverty depends upon the speaker and the audience, and you may very well have cases which it is not in the interests of the State to touch their capital which might appear considerable to others.
§ Sir R. ADKINS
Yes, it would-be if there is any justice whatever in making a capital levy on those upon whom the War has already produced diminished resources. If hon. Members think that, however much people may have suffered from the War, they ought to be made to suffer still further in the form of a capital levy, then, no doubt, it is a proper subject for inquiry. My first point is that if it is levied after a war which of necessity involves great suffering to people who have already suffered, and which reacts on the national stability and credit, there ought not to be an enquiry at that point and at this time. My second point is that to have it now tied up with the other is to widen the area of anxiety and uncertainty which 667 we all wish to limit. We all enjoy the spectacle of the two right hon. Gentlemen who, unable to speak in unison, yet in many things speak in harmony. One says, "We want an inquiry, but do not let us have it until we have done the other," and the second says, "Put it solemnly into the Amendment that when you have finished the first task you will begin the second." Is it not better to see the result of the first task before you go on to another, which, if it differs from the first, is much less properly the subject of discussion? If this matter be raised at another time independent of those incidents of a war which make its universal incidence now so especially unjust,' then we shall all be free, whatever our action or speech to-night, to approach the problem in a new light which will be upon it at the time. As a remedy to be applied now to all classes of the community whether they have prospered or not, I believe it to be unjust, and to inquire into what one believes to be unjust is a waste of time and a lowering of morale.
Mr. T. THOMSON
I rise to support the Amendment and I would respectfully submit, in view of the most serious financial position of the country—the Chancellor of the Exchequer has told us time after time the tremendous amount of debt which stands before us—that we should not hastily refuse to explore any avenue of possible means of reducing that debt and of establishing the financial stability which we desire from a commercial and industrial point of view. We know that not only those who are charged with extreme views, but also economists of repute and business men of high standing have given their blessing to this proposal. Surely, on those grounds there is reason why inquiry should be made. The hon. Member who spoke last (Sir R. Adkins) and the Chancellor of the Exchequer have suggested that the time is not opportune. How often has this House put reforms back because, although they might be good in themselves, the time was not opportune?' The hon. Member adduced as a reason the fact of the War: I submit that to many minds the very fact of the War when the widow's son was conscripted is an additional reason—
The hon. Gentleman is welcome to the interruption. If you can conscript human life, surely you have a right to conscript capital. I did not raise the point of the War. It was raised by those who object to this proposal as being a reason why the time is not opportune, and I am trying to show that it is because of the War that there is additional reason why this proposal should be at any rate inquired into. As to whether you would take the widow's mite, which is so often put forward as a reason why the capitalist and the millionaire should not be taxed, as well as having taken the widow's son is surely a question of the incidence of the tax. The principle of the question whether we can establish our financial standing by an Income Tax of 10s. in the £, or whether we can do it better by seeking to write off our capital liabilities by a levy on capital, is, I submit, a matter for this Committee to inquire into. The Chancellor of the Exchequer stated that the one thing he thought was necessary was security. At the present time there is insecurity and uncertainty as to whether there will be a capital levy, and that is acting as a deterrent against saving which would be removed if this inquiry were granted. I submit we ought not to refuse to explore any possible avenues and means of reducing our National Debt, especially as the making of the inquiry would remove insecurity and uncertainty and enable us to get the sound judgment of experts on this very important question.
