Commons Sitting of 8 July 1924

Preamble
The House met at a Quarter before Three of the Clock, Mr. SPEAKER in the Chair.

PRIVATE BUSINESS.
PRIVATE BILLS [Lords] (Standing Orders not previously inquired into complied with).
Mr. SPEAKER laid upon the Table Report from one of the Examiners of Petitions for Private Bills, That, in the case of the following Bills, originating in the Lords, and referred on the First Reading thereof, the Standing Orders not previously inquired into, which are applicable thereto, have been complied with, namely:
Rhymney and Aber Gas Bill [Lords].
Clyde Valley Electrical Power Bill [Lords].
Bills to be read a Second time.

PRIVATE BILL [Lords] (Special Report).
Mr. SPEAKER laid upon the Table Report from the Examiners of Petitions for Private Bills, That, in the case of the Petition for the following Bill they had made a Special Report, namely:
Londonderry and Lough Swilly Railway Bill [Lords].
Special Report referred to the Select Committee on Standing Orders.
Lancashire Asylums Board Bill [Lords],
To be read the Third time To-morrow.
Spencer Settled Chattels Bills [Lords],
Read the Third time, and passed, with Amendments.
Tynemouth Corporation Bill,
As amended, considered:
Ordered, That Standing Orders 223 and 243 be suspended, and that the Bill be now read the Third time.—[The Chairman of Ways and Means.]
Bill accordingly read the Third time, and passed.
North Metropolitan Electric Power Supply Company Bill [Lords],
To be read a Second time upon Friday.
County of London Electric Supply Company Bill [Lords] (by Order),
Second Reading deferred till Friday.
Lanarkshire Hydro-Electric Power Bill [Lords] (by Order),
Second Reading deferred till Tomorrow, at a quarter-past Eight of the Clock.
London Electricity Supply (No. 1) Bill [Lords] (by Order),
London Electricity Supply (No. 2) Bill [Lords] (by Order),
Second Reading deferred till Friday.
Saint Enoch's Church and Parish Quoad Sacra Order Confirmation Bill,
Clydebank and District Water Order Confirmation Bill,
Read the Third time, and passed.
Glasgow University (Barbour Scholarship) Order Confirmation Bill [Lords],
Burntisland Water Order Confirmation Bill [Lords],
Considered; to be read the Third time To-morrow.

ORAL ANSWERS TO QUESTIONS.

  ENEMY DEBTS (MIXED ARBITRAL TRIBUNAL).
  Mr. WILBERFORCE ALLENasked the President of the Board of Trade whether, seeing that a number of claims against the German Government in respect of businesses sequestrated by that Government during the war have not yet been adjudicated upon by the mixed arbitral tribunal, and that this is involving hardship to applicants, he will take steps to have the proceedings before that tribunal expedited?
  The PRESIDENT of the BOARD of TRADE (Mr. Webb): As I stated on 1st July, in a reply (of which I am sending the hon. Member a copy) to a question by the hon. Member for Harborough (Mr. Black), agreement has been reached with

  1927
  the German Government for the establishment of a Third Division of the Anglo-German Tribunal as soon as the necessary formalities have been complied with. It is hoped that this will considerably expedite the settlement of cases by the Tribunal.

  BEET SUGAR FACTORIES.
  Mr. BAKERasked the President of the Board of Trade the number of beet-sugar factories in this country, the number of men employed, and the quantities of beet sugar produced?
  The PARLIAMENTARY SECRETARY to the MINISTRY of AGRICULTURE (Mr. W. R. Smith): I have been asked to reply. There are at present two beet-sugar factories in this country, one at Cantley, in Norfolk, and one at Kelham, in Nottinghamshire. During the last manufacturing season (lasting from October to December), Cantley employed 795 men and produced 8,957 tons of white sugar, while Kelham employed 433 men and produced 4,322 tons of white sugar. At present 251 men are employed at Cantley and 83 at Kelham. A third factory is under construction at Colwick, near Nottingham, and is expected to be ready in time for the next manufacturing season.
  Lieut.-Colonel JAMES: Has the hon. Gentleman any figures which will give the numbers of additional agricultural labourers employed, owing to the introduction of sugar beet cultivation?
  Mr. SMITH: I can only give the figures after notice.
  Sir FREDRIC WISE: Is that full-time employment, for the whole year?
  Mr. SMITH: No. The first set of figures apply to the manufacturing season, but the second set apply to the numbers employed now. I believe that they are approximately correct, but they might not be exact, for the rest of the year
  Captain BERKELEY: Has the hon. Gentleman any information to show whether or not the figures for employment have been affected by the reduction in the bounty brought about by the Budget this year?
  Mr. SMITH: I do not think the reduction has had much effect on the manufacturing season, which was over before the Budget was announced.

  RUSSIA (EXPORT CREDIT SCHEME).
  Lieut. - Colonel Sir PHILIP RICHARDSONasked the President of the Board of Trade how many inquiries, and to what, amount in money, have been received from British manufacturers under the export credits scheme for transactions with Soviet Russia?
  Mr. LUNN (Secretary, Overseas Trade Department): As I stated in reply to the hon. and gallant Member for Central Hull (Lieut.-Commander Kenworthy) on the 25th June last, the question of the extension of the export credits scheme to Russia is still under consideration by His Majesty's Government. In these circumstances, no formal applications for credit for Russia have been submitted, but certain preliminary inquiries have been made at the Export Credits Department. In most of these cases the amounts concerned have not been stated.
  Captain BRASS: Can the hon. Gentleman give any indication as to when the Government will come to a decision?
  Mr. LUNN: It is quite impossible for me to say when that will be. I think that that is a question which ought to be put to the Prime Minister
  Mr. LUMLEY: Will the hon. Gentleman be prepared to give the information before the House rises?

  BRITISH TRADE (COMMITTEE OF INQUIRY)
  Mr. HANNONasked the President of the Board of Trade whether he is yet in a position to inform the House of the terms of reference to the proposed Committee to inquire into British import and export trade; whether he has yet decided upon the personnel of the Committee and whether he will take into consideration the advisability of including among the members of the Committee representatives of trade unions and employers' organisations?
  Mr. WEBB: I hope to be in a position to make a full statement, as to both the terms of reference to the Committee and its composition, at an early date. Consideration has been given to the point raised in the last part of the question.
  Mr. HANNON: Will the right hon. Gentleman take into consideration the importance of giving these organisations representation?
  Mr. WEBB: I am afraid it would not be possible to give organisations representation as such, in the sense of asking them to nominate members, but care will be taken that they have, in fact, some representation.

  SCOTLAND.

    CLYDE PASSENGER STEAMERS (EMPLOYÉS).
    Mr. T. JOHNSTONasked the President of the Board of Trade whether he is now in a position to announce the result of his consultations with the companies engaged in running passenger steamers on the Clyde on the question of the excessive hours of labour of the empoyé;s on these steamers?
    Mr. WEBB: I am pursuing this matter, but I am sorry I am not yet in a position to give the hon. Member the information for which he asks.
    Mr. JOHNSTON: Is the right hon. Gentleman aware that these railway companies are working their engineers up to 90 hours a week, and will he do nothing to prevent these sweaters from continuing this state of things in the midst of extraordinary unemployment?
    Mr. BUCHANAN: Is the right hon. Gentleman aware that it is months since this question was first raised in this House and that, with the holiday season on, the proportion of hours has increased? I hope he will not think he can treat this question in a flippant fashion.
    Mr. HANNON: Is there only one railway company concerned?
    Mr. BUCHANAN: No, two.
    Mr. WEBB: There are two railway companies running these steamers on the
    1930
    Clyde. In answer to my hon. Friend the Member for Stirling (Mr. T. Johnston), I feel with him that this is a serious matter, but I am bound to say that the railway companies have not yet been able to give us a definite answer. They have been communicated with, and we have received an acknowledgment, but sufficient time has not elapsed to warrant us in complaining of any delay on their part in replying to our communication. The matter will not be lost sight of, but I must remind the House that the Board of Trade has no power to require any reduction of the hours of labour.

    "SEX KNOWLEDGE."
    Major MOULTONasked the Secretary for Scotland whether his attention has been called to a publication, entitled "Sox Knowledge," which is on sale at the Proletarian Book Store, 39, Shuttle Street, Glasgow; and whether he proposes to institute a prosecution to restrain the sale of the same as an indecent and obscene publication?
    The SECRETARY for SCOTLAND (Mr. Adamson): The answer to the first part of the question is in the affirmative. With regard to the last part of the question, the matter is under consideration.

    AGRICULTURAL EDUCATION AND RESEARCH.
    Mr. WESTWOODasked the Secretary for Scotland the amount of money that was available for Scotland, under the Corn Production Act or other Acts, for assisting agricultural education and research for the last three years, respectively; what were the sums granted to authorities or governing bodies for the years 1922–23 and 1923–24 and the amounts granted or promised to the respective authorities or governing bodies, and the dates when same were paid or promised; if all the moneys promised have been paid; and, if not, what amounts are outstanding and what was the balance at his disposal when he took over office?
    Mr. ADAMSON: As the answer to my hon. Friend's question is long, I propose, with his permission, to circulate it in the OFFICIAL REPORT.
    Following is the answer:
    In reply to the first part of the question, the amounts available for Scotland under Acts, other than the Corn Pro-

    1931
    duction Acts, for assisting agricultural education and research for the last three years respectively are as follow:

    £

    1921–22

    152,034

    1922–23

    106,829

    1923–24

    129,988

    In addition, there was made available under the Corn Production Acts (Repeal)

    1922–23.

    —

    Grant promised.

    Grant paid.

    Date of promise.

    Date of payment.

    Outstanding at 30.6.24.

    Not exceeding

    £

    £

    £

    Edinburgh and East of Scotland College of Agriculture.

    857

    857

    17.10.22

    19.1.23

    —

    16,360

    1,050

    *

    8.2.23

    —

    2,162

    *

    18.4.22

    —

    12,000

    *

    13.12.22†

    —

    8,000

    5,000

    10.11.22

    10.11.22

    3,000

    West of Scotland Agricultural College

    212

    212

    23.3.23

    31.3.23†

    —

    450

    366

    19.5.22

    29.3.23†

    —

    545

    360

    27.1.23

    27.1.23

    —

    27,584

    1,300

    *

    8.2.23

    —

    2,975

    *

    18.4.22

    —

    23,000

    *

    13.12.22†

    —

    250

    —

    23.3.23

    —

    250

    500

    500

    1.7.22

    29.3.23†

    —

    North of Scotland College of Agriculture.

    1,240

    1,240

    13.12.21

    17.7.22

    —

    525

    418

    14.3.22

    19.9.22

    —

    2,592

    2,592

    13.2.13

    29.3.23

    —

    27,950

    2,605

    *

    18.4.22

    —

    20,750

    *

    9.2.23†

    —

    2,650

    *

    8.2.23

    —

    Royal (Dick) Veterinary College

    4,000

    3,000

    26.1.23

    29.3.23

    —

    3,440

    3,440

    26.1.23

    29.3.23

    —

    Glasgow Veterinary College

    600

    600

    22.3.23

    31.3.23

    —

    300

    300

    22.3.23

    31.3.23

    —

    970

    970

    10.9.21

    31.3.23†

    —

    271

    271

    22.3.23

    31.3.23

    —

    100

    100

    31.3.23

    31.3.23

    —

    Rowett Institute (year ending 30.9.22)

    6,389

    6,137

    14.3.22

    7.9.22†

    —

    Animal Diseases (Research Association)

    2,300

    1,350

    17.9.21

    29.3.23

    —

    Scottish Milk Records Association

    3,500

    3,177

    29.6.22

    19.3.22

    —

    Scottish Plant Breeding Society

    1,100

    765

    25.10.21

    20.3.23

    —

    137

    137

    25.10.21

    20.12.22

    —

    Pertbshire Education Authority

    250

    75

    4.11.21

    7.11.22

    —

    Joint Committee on Animal Breeding Research.

    1,000

    1,000

    2.12.22

    31.3.23†

    —

    1,211

    1,211

    2.12.22

    31.3.23†

    —

    University College, Dundee

    75

    75

    29.9.21

    17.9.22

    —

    Highland Society

    94

    94

    5.4.21

    4.9.22

    —

    Clydesdale Horse Society

    102

    102

    7.7.17

    31.3.23

    —

    Scottish Women's Rural Institutes

    1,250

    1,150

    19.10.22

    31.3.23†

    100

    114,154

    103,991

    —

    —

    3,350

    * No definite promise by Board. Colleges were taken over from Scottish Education Department in 1912, and administration in virtue of Board's statutory powers.

    † Instalments paid throughout year, the date given being date given being date of last payment.

    Act, 1921, a sum of £150,000. By arrangement with the Treasury, the expenditure of this sum was to be spread over the five years, 1922–23 to 1926–27, no specific amount being allocated for the years 1922–23, 1923–24 and 1924–25.
    The following tables give the details asked for in the next three parts of question:

    1922–23.

    —

    Grant promised.

    Paid.

    Date of promise.

    Date of payment.

    Outstanding at 30.6.24.

    £

    £

    £

    Edinburgh and East of Scotland College of Agriculture.

    271

    271

    24.3.24

    31.3.24

    2,162

    2,162

    *

    17.4.23

    13,665

    11,300

    *

    9.2.24

    4,400

    —

    19.3.24

    —

    4,400

    West of Scotland Agricultural College

    450

    370

    21.4.23

    31.3.24†

    —

    75

    56

    19.10.23

    31.3.24†

    —

    370

    316

    14.1.24

    14.1.24

    —

    1,156

    —

    19.11.23

    14.1.24

    —

    500

    500

    1.6.23

    29.3.24†

    —

    370

    —

    31.10.23

    —

    370

    23,149

    22,472

    *

    9.2.24†

    —

    2,975

    2,975

    *

    17.4.23

    —

    North of Scotland College of Agriculture.

    2,000

    1,000

    21.2.23

    27.3.24

    1,000

    300

    283

    18.10.23

    31.3.24†

    —

    35

    10

    21.10.22

    24.11.23

    —

    1,070

    956

    8.12.22

    31.3.24†

    —

    25,186

    23,300

    *

    9.2.24†

    —

    2,605

    2,605

    *

    17.4.23

    —

    Royal (Dick) Veterinary College

    2,748

    2,748

    11.10.23

    9.2.24†

    —

    722

    722

    11.10.23

    9.2.24†

    —

    60

    60

    25.10.23

    1.3.24

    —

    Glasgow Veterinary College

    1,334

    1,000

    12.10.23

    19.1.24†

    —

    Rowett Institute

    12,702

    10,600

    25.6.23

    29.3.24†

    —

    1,682

    1,682

    22.5.20

    1.8.23†

    —

    10,000

    10,000

    2.8.23

    2.8.23

    —

    1,000

    656

    26.9.23

    20.3.24

    344

    Animal Diseases (Research Association)

    2,548

    2,548

    29.3.24

    29.3.24

    —

    3,500

    1,500

    29.9.21

    18.7.23

    2,000

    15,000

    3,000

    9.2.24

    14.3.24

    12,000

    Scottish Milk Records Society

    4,123

    3,635

    18.4.23

    29.3.24

    —

    350

    —

    29.1.24

    —

    350

    Scottish Plant Breeding Society

    1,100

    878

    12.12.22

    25.3.24†

    —

    Pertbshire Education Authority

    500

    480

    4.11.21

    28.4.23

    —

    Joint Committee on Animal Breeding Research.

    740

    297

    24.3.24

    31.3.24†

    —

    University College, Dundee

    80

    60

    19.3.23

    20.3.24

    20

    15

    —

    26.2.24

    —

    15

    Scottish Women's Rural Institutes

    3,000

    2,109

    19.12.22

    31.3.24†

    891

    141,979

    110,587

    —

    —

    21,390

    * No definite promise by Board. Colleges were taken over from Scottish Education Department in 1912, and administration in virtue of Board's statutory powers.

    † Instalments paid throughout year, the date given being date given being date of last payment.

    The total of the sums outstanding at this date in respect of grants during the two years 1922–24 (£24,740) represents exclusively the balances of grants made from Corn Production (Repeal) Act moneys. Other balances lapse at the end of each financial year.
    In reply to the last part of the question, at the date when the present Government assumed office the balance at their disposal consisted of:

    (1) unspent balances of money voted on the Board of Agriculture's Vote for
    1934
    1923–24, this, however, being earmarked for the specific purposes narrated in the Sub-heads of the Vote:

    (2) the unallocated portion of the £150,000 Corn Production (Repeal) Act moneys.

    The position of the Corn Production money at that date was as follows:—

    £

    (a) Definitely allocated and announced

    111,565

    (b) Provisionally allocated

    38,200

    (c) Unallocated

    235

    This total of £38,200 includes some items to which the Board of Agriculture were not committed by announcement or otherwise. Making allowance for such items the balance of the £150,000 at my disposal when I took office amounted to a few thousand pounds. To this falls to be added any accrued interest on unspent balances.

    CORPUS CHRISTI PROCESSION (CARFIN).
    Mr. BLUNDELLasked the Secretary for Scotland whether he can say if it was upon instructions from the Lord Advocate that the police authorities prohibited the annual Corpus Christi procession in the village of Carfin, Lanarkshire; is he aware that this procession has taken place for the last nine years; and why on this occasion the procession has been prohibited?
    Mr. BUCHANANasked the Secretary for Scotland if he has inquired into the circumstances in connection with a procession which was to have taken place at Carfin, Lanarkshire, on Sunday, 22nd June, but was banned by the authorities; if he is aware that processions of a similar character have been held on many occasions during the last few years without interference; and if he can now state whether he will take steps to see that the right to hold the processions is restored?
    Mr. ADAMSON: I have inquired into the circumstances of the case. The procession was not prohibited on instructions of the Lord Advocate. It is the case that the procession has taken place for a number of years past, but I am informed that it was not until last year that it attained dimensions which caused serious traffic difficulties, when the procession resulted in a complete obstruction of the public thoroughfare which lasted for a considerable time. I understand that the police authorities this year informed the priest responsible that if the procession on the public roads were repeated the matter would be reported to the Crown Authorities. The result was that the public roads were not used, but the procession took place in private grounds to which the general public had access. I may add in reply to the last part of the question put by my hon. Friend the Member for Gorbals (Mr. Buchanan), that the public right in roads and streets is a right of passage only, and one which must be exercised by members of the public
    1936
    with due regard to the similar rights possessed by other members of the public.
    Mr. BLUNDELL: Is the right hon. Gentleman aware that the police invoked the Catholic Emancipation Act, 1829, and informed the priests concerned that they would be prosecuted for wearing their vestments in public, as is laid down in the Act? Is the Secretary for Scotland aware that under the same Act any person joining a Catholic religious society is liable to banishment, and if he does not accept banishment within 20 days he is liable to deportation for fife, according to His Majesty's pleasure; and does the right hon. Gentleman intend to enforce that part of the Act?
    Mr. FERGUSON: Is the right hon. Gentleman aware that it is a deliberate falsehood to say that these people have never marched in procession for nine years? Behind all this is the selling of holy water in order to raise money.
    Mr. BUCHANAN: Is the right hon. Gentleman aware that processions of this kind are regularly allowed by the local authorities all over Scotland and in England, and that with proper regulations they never interfere with the traffic; and is it, not a fact that no complaint has ever yet been made by the people who use the roads against these processions—
    Mr. SPEAKER: The hon. Member's question is too long.
    Mr. SEXTON: Is it not a fact that similar processions, and even worse from the point of view of public traffic, are held annually in the same place by students from the universities, without objection being taken, and can not this law, which is as dead as Queen Anne, he ignored in the future?
    Mr. STEPHEN: Will the right hon. Gentleman inform the House who stopped the procession?
    Mr. FERGUSON: Is it not the case that this procession was prohibited in London some time ago, and that it is got up for the Irish who will not pay their rents or obey the law?
    Mr. SPEAKER: Apparently this is a matter of sonic delicacy, and I had better see these questions.
    Mr. BLUNDELL: I beg to give notice that I shall raise this matter on the Scottish Estimates.
    Mr. BUCHANAN: I beg to give notice that at the end of Questions, I shall ask leave to move the Adjournment, in order to call attention to this matter.
    Mr. FERGUSON: Hear, hear, and loud cheers!

    CORPUS CHRISTI PROCESSION (CARFIN).
    Mr. MacKENZIE LIVINGSTONEasked the Secretary for, Scotland whether, in view of the fact that the Scottish crofters and smallholders are not provided for in the new Housing Bill, he will take steps to arrange for building loans to crofters and smallholders at a reduced rate of interest, and thus help to raise the standard of housing, especially in the Highlands?
    Mr. ADAMSON: I am carefully examining the suggestion made in the question.
    Mr. PRINGLE: Is the right hon. Gentleman aware that under the Financial Resolution it will be impossible to make provision for a larger subsidy for crofters?
    Mr. LIVINGSTONE: Will the right hon. Gentleman see that the crofter is not penalised under the housing legislation merely because he is a crofter?
    Mr. ADAMSON: I have already informed the hon. Gentleman that I am making careful inquiries into that phase of the question.
    Mr. PRINGLE: Can the right hon. Gentleman say whether the Scottish Office was consulted at all before the Housing Bill was introduced?
    Mr. MACPHERSON: Is the right hon. Gentleman aware that in every Housing Bill there has been special provision for this class of men?

    SCHOOL CLASSES (SIZE).
    Mr. COWANasked the Secretary for Scotland whether he can state the interpretation put by the Scottish Education Department on the expression, not more than 60 pupils habitually under the charge of one teacher, in the code for day schools; and whether the same interpretation is to be applied to the expression, the present provisional maximum of 60 pupils per class, employed in the prefatory memorandum attached
    1938
    to the Regulations for the Training of Teachers, now upon the Table of the House?
    Mr. ADAMSON: The expression "habitually under the charge of one teacher" has been in use in the code since 1899, and the Department have always interpreted it to mean that not more than 60 pupils should be present as a regular thing in any class taught by one teacher. For a time the state of the accommodation has made it difficult to enforce this rule in certain cases, and the sentence in the prefatory memorandum to which the hon. Member refers is intended as an intimation to education authorities that the rule will henceforth be strictly enforced.

    EXPERIMENTAL FARM, FIFE.
    Mr. DUNCAN MILLARasked the Secretary for Scotland whether, in view of the representations received from the Fife Education Authority as to the need for the institution of an experimental farm and farm school in Fife, he is prepared to secure the allocation of a money grant towards the objects in order that the scheme may now be proceeded with without further delay?
    Mr. ADAMSON: I would refer the hon. and learned Member to my reply to the question on the same subject asked by the hon. Member for Peebles and Southern Midlothian (Mr. Westwood) on Tuesday last.
    Mr. MILLAR: Can the right hon. Gentleman explain why so much delay has occurred with regard to the consideration of this question, and will he state definitely to the House that he has been in consultation with the Treasury and is now prepared to make a grant towards this purpose, which he himself advocated last Session?
    Sir HENRY CRAIK: Would not such action on the part of the Education Department be a grave interference with the duties of the Board of Agriculture, with which the Education Department has nothing whatever to do, and would not such an experiment be directly against the best educational interests of Scotland?
    Mr. ADAMSON: The funds for such a purpose as that mentioned in the question would require to be got by special grant

    1939
    from the Treasury, and in my reply last week to the hon. Member for Peebles I informed him that, in the meantime, I have no money available for this purpose.
    Mr. MAXTON: Can we have the assurance of my right hon. Friend that Fifeshire will not be considered in a more favourable way than other important agricultural counties in Scotland?
    Mr. MILLAR: Will the right hon. Gentleman give us an assurance that he is prepared to take action in order to secure the necessary grants for pursuing this end?
    Mr. WESTWOOD: Is it not the fact that the reason why the Secretary for Scotland cannot take action lies in the action taken by his predecessors in office?

    COURT STAFFS (PENSIONS AND CONDITIONS).
    Mr. MILLARasked the Secretary for Scotland whether he is aware of the growing dissatisfaction amongst the procurators fiscal, sheriff clerks, and Sheriff Court staffs in Scotland owing to the prolonged delay in carrying out the recommendations of the Blackburn Committee as to the institution of pensions and the improvement in the rate of remuneration and of the conditions in these services; and whether, in view of the urgency of securing a settlement which will be acceptable to all the parties interested, he is prepared to make further immediate representations to the Treasury on the subject
    Mr. ADAMSON: I have no doubt that the officials concerned are anxious, as I am, that the matter should be disposed of. I have communicated with my might hon. Friend the Chancellor of the Exchequer, who has promised to receive representatives of the associations concerned. The representatives will, I understand, be received as soon as possible, but, owing to the many pressing demands upon my right hon. Friend's time, it is not yet practicable to indicate a definite date.
    Mr. MILLAR: Would the right hon. Gentleman endeavour to secure the arrangement of an early date, in order that these officials, who have now been kept waiting for many years for the settlement of this matter, may have the question considered at once?
    Sir CHARLES BARRIE: Can the right hon. Gentleman say what has become of the £228,000 of extra fees which the Government have collected during the last three years for this purpose, and will the scheme be made retrospective?
    Mr. ADAMSON: I will make in the proper place the representation suggested by the hon. and learned Member for East Fife (Mr. Millar). As to the point put by the hon. Member for Banff (Sir C. Barrie), no doubt my right hon. Friend the Chancellor of the Exchequer will consider it.

    PLURAL FARMS.
    Mr. MILLARasked the Secretary for Scotland whether, having regard to the keen competition for farms and agricultural holdings in Scotland and to the limited number at present available, and to the growing practice under which the same tenant becomes the occupier of two or more farms or holdings, he is prepared to institute an inquiry as to the number of plural farms and agricultural holdings in Scotland, and to consider as to what steps ought to be taken to prevent the accumulation of a number of farms or agricultural holdings in the hands of the same tenant?
    Mr. ADAMSON: I am not satisfied that there is any necessity for a special inquiry on this subject, in view of the ordinary inquiries which are already made by the Board of Agriculture in connection with land settlement and other operations. As the hon. and learned Member is aware, the Board has powers under Section 7 (16) (a) of the Small Landholders' (Scotland) Act, 1911, to subdivide "led" farms if suitable and if required for the purpose of land settlement.
    Mr. MILLAR: Will the right hon. Gentleman ascertain through the ordinary channels what is the number of plural holdings in Scotland, in relation to the larger holdings as well as to the small ones?

    COUNTY VALUATION ROLL.
    Sir ROBERT HAMILTONasked the Secretary for Scotland whether, in the case of a county valuation roll being prepared by local assessors and such valuation being used by the Government for Income Tax purposes, he is prepared to recommend that a proportion of the cost of preparing such roll should be borne by the Government?
    The FINANCIAL SECRETARY to the TREASURY (Mr. William Graham): I have been asked to reply to this question. I would refer the hon. Member to the reply which I gave the right hon. Gentleman the Member for Ross and Cromarty (Mr. Macpherson) on the 23rd June. I am sending him a copy of that reply.
    Mr. MACPHERSON: If I produce several instances in which the valuations of the local assessors are accepted for Income Tax purposes, will the hon. Gentleman reconsider his answer?
    Mr. GRAHAM: I shall be delighted to receive the cases, but I am afraid I can hold out no hope of a change in the policy, because, in fact, these results are not generally accepted by the Government.

    SEVERN BARRAGE SCHEME.
    Mr. AYLESasked the President of the Board of Trade if the Committee appointed to inquire into the Severn barrage scheme has reported, and what is its nature?
    Mr. WEBB: The informal Committee, whose constitution and functions I stated in an answer to the hon. and learned Member for East Islington (Mr. Comyns-Carr) on the 3rd June—a copy of which I am sending to my hon. Friend—has now presented a Report indicating the nature of the detailed investigations which must be undertaken before any definite judgment can be formed as to the practicability of a barrage scheme, and the probable cost of those investigations. The Report is under consideration, and I hope to be able to make an announcement on the subject at an early date.
    Mr. AYLES: If I put a question down for this day week, does the right hon. Gentleman think that then he will be prepared with an answer as to the policy of the Board of Trade in this matter?
    Mr. D. G. SOMERVILLE: Will the House be given an opportunity to discuss this matter?
    Mr. WEBB: I must remind the House that all that is in question is undertaking a scientific investigation in order to see whether or not the scheme is practicable. I think the hon. Member for North Bristol (Mr. Ayles) may rely that I shall be able
    1942
    to give information as to that point, as to whether or not we are proceeding with this investigation, before the House rises, but the question as to whether the scheme will be undertaken is a matter for a much later date.
    Sir F. WISE: Can the right hon. Gentleman state who was the engineer who made the Report?
    Mr. WEBB: There were three experts, engineers and others, whose names I have already given to the House, but I have not got them in my hand at the moment.
    Major COLFOX: Is there any probability of this scheme providing any considerable amount of employment for those who are out of work?

    ENEMY ACTION CLAIMS.
    Mr. TREVELYAN THOMSONasked the President of the Board of Trade whether, in the event of the grant of£300,00 towards the belated claims of the victims of enemy damage proving to be inadequate when these claims have all been received and examined, he will recommend the Government to make an increased grant so as to put the belated claimants in the same position as the earlier claimants?
    Mr. WEBB: I would refer the hon. Member to the answer given by the Financial Secretary to the Treasury to the hon. and learned Member for East Fife (Mr. D. Millar) on the 5th May, a copy of which I am sending to him.
    Mr. THOMSON: Does the right hon. Gentleman not consider that the measure of compensation should be the justice of the claim, and not the amount that the Government propose to distribute?
    Major BURNIE: Has not a suns exceeding this amount been received from Germany, and can the right hon. Gentleman say whether it will be applied to the settlement of these claims?
    Mr. WEBB: The question of the solatium which is given—for it is only a solatium—is altogether separate from the claim of the British Government on the German Government. Whatever is paid by the German Government has to cover a very much larger field than these particular individual claims. If it is sug-

    1943
    gested that these individual sufferers are to take the whole of the receipts from the German Government, I am afraid I can only refer that to the Chancellor of the Exchequer.
    Major BURNIE: Were not these men promised the first call on what was paid by Germany?
    Captain W. BENN: Does the right hon. Gentleman deny that these claimants have the first claim on the reparation payments made by Germany?
    Mr. WEBB: I am not prepared to admit that. In so far as these claimants are members of the mercantile marine, as many of them—perhaps most of them—are, they have already received compensation to the extent of something like£11,000,000, and what is now in question is merely a matter of a final solatium.
    Mr. HARMSWORTH: Does the right hon. Gentleman regard the £300,000 as a final settlement of these claims?
    Mr. WEBB: I can only say that my hon. Friend the Financial Secretary to the Treasury has said that it was a final payment by His Majesty's Government in respect of these claims.
    Mr. LUMLEYasked the President of the Board of Trade if he can now state when those who have put in claims, which have been classified as belated claims, to the Royal Commission on Suffering and Damage done by Enemy Action, will be informed of the decision come to with regard to their claims?
    Mr. WEBB: An endeavour is being made to have the examination of all the belated claims completed within four months, and the payment of claims would then be promptly begun. Claimants whose claims are entertained will be notified of the decision come to at the same time as payment is made. Claimants whose claims cannot be entertained are being communicated with as soon as possible after their claims have been examined.
    Mr. LUMLEY: Do I understand that we shall have another three or four months to put in claims?
    Mr. HARMSWORTH: In the case of belated claimants whose claims have been turned down, will the claimants have another appeal against the decision?
    Mr. WEBB: It is the fact that some 35,000 claims have to be dealt with, and this can hardly be done under four months. There has never been any provision for an appeal. With regard to the first supplementary question, the last day for the receipt of claims was the 1st of June last, and new claims were put in right up to that date.
    Mr. WILBERFORCE ALLENasked the President of the Board of Trade whether the payments made to civilians on account of impairment to health during their internment at Ruhleben during the War are final, seeing that the amounts so paid are only about two-fifths of the sums at which the claims were assessed by the Department concerned?
    Mr. WEBB: I would refer to the answer given by the Financial Secretary to the Treasury to the right hon. and learned Member for Cambridge University (Mr. Rawlinson) on 23rd June, a copy of which I am sending to the hon. Member.

    NEW ZEALAND CHEESE.
    Mr. PERRYasked the President of the Board of Trade whether he is aware that recently 25,000 crates of cheeses were held up in London stores awaiting higher prices and have become heated and unsalcable; and whether, in view of this withholding of food supplies from the consumer, he will take steps to introduce legislation to restrict the operations of interests which control large supplies of foodstuffs?
    Mr. WEBB: I am informed that early arrivals of New Zealand cheese were this year more plentiful than and that it was decided to place the immature cheese in cold store, in order to provide a reserve for the autumn months. I am not aware that any appreciable wastage of the cheese has taken place, but if my hon. Friend has any detailed information in the matter, perhaps he will be good enough to send it me.
    Mr. PERRY: Will the right hon. Gentleman tell us how it is that cheeses in cold storage can become overheated?
    Mr. WEBB: That is beyond my knowledge.
    Major COLFOX: Will the right hon. Gentleman pursue it?

    AMERICAN SHIPPING.
    Mr. AYLESasked the President of the Board of Trade whether his attention has been drawn to a resolution proposed in the United States Senate early this year demanding information from the United States Shipping Board on the alleged discrimination by the Board of Trade against American shipping; whether there is any discrimination made by His Majesty's Government against American ships in favour of British ships; and, if so, if he can state the nature of the discrimination?
    Mr. WEBB: My attention has been called to the resolution to which the hon. Member refers, and also to many such statements in the United States Press. There is no truth in any of these suggestions. His Majesty's Government do not discriminate in any way against foreign shipping in favour of British shipping. Vessels of all flags enjoy perfect equality in the ports of the United Kingdom.
    Mr. AYLES: Can the President of the Board of Trade tell us how it is that these rumours are getting abroad to such an extent as they are?

  SAFEGUARDING OF INDUSTRIES ACT.

    GLASS BANGLES.
    Mr. HOGGEasked the President of the Board of Trade whether he is aware that consignments of fancy glass bangles drawn from solid glass rods have been declared by the officers of his Department to be dutiable under the Key Industries Schedule as lamp-blown glass-ware, in spite of declaration as to the process of manufacture, which indicate that lamp-blown glass-ware cannot be used for snaking these articles; and whether, in view of the inconvenience which is being caused to the trade by the prolongation of a dispute over the liability to duty and no similar goods being manufactured in this country, he will take steps to get the decision rectified without delay?
    Mr. WEBB: The question of the liability of the goods mentioned has been under discussion. The Board of Trade and the Commissioners of Customs have taken the view that they are liable to
    1946
    duty under the heading "lamp-blown ware," as that heading has been consistently interpreted since the passing of the Act. If the importers still desire to challenge that view, it is open to them to have recourse to an independent referee, in accordance with Section 11 of the Act.
    Mr. HOGGE: Would the right hon. Gentleman just say what is the difference, and whether the Board of Trade takes the view that everything, glass-blown or otherwise, of this sort is liable?
    Mr. HANNON: Also for the sake of clarity, is it not obvious that it is the duty of the Board of Trade to protect British manufacturers against the foreigner?
    Captain BENN: Could not the right hon. Gentleman assure the House that the Government will take an early opportunity of repealing this ridiculous Act?
    Mr. SPEAKER: That is a matter for debate.

    GAS MANTLES.
    Mr. HOGGEasked the President of the Board of Trade whether he has received an application from certain British firms of gas-mantle importers to refer under Section 9 of Part II of the Safeguarding of Industries Act the revocation of the Order of 9th October, 1922, to a Committee for further consideration in view of the fact that the British£is now only worth18½gold marks: and whether he proposes to grant the application?
    Mr. WEBB: The answer to the first part of the question is in the affirmative. The applicants have been informed that on a review of all the circumstances the Board of Trade are not prepared to refer to a Committee the revocation of this Order, which, I may remind the hon. Member, automatically lapses on 19th August.

    SHIPBUILDING.

      CONTRACTS PLACED ABROAD.
      Sir W. DAVISONasked the President of the Board of Trade whether his attention has been called to the fact that contracts for the building of nine ships

      1947
      for British owners have recently been placed in Holland owing to the more favourable prices quoted by the Dutch firms; and what information he has as to the reasons which enable the Dutch firms to quote prices much below the lowest British tenders?
      Mr. WEBB: I understand that a shipbuilding company at Rotterdam has obtained contracts for the building of seven vessels for British owners, but I have no information as to comparative prices, or as to the precise causes of such differences as there may be. I understand however, that in regard to three of the vessels, a Government subsidy has been given.
      Sir W. DAVISON: Is it not the business of the Board of Trade to have this information? Is it not in order to obtain it that the Board of Trade exists?
      Mr. T. HENDERSON: Can the right hon. Gentleman give us the names of those who ordered these vessels; who have made these contracts? [HON. MEMBERS: "Answer," and "Do not answer!"]
      Mr. WEBB: I have not got the names. As to the other question, I think the statement I have made that a Government subsidy has been given affords a fair explanation of any difference in price there may have been. The Board of Trade have no means of discovering at what price these gentlemen have placed the contracts.

      HOURS OF WORK.
      Sir W. DAVISONasked the President of the Board of Trade if he can state, approximately, what is the average number of hours per week worked by operatives in the shipbuilding industry in Great Britain and in Holland and Germany, respectively; and how many working days during the current year have been lost by strikes in the shipbuilding industry in this country and in Holland and Germany, respectively?
      The PARLIAMENTARY SECRETARY to the MINISTRY of LABOUR (Miss Bondfield): I have been asked to reply. The normal hours in the shipbuilding industry in this country are 47 per week. Statistics are not available as to the average hours actually worked. The
      1948
      number of working days lost through disputes this year in the shipbuilding and ship repairing industry in Great Britain and Northern Ireland is approximately 500,000. In Germany and Holland, the normal hours, as fixed by statute, are 48. In Germany these may be exceeded by agreement between employers and employed, and in Holland by authorization of the Minister of Labour. I understand that in Hamburg it has been agreed that the normal week shall be 54 hours. In Holland authorisation to work a 56½hour week have been issued, but I am unaware to what extent Information is not available as to the number of working days lost this year owing to strikes and lock-outs in Holland and Germany.

  BRITISH ARMY.

    ENLISTMENT OF BOYS.
    Mr. WHITELEYasked the Secretary of State for War whether he is aware that the military authorities are approaching boards of guardians with a view to securing lads between 14 and 15 years of age for military service; whether he will state the conditions of service these lads will be called upon to perform; and under what regulation the officers of his Department have the power to recruit lads of these ages?
    The UNDER-SECRETARY of STATE for WAR (Major Attlee): I am not specially aware that recruiting officers have approached hoards of guardians, but all recruiting officers have general instructions to bring to the notice of authorities concerned in the welfare of boys the scheme for enlisting boys and training them as tradesmen. Such enlistment is, of course, voluntary on the boy's part, and the consent of his parent or guardian is also required. The boys are enlisted for as long as may be necessary to give them 12 years' service from the date of attaining 18 years of age; for instance, a boy enlisted at 16 would serve for two years to 18, and for 12 years more, or 14 years in all, four years of which might be spent in the Army Reserve. The authority is Section 76 of the Army Act, and the Recruiting Regulations. I am sending the hon. Member a paper stating the conditions of service in further detail.
    Mr. AYLES: When boys enlist or offer themselves for enlistment, is a birth certificate required, seeing that it is practically certain that they enlist under age
    Mr. THURTLE: Do these youths of 15 really understand the obligations they enter into on enlistment?

    LIEUTENANT C. H. GLENDINNING.
    Mr. COSTELLOasked the Secretary of State for War whether his attention has been called to the publication of the names of the witnesses whose evidence Lieutenant C. H. Glendinning wishes to be taken on his behalf in support of his allegation of false imprisonment in India in the year 1917; and whether he proposes to take the evidence of these witnesses, subject to cross-examination?
    Major ATTLEE: The answer to the first part of the question is in the affirmative. As regards the latter part, I would refer the hon. Member to my reply yesterday to the hon. Member for Bow and Bromley.

    WOOLWICH ARSENAL (DISCHARGES).
    Sir KINGSLEY WOODasked the Secretary of State for War whether he is about to make any further discharges from the. Royal Carriage Department or any other Department at Woolwich Arsenal?
    The FINANCIAL SECRETARY to the WAR OFFICE (Mr. Lawson): As regards the Royal Carriage Department, on which recently received a deputation representing the men, the amount of work available is such that some reductions of strength are necessary. I am hopeful that the majority of the redundant men can be absorbed in other departments of the Ordnance Factories at Woolwich, but in the case of certain skilled men this will probably be impossible unless the men concerned find themselves able to accept semi-skilled or unskilled work. As regards departments of the factories other than the Carriage Department, no general measure of discharges is in prospect.
    Sir K. WOOD: Will the Financial Secretary say what steps he proposes to take to find employment for those men who are unable to take advantage of the suggestion he has made?
    Mr. LAWSON: I am not in a position to make any statement on that matter at the moment. I think I ought to say that the minimum staff is 6,600, and the present number is more than 2,000 over that.
    Captain Viscount CURZON: Is it the policy of the Government to provide employment by putting skilled men on unskilled work?

    DISCHARGES.
    Mr. D. G. SOMERVILLEasked the Secretary of State for War the number of recruits who have been liberated from the colours within the last year, either through purchase or on compassionate grounds, to enable them to take employment offered them?
    Major ATTLEE: During the year ending 31st May last, the number of soldiers who purchased their discharge was 1,097, and the number who were discharged on compassionate grounds was 755; making a total of 1,852. Out of the 1,097 men discharged by purchase, 341 were recruits who exercised their statutory right under Section 81 of the Army Act, but I am not able to say how many of the men discharged on compassionate grounds were recruits. A condition of discharge on compassionate grounds is that employment is available for the man.

    WAR BONUS (MR. M. SEGAL).
    Major CHURCHasked the Financial Secretary to the War Office if he will reconsider his decision not to press His Majesty's Treasury to reopen the case of Mr. Mark Segal, who was employed at the Royal Arsenal, Woolwich, from November, 1917, to November, 1920, as deputy assistant inspector of armaments, seeing that he received no increase of pay after May, 1918; that other similar classes received war bonuses dating from 1st July, 1919; that his claim for a bonus to meet the cost of living was first preferred in September, 1920, and that no decision regarding that claim was communicated to him by the War Office until September, 1921; that his claim was subsequently submitted through the recognised channels by the staff side of the War Office Out-stations Administrative Council; and that after nearly four years' delay lie has been informed that the lapse of time is such that His Majesty's Treasury cannot be called upon to reopen the matter?
    Mr. LAWSON: I am having this case further investigated, and I will communicate with the hon. and gallant Member in due course.

    CONTRACTS (PUBLICATION OF TENDERS).
    Mr. D. G. SOMERVILLEasked the Financial Secretary to the War Office whether his Department refuses to advise contractors of the result of tenders submitted; and whether, seeing that it is in the interests of the public that the information so far as it affects the amounts of the tenders and not the names of the tenderers should be made public, and that, by this practice of publicity, firms would be able to judge as to how their prices compared, he will consider a change of policy in this respect?
    Mr. LAWSON: It is the invariable custom of the Department to advise contractors whether their tenders are accepted or declined, but I regret that I am unable to agree that it would be in the public interest to sanction a departure from the long-established practice of the War Office under which particulars of tender prices are regarded as confidential.
    Mr. SOMERVILLE: In view of the fact that the tenders are published for all public buildings, what is the objection to publishing a list of these tenders for War Office work?
    Mr. LAWSON: There is a considerable number of objections which have been noted from time to time, and the matter has been investigated over the course of many years. It is necessary to safeguard the Department making contracts against arrangements for the making of rings, which the publication of the prices would facilitate.

    HOUSING (WAR OFFICE PROPERTY).
    Major HORE-BELISHAasked the Secretary of State for War (1) whether he will undertake, when coming to any agreement to let War Office property to municipalities for the purpose of relieving the housing shortage, to stipulate that those for whom the accommodation is ultimately intended shall in no case be required to pay a rent in excess of that which is current in the district for working-class lodgings;
    (2) whether, in considering the terms upon which the War Office will let certain
    1952
    Government property to the municipality of Plymouth for the purpose of relieving the housing shortage in Devonport and Plymouth, he will undertake only to let this property to the municipality upon an undertaking being given that no rent shall be charged to the tenants for whom it is ultimately intended in excess of that current for working-class lodgings in the worst districts of Devonport?
    Major ATTLEE: I would refer the hon. and gallant Member to my right hon. Friend's reply to him of the 25th ultimo, which represents the general policy of the Department.
    Major HORE-BELISHA: Will the hon. and gallant Gentleman undertake to see that the rents are not in excess of those charged for municipal houses?
    Major ATTLEE: That is not the business of the War Office. It is the duty of the local authorities. The rents have to be settled by the local authorities who take over the houses.
    Major HORE-BELISHA: If the War Office have an opportunity of making the terms, will the hon. and gallant Gentleman see that these houses are only let on condition that the tenants get the full benefit of this Government property?
    Mr. D. G. SOMERVILLE: Is the Under-Secretary aware that the Government have over 80 houses in their possession which they refuse to let and want to sell? Can nothing be done to insist upon letting them, in view of the housing shortage?

  COAL INDUSTRY.

    DEPARTMENTAL COMMITTEES.
    Mr. WHITELEYasked the Secretary for Mines the number of Departmental Committees in connection with his Department, and the names of those comprising the Committees; and whether Reports of their findings are published?
    The SECRETARY for MINES (Mr. Shinwell): My hon. Friend will find full information on this subject in the appendices to the Annual Report of the Secretary for Mines.