§ Lieut.-Commander KENWORTHY
As I listened to the speech of the Chancellor of the Exchequer my hope of getting anything from an inquiry into the increase of war wealth oozed away livery one of the arguments used from the Treasury Bench against a levy on capital could be used against any proposal to further tax war fortunes. The right hon. Gentleman told us it was our duty to expand our trade and to encourage enterprise, initiative and efficiency on the part of business men. But these are the very men who have made money during the War. They are now in the prime of their business connections. They have made a big capital out of the War and they are now busily engaged in increasing that capital and in expanding our export trade. We are told that they are the people we want to encourage. We are all agreed that if we can tax war 669 profits without damage it should be done, but we are warned that it is our duty to increase our trade and to remove insecurity and apprehension on the part of big capitalists; therefore it is suggested that to talk of depriving them of any of their war wealth would be mischievous. I am afraid that this proposition which has been brought forward by the Government is mere camouflage and that there is no intention of taxing property whether it be capital increased by the War or whether it is general capital to be levied on. I am afraid that the arguments used by the Chancellor of the Exchequer will be applied against even putting into operation any taxation on the increase of wealth through the War and there will be so many claims for exemption, and the meshes of the net will be so wide, that the men we really want to catch will escape. I hear an hon. "Member exclaim, "Wait and See." The same advice was given with regard to the proposal for a capital levy. We have waited quite long enough, and I think it is time that a committee was appointed. It was a common scandal to see how people grew richer during the War. Why did not the Chancellor of the Exchequer make some preparation to provide such a tax as this while the War was on? His whole attitude makes me think that the present proposal is not seriously put forward by the Government or supported from Ministerial quarters. It is intended simply to keep the people quiet. The proposals are put forward in response to a newspaper agitation, otherwise why have we not heard them long ago? I have no faith in the reception we have had of the suggestion, or the reception the Committee's findings will have. We are met with fair words as regards the war profiteers, but I am afraid the deeds will fall far short of our expectations. It is a great pity that the Amendment is not going to be accepted. I have made inquiries of friends in a position to know, and I am informed that the new proposals to take away war-time increases of wealth will cause insecurity in the business world, and therefore the main argument used, especially by the last speaker opposite, that more uncertainty will be caused if the Amendment is accepted, falls to the ground. There will be great insecurity among the very energetic and efficient business men who have made money out of the War at the 670 very suggestion of a Committee as things are now. Therefore we may go into the whole inquiry right away. The soundest argument we have had yet is that of my right hon. Friend (Mr. Lambert) that if there is nothing in the cry of a capital levy, what are you afraid of? Why not have a Committee of Inquiry as strong as possible, and prick the bubble? What is it that hon. Members object to in it? We are told that apparently we are going to get over our difficulties without any exceptional taxation. I am afraid that is not going to be the case. I should like to see the Government balancing their Budget first; we are yet to have that. Three countries at least are embarking already on this, and we at least must inquire, Italy is having a forced loan; we might even have that inquired into. Czechoslovakia, which is ruled by one of the ablest men in Europe as her President, is adopting the system and putting it into operation, and in Germany, of course, the Weimar Assembly have passed it, so I think at least we must have an inquiry in this country. It must be useful in many ways. It would save time if we should be so unfortunate as to find ourselves in financial difficulties in the near future, which is not at all unlikely. After all, committees' reports are not always at once acted upon. We all recognise that the Chancellor of the Exchequer is unable" to commit himself to being the instrument for carrying this out, but has he any objection to the Committee giving their opinion? A Committee reported ten years ago in favour of certain alterations in canals and nothing has yet been done. There are plenty of precedents for ignoring Committee's Reports.
The great criticism which is made of the suggestion for an inquiry into a capital levy is that it will not, and is not intended to, be used solely for the cancellation of debt, and the Chancellor of the Exchequer made this charge against the Labour party. I have read and heard a great many speeches made from Labour platforms and have read a great many election addresses and I have never yet seen any suggestion of the sort. I believe that an hon. Member nodded his head when that challenge was put from the other side of the House during a Debate on the Budget last Session. I know members of an extreme section in this country are not in favour of a capital 671 levy per se. They talk about repudiation. That is what one has to face unless our financial house is put in order. I never yet heard the suggestion that a capital levy should be made for the purpose of demobilising capital. I think that is only an argument to discredit the very serious proposals put forward which are supported by many business men all over the country.
The Chancellor of the Exchequer declares that the great need to-day is for more capital. I am not sure what he means. If he means more paper, he is wrong. We have all seen in the Press recently reports of the purchases of mills in the North of England at from four to six times their original value. Those are purchases made, not with cash, but with paper. Certain favoured gentlemen have managed to get command of a great deal of credit. Those mills are now obviously over-capitalised, and it will be necessary to charge high prices for the goods they produce, which all the world wants, in order to pay interest on the overcapitalised values.