    SHORT TIME.
    Mr. HANNONasked the Secretary for Mines in which districts colleries are at present working short time; whether he is in a position to state the number

    1953
    of men paid off and working short time, respectively, in each district affected; and what number of men were on full-time work in these districts during May and the first two weeks of June, 1923, as compared with the same period this year?
    Mr. SHINWELL: The answer to this question can only be given in statistical tables, which I will have circulated in the OFFICIAL REPORT.

    (1) AVERAGE number of wage earners fully employed.*

    District.

    In each of six weeks ended

    16th June, 1923.

    14th June, 1924.

    Scotland

    130,723

    84,722

    Northumberland

    61,370

    45,843

    Durham

    164,159

    132,640

    South Wales and Monmouth

    238,068

    212,576

    Yorkshire, Nottingham, Derby, Leicester, Cannock Chase and Warwick.

    339,251

    248,741

    Lancashire, North Staffs and Cheshire

    98,594

    69,038

    North Wales

    17,409

    13,232

    South Staffs and Salop

    9,280

    8,319

    Cumberland

    11,776

    10,389

    Bristol

    2,083

    1,755

    Forest of Dean

    6,809

    3,463

    Somerset

    5,344

    5,041

    Kent

    1,851

    1,774

    Great Britain

    1,086,717

    837,533

    * These figures represent the average number of wage-earners employed at mines which did not lose any time owing to want of trade and transport difficulties. Some of these persons may have lost time owing to disputes, accidents, holidays, etc.

    Mr. BATEY: Will the hon. Gentleman also inquire what is the real cause for so many miners being dismissed at the present time in Durham?
    Mr. SHINWELL: That is rather a different question. If my hon. Friend will give me notice, I will endeavour to give him an answer.
    The following is the information asked for in the Question, as far as it is available:

    (3) NUMBER of wage-earners on Colliery Books in the week ended 21st June, 1924, as compared with the number on the 17th May, 1924.*

    District.

    Number on 17th May.

    Number on 21st June.

    Difference.

    Scotland

    142,124

    139,785

    -2,339

    Northumberland

    64,623

    64,306

    -317

    Durham

    176,661

    175,592

    -1,069

    South Wales and Monmouth

    243,060

    240,738

    -2,322

    Yorkshire, Nottingham, Derby, Leicester, Cannock Chase and Warwick.

    366,649

    367,121

    +472

    Lancashire, North Staffs and Cheshire

    142,310

    141,608

    -702

    North Wales

    8,633

    18,577

    -56

    South Staffs and Salop

    10,315

    10,206

    -109

    Cumberland

    12,187

    11,629

    -558

    Bristol

    2,066

    1,987

    -79

    Forest of Dean

    7,431

    7,424

    -7

    Somerset

    5,707

    5,633

    -74

    Kent

    1,902

    1,892

    -10

    Great Britain

    1,193,668

    1,186,498

    -7,170

    * The total for this week is the highest in the past year.

    REDDING PIT.
    Mr. HARDIEasked the Secretary for Mines how many pints of water are pumped per day to the surface from the workings at No. 23 Redding pit.
    Mr. HARDIEasked the Secretary for Mines if he is aware that before the last disaster at Redding it was the expressed belief of the owners that a great barrier separated the men from the water that drowned them; can he state who took the present measurements; and has the thickness of the fault to Meadow-bank pit been proved?
    Mr. SHINWELL: About 4½ million pints of water are pumped daily from No. 23 Redding pit, or, in more usual terms, about 400 gallons per minute. It is a fact that the owners were under the impression, before the disaster, that there was a substantial barrier between the workings of No. 23 pit at the old workings on the south side of the Universal Dyke. As to the distance between the present Redding Ball workings and the Blairlodge fault which separates Redding Colliery from the old Meadowbank workings, this was measured by the Inspector of Mines from the plans, and found to be 500 feet. I am informed that this fault has not been proved. If my hon. friend still feels any difficulty about the position, I hope that he will furnish me with any information that is in his possession.
    Mr. HARDIE: Is the hon. Gentleman aware that it was he, in answer to a previous question, who introduced the public-house measurement to pints? I did not use pints at all: it was he. Men who know always talk in gallons. May I ask, further, whether the hon. Gentleman is aware, from reading the Report of the Inquiry into the last disaster, that it was clearly proved there that the barrier had not been measured, while now he tells us that this barrier is not proved? Is he aware—[Interruption]—this concerns men's lives. Is he aware that the character of any fault is not continuous, and that if he reads and understands the Report of the last drowning he will see that where they expected to find a fault it was toothed out in two or three lines not even the height of the coal seam; will he give an undertaking that, if it is necessary to pump some water from the Meadowband seam, it shall all be taken off; and can he say whether the men are working on the same horizon as the water in the Meadowbank seam?
    Mr. SPEAKER: I think the hon. Member should instruct the Minister in private.
    Mr. HARDIE: I beg to give notice that I shall raise this matter at the first opportunity on the Motion for the Adjournment of the House.

  TRANSPORT.

    ROAD VEHICLES (LIGHTING).
    Mr. PENNYasked the Minister of Transport whether his attention has been drawn to the recent death of George Gilbert, of Feltham, owing to a motorcyclist running into the back of the pony trap which he was driving and which had no rear light, and that the motorist was censured for not keeping a sufficiently good look-out; and whether he can inform the House if it has yet been decided to introduce legislation making it compulsory for reflectors to be carried on the off-side of all motor vehicles and rear lights or red reflectors on all road vehicles, and, as far as possible, prevent happenings of this nature?
    The MINISTER of TRANSPORT (Mr. Gosling): My attention has not been drawn to the accident referred to by the hon. Member, but if he will furnish me with further details I will consider whether I can usefully make any inquiries into the matter. I am not satisfied that the carrying of reflecting mirrors by all motor vehicles should be made compulsory. I agree, however, that amending legislation is required with regard to the lighting of road vehicles, and that a general Bill dealing with this matter should be introduced whenever a suitable opportunity occurs.
    Mr. PENNY: I will certainly bring to the notice of the Minister the particulars he asked for, but did not the Committee which was appointed to consider the regulation of road traffic report favourably as regards reflectors being carried, saying that if they were not carried it was a source of annoyance and danger?
    Mr. W. A. JENKINS: Will the hon. Gentleman take into consideration the question of introducing legislation making it compulsory that all persons in charge of horses and traffic on the main roads shall be obliged to carry lights?

    UNEMPLOYMENT (GRANTS TO LOCAL AUTHORITIES).
    Mr. T. THOMSONasked the Prime Minister whether he is now able to state the Government's reply to the representations recently made on behalf of local authorities for increased State assistance towards works of public utility to be
    1958
    carried out by unemployed labour in those districts where unemployment is above the average for the rest of the country, and where the burden of rates is already excessive?
    The LORD PRIVY SEAL (Mr. Clynes): This matter has been carefully considered by the Government, who have come to the conclusion that it is not advisable to increase the rates of grant and that it is better to rely on other measures, particularly the proposed increased insurance benefits for reducing local burdens.
    Mr. PRINGLE: Is this a method of substituting work for doles?
    Mr. THOMSON: Is the right hon. Gentleman aware that the prospect during the coming winter in many of these districts is worse than it was last winter, and will he reconsider the question?
    Mr. CLYNES: Those factors have been gone into in giving consideration to the subject.

    SOLICITOR-GENERAL (SEAT IN HOUSE OF COMMONS).
    Major COLFOXasked the Prime Minister what steps, if any, have been or are being taken to secure the presence of more than one Law Officer of the Crown in this House?
    Mr. CLYNES: It is the intention of the Government to take the first opportunity of securing the presence of more than one Law Officer in the House.
    Major COLFOX: Is there any truth in the report that the hon. and gallant Member for South-East Leeds (Captain O'Grady) is being banished in order to provide a vacancy for the Solicitor-General?
    Mr. HOPE: Are we to understand that all the hon. Members behind the right hon. Gentleman have a greater individualist affection for their own seate than a sense of collectivist duty?

  FINANCE BILL.

    SUPER-TAX.
    Mr. SAVERYasked the Chancellor of the Exchequer whether he will take

    1959
    steps to ensure that when a company by inadvertence declares two annual dividends within the same financial year, any claim for Super-tax which results entirely from such mistake shall be cancelled?
    The CHANCELLOR of the EXCHEQUER (Mr. Snowden): I do not se, sufficient reason for altering the existing law, under which all dividends declared within a particular year of assessment are aggregable with the rest of a taxpayer's income for that year for the purposes of assessment to Super-tax.

    CUSTOMS DUTIES (REVENUE).
    Mr. HANNONasked the Chancellor of the Exchequer whether he will state the principal headings under Customs under which the revenue has shown a decline during the first quarter of the present financial year as compared with last year; if he will state the amounts received during the first quarter of the present year and last year, respectively, on account of goods imported into this country from Germany; and whether he attributes the decline to the reduction of the duties payable under the German Reparation (Recovery) Act, 1921?
    Mr. SNOWDEN: The principal headings which show a decline in the receipts from Customs duties during the first quarter of the present financial year, as compared with the corresponding quarter last year, are spirits, tea, cocoa, sugar, tobacco, and the new import duties. No information is available as to the amount of duty received on goods consigned from Germany. The answer to the last part of the question is in the negative.

    MINERAL WATERS DUTY.
    Brigadier-General SPEARSasked the Chancellor of the Exchequer whether he is aware that in many parts of the country the retail trade is not passing on to the consumer the amount of the reduction in the duty on mineral waters; and whether he can take any steps to see that this is done?
    Mr. SNOWDEN: I am not in the least surprised to hear that the proposed reduction in duty is not being passed on to the consumer, as it does not take effect until August.

    McKENNA IMPORT DUTIES.
    Sir JAMES REMNANTasked the Chancellor of the Exchequer whether, having regard to the fact that traders holding stocks of duty-paid goods, clocks and watches, can ship these out of the country and claim drawback to the amount of duty paid on importation, he will consider the expediency of allowing traders a rebate to the extent of duty paid on importation on their stocks of duty-paid goods remaining on 1st August, thereby saving a great deal of unremunerative work and expenses both to traders and Customs which is involved on the exportation of such goods?
    Mr. SNOWDEN: I have carefully considered this suggestion, but I regret that I cannot see my way to adopt it.
    Sir J. REMNANT: In view of the hardship on the traders concerned and of the fact that it does not affect the financial statement, will the right hon. Gentleman reconsider the matter?
    Mr. VIVIAN: Seeing that the hon. Member opposite believes the foreigner already pays the duty, why should the Exchequer pay it back again?
    Mr. SNOWDEN: I will leave to the two hon. Members the question whether the foreigner pays, but I may say I postponed the repeal of the McKenna Duties for three months in order to deal with this question. It would have been quite impracticable to give a rebate, and I think the traders have had sufficient time to get rid of their duty-paid stock without any serious loss.

    ENTERTAINMENTS DUTY (COMPLIMENTARY TICKETS).
    Mr. DUNNICOasked the Chancellor of the Exchequer whether, in view of the fact that large numbers of complimentary tickets are issued by theatre, music hall and cinema proprietors, and that these tickets are in the majority of cases given to persons better able to pay for admission than many who do, he is prepared to consider the advisability of extending the operations of the Entertainments Duty, pending its entire removal, to all admissions except bona fide Press representatives?
    Mr. SNOWDEN: My hon. Friend's proposal would be inconsistent with the

    1961
    general scheme of the Entertainments Duty, which is to impose taxation on persons who pay for admission to see or hear entertainments.
    Mr. DUNNICO: Is he aware that many of these tickets are given as payment for services and that the recipients are not only escaping Entertainments Duty but Income Tax as well?
    Mr. SNOWDEN: I am not aware of that. If that were the case, it would clearly be an evasion of the Entertainments Duty.

    INDUSTRIAL ASSURANCE COURT.
    Lieut.-Commander KENWORTHYasked the Chancellor of the Exchequer whether his attention has been drawn to the fact that during the week ending the 28th June an Industrial Assurance Court has been sitting in Hull, and that during four days eight claimants, resident in the Central Division of Hull, have recovered sums of money due to them from various companies on industrial assurance policies and wrongly withheld, and that there are a large number of these cases being dealt with; and what is being done to meet the cases of injustice to poor policyholders in other towns?
    Mr. SNOWDEN: The Industrial Assurance Commissioner sat at Hull on Thursday, 26th June, and heard five claims, two against a collecting society and three against an industrial assurance company. He dismissed two of the claims against the company. In the other case against the company no award was made, but the company, at his suggestion, agreed, in all the circumstances, to pay a portion of the sum claimed to the claimant. In the cases against the collecting society, the society did not dispute its liability to pay, and, in the Commissioner's opinion, had reasonably deferred payment till it could get a proper discharge. The Commissioner has heard 117 cases since the Act came into force, in 11 of which the claimant resided in Hull. A considerable number await hearing, and the Commissioner proposes to hear them locally, wherever, in his opinion, the facts or the circumstances of the parties require.

    NORTHERN IRELAND (CIVILIAN SPECIAL POLICE).
    Mr. HEALYasked the Chancellor of the Exchequer if he can, in view of the peaceful state of Ireland, say if it is the intention of the Government to provide any sum this year for the upkeep of the civilian special police in Northern Ireland?
    Mr. SNOWDEN: I fear that I cannot add anything to the answer which I gave to the hon. Member on this matter on the 3rd June.
    Mr. HEALY: Will the right bon. Gentleman undertake to give sufficient time for discussing the matter before the money is voted, and does he not think the Northern Government ought to pay for their own military supporters?
    Viscount CURZON: Is it not a fact that the hon. Member opposite owes his life to these same civilian police?
    Mr. FERGUSON: Is it not the case that the present peaceful state of matters is the result of the internment of the murder gang of whom the hon. Member opposite was a principal leader?
    Mr. COMPTON: Is it within the Rules of the House for one hon. Member to refer to another as "a leader of a murder gang."
    Mr. SPEAKER: Certainly not. If the hon. Member referred to a Member of the House as the leader of a murder gang, I must call upon him to withdraw.
    Mr. FERGUSON: Might I ask—
    Mr. SPEAKER: The hon. Member will please answer my question. Did he use that expression? If so, he must withdraw it at once.
    Mr. FERGUSON: Very well, I withdraw it.

    EXCHEQUER GRANTS (MESTON COMMITTEE).
    Sir JOHN MARRIOTTasked the Chancellor of the Exchequer whether he is now in a position to inform the House when the Report of the Meston Committee on Exchequer Grants may be expected?
    Mr. SNOWDEN: I have consulted the Chairman of the Committee, and hope that he will be in a position to report before the House rises.
    Sir J. MARRIOTT: Is the right hon. Gentleman aware that the Committee was appointed in May, 1922, and that it held its last sitting in March, 1923?
    Mr. SNOWDEN: I am aware of that fact. I am aware also of the fact that the proceedings were interrupted by two General Elections, but, as I said in reply to the question, I have seen the Chairman of the Committee, and it is hoped before the House rises, that it will be possible to present the Report.

    WAR SAVINGS CERTIFICATES.
    Mr. SUNLIGHTasked the Chancellor of the Exchequer if he will state the number of individuals who invested in or now hold War Savings Certificates of an amount not exceeding £25, £50 and £100, respectively; and if he can say that these small investors are of the wage-earning class?
    Mr. SNOWDEN: I regret that the statistics asked for in the first part of the question are not available. As regards the second part, the hon. Member may remember that the Committee that inquired last year into Savings Certificates, etc., reported that, while the distribution could not be ascertained with any exactitude, they thought it probable that at least one-half of the Certificates sold up to the 31st March, 1922, represented subscriptions by those classes of the community for whom this form of saving was primarily designed.

    PRICES (MAINTENANCE).
    Mr. E. SIMONasked the Chancellor of the Exchequer whether the statement of the Prime Minister in the House of Commons on 4th July, 1923, that the right policy of this country at the present moment is to do all in our power to keep prices steady and on a level, is accepted as the policy of the present Government?
    Mr. SNOWDEN: I am not able, to add to the statements already made with regard to the views of the Government. The hon. Member will recognise that the
    1964
    very complicated issues involved cannot be adequately dealt with by question and answer.
    Mr. JOHNSTON: Is the right hon. Gentleman aware that proposals are being seriously heard in influential quarters in the City of London for a raising of the bank rate; and is he aware that such a rise in the bank rate would inevitably cause a fall in prices and an increase in the amount of unemployment in this country?
    Mr. SNOWDEN: I am quite aware that there has been some talk recently about the possibility of an increase in the bank rate, but as to the consequences of an increase in the bank rate that is a matter on which opposite opinions are expressed.
    Mr. MOSLEY: Will the right hon. Gentleman consider the setting up of a Committee analogous to that which is inquiring into the National Debt, for the purpose of inquiring into the relationship of monetary policy and unemployment?
    Mr. SNOWDEN: The hon. Member cannot expect me to give an answer to a question like that now. May I remind those hon. Members who appear to be anxious to put supplementary questions on this matter that I have stated in reply to the original question that these complicated issues cannot be adequately dealt with by question and answer.
    Mr. PRINGLE: Will the right hon. Gentleman see whether he can arrange for an opportunity to discuss this matter either on the Third Reading of the Finance Bill or on the Appropriation Bill?
    Mr. SNOWDEN: It is not for me to arrange an opportunity. There are plenty of opportunities for raising this question, and the hon. Member is perfectly familiar with them.

    TRADES FACILITIES ACTS (APPLICATION).
    Mr. FRANKLINasked the Chancellor of the Exchequer what is the total number and amount of guarantees that have been applied for and granted during the last six months under the Trades Facilities Act; how many applications have been made for guarantees under

    1965
    £10,000; how many have been granted; and how many are now under consideration?
    Mr. SNOWDEN: With the hon. Member's permission I will circulate in the OFFICIAL REPORT the figures in reply to this question.
    Following is the reply:
    Some 400 applications for guarantees under the Trade Facilities Acts have been made in the last six months, the amount involved being £40,000,000. The Treasury have guaranteed, or expressed their willingness to guarantee, 33 loans for an aggregate of £10,000,000. Fifty applications aggregating £250,000 were for guarantees for sums less than £10,000. Two such applications are at present under consideration; none have so far been granted.

    BANK RESERVE.
    Sir F. WISEasked the Chancellor of the Exchequer what is the proportion of the bank reserve by the last return and the return a year ago?
    Mr. SNOWDEN: The proportion of reserve to liabilities in the Bank Return of 2nd July, 1924, was 13⅜ per cent., as compared with 14¼ per cent. a year ago.
    Mr. A. M. SAMUEL: Does not this matter govern the fact as to whether the hank rate should rise and fall, quite independently of any recommendation, as pointed out by hon. Members behind the right hon. Gentleman?
    Mr. SNOWDEN: That is going back upon the previous question. I can only repeat what I have said that I decline to be drawn into a discussion on this question, and to be expected to give answers which might have very serious consequences.

    REPARATION RECEIPTS.
    Sir F. WISEasked the Chancellor of the Exchequer what was the date of the last payment and the amount received from the Reparation Commission; and if the amount was credited in London?
    Mr. SNOWDEN: The reparation receipts of this country at present are not derived from cash payments by the Reparation Commission, but from the levy under the German Reparation
    1966
    (Recovery) Act, and the proceeds of the sale of deliveries in kind, e.g., dyestuffs. Such receipts are paid directly to His Majesty's Government, which renders an account of them to the Reparation Commission.

    BRITISH DEBT (UNITED STATES).
    Sir F. WISEasked the Chancellor of the Exchequer the amounts respectively in sterling of the three payments of interest and Sinking Fund on the British War Debt to the United States, and the balance of indebtedness after the third payment?
    Mr. SNOWDEN: I am circulating a statement showing the cost in sterling to the Treasury of the three payments of interest and the one payment of capital so far made in respect of the British Government Debt to the Government of the United States of America. The capital outstanding is $4,577,000,000.
    Following is the statement promised:

    Sterling Cost of Payments to U.S.A. Government on Account Loan

    —

    —

    interest.

    Sinking Fund.

    1923.

    $

    £

    £

    15th June

    69,000,000

    14,463,704

    —

    15th Dec.

    69,000,000

    14,682,350

    4,894,116

    23,000,000

    1924.

    15th June

    68,655,000

    15,685,401

    —

    Balance of capital remaining unrepaid, $4,577,000,000.

    COSTERMONGERS.
    Mr. THURTLEasked the Financial Secretary to the Treasury whether he is aware that a considerable number of costermongers in the East End of London lack the necessary stock for carrying on their business and are without the requisite means for acquiring this stock; and whether he is prepared to formulate a scheme, in accordance with the precedent recently established in connection with distressed fishermen in Scotland, whereby small loans may be made from State funds to these costermongers, to the extent of 50 per cent. of

    1967
    the amount required for stock, in order that they may have an opportunity of earning a living?
    Mr. GRAHAM: The answer is in the negative.

CORPUS CHRISTI PROCESSION, CARFIN.
Mr. BUCHANAN: I beg to ask leave to move the Adjournment of the House for the purpose of discussing a definite matter of urgent public importance, namely, "the banning of a public procession in Carfin, Lanarkshire, and the constitutional issues involved by the circumstances that the local authority and the Crown authority both deny responsibility."
Mr. SPEAKER: I am afraid that this is not a Motion which I can put to the House. It is a matter for the local police. There is no central responsibility, as will be seen from the answer given by the Minister. The Lord Advocate had no knowledge or responsibility in the matter.
Mr. BUCHANAN: May I submit, with due deference, a point of order, namely, that the local police authorities have been consulted and they deny having any responsibility in the matter. They say that they have been instructed from someone above them, but that someone has not been defined by the Scottish Office, or by anybody else. Our difficulty is great. We approached the local police and they denied responsibility. We approached the local authorities and they denied responsibility, and we have now approached the Crown, and the Secretary for Scotland denies responsibility. We have no other constitutional way of raising this question as to who is or is not responsible. If we knew that, we could proceed without asking for the Adjournment. We ask for the Adjournment in order that we may raise the constitutional issue as a matter of urgency, in order to find out who is responsible for the banning of this procession.
Mr. BLUNDELL: May I point out that in the answer given by the right hon. Gentleman he stated that the action was taken by the local police. All the information that I have been able to obtain
1968
and all the information which has been obtained by hon. Members opposite is to the contrary effect. The local police stated clearly that it was not their own action and that they were instructed by higher authority. We want to discuss the matter in order that the Secretary for Scotland may tell us who is that higher authority.
Mr. FERGUSON: On a point of Order. Is it not the fact that the law of the land is against these processions and that some time ago the right hon. Member for Paisley (Mr. Asquith) raised the question and got them stopped. It is the same thing here. They ought to be pursued for fraud.
Mr. SPEAKER: I think I am correct in saying that it is only in London that the police are under the Government. In other parts of the country, the police are under the local authorities, and we have never allowed these matters to be raised on the Adjournment, except in regard to the London police.
Mr. PRINGLE: These processions come under the Catholic Emancipation Act, and under that Act a prosecution can only be taken at the instance of the Lord Advocate in Scotland. Consequently, if they are to be prevented, it would be on the initiative of the Lord Advocate's Department. The local procurator fiscas could not initiate such prosecution without instruction. In view of the fact, therefore, that the Lord Advocate is directly responsible, this House should have an opportunity, on the ground of Ministerial responsibility, of raising this matter.
Mr. FERGUSON: On a point of Order. Should they not be pursued for fraud for selling this water in bottles?
Mr. SPEAKER: The hon. Member must understand that I am not dealing with the merits of this matter, but only with the Orders of the House. I cannot accept the statement of the hon. Member for Penistone (Mr. Pringle). There is no prosecution in this case at the present time. It is a question of obstruction, and of action being taken by the local police. Whether they were acting by themselves or for some more general authority, I do not know. It is clear to me that it was not under the Government authority, and that fact rules the proposed Motion out of order.
Mr. PRINGLE: Is it not the case that if, according to the answer given by the right hon. Gentleman, the matter had not come within the knowledge of the Lord Advocate, it is still possible that the Legal Department in Scotland may have been consulted without the Lord Advocate having any knowledge of the matter?
Mr. FERGUSON: The Lord Advocate administers the law of Scotland. What more does the hon. Member want?
Mr. BLUNDELL: May I point out, as the hon. and learned Member for Penistone (Mr. Pringle) has pointed out, that the ground on which the police took action was because of an infringement of Section 26 of the Catholic Emancipation Act of 1829. But that deals only with the wearing of certain vestments in a public place and has nothing whatever to do with obstruction to the traffic. This is not a question of the local police acting as the traffic authority in order to keep the public streets clear. It is a question of principle as to whether certain obsolete Acts should he allowed to be invoked against certain of His Majesty's subjects.
Mr. SPEAKER: This is not a matter of administration by the Government.
Mr. PRINGLE: May I remind you that in Scotland the law as regards prosecution is different from the law in England, and that in Scotland in a matter of this kind proceedings are taken at the instance of the Lord Advocate, and that in consequence there is Government responsibility.
Mr. FERGUSON: I know the law of Scotland as well as any man in this House. This is a matter of causing an obstruction, and stepping in to prevent a procession.
Captain BENN: If there is any dispute as to whether the Government are responsible, is it sufficient for them to state in the House that they have no responsibility, or is it not a matter which can be properly left to be dealt with by the House on the Motion for Adjournment?
Mr. SPEAKER: I have to take the responsibility of deciding upon such information as is available to me, and I have given my decision on that.
Mr. MAXTON: Does your ruling also mean that this would not be a suitable matter to raise on the Adjournment at 11 o'clock?
Mr. SPEAKER: That does not follow.

UNOCCUPIED HOUSES.
Mr. THURTLE: I beg to move,
"That leave be given to bring in a Bill to make provision with respect to the acquisition by municipal authorities of unoccupied houses for the purpose of relieving overcrowding."
We have the extraordinary position in this country that large numbers of people are homeless, or are living in overcrowded conditions, and at the same time there are large numbers of empty houses. The object of this Bill is to set up machinery which will bring that indefensible anomaly to an end. Under the Housing Act of 1919, Section 12, local authorities possess certain powers for acquiring property. Those powers are not nearly adequate for the purpose which I have in mind. My Bill seeks to confer power on local authorities to obtain possession of empty dwellings, if the dwellings have been empty for more than three months, and dwellings so obtained shall be used to provide accommodation for people of the working classes, who may not have any homes at all or who may be living in seriously overcrowded conditions? The Bill provides that reasonable rent, according to working-class standards, shall be charged for the accommodation provided, and these rents, less a charge of 10 per cent. for administrative purposes, shall be paid to the owners of the property concerned.
It is also provided in the Bill that where a local authority is inactive, and does not exercise its power, it shall he competent for the superior authority to acquire these premises in its stead. This provision is introduced in order to guard against the case of London boroughs like Kensington, Chelsea or Westminster where, in the main, the large property interests dominate the local authorities. I submit that the object of the Bill should command the general approval of this House on broad humanitarian grounds. I cannot think that Members of this House will refuse to make what provision lies in their power to remedy the evils, which we saw manifested at Fulham

1971
yesterday, from which the people are suffering owing to lack of housing accommodation. There is a special reason why I ask for the support of the House. The right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) said some time ago that as long as there was a crust to be found it should be shared with the men who fought for their country. I submit that as long as an empty house or an empty room is to be found in the country, that room and that house ought to be shared among the homeless ex-service men and their families.
Sir K. WOOD: Will the hon. Member kindly tell me if this Bill is so drafted—
Mr. THURTLE: I would willingly give way to the hon. Member, but I have very little time. The Minister of Health has stated that the best way of dealing with this problem is to build new houses, and in the long run that is the best way, but building houses takes a very long time, and meantime the position of many of these people is desperate, so that anything which we can do to alleviate their distress I submit we ought to do. On a very moderate estimate, if the Housing Bill is the greatest success in the world, it would take at least five years before there will be any real relaxation of the great pressure due to lack of housing accommodation, owing to the operation of that Measure.
If the proverbial messenger from Mars were to go down to the East End of London, and look at our slums and were to ask what we had to say in defence, we might say: "We know that these conditions are deplorable and they are a disgrace to the country, but until such time as we can build new houses we cannot do anything for these unfortunate people." But if he went to the West End of London, and saw, as he would see, large numbers of houses in Kensington without any occupants, what reason could we give him for not making use of these empty houses in our present emergency? I can find no adequate reason. It does not seem to me that it would be an adequate reason to talk about the rights of private property in such cases. After all, we have not forgotten the War. We remember that during the War we took these houses to billet soldiers in and to
1972
use as stores, depots and offices—[HON. MEMBERS: "What about the price!"]—and we did not ask whether the people wanted us to take them or not. We took them, just as we took human lives. I submit that to-day, when we are in such great need of housing accommodation, as a matter of national emergency we are entitled to take these houses in very much the same way.
Mr. PRINGLE: On the same terms?
Mr. THURTLE: Never mind about the terms. I am told that it is an impossible proposition to bring slum dwellers to live in the best parts of the West End of London. They say there would be a tremendous slump in property values if we brought people of this sort, the very poorest people, to live next door to the rich. [HON. MEMBERS: "Who said so?"] I have had it said to me already, and I say that if we brought people of this sort from Shoreditch and Bethnal Green to Belgravia it ought to commend itself to hon. Members opposite who have always talked about the necessity of mingling the classes. We are told that
"The Colonel's lady and Judy O'Grady are sisters under their skin,"
and I cannot see anything subversive in the idea of Mrs. Atkins, the wife of Thomas Atkins, going to live next door to Lady Vere de Vere. I suggest that, if anything, the titled lady stands to gain. She may learn something of the fortitude and courage under adversity of the poor man's wife. I am afraid I cannot go very much further into that aspect of the question, but, if Members really are serious in their sympathy with the ex-service men, and if they are really distressed by the kind of sights which were to be seen in Fulham yesterday—
Sir K. WOOD: And on the estates under the Office of Works.
Mr. THURTLE:—they ought to be prepared to take action of this sort. I am going to ask the House, for the reasons that I have given and as an indication of their earnest desire to grapple with this overcrowding problem, to give me authority to bring in this Measure.
Sir K. WOOD: Before the hon. Gentleman sits down, will he tell me if this Bill includes the houses under the Office of Works?
Mr. SPEAKER: Questions are not allowed for in the 10 minutes.
Question put, and agreed to.
Bill ordered to be brought in by Mr. Thurtle, Mr. James Gardner, Mr. Ayles, Mr. Romeril, Mr. Lansbury, Mr. Masterman, and Mr. Mosley.

UNOCCUPIED HOUSES BILL,
"to make provision with respect to the acquisition by municipal authorities of unoccupied houses for the purpose of relieving overcrowding," presented accordingly, and read the first time; to be read a Second time upon Monday next, and to be printed. [Bill 194.]

OPEN SPACES.
Mr. PERCY ALDEN: I beg to move,
"That leave be given to bring in a Bill to extend the powers of local authorities with regard to the acquisition and use of land for recreation purposes."
I am very sorry indeed to delay the House, and I should not have put this Bill down for to-day it I had known that there was to be another Bill introduced under the Ten Minutes Rule, but I will detain the House for only a very few minutes. This Bill is promoted by the Commons and Footpaths Preservation Society, by the London Playing Felds, and by the Metropolitan Gardens Association, and it is very strongly and warmly supported by the British Olympic Sports Council, by the London County Council, by the two big football associations, and by the National Association for Hockey, Tennis, and Lacrosse, so that practically all the athletic societies of the country are behind this rather simple and non-controversial Measure. I suppose it is within the knowledge of everybody in the House that big industrial cities cannot find sufficient playing fields for the large number of clubs that spring up in those towns. I understand that the London County Council have only found one-third of the accommodation that is required by cricket clubs this summer, and that last winter they found only 275 football grounds for nearly 1,000 applications that were made by football clubs. I could give corresponding figures for other large industrial centres. The question is very naturally asked, "Why is it not possible to get more land? Why do
1974
they not get more land for playing fields? "The first answer is that it is too costly, because they would have to buy land, as they are empowered to do, for recreation grounds and parks; and the second answer is that they have no power to buy playing fields.
That requires just one word of explanation, and it is this part of this simple Bill which is of importance. Under the Open Spaces Act of 1906, it is possible to buy land for various public purposes, such as recreation grounds, but the definition of an open space is so narrow and so confined that it is necessary to alter it. It is not possible for any local authority to buy land unless it is being used as a garden or recreation ground or is lying waste and unoccupied. That means that no local authority, except such local authorities as are very powerful and have obtained private bills of their own, can buy a meadow. They are not allowed to buy a meadow which can be used for playing fields, and of course it is the meadows which the local authorities want to buy. The city is gradually encroaching on the land, and this simple Bill will enable the local authorities to acquire by agreement or by gift or by lease the green fields which are round the town and thus prevent the encroachment of building upon the land. I will not delay any more, because I am perfectly certain that this is a non-controversial Measure. I will just say one word to those who represent agricultural constituencies. I do not know whether they are aware that it is impossible to prevent a village green from being enclosed if it is used by two parishes for recreation purposes. The Clause in this Bill gives the authority power to take a village green which has been used for recreation purposes for 40 years and make it public for ever as playing fields whether it has been used by two parishes or not. That is a most important point and concerns vitally those who represent rural constituencies. I do not think I need say more to commend this Bill to the House.
Question put, and agreed to.
Bill ordered to be brought in by Mr. Alden, Major Birchall, Sir John Brunner, Mr. Alfred Thomas Davies, Sir Joseph Hood, Mr. Pethick-Lawrence, Mr. Mosley, Mr. Rathbone, Mr. Sydney Robinson, and Mr. Ernest Simon.

OPEN SPACES BILL,
"to extend the powers of local authorities with regard to the acquisition and use of land for recreation purposes," presented accordingly, and read the First time; to be read a Second time upon Monday next, and to be printed. [Bill 195.]

CONSOLIDATION BILLS (TOWN PLANNING BILL [Lords]).
Report from the Joint Committee on Consolidation Bills, in respect of the Town Planning Bill [Lords] (pending in the Lords), brought up, and read.
Report to lie upon the Table, and to be printed.

CONSOLIDATION BILLS (TOWN PLANNING (SCOTLAND) BILL [Lords]).
Report from the Joint Committee on Consolidation Bills, in respect of the Town Planning (Scotland) Bill [Lords] (pending in the Lords), brought up, and read.
Report to lie upon the Table, and to be printed.

CONSOLIDATION BILLS (HOUSING BILL [Lords].
Report from the Joint Committee on Consolidation Bills, in respect of the Housing Bill [Lords] (pending in the Lords), brought up, and read.
Report to lie upon the Table, and to be printed.

CONSOLIDATED BILLS (HOUSING (SCOTLAND) BILL [Lords]).
Report from the Joint Committee on Consolidated Bills, in respect of the Housing (Scotland) Bill [Lords] (pending in the Lords), brought up, and read.
Report to lie upon the Table, and to be printed.

ARBITRATION CLAUSES (PRO- TOCOL) BILL [Lords].
Reported, without Amendment, from Standing Committee C.
Report to lie upon the Table, and to be printed.
Minutes of the Proceedings of the Standing Committee to be printed.
Bill, not amended (in the Standing Committee), to be taken into consideration To-morrow.

DOCK PILOTAGE BILL,
"to amend the Law relating to dock pilotage," presented by Mr. ISAACS; supported by Mr. Mills and Mr. Hoffman; to be read a Second time upon Friday, and to be printed. (Bill 193.]

MESSAGE FROM THE LORDS,
That they have agreed to,—
Central London and Metropolitan District Railway Companies Bill, with Amendments
Amendment to—
London, Midland, and Scottish Railway (Dock Charges) Bill [Lords], without Amendment.
Amendments to—
Hackney and New College Bill [Lords],
London and North Eastern Railway (Dock Charges) Bill [Lords], without Amendment.
That they have passed a Bill, intituled, "An Act to confirm certain Provisional Orders of the Minister of Health relating to Blackpool, Denton, Derwent Valley Water Board, North Cornwall Joint Water District, Poole, and Wimbledon." Ministry of Health Provisional Orders Confirmation (No. 7) Bill [Lords].

MINISTRY OF HEALTH PROVI- SIONAL ORDERS CONFIRMA- TION (No. 7) BILL [Lords],
Read the First time; and referred to the Examiners of Petitions for Private Bills.
SELECTION (STANDING COMMITTEES).

  STANDING COMMITTEE C.
  Mr. WILLIAM NICHOLSON reported from the Committee of Selection; That they

  1977
  had added the following Ten Members to Standing Committee C (in respect of the Protection of Birds Bill, the Advertisements Regulation Bill [Lords], and the Protection of Animals Bill); Captain Bowyer, Sir Harry Brittain, Mr. Rhys Davies, Mr. Edmund Harvey, Sir Douglas Newton, Sir Philip Richardson, Mr. Stamford, Lady Terrington, Mr. Vivian, and Mr. Wignall.
  Mr. WILLIAM NICHOLSON further reported from the Committee; That they had discharged the following Member from Standing Committee C Brigadier-General Sir Henry Page Croft.
  Reports to lie upon the Table.

ORDERS OF THE DAY.

  FINANCE BILL.
  Considered in Committee. [Progress, 2nd July]
  [Mr. ROBERT YOUNG in the Chair.]

  FINANCE BILL.

    NEW CLAUSE.—(Extension of 9 and 10 Geo. V., c. 32, s. 16.)
    "Section sixteen of the Finance Act, 1919 (which exempts from Income Tax wounds and disability pensions), shall be extended to apply to pensions granted to widows whose husbands lost their lives as the result of naval, military, or Air Force service."—[Captain Viscount Ednam.]
    Brought up, and read the First time.
    Captain Viscount EDNAM: I beg to move, "That the Clause be read a Second time."
    This is a proposal which I feel sure will commend itself to every member of the Committee, and I sincerely hope that the Chancellor of the Exchequer will see his way to give effect to it in this year's Finance Bill. On a previous Clause which I moved last Wednesday with regard to bequests to hospitals, the debate was inclined to deteriorate into accusations of inconsistency on both sides of the Committee. That was not what I intended or desired, and it certainly did not help my case. I hope that similar taunts will not arise on this occasion. I am not going to divide the Committee on this Clause if the Chancellor of the Exchequer cannot see his way to give effect to it this year, because, although we all realise and understand that certain inconsistencies of voting are almost inevitable on certain Amendments and new Clauses, the general public outside do not understand it, and it seems to me that it is not in accordance with the dignity of this House that publicity should be unduly and unnecessarily given to this in consistency. As a matter of fact, this Clause was moved last year by the present Financial Secretary to the War Office (Mr. Lawson), and it was seconded by the present Minister of Pensions (Mr. F. Roberts). The Financial Secretary to the War Office, I may say, expressed himself a diehard on the question. It was also strongly supported by the Attorney-General (Sir P. Hastings) and the Under-Secretary of State for War (Major Attlee). The then Financial Secretary to the
    2008
    Treasury, my right hon. Friend the Member for Twickenham (Sir W. Joynson-Hicks) expressed the strongest sympathy with the case of these widows. He asked the Mover to defer it to the Report Stage, and said he would try and see if he could give effect to it, Unfortunately, he was unable last year to give effect to it, and I frankly say that I think he made a great mistake in not doing so.
    The facts of the ease are well known to the Committee, and I do not intend to enlarge upon them. When, in 1919, service disability pensions were exempted from Income Tax, it was generally supposed that the pensions of the widows of the men who had fallen in the War were also exempted from Income Tax. This, however, is not the case, and this new Clause is merely a logical extension of the existing Section of the Finance Act of 1919. Why the same exemption should not be given in the case of widows' pensions as in the case of service pensions it is really impossible to see. They are both pensions under the same Royal Warrant, anti I feel quite sure it was not in the minds of anyone when those warrants were first agreed that these deductions for Income Tax should be made from the widows' pensions. This Clause, of course, does not apply to widows with an income of less than£3 a week. They are exempt at present. But it does seem to me that exemptions should apply to the pensions of all widows of service men. It seems to me very false gratitude to men who gave their lives in the War that this rebate should be demanded on the meagre pensions which the widows were awarded. It really seems to me heart-breaking that widows with£200 a year to live en, and perhaps to educate two or three children on, who have a hard enough struggle to endure even without the payment of the tax, should have the added hardship imposed on them of paying Income Tax on their pensions. There is something to me peculiarly hypocritical in spending money lavishly on war memorials to the fallen on the one hand, and taking a rebate for the purposes of revenue from the small enough pittance which their widows were granted. I think it is up to the Government to show cause why this Income Tax should be demanded. I do not think it is up to the widows to show cause why they should be exempt.

    2009
    It is almost dishonest on the part of the Government to grant pensions in this form. They are meagre enough in all conscience; they are only gross pensions, and it would be far more honest if they were granted as net pensions. It is a case of false representation of the actual amount of the pension. The figures arc represented as net figures when they are only gross figures subject to a deduction for Income Tax purposes. The present Attorney-General made a strong point last year when supporting this Clause. He pointed out that the incidence of the tax fell particularly hardly on the widow of a young officer or a young soldier, because the subaltern or the young soldier did not marry so much on his actual position; he married rather on the strength of his future prospects and on the remuneration he would receive when he was more advanced in his profession. But the pensions were awarded to the widows on the basis of the rank held by the husband at the time he was killed, and they did not increase in the course of years as the husband's remuneration would have increased had he lived. This is a very serious grievance which should be put right at the earliest possible moment. After all, it is a decreasing liability. I do not know what it would cost, but I rather gather from last year's debate that the cost will not be very much. I appeal to the Chancellor of the Exchequer to try and give effect to this Clause this year, and, if he cannot do that, at any rate to undertake to give the matter his serious consideration next year should he still be in office.
    Mr. S. ROBERTS: I hope that my hon. Friend will press this New Clause to a Division. During the last election a leaflet was got out against me by a candidate supporting the present Government attacking me for the vote I gave on this question last year. I was then a supporter of the Budget of the Chancellor of the Exchequer of that day. There has been a good deal of talk about inconsistency with regard to Budget votes, but when one is a supporter of the Government which has brought forward a Budget he has to support that Budget as a whole, and he cannot pick and choose the parts lie would cut out or leave in. To-day I am not a supporter of the Government and I feel at liberty to give my vote on individual questions as I think proper.
    2010
    It does not matter to me whether the present Government or the Chancellor the Exchequer are destroyed to-morrow. The sooner they are destroyed the better. We have now an opportunity of voting exactly as our inclination suggests. This is a question on which two years ago, when the Liberals were in office, I spoke and supported in favour of the Amendment, for I did not much care about continuing that party in power. Last year there was a Government in power which I desired to support, and I did support its Budget throughout. I, therefore, hope the Noble Lord will now give us an opportunity of voting in favour of this Amendment, and if the Chancellor of the Exchequer refuses to accept it then we shall have an opportunity of bringing out, in the constituencies, leaflets exactly similar to the one which was got out against me on the last occasion by my Labour opponent.
    Lieut.-Colonel SPENDER-CLAY: I shall be very sorry if this Amendment is allowed to go by default. I feel it is one on which we ought to be allowed to go to a. Division.
    Sir GODFREY COLLINS: Members of the Committee must find themselves in sonic difficulty this, afternoon. The Noble Lord who moved this Amendment reminded us that it was considered by the House of Commons last year. Before I came down to the House this afternoon I took an opportunity of ascertaining how the Noble Lord himself voted on that occasion.
    Viscount EDNAM: I have appealed to the Committee not to deteriorate this discussion into a taunt of "You're another." I am sure the Chancellor of the Exchequer will give effect to this Amendment if he can possibly do so, and I hope he will do so so that we may have no more charges of inconsistency in regard to our votes.
    Sir G. COLLINS: Last year the Noble Lord voted against the very Amendment which he has moved this afternoon.
    Viscount EDNAM: I have already said so.
    Sir G. COLLINS: And the hon. and gallant Member (Lieut.-Colonel Spender-Clay) also voted against it. On the other hand, I took another view, and I am prepared if necessary to tell hon. Mem-