§ Lieut.-Commander KENWORTHY
Mills are being sold to-day all over the North of England from where I come and of which I think I have a little more knowledge than the hon. Member for Devonport (Sir C. Kinloch-Cooke). If by capital you mean machinery, buildings, and that sort of thing, there is too little, but if you mean paper and artificial credit, there is too much of it. Until we have a bonfire of some of this paper we shall not get straight. The sooner that bonfire is lighted the better it will be for the credit of the world, not only for that of this country. There must be a change in our financial values and in our whole system of taxation. We ask, therefore, for an inquiry. We want to extend the modest terms of reference to the war fortunes tax to the tax on wealth. It is refused. Very well'. I hope the result will not be bad for the whole country. The Chancellor of the Exchequer said that he would not be the instrument for putting such a levy into operation. I am not sure that any Member of the present Govern- 672 ment will be the instrument for doing anything in a very few months. [HON. MEMBERS: "Oh, oh!"] Look at the bye-elections. There is now a chance of having a Committee of Members of this House set up. No doubt they are distinguished Members. They would have an opportunity of examining this proposal calmly and coolly before there is a danger of a financial crash It is not so much a British question as a European question. At present we are on safe ground. Before long the financial position may become so acute that something of this sort will be imperatively demanded to save our own credit. The whole thing would now receive a fair inquiry, but instead of that we may have another Government which is impressed with the necessity of having a capital levy and which is pledged to its constituents on the subject, and we may get an inquiry which is not so favourable to the vested interests that certain hon. Members may feel they are bound to champion It will be a great pity if the inquiry is refused now that there is a chance of solidifying the position. At present the talk is too loose. There is too much talk about widows' mites, widows' sons and people who have suffered in the War. This is a business proposition: let us tackle it as such. What are hon. Members afraid of? What is the Government afraid of? I am afraid it is no good appealing to the Government. We shall be beaten in the Division; but Governments do not last for ever, and hon. Members may regret not having helped to get an inquiry which might give them extra safeguards and more leniency than they would get from another Government.
§ Colonel ROYDS
I am not surprised at the speech of the hon. and gallant Gentleman. He said this was a matter to be dealt with on business lines, as a business proposition. He started his speech by saying that this Select Committee was a camouflaged Committee and useless to deal with anything, and wound up by asking the House to refer to the Committee the question of a capital levy. I simply rise to call attention to that, and to say how absolutely ridiculous the speech was from beginning to end.
§ Question put, "That those words, as amended, be there added."
§ The House divided: Ayes, 62; Noes, 167.
|Division No. 7.]||AYES.||[10.44 p.m.|
|Adamson, Rt. Hon. William||Hayward, Major Evan||Robertson, John|