    2011
    bers exactly how I did vote. On this occasion, supporting as I do the general Budget of the Chancellor of the Exchequer, I have to say that if this Amendment is pressed to a Division, and as I am not anxious as one of a large class of tax payers to see this Budget torpedoed by hon. Members moving Amendments after Amendments which wire brought forward last year, and as I am anxious to safeguard the Budget of my right hon. Friend, I shall resist this Amendment. But it makes it far more difficult for hon. Members like myself to support the Chancellor of the Exchequer while candidates of the Labour party are going up and down the country, visiting our constituencies, and attacking us in regard to the votes we are giving in this House. If the Chancellor of the Exchequer, after due consideration of all the circumstances, cannot possibly accept this Amendment then I shall support him in the position he takes up.
    The CHANCELLOR of the EXCHEQUER (Mr. Snowden): I do not think the Noble Lord who moved this Amendment in a very reasonable speech will thank his colleague, the hon. Member for Hereford (Mr. S. Roberts) for the assistance he has offered him. The hon. Member for Hereford did not appear to advance any single reason in support of the Amendment. I am quite sure that the reason which actuated him last year in voting against this Amendment, and which will actuate him this year in voting for it, will not be lost on hon. Members who sit behind me. We have the confession of the hon. Member for Hereford that he feels he is striking a blow at the Budget as a whole, and that he is trying to destroy that Budget.
    Mr. S. ROBERTS: Destroy the Government.
    Mr. SNOWDEN: I have no doubt the hon. Member would like to see the Budget killed, because it is one he does not care to support. I notice that he has on the Paper another Amendment which we may reach some time to-morrow, in which he suggests an alternative Budget, namely, that one-half of the relief that I am giving to taxation this year should not be devoted to the objects to which I propose to give it, but should be devoted to a further reduction of the beer duty. I
    2012
    can therefore well understand the hon. Member's desire to get rid of this Budget.
    I am not going to taunt the Noble Lord who moved this Amendment and the hon. and gallant Member who supported it with having voted against an Amendment in these terms 12 months ago. Last year I voted in support of the Amendment which we are discussing on the proposition of the Noble Lord, and I voted for it last year because it was an Amendment which appealed to one's sympathy. But in a matter of this kind one should not allow his sympathies or his compassion to over-rule his reason or his judgment. Mr. Robert Lowe, once Chancellor of the Exchequer, said that it was the business of the Chancellor of the Exchequer to distribute misery, and that he was the most successful Chancellor who distributed it evenly. But it appears to be the idea of hon. Members opposite who are responsible for this Amendment that it is the duty of the Chancellor of the Exchequer to distribute compassion.
    Under the present law, as hon. Members are aware, wound pensions are excluded from Income Tax assessment and now the Noble Lord wants that exemption extended to the pensions granted to widows. When the exemption with regard to wound pensions was conceded in 1919 this question of extending it still further to the pensions of soldiers' widows was fully considered by the House of Commons which decided against it. I would like to remind the Committee that. 1919 was the year which followed the end of the War, when sympathy with the soldier was at any rate more vocal than it is to-day, and yet at a time like that the House of Commons, after deliberately considering the question, decided that the concession granted in the case of wound pensions should not be extended to pensions enjoyed by widows. The Leader of the Opposition gave what I think was a very false comparison on that occasion. He compared awards given under the Workmen's Compensation Act to pensions enjoyed by the widows of soldiers. I think that is quite a false analogy. In the case of workmen's compensation, a lump sum and not a pension is awarded to the widow. The Noble Lord who submitted this Amendment admitted that this extension would benefit only comparatively well-to-do persons.
    Viscount EDNAM: This, I pointed out, would affect a widow with £200 a year.
    Mr. SNOWDEN: If she had three children she would be entitled to total exemption under the existing scheme of Income Tax. Let me give one or two illustrations. With reference to the Noble Lord's remarks he admitted that it would not mean much to the widow of a private. For example, the widow with a pension of 26s. 8d. per week—about £66 a year, with no other income. Take the case of a subaltern's widow. She has a pension, say, of £140 a year, and in addition, she has an earned income of £200 a year. This widow would be relieved—I am assuming that there are no children—of £14 3s. 6d., or in effect, the pension would be increased from £140 to £154 a year. Let us take a more extreme case, the case of a Colonel's widow who is a Super-tax payer, with £2,500 a year. This widow would not only gain £43 15s. 3d. in Income Tax but also a further sum of £21 12s. in Super-tax. That is, if this Amendment were adopted, she would gain a total relief of £65 7s. 3d.
    If this Amendment were adopted it would be, in effect, an addition to the pensions. There might be a case for increasing pensions, but that question ought to be considered independently of this one and on its merits. If there be a case for increasing pensions, it must be considered by itself, and the endeavour should not be made in this indirect way to get a substantial increase in these pensions. The Noble Lord said that he did not know how much it would cost. Well, the Bost would be fairly substantial. It would amount to about £200,000 a year, and I have already—either willingly or unwillingly—had to make concessions in the Budget which have made considerable inroads in the surplus at my disposal. Whatever, therefore, are the merits of this proposal, I cannot afford it. We shall have to consider, in the course of the afternoon, many other matters, all of which would make considerable inroads not merely into the revenue, but into the whole Income Tax structure, and if we were to go on accepting such Amendments as that before the Committee, we should be gradually whittling away the Income Tax altogether, excluding one class after another, until everybody was exempt. I remind hon. Members that I have reduced taxation this year by£40,000,000, and
    2014
    that if I were in office for another 20 years and did the same every year, then taxation would be entirely abolished. Hon. Members, therefore, I hope, will have regard to the reasons that I have put before them, though I admit the appeal of sentiment and compassion, and reject this Amendment.
    Colonel Sir CHARLES YATE: With reference to the right hon. Gentleman's example of a widow who pays Super-tax, my impression is, although I cannot quite remember the figure—I think it is£400that no pension is given to a widow if she has an income over a certain amount. Thus a widow who pays Super-tax would not escape taxation, and if it be the case that no pension is given to a widow who has more than £400 a year, or whatever the sum be, surely this concession might be limited to that amount?
    Mr. SNOWDEN: I think there is some regulation of that sort applying to the general service pensions, but not to these, pensions.
    Sir C. YATE: I am only talking of the widow's pension, owing to the death of her husband on service. Apart from questions of voting, I have my own feelings on this matter, and I hope the right hon. Gentleman will take into consideration the suggestion that no widow who has more than £400 shall get any advantage. I think he might allow this concession.
    Mr. SNOWDEN: Take the case of a widow with an income, say, of from £250 to£400 a year, who bas been living in a house and paying Inhabited Housed Duty. I have done away with that.
    Mr. HARMSWORTH: This widow, like everybody else, will be let off Inhabited House Duty. That is an extreme argument to put forward in a case where we are only considering a certain section or class of the inhabitants. I am sure the right hon. Gentleman would wish, when considering matters that affect either ex-servicemen or ex-servicemen's widows, to consider them in a different light, and as a matter separate from the affairs of the general community. I feel sure the right hon. Gentleman did not mean to press the point that those widows were getting this year a certain amount off their Inhabited House Duty. He might have gone further and mentioned

    2015
    the case of tea and sugar. I am sure that the Committee would welcome a word from him as to the future. This matter, if it is to be put forward at all, should be put forward at once. It is no good waiting another year. The War has been over for six years, and if you are going to wait seven, eight, nine, or ten years after the War, the case will not arise. As the Amendment shows, it is only putting something right. For what reason should the widow of a man who was killed in the War pay Income Tax, and a man receiving a pension not pay Income Tax? If you do it in one case, you must do it in another. If you are going to exempt more people from Income Tax, other sections of the community will come forward.
    These widows are in an entirely separate department. Every party in the House, I am sure, would wish to treat them as an entirely separate matter. I hope the Noble Lord who moved this Amendment will deprecate any speeches from a Party point of view. Any hon. Members who put forward the suggestion that a party is going to vote on, ex-service matters purely according to the Government that is in power, are not acting in accord with the history of the past few years. When we have had ex-service matters raised hon. Members of various parties have voted in different lobbies on these questions—not at all in agreement with their leaders, or the Government. Hon. Members behind the Government and those on this side of the Committee should vote—and I hope we shall vote—as they please as to whether they thing these widows are entitled to exemption from Income Tax on their pensions. The Chancellor of the Exchequer has a surplus at the end of the year. He says that very few people will benefit from the Amendment if it is carried. If that be so, the sum of money involved will not be very large. It will not cripple his Budget in any way, and if hon. Members think it is right, we should vote upon it this afternoon.
    Sir JOHN PENNEFATHER: I differ entirely from the point of view put forward by the hon. Member for Greenock (Sir G. Collins). I do not think we shall make any progress if we come here with books to see which way we voted this year or last year. I think that is Conservatism of the worst type. According to the
    2016
    hon. Member, any hon. Member would always ask himself before voting, "How did I vote on this question last year in the House?" That is preposterous. I suggest that there is a much more honourable test, and that is this. Here is a case where some of us have given pledges to our constituents. In speeches, or in election addresses we have held out to the people the practical promise that, if they voted for us, we would vote for the abolition of Income Tax on the pensions of War widows. For anybody who has done that there can be only one honourable form of conduct, and that is to fulfil pledges given. I do not care whether he speaks on that side of the House or on this. Those who have given those pledges, who have obtained votes by putting forward that suggestion, are bound to implement their promises or to be subject to the charge of having obtained votes by fraudulent pretences. There are others who are not pledged on this point, who perhaps said nothing about it. They perhaps even voted against this Amendment last yeas. They were not returned to this House on a promise to carry out the proposal and then before, they are free. But I submit that there are in this House a certain number of men who are pledged to sup port this proposal and a certain number who have a free hand. We can simply regard this proposal on its merits to-day and say, "Is it a good proposal? Did we promise to support it or have we a free hand?"
    Viscount EDNAM: I said before that I did not want to press the Amendment to a Division and I will keep my word. I beg to ask leave to withdraw the Amendment. [HON. MEMBERS: "No!"] I am disappointed with this Clause in the Finance Bill, because I think there is a wrong which should be put right. I represent a very large number of these women and I know their feelings in this matter. It is beside the point whether they are comparatively rich or whether they have a very hard struggle to exist, as many of them have. What rankles is the feeling that they have to pay this Income Tax on a pension granted to them in consideration of their husbands' great sacrifice. I would suggest again that when the Chancellor of the Exchequer is considering this question it would be more honest for the Government to curtail the pension and give the widows

    2017
    a net figure than to represent the pension as a net figure when it is not.
    Captain WEDGWOOD BENN: As the Noble Lord is not allowed to pursue a course which I think shows great generosity and wisdom on his part, I propose to explain why I shall support the Government. I voted and spoke in favour of this Amendment last year. I understand that the Chancellor to-day is not closing the book on this proposal. He has said that for this year he cannot grant the demand. He has also said that the question whether these pensions were adequate or not would require careful and sympathetic consideration in the proper quarter. This Amendment must not be taken by itself. You must take all the Amendments on the Paper and ask yourselves whether you can support the policy of breaking the Budget. No doubt the Chancellor of the Exchequer will say what is the aggregate cost of these concessions. It is hundreds of millions. It is no good hon. Gentlemen like the hon. Member for Kirk dale (Sir J. Pennefather) saying that we are to judge this Amendment on its merits. He and his friends have put down a number of Amendments all of which have equal merits, but in the aggregate they represent a sum which would wreck the Budget. Therefore, I say, without any want of any want the of the people concerned—
    Sir J. PENNEFATHER: Does the hon. and gallant Gentleman mean that every Amendment on the Paper should be rejected for fear of breaking the Budget?
    Captain BENN: I say that the responsibility for seeing that the Budget is safely piloted rests with the Chancellor of the Exchequer, and I shall be guided largely by what he says. I hope that he will give credit to me, and to those who support me, that the Budget is also partly our Budget. [HON. MEMBERS:"Oh!"] If he does not it is immaterial. There has been a great deal of throwing from one side to the other, "How did you vote last year?" The Parliamentary situation is entirely altered in this Parliament. Parliamentary institutions are on their trial. Whereas in the old days there was a Government with a majority which could force its way, and hon. Gentlemen opposite had an opportunity of making propaganda speeches, that is not the case
    2018
    to-day. Every Member of the House has to take his own personal share of the responsibility. If everyone who does not belong to the Government party is going to cast only a propaganda vote, it is not this Government's fate that concerns me, but Government in general that concerns me. If we pursue the policy which we have pursued in the past, namely, to cast a vote which is popular, knowing that we are bound to be defeated, we are making ourselves responsible for destroying the Parliamentary machine on which the good government of the country depends. I propose to vote with the Government against the Amendment.
    Sir H. CRAIK: I am glad that the attitude adopted by the hon. and gallant Member for Greenock (Sir G. Collins) has been so completely repudiated by his colleague. I think that the bandying of the votes in particular cases, and the anxiety to accuse one another, are unworthy of this House. I listened with great pleasure and interest and sympathy to the Noble Lord who proposed the Amendment. I was very glad, indeed, to find that the Chancellor of the Exchequer accepted it with a great deal of sympathy, and probably held out some slight hope that, in one way or another, though not in this way, it might be met. I was glad, too, that the Noble Lord offered to withdraw the Amendment, because I say plainly that I should not have voted for it. No one is more sympathetic than I am towards these pensioners of all kinds, but surely our business is to make a pension adequate, and not to swell it out by various devices of exemption from this or that tax. I think the Chancellor of the Exchequer, like his predecessor in office, took a very reasonable attitude when he said, "I shall be prepared to consider an increase in these pensions, but I do not think that the proper way of doing that is to exempt them from this or that tax which they would otherwise have to pay." Otherwise, where is to be the end of this exemption from taxation? Surely in fixing the pension you took into account the burdens that would fall upon the holder of it. If we are not doing enough for the widow, let us boldly and generously increase the pension. Last year I voted against a similar Amendment, and I am sure that at the time I did so because I thought the attitude of the Chancellor of the Exchequer was right. I shall do

    2019
    the same this time. I think that the Noble Lord who moved this Amendment in a most admirable way took the wise and expedient course in asking leave to withdraw the Amendment.
    Colonel PENRY WILLIAMS: I cannot agree that if we vote for this Amendment we are compelled to adopt every other Amendment on the Paper. This Amendment is aimed at the removal of a grievance of one class of persons who are in a peculiar position. It refers to the widow of a man who laid down his life during the War. The disability pension is exempt. I believe that, owing to the action of the right hon. Member for Hill-head (Sir R. Horne), the allowances which were granted in aid of the children of officers killed in the War are also exempt. That leaves the widows' allowance as the sole allowance which is liable to Income Tax. I think that the time has come for the Chancellor of the Exchequer to take into consideration whether he is not able to relieve that allowance from Income Tax. It is rather an ungracious thing to give to a widow an allowance because her husband is lying in France, and then to take part of it back by way of taxation. It would be far better to make the allowance less in the first instance and to let the widow have it somplete. My conscience is quite clear. I have consistently and persistently voted for this Amendment ever since it came before Parliament, but if the Chancellor of the Exchequer can give some hope that in next year's Budget he will make an effort to get rid of this grievance, I will vote in favour of the Budget as a whole, and I hope that the Noble Lord will be allowed to withdraw the Amendment. Unless some hope is held out for next year I shall vote for the Amendment.
    Sir J. MARRIOTT: I desire to join in the very powerful appeal to the Chancellor of the Exchequer made by the last speaker. I wish to enter a protest
    against what was said by the hon. and gallant Member for Leith (Captain Benn). In the first place, I desire to say—and I think I speak on behalf of many Members on this side of the Committee—that we are at least as jealous for the security a Parliamentary institutions as the hon. and gallant Gentleman himself is. We feel quite as strongly as he that Parliamentary institutions are in some respects in a critical condition, and in other respects than those to which the hon. and gallant Gentleman alluded. The honour and security of Parliament are things that should be maintained. The hon. and gallant Gentleman said, apparently on behalf of the Committee at large, that all the Amendments on the Paper were of equal value. On the contrary, I would join with the hon. and gallant Member for Middlesbrough East (Colonel P. Williams) in urging that there is a very special claim for consideration on behalf of this Amendment. It happens that I have the honour to represent a very considerable number of persons who are very closely concerned in this Amendment. Less than a week ago I was moving an Amendment in this House, asking the Chancellor of the Exchequer to consider the exemption from Death Duties of all soldiers who died on service, and the Chancellor of the Exchequer met us on that occasion in a very kindly and sympathetic way. I hope that he will extend equally kindly consideration to an Amendment which is on precisely similar lines. Here are the representatives of men who have laid down their lives for the country. They have a special claim on the generosity of this House, and I hope that the Chancellor, even if he is not able to give us the concession this year, will hold out the hope that before this time next year the matter will be very carefully and sympathetically reconsidered.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 128; Noes, 211.

    Division No. 132.]

    AYES.

    [5.1 p.m.

    Apsley, Lord

    Bowater, Sir T. Vansittart

    Butler, Sir Geoffrey

    Balfour, George (Hampstead)

    Bramsdon, Sir Thomas

    Caine, Gordon Hall

    Banks, Reginald Mitchell

    Briscoe, Captain Richard George

    Cautley, Sir Henry S.

    Beckett, Sir Gervase

    Brittain, Sir Harry

    Clayton. G. C.

    Benn, Sir A. S. (Plymouth, Drake)

    Buckingham, Sir H.

    Cohen, Major J. Brunel

    Berry, Sir George

    Bull, Rt. Hon. Sir William James

    Colfox, Major Wm. Phillips

    Blades, Sir George Rowland

    Bullock, Captain M.

    Crooke, J. Smedley (Deritend)

    Blundell, F. N.

    Burman, J. B.

    Cunliffe, Joseph Herbert

    Bourne, Robert Croft

    Burney, Lieut.-Com. Charles D.

    Curzon, Captain Viscount

    Dalkeith, Earl of

    James, Lieut.-Colonel Hon. Cuthbert

    Roberts, Samuel (Hereford, Hereford)

    Davies, Alfred Thomas (Lincoln)

    Jenkins, W. A. (Brecon and Radnor)

    Robinson, Sir T. (Lancs., Stretford)

    Davies, Sir Thomas (Cirencester)

    Kay, Sir R. Newbald

    Samuel, A. M. (Surrey, Farnham)

    Davison, Sir W. H. (Kensington, S.)

    Kindersley, Major G. M.

    Sandeman, A. Stewart

    Dawson, Sir Philip

    Lamb, J. Q.

    Shepperson, E. W.

    Dixey, A. C.

    Laverack, F. J.

    Simms, Dr. John M. (Co. Down)

    Doyle, Sir N. Grattan

    Lumley, L. R.

    Spero, Dr. G. E.

    Dunnico, H.

    McCrae, Sir George

    Stanley, Lord

    Eden, Captain Anthony

    Macdonald, Sir Murdoch (Inverness)

    Stuart, Hon. J. (Moray and Nairn)

    Ednam, Viscount

    MacDonald, R.

    Sueter, Rear-Admiral Murray Fraser

    Elveden, Viscount

    Maclean, Neil (Glasgow, Govan)

    Sunlight, J.

    England, Colonel A.

    Macnamara, Rt. Hon. Dr. T. J.

    Sutcliffe, T.

    Falle, Major Sir Bertram Godfrey

    Macpherson, Rt. Hon. James I.

    Thomas, Sir Robert John (Anglesey)

    Ferguson, H.

    Makins, Brigadier-General E.

    Thompson, Luke (Sunderland)

    FitzRoy, Capt. Rt. Hon. Edward A.

    Marriott, Sir J. A. R.

    Thomson, F. C. (Aberdeen, South)

    Franklin, L. B.

    Meller, R. J.

    Thomson, Trevelyan (Middlesbro, W.)

    Gates, Percy

    Mitchell, Sir W. Lane (Streatham)

    Titchfield, Major the Marquess of

    Gaunt, Rear-Admiral Sir Guy R.

    Mond, H.

    Waddington, R.

    Greene, W. P. Crawford

    Moulton, Major Fletcher

    Ward, Col. J. (Stoke upon Trent)

    Gretton, Colonel John

    Nail, Lieut.-Colonel Sir Joseph

    Ward, Lt.-Col. A.L. (Kingston-on-Hull)

    Hannon, Partrick Joseph Henry

    Newton, Sir D. G. C. (Cambridge)

    Warrender, Sir Victor

    Harland, A.

    Nicholson, William G. (Petersfield)

    Wells, S. R.

    Harmsworth, Hon. E. C. (Kent)

    Nield, Rt. Hon. Sir Herbert

    Williams, Col. P. (Middlesbrough, E.)

    Hartington, Marquess of

    Ormsby-Gore, Hon. William

    Wilson, Sir C. H. (Leeds, Central)

    Harvey, C.M.B. (Aberd'n & Kincardne)

    Penny, Frederick George

    Windsor-Clive, Lieut.-Colonel George

    Herbert, Capt. Sidney (Scarborough)

    Percy, Lord Eustace (Hastings)

    Wise, Sir Fredric

    Hood, Sir Joseph

    Philipson, Mabel

    Wood, Major Rt. Hon. Edward F. L.

    Hore-Belisha, Major Leslie

    Pleiou, D. P.

    Wood, Sir H. K. (Woolwich, West)

    Horne, Sir R. S. (Glasgow, Hillhead)

    Pilditch, Sir Philip

    Wragg, Herbert

    Howard, Hn. D. (Cumberland,Northrn.)

    Pilkington, R. R.

    Yate, Colonel Sir Charles Edward

    Howard-Bury, Lieut.-Col. C. K.

    Raine, W.

    Yerburgh, Major Robert D. T.

    Hume-Williams, Sir W. Ellis

    Rees, Sir Beddoe

    Huntingfield, Lord

    Rees, Capt. J. T. (Devon, Barnstaple)

    TELLERS FOR THE AYES.—

    Inskip, Sir Thomas Walker H.

    Remnant, Sir James

    Sir John Pennefather and Lieut.-

    Jackson, Lieut.-Colonel Hon. F. S.

    Rhys, Hon. C. A. U.

    Colonel Spender-Clay.

    NOES.

    Ackroyd, T. R.

    Dodds, S. R.

    John, William (Rhondda, West)

    Adamson, Rt. Hon. William

    Dukes, C.

    Johnston, Thomas (Stirling)

    Adamson, W. M. (Staff., Cannock)

    Duncan, C.

    Jones, Henry Haydn (Merioneth)

    Alden, Percy

    Dunn, J. Freeman

    Jones, Rt. Hon. Leif (Camborne)

    Allen, R. Wilberforce (Leicester, S.)

    Edwards, John H. (Accrington)

    Jones, Morgan (Caerphilly)

    Alstead, R.

    Egan, W. H.

    Jones, T. I. Mardy (Pontypridd)

    Ammon, Charles George

    Emlyn-Jones, J. E. (Dorset, N.)

    Jowett, Rt. Hon. F. W. (Bradford,E.)

    Attlee, Major Clement R.

    Falconer, J.

    Jowitt, W. A. (The Hartlepools)

    Ayles, W. H.

    Foot, Isaac

    Keens, T.

    Baker, Walter

    Gardner, B. W. (West Ham, Upton)

    Kenyon, Barnet

    Banton, G.

    Gavan-Duffy, Thomas

    Lambert, Rt. Hon. George

    Barclay, R. Noton

    George, Major G. L. (Pembroke)

    Lansbury, George

    Barnes, A.

    Gosling, Harry

    Law, A.

    Batey, Joseph

    Gould, Frederick (Somerset, Frome)

    Lawrence, Susan (East Ham, North)

    Bellairs, Commander Canyon W.

    Graham, W. (Edinburgh, Central)

    Lawson, John James

    Benn, Captain Wedgwood (Leith)

    Greenwood, A. (Nelson and Colne)

    Leach, W.

    Bondfield, Margaret

    Grenfell, D. R. (Glamorgan)

    Lee, F.

    Bonwick, A.

    Griffiths, T. (Monmouth, Pontypool)

    Lessing, E.

    Broad, F. A.

    Groves, T.

    Linfield, F. C.

    Bromfield, William

    Grundy, T. W.

    Livingstone, A. M.

    Brown, A. E. (Warwick, Rugby)

    Guest, J. (York, Hemsworth)

    Loverseed, J. F.

    Brown, James (Ayr and Bute)

    Guest, Dr. L. Haden (Southwark, N.)

    Lowth, T.

    Buchanan, G.

    Hacking, Captain Douglas H.

    Lunn, William

    Buckle, J.

    Hall, G. H. (Merthyr Tydvil)

    McEntee, V. L.

    Burnie, Major J. (Bootle)

    Hamilton, Sir R. (Orkney & Shetland)

    Mackinder, W.

    Buxton, Rt. Hon. Noel

    Hardie, George D.

    Mensal, Sir Courtenay

    Chapple, Dr. William A.

    Harvey, T. E. (Dewsbury)

    March, S.

    Charleton, H. C

    Hastings, Sir Patrick

    Marley, James

    Church, Major A. G.

    Hastings, Somerville (Reading)

    Martin, F. (Aberd'n & Kinc'dine, E.)

    Clarke, A.

    Haycock, A. W.

    Martin, W. H. (Dumbarton)

    Climle, R.

    Hayday, Arthur

    Masterman, Rt. Hon. C. F. G.

    Cluse, W. S.

    Hemmerde, E. G.

    Middleton, G.

    Clynes, Rt. Hon. John R.

    Henderson, Rt. Hon. A. (Burnley)

    Mills, J. E.

    Collins, Sir Godfrey (Greenock)

    Henderson, T. (Glasgow)

    Montague, Frederick

    Compton, Joseph

    Henderson, W. W. (Middlesex, Enfld.)

    Morel, E. D.

    Conway, Sir W. Martin

    Hillary, A. E.

    Morris, R. H.

    Costello, L. W. J.

    Hindle, F.

    Morrison, Herbert (Hackney, South)

    Cove, W. G.

    Hirst, G. H.

    Morrison, R. C. (Tottenham, N.)

    Cowan, D. M. (Scottish Universities)

    Hobhouse, A. L.

    Morse, W. E.

    Craik, Rt. Hon. Sir Henry

    Hoffman, P. C.

    Muir, John W.

    Crittall, V. G.

    Howard, Hon. G. (Bedford, Luton)

    Muir, Ramsay (Rochdale)

    Darbishire, C. W.

    Hudson, J. H.

    Murray, Robert

    Davies, Ellis (Denbigh, Denbigh)

    Isaacs, G. A.

    Naylor, T. E.

    Davies, Rhys John (Westhoughton)

    Jackson, R. F. (Ipswich)

    Newman, Sir R. H. S. D. L. (Exeter)

    Davison, J. E. (Smethwick)

    Jenkins, W. (Glamorgan, Neath)

    Nichol, Robert

    Dickson, T.

    Jewson, Dorothea

    Nixon, H.

    2022

    2023

    O'Grady, Captain James

    Sherwood, George Henry

    Warne, G.H.

    Owen, Major G.

    Shinwell, Emanuel

    Watson, W.M. (Dimfermline)

    Paling, W.

    Short, Alfred (Wedneebury)

    Watts-Morgan, Lt.-Col. D (Rhondda)

    Parkinson, John Allen (Wigan)

    Simon, E. D. (Manchester, Withington)

    Webb, Rt. Hon. Sidney

    Perry, S. F.

    Simpson, J. Hope

    Wedgwood, Col. Rt. Hon. Josiah C.

    Pethick-Lawrence, F. W.

    Smith, Ben (Bermondsey, Rotherhithe)

    Weston, John Wakefield

    Phillips, Vivian

    Smith, T. (Pontefract)

    Westwood, J.

    Potts, John S.

    Smith, W. R. (Norwich)

    Wheatley, Rt. Hon. J.

    Pownall, Lieut.-Colonel Assheton

    Snell, Harry

    Whiteley, W.

    Purcell, A. A.

    Snowden, Rt. Hon. Philip

    Wignall, James

    Raffety, F. W.

    Spears, Brigadier-General E. L.

    Williams, David (Swansea. E.)

    Ramage, Captain Cecil Beresford

    Spence, R.

    Williams, Lt.-Col. T. S. B. (Kennington)

    Raynes, W. R.

    Spencer, H. H. (Bradford, South)

    Williams, Maj. A. S. (Kent, Sevenoaks)

    Rea, W. Russell

    Spoor, B. G.

    Williams, T. (York, Don Valley)

    Richards, R.

    Stamford. T. W.

    Willison, H.

    Richardson, R. (Houghton-le-Spring)

    Stewart, J. (St. Rollox)

    Wilson, C. H. (Sheffield, Attercliffe)

    Ritson, J.

    Sturrock, J. Leng

    Wilson, R. J. (Jarrow)

    Robertson. J. (Lanark, Bothwell)

    Thomas, Rt. Hon. James H. (Derby)

    Windsor, Walter

    Romeril, H. G.

    Thompson, Piers G. (Torquay)

    Wintringham, Margaret

    Rose, Frank H.

    Thornton, Maxwell R.

    Wood, Major M. M. (Aberdeen, C.)

    Royle, C.

    Thurtle, E.

    Wright, W.

    Scrymgeour, E.

    Tout, W. J.

    Young, Andrew (Glasgow, Partick)

    Scurr, John

    Trevelyan, Rt Hon C.P.

    Seely, H. M. (Norfolk, Eastern)

    Viant, S. P.

    TELLERS FOR THE NOES.—

    Sexton, James

    Vivian, H.

    Mr. Frederick Hall and Mr.

    Shaw, Rt. Hon. Thomas (Preston)

    Wallhead, Richard C.

    Kennedy.

    NEW CLAUSE.—(Reduction of licence duty on certain liquor licences.)
    The duties chargeable on the following excise liquor licences, that is to say, retailers' on-licences for spirits, beer, or wine, retailers' off-licences for spirits, beer, or wine, shall be reduced by fifty per cent.—[Mr Banks.]
    Brought up, and read the First time.
    Mr. BANKS: I beg to move, "That the Clause be read a Second time."
    In moving the Second Reading of this new Clause I do not think I need tread upon that dangerous ground beneath which one hears the rumbling and seething of controversy on the temperance question. My hon. Friend the Member for Hereford (Mr. S. Roberts) when he approaches the matter of the beer duty may have to venture upon it, and I hope he will not fall through. The question involved in this proposal, however, is not concerned with temperance at all. Under the present system certain persons are conceded the privilege of selling intoxicating liquor and have to pay charges to the State in return for that privilege, and the question is simply whether the charge imposed upon them is or is not equitable. If the Chancellor of the Exchequer sees his way to accept this Clause it will not make any difference at all in the consumption of intoxicating liquor, nor need those who have an objection to the brewer, and who sometimes accuse him of enjoying bloated profits, oppose the Clause on the ground that it gives him any substantial concession. As everybody knows, in the Budget of 1909–10 the charges on all licences in this country were enormously
    2024
    increased, and we may assume that at the time of the outbreak of the War those licences were probably regarded as having been scaled up to the highest point which they ought to reach.
    In those clays the man behind the bar in the public house was entitled to do business for from 17 to 19 hours out of the 24. Now, under the Act of 1921 he can only trade for eight or nine hours. That being so, it seems, prima facie, to be unjust that a mar, should have to continue to pay to the State exactly the same amount of money for the privilege of trading only half the number of hours which he was allowed to trade in days gone by. The principle of reducing duties in proportion to the reduction of hours is to novelty. It was recognised by the Act of 1872 that a man who had only the privilege of trading on six days, should pay less, proportionately, than the man who enjoyed that privilege for seven days. Again, the Act of 1874 recognised that a man who had an early closing licence should not be saddled with such heavy duty as the man who had a more extended licence. It was recognised during the War when, from time to time, orders were brought in limiting the hours, and corresponding rebates were granted to the licensees. The first rebate represented one-fifteenth for each hour taken off. Then there was a rebate of one-quarter, and, finally, under the Finance Act of 1917, a rebate of three-quarters of the duty was permitted. When the Liquor Control Board was dissolved, naturally this concession came to an end and we would have reverted to the old hours but for the Act of 1921.

    2025
    It is an undoubted fact that the Act of 1921, which reduced the hours to eight or nine, was passed with the object of reducing the consumption of liquor and was highly commended on that score by gentlemen who are great advocates of temperance in this House. We know benches of magistrates have taken advantage of the discretion granted to them, by frequently so allotting the permitted hours that, instead of trading until 11 o'clock, licensees in certain divisions can only trade until 10 o'clock. That reduction of hours is warmly commended by temperance advocates on the ground that it reduces the consumption of intoxicating liquor. In truth and in fact, the consumption of spirits has been steadily going down since 1921 and the consumption of other exciseable liquors has remained more or less stationary. Anyone who has practical experience of licensing matters will admit that a very large part of the consumption of intoxicating liquors has gone from the public house to the club. I have nothing to say against that, but
    there is no doubt it is the fact and that is presumably because the club may allot those permitted hours as it chooses while the licensee may not. Therefore, in many divisions of this City there exist regulations closing the public houses at 10 o'clock while the clubs almost invariably choose to close at 11 o'clock and, consequently, gain a large proportion of the trade. On these grounds, which I hope are grounds of common sense and equity, I submit this New Clause. The Chancellor of the Exchequer said that there were two rules guiding a Chancellor of the Exchequer—he might be a distributor of misery, or he might be a distributor of compassion. In my submission, what he ought to be is a distributor of justice, and the case for the licensed victuallers in this country is based upon justice, and only upon justice.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 89; Noes, 236.

    Division No. 133.]

    AYES.

    [5.17 p.m.

    Apsley, Lord.

    Greene, W. P. Crawford

    Percy, Lord Eustace (Hastings)

    Banks, Reginald Mitchell

    Gretton, Colonel John

    Pielou, D. P.

    Barnston, Major Sir Harry

    Hacking, Captain Douglas H.

    Pilditch, Sir Philip

    Beckett, Sir Gervase

    Harland, A.

    Pownall, Lieut.-Colonel Assheton

    Blades, Sir George Rowland

    Hartington, Marquess of

    Remnant, Sir James

    Bourne, Robert Croft

    Hennessy, Major J. R. G.

    Rhys, Hon. C. A. U.

    Bowater, Sir T. Vansittart

    Herbert, Dennis (Hertford, Watford)

    Roberts, Samuel (Hereford, Hereford)

    Briscoe, Captain Richard George

    Herbert, Capt. Sidney (Scarborough)

    Roundell, Colonel R. F.

    Brittain, Sir Harry

    Hohler, Gerald Fitzroy

    Samuel, A. M. (Surrey, Farnham)

    Buckingham, Sir H.

    Hood, Sir Joseph

    Sandman, A. Stewart

    Bullock, Captain M.

    Hore-Belisha, Major Leslie

    Sheffield, Sir Berkeley

    Burman, J. B.

    Howard, Hn. D. (Cumberland, North)

    Shepperson, E. W.

    Butler, Sir Geoffrey

    Howard-Bury, Lieut.-Col. C. K.

    Somerville, Daniel (Barrow-In-Furn'ss)

    Calne, Gordon Hall

    Hume-Williams, Sir W. Ellis

    Spender-Clay, Lieut.-Colonel H. H.

    Cautley, Sir Henry S.

    Huntingfield, Lord

    Sueter, Rear-Admiral Murray Fraser

    Clarry, Reginald George

    King, Captain Henry Douglas

    Sunlight, J.

    Clayton, G. C.

    Lamb, J. Q.

    Sutcliffe, T.

    Cope, Major William

    Lane-Fox, George R.

    Turton, Edmund Russborough

    Croft, Brigadier-General Sir H.

    Lumley, L. R.

    Waddington, R.

    Crooke, J. Smedley (Deritend)

    Makins, Brigadier-General E.

    Ward, Lt.-Col. A. L. (Kingston-on-Hull)

    Davies, Alfred Thomas (Lincoln)

    Marriott, Sir J. A. R.

    Warrender, Sir Victor

    Davies, Sir Thomas (Cirencester)

    Meller, R. J.

    Wells, S. R.

    Dawson, Sir Philip

    Milne, J. S. Wardlaw

    Wilson, Sir C. H. (Leeds, Central)

    Dixey, A. C.

    Morrison-Bell, Major A. C. (Honlton)

    Winsdsor-Clive, Lieut.-Colonel George

    Eden, Captain Anthony

    Nall, Lieut.-Cotonel Sir Joseph

    Wragg, Herbert

    Ednam, Viscount

    Newman, Sir R. H. S. D. L. (Exeter)

    Yate, Colonel Sir Charles Edward

    Elveden, Viscount

    Newton, Sir D. G. C. (Cambridge)

    Yerburgh, Major Robert D. T.

    Falle, Major Sir Bertram Godtray

    Nicholson, William G. (Petersfield)

    Ferguson, H.

    Nield, Rt. Hon. Sir Herbert

    TELLERS FOR THE AYERS.—

    Forestler-Walker, L.

    Ormsby-Gore, Hon. William

    Mr. Percy Gate and Mr. Hannon

    Gaunt, Rear-Admiral Sir Guy R.

    Penny, Frederick George

    NOES.

    Ackroyd, T. R.

    Backer, Walter

    Bonwick, A.

    Adamson, Rt. Hon. William

    Banton, G.

    Bramsdon, Sir Thomas

    Adamson, W. M. (Staff., Cannock)

    Barclay, R. Noton

    Broad, F. A.

    Alexander, A. V. (Sheffield, Hillsbro')

    Barnes, A.

    Bromfield, William

    Allen, R. Wilberforce (Leicester, S.)

    Barrie, Sir Charles Couper (Banff)

    Brown, A. E. (Warwick, Rugby)

    Alstead, R.

    Batey, Joseph

    Brown, James (Ayr and Bute)

    Ammon, Charles George

    Benn, Captain Wedgwood (Leith)

    Buckle, J

    Aske, Sir Robert William

    Berry, Sir George

    Burney, Lieut.-Com. Charles D.

    Attlee, Major Clement R.

    Blundell, F.N.

    Buxton, Rt. Hon. Noel

    Ayles, W. H.

    Bondfield, Margaret

    Chapple, Dr. William A.

    Charleton, H. C.

    Jones, Rt. Hon. Lelf (Camborne)

    Richardson, R. (Houghton-le-Spring)

    Church, Major A. G.

    Jones, Morgan (Caerphilly)

    Ritson, J.

    Clarke, A.

    Jones, T. I. Mardy (Pontypridd)

    Robertson, J. (Lanark, Bothwell)

    Climle, R.

    Jowett, Rt. Hon. F. W. (Bradford, E.)

    Romeril, H. G.

    Cluse, W. S.

    Jowitt, W. A. (The Hartlepools)

    Rose, Frank H.

    Clynes, Rt. Hon. John R.

    Kay, Sir R. Newbald

    Royle, C.

    Collins, Sir Godfrey (Greenock)

    Keens, T.

    Scurr, John

    Compton, Joseph

    Kennedy, T.

    Seely, H. M. (Norfolk, Eastern)

    Conway, Sir W. Martin

    Kenyon, Barnet

    Sexton, James

    Cove, W. G.

    Lansbury, George

    Shaw, Rt. Hon. Thomas (Preston)

    Cowan, D. M. (Scottish Universities)

    Laverack, F. J.

    Sherwood, George Henry

    Crittall, V. G.

    Law, A.

    Short, Alfred (Wednesbury)

    Darbishire, C. W.

    Lawrence, Susan (East Ham, North)

    Simms, Dr. John M. (Co. Down)

    Davies, Ellis (Denbigh, Denbigh)

    Lawson, John James

    Simon, E. D. (Manchester, Withington)

    Davies, Rhys John (Westhoughton)

    Leach, W.

    Simon, Rt. Hon. Sir John

    Davison, J. E. (Smethwick)

    Lee, F.

    Simpson, J. Hope

    Dickle, Captain J. P.

    Lessing, E.

    Smith, Ben (Bermondsey, Rotherhithe)

    Dickson, T.

    Linfield, F. C.

    Smith, W. R. (Norwich)

    Dodds, S. R.

    Livingstone, A. M.

    Snell, Harry

    Duckworth, John

    Loverseed, J. F.

    Snowden, Rt. Hon. Philip

    Dukes, C.

    Lowth, T.

    Spears, Brigadier-General E. L.

    Duncan, C.

    Lunn, William

    Spence, R.

    Dunn, J. Freeman

    McCrae, Sir George

    Spencer, H. H. (Bradford, South)

    Dunnico, H.

    McEntee, V. L.

    Spero, Dr. G. E.

    Egan, W. H.

    Mackinder, W.

    Spoor, B. G.

    Emlyn-Jones. J. E. (Dorset, N.)

    Maclean, Nell (Glasgow, Govan)

    Stamford, T. W.

    England, Colonel A.

    Macnamara, Rt. Hon. Dr. T. J.

    Stewart, J. (St Rollox)

    Fletcher, Lieut.-Com. R. T. H.

    Macpherson, Rt. Hon. James I.

    Sturrock, J. Leng

    Foot. Isaac

    Mansel, Sir Courtenay

    Thomas, Rt. Hon. James H. (Derby)

    Franklin, L. B.

    March, S.

    Thomas, Sir Robert John (Anglesey)

    Gardner, B. W. (West Ham, Upton)

    Marley, James

    Thompson, Luke (Sunderland)

    Gardner, J. P. (Hammersmith, North)

    Martin, F. (Aberd'n & Kine'dine, E.)

    Thompson, Piers G. (Torquay)

    George. Major G. L. (Pembroke)

    Martin, W. H. (Dumbarton)

    Thomson, T. (Middlesbrough, West)

    Gosling, Harry

    Middleton, G.

    Thorne, W. (West Ham, Plaistow)

    Gould, Frederick (Somerset, Frome)

    Millar, J. D.

    Thornton, Maxwell R.

    Graham, W. (Edinburgh, Central)

    Mills, J. E.

    Thurtle, E.

    Greenwood, A. (Nelson and Colne)

    Mond, H.

    Tout, W. J.

    Grenfell, D. R. (Glamorgan)

    Montague, Frederick

    Turner, Ben

    Griffiths, T. (Monmouth, Pontypool)

    Morel, E. D.

    Viant, S. P.

    Groves, T.

    Morris, R. H.

    Vivian, H.

    Grundy, T. W.

    Morrison, Herbert (Hackney, South)

    Wallhead, Richard C.

    Guest, J. (York, Hemsworth)

    Morrison R. C. (Tottenham, N)

    Ward, Col. J. (Stoke upon Trent)

    Guest, Dr. L. Haden (Southwark, N.)

    Morse, W. E.

    Watson, W. M. (Dunfermline)

    Hall, G. H. (Merthyr Tydvil)

    Moulton, Major Fletcher

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Hamilton, Sir R. (Orkney & Shetland)

    Muir, John W.

    Webb, Rt. Hon. Sidney

    Hardie, George D.

    Muir, Ramsay (Rochdale)

    Wedgwood, Col. Rt. Hon. Josiah C.

    Harvey, T. E. (Dewsbury)

    Murray, Robert

    Weston, John Wakefield

    Hastings, Sir Patrick

    Nichol, Robert

    Westwood, J.

    Hastings, Somerville (Reading)

    Nixon, H.

    Wheatley, Rt. Hon. J.

    Haycock, A. W.

    O'Grady, Captain James

    Whiteley, W.

    Hayday Arthur

    Owen, Major G.

    Wignall, James

    Healy, Cahir

    Paling, W.

    Williams, A. (York, W. R., Sowerby)

    Hemmerde, E. G.

    Parkinson, John Allen (Wigan)

    Williams, David (Swansea, E.)

    Henderson, Rt. Hon. A. (Burnley)

    Pattinson, S. (Horncastle)

    Williams, Col. P. (Middlesbrough, E.)

    Henderson, T. (Glasgow)

    Perry, S. F.

    Williams, Lt.-Col. T.S.B. (Kenningtn.)

    Henderson, W. W. (Middlesex, Enfld.)

    Pethick-Lawrence, F. W.

    Williams, Maj. A.S. (Kent, Sevenoaks)

    Hillary, A. E.

    Phillipps, Vivian

    Williams, T. (York, Don Valley)

    Hindle, F.

    Pilkington, R. R.

    Willson, H.

    Hirst, G. H.

    Ponsonby, Arthur

    Wilson, C. H. (Sheffield, Attercliffe)

    Hobhouse, A. L.

    Potts, John S.

    Wilson, R. J. (Jarrow)

    Hoffman, P. C.

    Pringle, W. M. R.

    Windsor, Walter

    Hogg, Rt. Hon. Sir D.(St. Marylebone)

    Purcell, A. A.

    Wintringham, Margaret

    Howard, Hon. G. (Bedford, Luton)

    Raffety, F. W.

    Wise, Sir Fredric

    Hudson, J. H.

    Ramage, Captain Cecil Beresford

    Wood, Sir H. K. (Woolwich, West)

    Jackson, R. F. (Ipswich)

    Raynes, W. R.

    Wood, Major M. M. (Aberdeen, C.)

    Jenkins, W. (Glamorgan, Neath)

    Rea, W. Russell

    Wright, W.

    Jenkins, W. A. (Brecon and Radnor)

    Rees, Sir Beddoe

    Young, Andrew (Glasgow, Partick)

    Jewson, Dorothea

    Rees, Capt. J. T. (Devon, Barnstaple)

    John, William (Rhondda, West)

    Reid, D. D. (County Down)

    TELLERS FOR THE NOES—

    Jones, Henry Haydn (Merioneth)

    Richards, R.

    Mr. Frederick Hall and Mr. Warne.