|Barnes, Major H. (Newcastle, E.)||Hirst, G. H.||Robinson, S. (Brecon and Radnor)|
|Bowerman, Rt. Hon. Charles W.||Holmes, J. Stanley||Rose, Frank H.|
|Brace, Rt. Hon. William||Jones, J. J. (West Ham, Silvertown)||Royce, William Stapleton|
|Broad, Thomas Tucker||Kenworthy, Lieut.-Commander J. M.||Shaw, Thomas (Preston)|
|Brown, James (Ayr and Bute)||Lambert, Rt. Hon. George||Shaw, William T. (Forfar)|
|Cairns, John||Lawson, John J.||Short, Alfred (Wednesbury)|
|Cape, Thomas||Lunn, William||Sitch, Charles H.|
|Carter, W. (Nottingham, Mansfield)||Maclean, Nell (Glasgow, Govan)||Smith, W. R. (Wellingborough)|
|Chadwick, R. Burton||Maclean, Rt. Hn. Sir D. (Midlothian)||Thomson, T. (Middlesbrough, West)|
|Clynes, Rt. Hon. J. R.||MacVeagh, Jeremiah||Tootill, Robert|
|Davison, J. E. (Smethwick)||Malone, Lieut.-Col. C. L. (Leyton, E.)||Walsh, Stephen (Lancaster, Ince)|
|Devlin, Joseph||Morgan, Major D. Watts||Waterson, A. E.|
|Edwards, C. (Monmouth. Bedwellty)||Murray, Dr. D. (Inverness & Ross)||Williams, Aneurln (Durham, Consett)|
|Edwards, Major J. (Aberavon)||Myers, Thomas||Williams, John (Glamorgan, Gower)|
|Finney, Samuel||Newbould, Alfred Ernest||Wilson, W. Tyson (Westhoughton)|
|Galbraith, Samuel||O'Connor, Thomas P.||Wood, Major M. M, (Aberdeen, C.)|
|Graham, D. M. (Lanark, Hamilton)||Onions, Alfred||Young, Robert (Lancaster, Newton)|
|Graham, W. (Edinburgh, Central)||Parkinson, John Allen (Wigan)|
|Grundy, T. W.||Raffan, Peter Wilson||TELLERS FOR THE AYES.—|
|Hall, F. (York, W. R., Normanton)||Redmond, Captain William Archer||Mr. G. Thorne and Mr. Hogne.|
|Mayday, Arthur||Richardson, R. (Houghton-le-Spring)|
|Adkins, Sir W. Ryland D.||Greene, Lleut.-Col. W. (Hackney, N.)||Moore-Brabazon, Lieut.-Col. J. T. C.|
|Allen, Lieut.-Colonel William James||Greenwood, Colonel Sir Hamar||Moreing, Captain Algernon H.|
|Archdale, Edward Mervyn||Gregory, Holman||Morrison, Hugh|
|Armitage, Robert||Greig, Colonel James William||Murray, Lt.-Col. C. D. (Edinburgh)|
|Atkey, A. R.||Gritten, W. G. Howard||Murray, Hon. Gideon (St. Rollox)|
|Baird, John Lawrence||Guest, Major O. (Leic, Loughboro')||Neal, Arthur|
|Baldwin, Stanley||Guinness, Lleut.-Col. Hon. W. E.||Nicholl, Commander Sir Edward|
|Balfour, Sir R. (Glasgow, Partick)||Hambro, Captain Angus Valdemar||Nicholson, Reginald (Doncaster)|
|Barnett, Major R. W.||Hamilton, Major C. G. C.||Norris, Colonel Sir Henry G.|
|Barnston, Major Harry||Hancock, John George||Oman, Charles William C.|
|Bellairs, Commander Carlyon W.||Henry, Denis S. (Londonderry, S.)||Parkinson, Albert L. (Blackpool)|
|Benn, Sir A. S. (Plymouth, Drake)||Herbert, Dennis (Hertford, Watford)||Parry, Lieut.-Colonel Thomas Henry|
|Bennett, Thomas Jewell||Hewart, Rt. Hon. Sir Gordon||Peel, Lieut.-Col. R. F. (Woodbridge)|
|Birchall, Major J. Dearman||Hills, Major John Waller||Perkins, Walter Frank|
|Blades, Capt. Sir George Rowland||Hinds, John||Pickering, Lieut.-Colonel Emil W.|
|Blake, Sir Francis Douglas||Hoare, Lieut.-Colonel Sir S. J. G.||Pownall, Lieut.-Colonel Assheton|
|Bowyer, Captain G. E. W.||Hohler, Gerald Fitzroy||Pratt, John William|
|Breese, Major Charles E.||Hood, Joseph||Prescott, Major W. H.|
|Bridgeman, William Clive||Hope, James F. (Sheffield, Central)||Purchase, H. G.|
|Brittain, Sir Harry||Hope, Lt.-Col. Sir J. A. (Midlothian)||Rae, H. Norman|
|Brown, Captain D. C.||Hope, J. D. (Berwick & Haddington)||Raw, Lieutenant-Colonel N.|