    NEW CLAUSE.—(Amendment of s 32 of 11 and 12 Geo. V., c. 32)
    "Section thirty-two of the Finance Act, 1921 (which provides for exemption of superannuation funds from Income Tax) shall have effect as though at the end of paragraph (b) in Sub-section (3) of that Section there were added the words 'or, in case of death, for their widows or children.'"—[Mr. Romeril.]
    Brought up, and read the First time.
    Mr. ROMERIL: I beg to move, "That the Clause be read a Second time."
    I am hopeful that the Chancellor of the Exchequer may see his way to accept this Clause, or, at any rate, that it will receive much support in the Committee, and that he will not resist it. Its effect is to apply the exemptions provided in the Act of 1921 in regard to superannua-

    2029
    tion funds, that is to say, funds for the purpose of providing a superannuation allowance to employés, to similar funds for the purpose of providing pensions for the widows and orphans of such persons. I can only conclude that it is an oversight that those same provisions have not been extended to the funds for providing pensions for widows and orphans. It is not a question in this ease of relieving the pension itself from Income Tax—that is a different question altogether—but what we are asking here is that the investments of the funds shall be relieved from Income Tax. If you impose Income Tax upon the invested funds, remembering that the money, with the exception of certain small payments made in connection with death or retirement, is kept in the funds until such time as the pension falls due to the party concerned, and if then the pension itself is made subject to Income Tax, that is all that should be required. If you charge the fund itself, on its investment, and then again charge the pension when it falls to be paid out of the fund, you are, in effect, making a double charge for Income Tax.
    I suggest that if the Committee is concerned about the pensions of the widows of ex-service men, here in this case we are not asking that the pension shall be exempt—we agree that if the pension comes within the scope of the Income Tax scale it should pay the tax—but that you shall not discriminate against widows and orphans, and that you shall not treat them worse than you are treating the men. These pension funds are things to be encouraged, I think, both by this House and by the Government. They are attempts by joint efforts, on the part of employés and their employers, to provide against old age on the part of the employés themselves and also for their widows and orphans. This is a most desirable form of activity, and the State itself gains. It will not gain so much when the Chancellor's new proposals come into effect in the matter of the means disqualification for old age pensions, but even by the new proposals the State does get relief from certain obligations by the assistance of these funds.
    The Colwyn Commission reported in favour generally of superannuation funds being exempt. Every argument that caused that Committee to report in
    2030
    favour, and caused the recommendations to be adopted, apply with equal force to this proposition that the exemption should be extended to widows and orphans There is no fear, or there need be none, that if this be carried in its present form in connection with that particular Section of the Act, of any large extension of other claims coming in, certainly not with the same force that this claim comes in connection with this existing exemption for ordinary superannuation funds. There is no fear that there would be any large and extensive claims in connection with it I put this Amendment with confidence to the House believing that it is an act of justice and reason, and that it should be carried.
    Mr. SNOWDEN: The point raised by my hon. Friend is a very simple one. He proposes to exempt from tax the income which is invested by certain benefit societies. The exemption is limited to funds for the benefit of persons who have actually been employed, and the Amendment would extend the benefit to the pension received by the widows and the orphans. Under the existing law contributions by an employer for widows and orphans funds are, in ordinary circumstances, exempted from taxation. I was rather surprised to hear the doctrine from my hon. Friend that there was no distinction between contributions to benefit societies and income from investments, because—I am quite sure my hon. Friend will not dispute the statement—income from investments has always been considered by the Labour party to be very different to income from earnings. There is, too, a difference between the taxation of income from investments, and no taxation on income from contributions. There is the further point. I should like to make and it is this; that experience has shown that contributions to superannuation funds which are already in operation have really gone towards reducing the contributions which employers otherwise would pay to the funds of the societies.
    There is no doubt at all that if the exemption be made for which my hon. Friend asks we really would be giving a subsidy to the employers and help to reduce their contributions to the societies. I do not agree at all with the latter part of the observations of my

    2031
    hon. Friend when he said that there was no danger in these extensions being made that a demand would arise for still further extensions. If these were granted then next year, on behalf of provident industrial and the ordinary insurance societies, demands, would be put forward that their investments should be exempt from taxation. We have the greatest possible sympathy with these benevolent associations, but this suggested Amendment would cost a quarter of a million, and unless I could resist it the application would be repeated, and I should very soon find its scope extended. There are a very large number of Amendments upon the Paper suggesting alterations in our Income Tax system and if these were allowed they might cost a sum of £6,000,000 or £7,000,000. It might be a good thing if the Chancellor of the Exchequer in the future could make some remission of taxation to small taxpayers, and it is probable that the claims of the small Income Tax payers will yet receive the consideration of the Treasury. Although I stand here opposing many of these Amendments, however meritorious they might be—I strongly appreciate some of their points—but I cannot afford to make the concessions.
    Sir G. COLLINS: I am sure all parties in the House will have listened with interest to the Chancellor of the Exchequer. If I understood him correctly he has stated to the House that between now and the Finance Bill of next year the claims of the small Income-Tax payers will receive consideration from the Treasury.
    Mr. SNOWDEN indicated assent.
    Sir G. COLLINS: As the Chancellor of the Exchequer stated accurately, there are a number of Amendments on the Paper to grant concessions where concessions should be granted. But I would remind the Chancellor that although the present Income-Tax law is based on the Report of the Royal Commission which sat in 1919, the policy and steps which were taken in the War period should not bind this House in the years 1924–25. I hope, therefore, that during the coming months the Chancellor may give consideration to the claims of the Amendments moved this year, and which were moved last year, to lighten the burdens
    2032
    on the small Income-Tax payer where the burden is heavy to-day. The Chancellor has taken up the case of the concessions which he has refused this afternoon. I listened with interest to see if he could tell the Committee the cost of the concessions, or rather the cost of the Amendments which are on the Order Paper this afternoon. It might have helped some hon. Members in the particular division, but the Chancellor of the Exchequer—and this is ray main reason in supporting the Government this afternoon—has in his Budget given relief to the indirect and poorer class of taxpayers. Last year we moved many Amendments to the Budget, because that Budget gave direct relief to the brewing industry and the consumers of beer as well as the Income-Tax payer. The concessions of the Chancellor of the Exchequer have reached right down to millions of the people, and, although Amendments may be moved this afternoon and further concessions given to these industries, I think personally the Chancellor has done well, and I support him.
    Question, "That the Clause be read a Second time," put, and negatived.

    NEW CLAUSE.—(Amendment of 10 Edw. VII., c. 8.)
    Notwithstanding anything contained in this or any other Act to the contrary, the Finance (1909–10) Act, 1910, Schedule I (c) (Provisions applicable to retailers' off-licences, Spirits (2) Minimum quantity of spirits to be sold) shall be deemed to have effect, as if, in lieu of the words "one reputed quart bottle," there were inserted the words "one reputed pint bottle," and accordingly the minimum quantity which may be sold by a person holding an off-licence to be held by a retailer of spirits shall be, in England, one reputed pint bottle.—[Mr. Hannon.]
    Brought up, and read the First time.
    Mr. HANNON: I beg to move, "That the Clause be read a Second time."
    This new Clause asks the Chancellor of the Exchequer to take into consideration the case of the off-licence holder who has permission under the existing law only to sell a quart of brandy or whisky. I am not asking for any concession which will at all affect the revenue, but that the Government shall allow this concession for public convenience, and for the benefit of a very large and important section of the business community of the country. As the

    2033
    Chancellor has just said, and quite rightly, that he has in view certain revisions affecting the revenue, may I add that my new Clause will not in the least affect his revenue for the year. I understand that a section of the on-licence holders are in favour of this concession being made to the off-licence holders. From the point of view of the temperance reformer and the teetotaller, this new Clause may be objected to on the ground that it would facilitate the sale of drink. In point of fact, it simply enables the poor person who may want half a bottle for medicinal purposes to be able to get it, and get it at the grocer's shop, instead of having to go to the ordinary public-house where he can buy the same quantity of spirits without any Amendment of the law at all. A great many persons in this country, however, object to going into a public-house, and in the daily family life a, small quantity of spirits is frequently necessary. Doctors order spirits occasionally for their patients. That spirits are necessary for medicinal purposes, I may quote the testimony of Lord Dawson one of the most distinguished medical authorities in the country. Therefore, I think that on that ground there is no real and substantial reason to be urged against the acceptance of this proposed new Clause. The Chancellor of the Exchequer may be willing next year to consider rearrangements of Budget revenue; so may I add that there may be a very substantial Budget surplus, because I think the right hon. Gentleman has taken great care in arranging his Estimates this year to look forward to a very substantial surplus next year. If the fortunes of war place him where he is 12 months hence he would be in a position to make these reforms without any very material loss to the revenue. On these grounds I ask the Chancellor of the Exchequer to accept this very humble and small modification of his financial arrangements for the year. I am aware that the teetotaller says that this facility, if given to the off-licence holder, will increase the sale of drink. I think it may be argued that if anyone wants to drink he will buy the reputed quart, but at the present moment you can buy a half bottle, if in addition you nay a whole bottle. I hope the Chancellor of the Exchequer will regard this proposal from this point of view and not
    2034
    as in any way affecting the revenue, or of making any inroad upon the principles of teetotallers. It will not hurt the licensed trade, and it will confer a benefit on those who need small quantities of spirits from time to time in their houses. For these reasons I ask that this small concession should be granted.
    Mr. SNOWDEN: The hon. Member correctly said that there is not directly much revenue involved in this proposal, but indirectly there is a great deal of revenue at stake. The hon. Member just now stood at this Table as a teller on an Amendment which proposed to reduce the licence duty on on-licences by nearly one-half.
    Mr. HANNON: That was under the stress of political circumstances.
    Mr. SNOWDEN: Now he is supporting an Amendment in the interests of the off-licence trade. The purpose which the hon. Member has in view is this: Spirits cannot be bought in places which have off-licences in smaller quantities than the reputed quart, and the hon. Member's Amendment proposes to reduce that quantity by one-half. What have we against this proposal? In the first place, there is the opposition of the on-licence holder. The hon. Member appeared to think that no opposition comes from this quarter, but my information as to the attitude of the licensed trade does not agree in the least with the view which has been stated by the hon. Member who moved this new Clause. I know that many efforts have been made to reconcile the divergent interests of these two branches of the licensed trade, and I believe, if I am correctly informed, that they are still as far away from any agreement. If this Amendment be carried, the on-licence holder, who has to pay a heavier duty than the off-licence holder, will feel that he has a grievance.
    Now let me turn to the temperance side. In all the Debates I have heard in the House of Commons from a purely temperance point of view, there has always been a pretty unanimous agreement that the sale and consumption of spirits was a greater evil than the sale and consumption of beer. Many people who are not teetotallers agree that the consumption of spirits is a much greater danger to the community than the drinking of beer. At

    2035
    any rate, this proposal would undoubtedly have the effect of increasing the temptation to drink spirits, and on that ground I do not think the Amendment ought to be accepted. I do not know what the view of the House may be on this point, but I really do not think it is desirable that this Amendment should be accepted.
    Mr. A. M. SAMUEL: This Amendment only applies to England. How can the Chancellor of the Exchequer refuse it, seeing that it is in force in Scotland?
    Mr. SNOWDEN: There are a great many laws operating in Scotland that do not apply to this country. It has been pointed out that Sunday closing is possible in Scotland, whereas it is not possible here. I know the Scottish people have a reputation for many things. They have a reputation for strong temperance views and an enormous consumption of whisky. If the hon. Member looks into this matter, I think be will find that the origin of this distinction between England and Scotland in this matter is due to the popularity of beer and spirits in the respective countries. I think those are the two main points, namely, the effect from a temperance point of view, the fact that revenue might be sacrificed, that it would be an injustice to the on-licence holder, and that there would be a certain depreciation of their property.
    Mr. S. ROBERTS: I should like to say a word to the Chancellor of the Exchequer, with regard to the rebuke which he thought fit to utter towards me just now, that when I left this Chamber it was not out of any discourtesy to him, or any fear of his argument, but because I had been called out to see a constituent in the Lobby. I want to ask the Committee to consider this Amendment from the point of view of common sense, and I will give one instance which will show any reasonable person that this Amendment is necessary. Two friends were coming to my house, and I wanted to offer them the alternative of two liqueurs. I went to a large wine merchant and asked for a small bottle of two different liqueurs, and he said I could not have them, but I could have two small bottles of the same liqueur. I could have had two small bottles of Benedictine, but I wanted one small bottle of Benedictine and one small bottle of Curacao.
    2036
    This seems to me to be quite ridiculous and against all our ideals of liberty. Why cannot we buy what we want, where we want, and when we want it. The argument of the Chancellor of the Exchequer with regard to temperance seems to me can be countered by another argument. If a person who desires to be intemperate buys a half-bottle and takes it home he will be exposed to less temptation than if he took a whole bottle. I do not think there is any case against this proposal on the temperance side at all. With regard to the revenue, does the Chancellor of the Exchequer seriously suggest that this opportunity given to off-licence holders and grocers to sell these half-bottles would have any serious effect upon the sale in licensed houses? Is not the sale of drink in licensed houses almost entirely an on-consumption trade? Therefore I think the revenue argument is a very weak one, and the temperance argument may be balanced on either side, while the common-sense argument in favour of individual liberty is conclusively in favour of this Amendment.
    Mr. D. HERBERT: I regret that the Chancellor of the Exchequer has not seen his way to accept this Amendment, but I welcome his sympathy for the on-licence trade. I would like to say a word or two in support of an Amendment which has, I think, a very great deal in its favour from the point of view of the ordinary subject who is not a teetotaller, and who has no interest whatever in the on or the off-licence trade. Personally, as far as the temperance view is concerned, I agree with my hon. Friend the Member for Hereford (Mr. S. Roberts). I do not believe that this proposal affects the temperance question in the slightest degree one way or the other. It has been argued from the temperance point of view that it is better that people should be able to buy small quantities, because by this concession the man or woman who wishes to drink is not prevented from getting it, but will not have to go on buying a whole bottle instead of a half-bottle. I do not think there is anything in that argument any more than in the argument in the other direction, that this change would make people less temperate.
    6.0 P.M.
    I have no authority to speak for the on-licence trade, and I do not know their view on this question. I have been informed that the on-licence trade are not

    2037
    really opposing this Amendment, and I think that is a very likely attitude for them to take up, because it cannot have very much effect upon them. I have met a number of licensed victuallers from time to time who have said that, although this Amendment seems to be against them, they do not regard it as a matter of any importance, and they consider that it would be a very great convenience to the off-licence holder and the general public, and they do not want to oppose it in any way. I do want to ask the Committee to consider this from the purely common-sense point of view, from the point of view of the interest of the ordinary subject. If I thought there was any question of temperance, I would not shirk that for a moment, but, as I have said, I do not believe the temperance question is affected in the very slightest degree one way or the other. I do not think that this Amendment would have any very great effect on either the on-licence trade or the off-licence trade, but I am certain that it would be of immense benefit to a large number of people who are not teetotallers, but who are quite moderate drinkers, and who, from time to time, do want to buy a small quantity. The case, of course, is perfectly well known of the many householders in the country who, whatever may be thought of their views, rightly or wrongly, think it well to keep in their house a small quantity of brandy as a medicine in case of emergency and it really does seem rather ridiculous that a person with Et small household who wants to do that has either to buy a whole bottle or to go to a public-house and take a medicine bottle or something of that kind in which to put it.
    It is not right or fair that people who want these small quantities should be driven to go to an on-licensed. public-house, into which they very often object—quite wrongly, as I think—to be seen going, and into which, sometimes, it is not very convenient that the people who want to buy these things should have to go. The woman who manages the household and does the household shopping may want to do this kind of shopping, and it does seem rather ridiculous that she should not be able to buy these small quantities when they are wanted. Let the Committee remember that this is one of those war-time restrictions for which
    2038
    there may have been some excuse in the abnormal circumstances of that time, but for which, I respectfully submit, there is no excuse at the present time; and, even if there were not going to be a change which would meet with general approval, I suggest that, in the absence of some much stronger arguments against it than there are, it would be a good thing on general principles to get rid of little irritating restrictions and interferences with the ordinary liberty of the subject, which are not required for any particular reason, and which are a mere survival of times which we do not want to gothrough again.
    Lieut.-Colonel JAMES: I desire to support the remarks of the two previous speakers. I am not, either directly or indirectly, connected with the trade, but I do think that the present situation is perfectly absurd and entirely anomalous. I very often travel long distances by train, and I usually go third class; and, in the course of my democratic travels, I meet many a man who will produce a small container from his pocket—it may be what is called a "nip," or it may be a rather larger measure—which he has purchased from an on-licence holder, and at intervals during the journey he seeks liquid refreshment. Surely, it is rather anomalous that he should be able to purchase these supplies of alcohol from an on-licence holder and not from an off-licence holder. I admit that what the Chancellor of the Exchequer has said as to the possibility of hardship to those who pay a larger sum for their licences, as against those who pay a smaller sum, would be the case if this purchase of small quantities of alcohol from grocers or off licence holders became a general practice, but I do not think that it is liable to become so, and, from what previous speakers have said, the whole thing appears to be so anomalous, so contrary to common sense, and so absurd, That I hope the right hon. Gentleman will see his way to do something to remove this ridiculous and vexatious anomaly. There is an old story of the man who, meeting a friend, said to him, "Well, bow's Jarge?"—and his friend said, "Jarge is nicely, thank you. He eats what ho likes and he drinks what he likes, and he don't give a clang for anybody." I do not think that such legislation as we are now discussing enables people to eat what they like, drink what they like,

    2039
    and think as they like, and I do ask the Chancellor of the Exchequer whether he cannot remove these vexatious restrictions.
    Question put, "That the Clause be read a Second time"
    The Committee divided: Ayes, 157; Noes, 222

    NEW CLAUSE.—(Repeal of s. 36 of 8 and 9 Geo. V, c. 15.)
    Section thirty-six of the Finance Act, 1918, is hereby repeated.—[Mr. Freeman Dunn.]
    Mr. FREEMAN DUNN: I beg to move, "That the Clause be read a Second time."
    The effect of this Clause would be to reduce the Stamp Duty from 2d. to 1d. This is a reform long overdue, the desirability of which is frequently lost sight of owing to our familiarity with the stamp as it exists to-day. The revenue from the Stamp Duty on cheques is £3,050,000. In reply to a question which I addressed to the Chancellor of the Exchequer, he informed me that if the Stamp Duty were reduced to 1d. the revenue would suffer to the extent of £1,500,000. I think he is unduly pessimistic, and leaves out of account the largely increased number of cheques that would be drawn if the duty were reduced. In 1902, when Sir Michael Hicks-Beach proposed to increase the Stamp Duty from 1d. to 2d., he was met by the urgent representations of the bankers that this should not be done, and he yielded to those representations. The arguments then, in the main, were based upon the fact, as the bankers showed, that the duty would militate against the keeping of small bank accounts.
    Those arguments which were used in 1902 are as cogent to-day as they were then, indeed more so. The reduction of the duty would not only promote the keeping of small banking accounts among that section of the community which has not yet contracted the habit, but there is the further point in these days when we are striving to encourage trade in every possible way as to the real need of our
    2048
    banking resources being marshalled and utilised to the fullest possible extent. I have been at some trouble to get statistics in regard to the Stamp Duty, and I find that of the total number of cheques drawn no fewer than 55 per cent. were cheques under £10. If that fact be taken in conjunction with the total of the cheque clearances, it will be found that the drawer of small cheques has to pay a tax of 2s. 6d. per cent. as against one half pence per cent. paid by the drawer of large cheques. Therefore, this Stamp Duty presses too hardly upon the drawer of small cheques and is a discouragement to the keeping of small banking accounts. That argument in itself ought to be sufficient to justify the Chancellor of the Exchequer in accepting the new Clause.
    I will mention another matter and that is the currency economy that would result from an extended use of cheques consequent upon the reduction of the Stamp Duty from 2d. to 1d. I am sure the Chancellor of the Exchequer will agree with me that in the cheque we have an instrument so valuable that it is the finest piece of mechanism in exchange that the ingenuity of man has ever devised. We in this country have brought it to a fine art. In America they have gone still further. They have realised how unwise it is in any way to hamper the development of the cheque, by sweeping away the tax on the cheque altogether. In all movements for industrial progress in the past, the development of banking and the economy of our legal tender have been inseparable features from our industrial progress. For that reason, especially at this juncture, it is desirable that we should encourage an extended use of cheques by reducing the Duty.
    The restricted use of cheques due to this extra Stamp Duty is having the reverse result from that which our monetary policy should have as its aim. It is making for the demobilisation of currency and credit in this country in so far as it makes for the retention in the tills of our traders and in the pockets of our people of currency notes that ought to be in the coffers of the banks. If we remove or reduce this tax we shall drive this superfluous currency from the tills and pockets of the people into the coffers of the banks, where it can be used for the purpose of fructifying trade. In pre-War days, currency stood at £2 per head, while

    2049
    to-day it stands at from £6 to £7 per head, so that even if we allow for the cost of living having doubled we still have a surplus currency of £2 to£3 which is idle and unproductive in the tills and the pockets of our people. Therefore, I contend that, roughly, the estimate that has been made by that well-known authority Sir Drummond Fraser is the correct one, that there is at the present time something like £100,000,000 of currency notes in this country idle and unproductive in the tills and pockets of our people.
    That has the further effect that the bank balances are being unduly depleted. If these notes were forced back into the banks they would be able to increase their loans from the fact that their balances would be increased. It would have the further desirable financial effect which the hon. Member for Farnham (Mr. A. M. Samuel) has at heart, in that it would make for the centralisation of our currency note issue into the hands of the Bank of England as against the Government. In so far as economy is effected we shall be strengthening the value of the £1 sterling, and that tendency would help towards a further desirable thing, namely, the return to the gold standard. I appeal to the Chancellor of the Exchequer to give us this concession which not only the bankers would welcome, but big business wholesale business, the retailers, the small trader and the private individual also desire. The London Chamber of Commerce have advocated it.
    It would have the effect of encouraging the unknown many who up to the present time have not had banking accounts to open banking accounts if the Chancellor can see his way to make this concession. I ask him not to resist a suggestion which would have such widespread consequences to the community. The effect of the concession as far as he is concerned and as far as the revenue is concerned will be very small, but the importance to the trading community and to our currency will be great.
    Mr. A. M. SAMUEL: On a point of Order. I have a new Clause on Page 815 which goes rather wider than the Clause now moved. Will that Clause be called, or had I better speak on this Clause?
    The DEPUTY-CHAIRMAN (Mr. Entwistle): The hon. Member's Clause
    2050
    later on the Paper has not been selected. Therefore, he had better speak on this Clause.
    Mr. BARCLAY: I wish to support this new Clause. One feels some diffidence in making any suggestion that might trench upon the resources of the Chancellor of the Exchequer in any way, but he indicated the other night that he might be willing to make some small concessions, although he pointed out that if he granted all the small concessions which were being asked it would undermine the whole basis of his Budget. I hope that this is one of the small concessions which he can see his way to make. When this matter was discussed in 1918, the proposal to increase the Duty from ld. to 2d. was made under the stress and emergency of war conditions at a time when the Chancellor of Exchequer was compelled to look around and to seek all possible means for increasing his revenue. It was recognised at that time that the effect of that increase would considerably retard the expansion of the use of cheques. Some hon. Members went so far as to say that if it had that effect it would be a good thing at that time, in as much as it would reduce the pressure on banking staffs which were so much depleted.
    It is difficult to estimate what has been the effect of the increased duty as regards retarding the expansion of the use of cheques, but it is interesting to note the value per cheque in the various years since the tax was increased. I have the figures for the years 1917–18 up to the years 1923–24 of the number of cheques used in this country and the total clearinghouse returns for the corresponding years. In the year 1917–18, 306,000,000 cheques were used, and the total amount of the bankers' clearances for that year was £19,335,000,000, which gives an average per cheque of approximately£63. The corresponding figures for the succeeding years were £72 in 1918–19;£95, 1919–20 and 1920–21;£110, 1921–22;£108 in 1922–23, and£101 for last year. It may be argued that the increase in the value per cheque may be accounted for to a large extent by the increase in prices of commodities, but I think that the increase which is shown in these figures is in itself very significant.