|Bull, Rt. Hon. Sir William James||Hopkins, John W. W.||Rawlinson, John Frederick Peel|
|Burdon, Colonel Rowland||Hopkinson, A. (Lancaster, Mossley)||Rees, Sir John D, (Nottingham, East)|
|Burn, Col. C. R. (Devon, Torquay)||Howard, Major S. G.||Reid, D. D.|
|Burn, T. H. (Belfast, St. Anne's)||Hunter, General Sir A. (Lancaster;||Richardson, Alexander (Gravesend)|
|Campbell, J. D. G.||Hurd, Percy A.||Rothschild, Lionel de|
|Campion, Lieut.-Colonel W. R.||James, Lieut.-Colonel Hon. Cuthbert||Royds, Lieut.-Colonel Edmund|
|Carr, W. Theodore||Jesson, C.||Rutherford, Sir W. W. (Edge Hill)|
|Carter, R. A. D. (Man., Withington)||Jodrell, Neville Paul||Samuel, Samuel (W'dsworth, Putney)|
|Casey, T. W.||Johnson, L. S.||Sanders, Colonel Sir Robert A.|
|Chamberlain, Rt. Hn. J. A. (Birm. W.)||Jones, Sir Edgar R. (Merthyr Tydvil)||Seager, Sir William|
|Chilcott, Lieut.-Com. Harry W.||Jones, G. W. H. (Stoke Newington)||Seddon, J. A.|
|Coates, Major Sir Edward F.||Jones, J. T. (Carmarthen, Llanel'y)||Shaw, Hon. Alex. (Kilmarnock)|
|Conway, Sir W. Martin||Kerr-Smlley, Major Peter Kerr||Smith, Sir Allan M. (Croydon, South)|
|Coote, Colin Reith (Isle of Ely)||Kinloch-Cooke, Sir Clement||Smith, Harold (Warrington)|
|Courthope, Major George L.||Knights, Capt. H. N. (C'berwell, N.)||Stanley, Lieut.-Colonel Hon. G. F.|
|Craig, Colonel Sir J. (Down, Mid.)||Lane-Fox, G. R.||Stephenson, Colonel H. K.|
|Craik, Rt. Hon. Sir Henry||Law, Alfred J. (Rochdale)||Stewart, Gershom|
|Curzon, Commander Viscount||Law, Rt. Hon. A. B. (Glasgow, C.)||Strauss, Edward Anthony|
|Davidson, Major-General Sir J. H.||Lewis, Rt. Hon. J. H. (Univ., Wales)||Sugden, W. H.|
|Davies, Sir Joseph (Chester, Crewe)||Lindsay, William Arthur||Sykes, Sir Charles (Huddersfield)|
|Denison-Pender, John C.||Lister, Sir R. Ashton||Taylor, J.|
|Edgar, Clifford B.||Lloyd, George Butler||Waddington, R.|
|Elliot, Capt. Walter E. (Lanark)||Lloyd-Greame, Major P.||Wallace, J.|
|Eyres-Monsell, Commander B. M.||Lorden, John William||Ward, William Dudley (Southampton)|
|Falcon, Captain Michael||Lyle-Samuel, Alexander||Watson, Captain John Bertrand|
|Forrest, Walter||Lynn, R. J.||White, Lieut.-Col. G. D. (Southport)|
|Fraser, Major Sir Keith||Lyon, Laurance||Whitla, Sir William|
|Gardiner, James||Mackinder, Sir H. J. (Camichle)||Williams, Lt.-Com. C. (Tavistock)|
|Geddes, Rt. Hon. Sir A. (Bas'gst'ke)||McLaren, Robert (Lanark, Northern)||Williamson, Rt. Hon. Sir Archibald|
|Gibbs, Colonel George Abraham||Macleod, J. Mackintosh||Wilson, Daniel M. (Down, West)|
|Gilbert, James Daniel||Macmaster, Donald||Wilson, Colonel Leslie O. (Reading)|
|Gllinour, Lieut.-Colonel John||Macph'erson, Rt. Hon. James I||Wilson-Fox, Henry|
|Glanville, Harold James||Macqulsten, F. A.||Younger, Sir George|
|Glyn, Major Ralph||Moles, Thomas|
|Gray, Major Ernest (Accrington)||Molson, Major John Elsdale||TELLERS FOR THE NOES.—|
|Lord E. Talbot and Capt Guest.|
§ Main question put, and agreed to.
§ Committee accordingly nominated of Sir John Bethell, Mr. Hartshorn, Mr. Holmes, Mr. Macquisten, Captain Moreing, Mr. Murchison, Sir William Pearce, Colonel Sidney Peel, Mr. Pennefather, Lieutenant-Colonel Assheton-Pownall, Lieutenant-Colonel Royds, Mr. Walsh, Colonel Penry Williams, Mr. Wilson-Fox, and Mr. Robert Young.
§ Ordered, That the Committee have power to send for persons, papers and records.
§ Ordered, That Five be the quorum.— [Colonel Gibbs.]