    2051
    What we have to try to gauge is what has been the effect in checking the increase in the use of cheques. My hon. Friend has referred to the value per cheque, and the percentage of the cheques drawn for amounts under £10. If you come to think of the fact that enormous numbers of these cheques are issued for amounts of £1 and under, and the percentage tax on the cheque of£1 is something like three-quarters per cent., one realises how onerous the tax is on small cheques. Anyone who makes inquiries will discover that there has been a growing tendency to pay small accounts by currency and notes, with the result that people carry an enormous amount of currency in their pockets
    My hon. Friend has referred to the fact that there is no stamp duty on cheques in the United States, and those who have lived in that country, I believe, all confirm the opinion that the use of the cheque is enormously more popular there than it is in this country. It would be too much to ask the Chancellor of the Exchequer to concede complete exemption, but I do think that he might seriously consider this concession. One hears a great deal in these days about the assistance which the Government might render to trade and industry. To my mind a great many people look for far too much in that respect from the Government. There are decided limitations to what the Government can do in this regard, but they can do a great deal in the way of clearing the channels of trade. I think that this is one of the small reforms which might be made, and which would be of considerable value in helping to clear the channels of trade, especially at a time like the present, when we want to do everything which we can to stimulate trade.
    Mr. A. M. SAMUEL: I have put down an Amendment which goes further than this Clause, and I must therefore support my hon. Friend opposite. I go so far as to ask that the Stamp Duty which is chargeable under the Stamp Act, 1891, should be extinguished. I do not ask for that because I want the 2d. to be saved to the taxpayer. I want it for a far wider purpose than that. I want to help us to get back to a free export market for gold. One of the steps towards that end, and I think I have explained it on many occasions, is the increased use of the cheque. The cheque was invented
    2052
    originally as a substitute for the wasteful bank-note. Cheque currency is one of the most wonderfully useful instruments of finance that have ever been invented, and the clog of a duty of ld. or 2d. on cheques operates towards preventing the extension of the use of cheque currency.
    We have got in this country a great and popular use of cheque currency. France is trying to get it, and the United States and Germany are trying to get it. I do not agree with my hon. Friends opposite in saying that there is a greater cheque currency in the United States. They do not know how to handle a cheque currency in the United States in any way comparable to the way in which we handle it, and Germany, France and the United States would do anything they could to get their system of finance on a similar basis of cheque currency. While we have this splendid system, what we are now doing is, for this trumpery £3,000,000 a year, putting a clog on the use of cheques. People are disinclined, I do not know why, to draw small cheques now and spend the two pennies per cheque. They prefer to draw large cheques and to have a large number of notes immobile in a drawer or in their pockets. It is a stupid thing to have much money in hand liquid in this way. I avoid carrying much money about me. If I have it I spend it. It burns a hole in my pocket, and the man who draws more notes than he wants, just to save the 2d. on the cheque, will fritter it away or spend more than he requires.
    The Chancellor of the Exchequer gets£3,000,000, and, because people will not use cheques on account of the 2d., he may get a few pounds for postal orders. But that is all the advantage which he gets. The disadvantage is that people carry too many notes in their pockets while, if they left some of them in the bank, and drew out their payments by cheque, as they were wanted, those same notes would be available to be lent, and if they were left in larger volume in the banks there would be a larger amount of money to lend, and money would be cheaper. There are in issue now £290,000,000 sterling currency notes, and, if you add the Bank of England notes, you have an issue of something like £407,000,000. If you could induce people to take out fewer notes and, instead, use cheques, by taking the 2d. stamps off, you would probably leave a hundred millions more in the coffers of the various banks, and, in the result, you

    2053
    would lose £2,000,000 or £3,000,000 stamp duty, but you would probably, owing to the banks having more money to lend, bring down the price of money and be able to borrow on your Treasury Bills more cheaply, and very likely you might get back your£3,000,000 quite easily by the smaller interest you would have to pay for the Treasury Bills.
    But I would go a little further. The more currency notes that you have in existence, because people draw a larger volume of currency notes to avoid paying the 2d. on cheques, the larger amount of gold cover you have got to have. That is a block on our road towards a free export market in gold. If you have not to keep so much gold to cover these notes, because you are using cheques, you have gone a step towards that very desirable goal. If you do not use notes but cheques, the cheques will be drawn by a man on his own credit account, and they provide their own fiduciary cover. I am not pleading that this duty of 2d. should be taken off cheques because I want to save the taxpayers' pockets. It is because I want to take away what is a stumbling block on our road towards a free export market in gold, that I think that the Chancellor of the Exchequer ought to look at the matter from the wider point of view, rather than from the point of view of revenue.
    Mr. SNOWDEN: I never dreamt, until I heard the speech of the hon. Gentleman who moved this Amendment, that in the difference between 2d. and ld. on cheques we had the solution of all our economic financial and trade difficulties, and that the reduction which is proposed in this Amendment from 2d. to 1d. was going to increase bank deposits, going to increase the lending power of the banks, and going to rectify the exchange between this country and the United States of America.
    Mr. SAMUEL: I never said so.
    Mr. SNOWDEN: I do not think that I misrepresent the hon. Gentleman. I am sure that every Member of the Committee who heard the speeches will agree that I am not doing so. [HON. MEMBERS: "No!"] The hon. Member referred to the effect which it would have on foreign exchange. I was in the House of Commons when the duty was raised from ld. to 2d. and I remember speaking against
    2054
    it, but there is all the difference in the world between opposing a proposition and dealing with a matter which is already an established fact. It cannot be denied that the gloomy anticipations, which were suggested in 1918 when the duty was raised, as to a falling off in the use of cheques, have not been realised. The figures show that the increase in the use of cheques, since the duty was increased, has been in no way affected. Since that date there has been an annual increase in the number of cheques. It is true that in one year, 1920, the figure rose very high, and that in the slump which followed there has been a decline on the figure for that year, but, still, in the last three years there has been an increase each year in the number of cheques issued, and the number for 1923–24 was 367,000,000 in the 12 months. In the year before the duty was raised the number was 298,000,000. There was, therefore, an increase in the number of cheques used, notwithstanding the increase in the duty, of 68,000,000.
    7.0 P.M.
    I do not think that those figures tend to support the argument that has been advanced in support of the reduction of the present duty of 2d. I was reminded of the Debates which took place six years ago, when the proposed increase was submitted 0to the House of Commons, by the arguments used by the hon. Member for Farnham (Mr. A. M. Samuel) that there was a tendency to draw cheques for larger sums on account of the increase in the duty and to keep the money in people's pockets, but I think that the experience is that, after a falling off in the use of cheques on the part of some people, those people soon returned to the old practice, and they continue to draw cheques with a 2d. stamp just as they have drawn them with the ld. stamp. The hon. Member argued that it would not cost very much, as the amount lost by the reduction would be met by the enormous increase in the number of cheques used, and, therefore, we should get on the penny practically the same revenue as we now get on the twopence. There are not in our experience any facts to justify such an optimistic anticipation. There is not the shadow of doubt that the revenue would suffer by the reduction of duty in proportion to the amount by which the duty would be reduced. The yield last year of cheques was just under £3,000,000.

    2055
    I estimated in my Budget this year that the yield this year would be£3,050,000. If I accepted this Amendment it would not operate in the whole year, but I have no doubt that in a full year I would have to sacrifice—and I am making some allowance for a possible increase in the number of cheques—revenues of not less than£1,250,000 and possibly£1,500,000. For those reasons I regret that I cannot accept the Amendment.
    Lieut.-Commander BURNEY: I do not think that I quite follow the Chancellor of the Exchequer, because the hon. Member who brought this matter forward put it on the basis that it would increase the number of cheques in use, and reduce the amount of money which people would keep in their own houses, and that, as a result of this, we should get an increase in the amount of money available for lending. Following that point to its natural conclusion, the first thing that would happen would be that we should get increased currency in circulation. That would put up the velocity of the circulation by increasing the purchasing power of persons, due to the disbursement of that money on enterprises. The further result of that would be that the price level of this country would be somewhat put up because of the increased velocity of circulation. But by putting up the price level in this country we shall damage, in a sense, our exchange with New York.
    That would further mean that we should have to pay more sterling to New York for dollars owing to the fact that the price level of the country had been raised relatively to New York, and consequently our payments of debt to America would be increased upon a sterling basis. So far as the burden of this extra amount of sterling to be gathered in taxes is concerned, the result would be immaterial, as the revenue upon a given basis of taxation would increase, due to the increase of price level in the country; and if I follow the Mover of this Amendment in his remarks, the point which he is endeavouring to make is not that the Chancellor of the Exchequer would actually lose on this tax. Of course, he would lose money on this tax if he removes the duty altogether, but the argument is that by removing the duty altogether he would benefit trade to a still
    2056
    greater extent and thereby increase the revenue which he would obtain from this better basis of taxation. It is for that reason that I think that it would be worth while to make the experiment, because I do not think that the country would lose. I think it probable that it would make a profit of £6,000,000 or more, and it is because I think that that is a speculation which the Chancellor of the Exchequer would be fully entitled to make that I support the Amendment.
    Sir FREDRIC WISE: I rise to ask the Chancellor of the Exchequer as to one matter. I cannot help thinking that, if there were any alteration made, it would affect the fiduciary issue more than any of the other issues. In regard to the Bank of England the fiduciary issue is now about £246,000,000, which is very near the maximum figure fixed by the Cunliffe Committee. If you had more money in the banks I think that you would not be so near the limit which was fixed by the Cunliffe Committee. I only put that technical point before the Committee in this way, that it might possibly assist in bringing more depositors to the bank, and in that way with a cheaper cheque and more deposits we should not be so near the limit of the fiduciary issue which was suggested by the Cunliffe Committee.
    Mr. SNOWDEN: I think that I have indirectly answered that question by saying that I do not agree that the reduction of the duty would increase the amount in the bank in the manner described.
    Mr. A. M. SAMUEL: Does the right hon. Gentleman lay it down that it is good for a country, or bad for a country, to have a less amount of currency notes or a greater amount of currency notes?
    Mr. SNOWDEN: I am not going to be involved in a discussion on that matter on this Amendment.
    Mr. DUNN: After the statement of the Chancellor of the Exchequer I beg to ask leave to withdraw the Amendment.
    HON. MEMBERS: No!
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 101; Noes, 298.

    Division No. 134.]

    AYES.

    [6.7 p.m.

    Alstead, R.

    Gardner, J. P. (Hammersmith, North)

    Pease, William Edwin

    Apsley, Lord

    Gaunt, Rear-Admiral Sir Guy R.

    Penny, Frederick George

    Atholl Duchess of

    Gavan-Duffy, Thomas

    Percy, Lord Eustace (Hastings)

    Balfour, George (Hampstead)

    Gibbs, Col. Rt. Hon. George Abraham

    Perkins, Colonel E. K.

    Banner, Sir John S. Harmood-

    Greene, W. P. Crawford

    Plelou, D. P.

    Barnston, Major Sir Harry

    Grenfell, Edward C. (City of London)

    Pliditch, Sir Philip

    Beckett, Sir Gervase

    Gretton, Colonel John

    Pownall, Lieut.-Colonel Assheton

    Benn, Sir A. S. (Plymouth, Drake)

    Guinness, Lieut.-Col. Rt. Hon. W. E.

    Pringle, W. M. R.

    Berry, Sir George

    Hacking, Captain Douglas H.

    Raine, W.

    Blades, Sir George Rowland

    Harland, A.

    Rankin, James S.

    Blundell, F. N.

    Harney, E. A.

    Rawlinson, Rt. Hon. John Fredk. Peel

    Bourne, Robert Croft

    Hartington, Marquess of

    Remnant, Sir James

    Bowater, Sir T. Vansittart

    Hayday, Arthur

    Rhys, Hon. C. A. U.

    Bowerman, Rt. Hon, Charles W.

    Hennessy, Major J. R. G.

    Richardson, Lt.-Col, Sir P.(Chertsey)

    Bowyer, Capt. G. E. W.

    Herbert, Dennis (Hertford, Watford)

    Ropner, Major L.

    Bridgeman, Rt. Hon. William Clive

    Herbert, Capt. Sidney (Scarborough)

    Roundell, Colonel R. F.

    Buckingham, Sir H.

    Hoffman, P. C.

    Samuel, A. M. (Surrey, Farnham)

    Bull, Rt. Hon. Sir William James

    Hogg, Rt. Hon. Sir D. (St. Marylebone)

    Sandeman, A. Stewart

    Bullock, Captain M.

    Hohler, Sir Gerald Fitzroy

    Sassoon, Sir Philip Albert Gustave D.

    Burman, J. B.

    Hood, Sir Joseph

    Savery, S. S

    Burney, Lieut.-Com. Charles D.

    Hope, Rt. Hon. J. F. (Sheffield, C.)

    Sheffield, Sir Berkeley

    Butler, Sir Geoffrey

    Hore-Belisha, Major Leslie

    Shepperson, E. W.

    Butt, Sir Alfred

    Howard, Hn. D. (Cumberland, North)

    Somerville, Daniel (Barrow-in-Furness)

    Caine, Gordon Hall

    Hume-Williams, Sir W. Ellis

    Spencer, H. H. (Bradford, South)

    Cautley, Sir Henry S.

    Huntingfield, Lord

    Spender-Clay, Lieut.-Colonel H. H.

    Cayzer, Sir C. (Chester, City)

    Inskip, Sir Thomas Walker H.

    Stanley, Lord

    Cayzer, Maj. Sir Herbt.R. (Prtsmth.S.)

    Jackson, Lieut.-Colonel Hon. F. S.

    Steel, Samuel Strang

    Cecil. Rt. Hon. Lord H. (Ox. Univ.)

    James, Lieut.-Colonel Hon. Cuthbert

    Stuart, Hon. J. (Moray and Nairn)

    Chamberlain, Rt. Hn. J. A. (Birm. W.)

    Jenkins, W. A. (Brecon and Radnor)

    Sueter, Rear-Admiral Murray Fraser

    Chilcott, Sir Warden

    Jowitt, W. A. (The Hartlepools)

    Sutcliffe, T.

    Clarry, Reginald George

    Kindersley, Major G. M.

    Thornton, Maxwell R.

    Clayton, G. C.

    King. Captain Henry Douglas

    Titchfield. Major the Marquess of

    Cohen, Major J. Brunel

    Lamb, J. Q.

    Turner, Ben

    Colfox, Major Wm. Phillips

    Lane-Fox, George R.

    Turton, Edmund Russborough

    Cope, Major William

    Lumley, L. R.

    Vaughan-Morgan, Col. K. P.

    Crooke, J. Smedley (Deritend)

    Macdonald, Sir Murdoch (Inverness)

    Waddington, R.

    Cunliffe, Joseph Herbert

    MacDonald, R.

    Ward, Lt.-Col. A.L.(Kingston-on-Hull)

    Dalkeith, Earl of

    Macnamara, Rt. Hon. Dr. T. J.

    Warrender, Sir Victor

    Davidson, Major-General Sir J. H.

    McNeill, Rt. Hon. Ronald John

    Watson, Sir F. (Pudsey and Otley)

    Davies, Alfred Thomas (Lincoln)

    Macpherson. Rt. Hon. James I.

    Weston, John Wakefield

    Davies, Sir Thomas (Cirencester)

    Maltland, Sir Arthur D. Steel-

    Wilson, Sir C. H. (Leeds, Central)

    Davison, Sir W. H. (Kensington, S.)

    Makins, Brigadier-General E.

    Windsor-Clive, Lieut.-Colonel George

    Dawson, Sir Philip

    Martin, F. (Aberd'n & Kincardine, E.)

    Winterton, Rt. Hon. Earl

    Dixey, A. C.

    Mason, Lieut.-Col. Glyn K.

    Wise, Sir Fredric

    Dunnico, H.

    Meller, R. J.

    Wood, Major Rt. Hon. Edward F. L.

    Eden, Captain Anthony

    Mills, J. E.

    Worthington-Evans, Rt. Hon. Sir L.

    Eiveden, Viscount

    Milne, J. S. Wardlaw

    Wragg, Herbert

    Emlyn-Jones, J. E. (Dorset, N.)

    Mitchell, Sir W. Lane (Streatham)

    Yate, Colonel Sir Charles Edward

    Erskine, James Malcolm Monteith

    Morden, Col. W. Grant

    Yerburgh, Major Robert D. T.

    Eyres-Monsell, Com. Rt. Hon. B. M.

    Morrison-Bell, Major A. C. (Honiton)

    Falls, Major Sir Bertram Godfray

    Nall, Lieut.-Colonel Sir Joseph

    TELLERS FOR THE AYES.—

    Ferguson, H.

    Newton, Sir D. G. C. (Cambridge)

    Mr. Hannon and Mr. Samuel

    FitzRoy, Capt. Rt. Hon. Edward A.

    Ormsby-Gore, Hon. William

    Roberts.

    Forestler-Walker, L.

    Pattinson, S. (Horncastle)

    NOES.

    Ackroyd, T. R.

    Bondfield, Margaret

    Collins, Sir Godfrey (Greenock)

    Adamson, Rt. Hon, William

    Bonwick, A.

    Compton, Joseph

    Adamson, W. M. (Staff., Cannock)

    Bramsdon, Sir Thomas

    Conway, Sir W. Martin

    Alexander, A. V. (Sheffield, Hillsbro')

    Bromfield, William

    Cove, W. G.

    Allen, R. Wilberforce (Leicester, S.)

    Brown, A. E. (Warwick, Rugby)

    Cowan, D. M. (Scottish Universities)

    Ammon, Charles George

    Brown, James (Ayr and Bute)

    Crittall, V. G.

    Aske, Sir Robert William

    Buchanan, G.

    Croft, Brigadier-General Sir H.

    Attlee, Major Clement R.

    Buckle, J.

    Darbishire, C. W.

    Ayles, W. H.

    Burnie, Major J. (Bootle)

    Davies, David (Montgomery)

    Baker, Walter

    Chapple, Dr. William A.

    Davies, Ellis (Denbigh, Denbigh)

    Banton, G.

    Charleton, H. C.

    Davies, Rhys John (Westhoughton)

    Barclay, R. Noton

    Church, Major A. G.

    Dickle, Captain J. P.

    Barnes, A.

    Clarke, A.

    Dickson, T.

    Barrie, Sir Charles Coupar (Banff)

    Climle, R.

    Dodds, S. R.

    Batey, Joseph

    Cluse, W. S.

    Duckworth, John

    Benn, Captain Wedgwood (Leith)

    Clynes, Rt. Hon. John R.

    Dukes, C.

    Duncan, C.

    Lawson, John James

    Romeril, H. G.

    Dunn, J. Freeman

    Leach, W.

    Rose, Frank H.

    Edwards, John H. (Accrington)

    Lee, F.

    Royle, C.

    Egan, W. H.

    Lessing, E.

    Scurr, John

    England, Colonel A.

    Linfield, F. C.

    Seely, H. M. (Norfolk, Eastern)

    Falconer, J.

    Livingstone, A. M.

    Sexton, James

    Fletcher, Lieut.-Com. R. T. H.

    Loverseed, J. F.

    Shaw, Rt. Hon. Thomas (Preston)

    Foot, Isaac

    Lowth, T.

    Sherwood, George Henry

    Franklin, L. B.

    Lunn, William

    Short, Alfred (Wednesbury)

    Gardner, B. W. (West Ham, Upton)

    McCrae, Sir George

    Simms, Dr. John M. (Co. Down)

    Gates, Percy

    McEntee, V. L.

    Simon, E. D. (Manchester, Withington)

    George, Major G. L. (Pembroke)

    Macfadyen, E.

    Simpson, J. Hope

    Gillett, George M.

    Mackinder, W.

    Sinclair, Major Sir A. (Caithness)

    Gosling, Harry

    Maclean, Nell (Glasgow, Govan)

    Smith, Ben (Bermondsey, Rotherhithe)

    Gould, Frederick (Somerset, Frome)

    Mansel, Sir Courtenay

    Smith, W. R (Norwich)

    Graham, W. (Edinburgh, Central)

    March, S.

    Snell, Harry

    Greenwood, A. (Nelson and Colne)

    Marks, Sir George Croydon

    Snowden, Rt. Hon. Philip

    Grenfell, D. R. (Glamorgan)

    Marley, James

    Spears, Brigadier-General E. L.

    Griffiths, T. (Monmouth, Pontypool)

    Martin, W. H. (Dumbarton)

    Spence, R.

    Groves, T.

    Maxton, James

    Spero, Dr. G. E.

    Grundy, T. W.

    Middleton, G.

    Spoor, B. G.

    Guest, J. (York, W. R., Hemsworth)

    Millar, J. D.

    Stamford, T. W.

    Hall, G. H. (Merthyr Tydvil)

    Mond, H.

    Stephen, Campbell

    Hamilton, Sir R. (Orkney & Shetland)

    Montague, Frederick

    Stewart, J. (St. Rollox)

    Hardie, George D.

    Morel, E. D.

    Sturrock, J. Leng

    Harvey, T. E. (Dewsbury)

    Morris, R. H.

    Thomas, Rt. Hon. James H. (Derby)

    Hastings, Sir Patrick

    Morrison, Herbert (Hackney, South)

    Thomas, Sir Robert John (Anglesey)

    Hastings, Somerville (Reading)

    Morse, W. E.

    Thompson, Luke (Sunderland)

    Haycock, A. W.

    Mosley, Oswald

    Thompson, Piers G. (Torquay)

    Healy, Cahir

    Moulton, Major Fletcher

    Thomson, Trevelyan (Middlesbro. W.)

    Hemmerde, E. G

    Muir, John W.

    Thorne, W. (West Ham, Pialstow)

    Henderson, Rt. Hon. A. (Burnley)

    Muir, Ramsay (Rochdale)

    Thurtle, E.

    Henderson, T. (Glasgow)

    Murray, Robert

    Tout, W. J.

    Henderson, W. W. (Middlesex, Enfld.)

    Murrell, Frank

    Trevelyan, Rt. Hon. C. P.

    Hillary, A. E.

    Naylor, T. E.

    Viant, S. P.

    Hindle, F.

    Newman, Sir R. H. S. D. L. (Exeter)

    Vivian, H.

    Hirst, G. H.

    Nichol, Robert

    Wallhead, Richard C.

    Hobhouse, A. L.

    Nixon, H.

    Watson, W. M. (Duntermline)

    Howard, Hon. G. (Bedford, Luton)

    Owen, Major G.

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Hudson, J. H.

    Paling, W.

    Webb, Rt. Hon. Sidney

    Isaacs, G. A.

    Parkinson, John Allen (Wigan)

    Westwood, J.

    Jackson, R. F. (Ioswich)

    Perry, S. F.

    Wheatley, Rt. Hon. J.

    Jenkins, W. (Glamorgan, Neath)

    Pethick-Lawrence, F. W.

    Whiteley, W.

    Jewson, Dorothea

    Phillipps, Vivian

    Wignall, James

    John, William (Rhondda, West)

    Pilkington, R. R.

    Williams, David (Swansea, E.)

    Johnston, Thomas (Stirling)

    Ponsonby, Arthur

    Williams, Col. P. (Middlesbrough, E.)

    Jones, Henry Haydn (Merioneth)

    Potts, John S.

    Williams, Lt.-Col. T.S.B. (Kennington)

    Jones, Rt. Hon. Leif (Camborne)

    Purcell, A. A.

    Williams, Maj. A.S. (Kent, Sevenoaks)

    Jones, Morgan (Caerphilly)

    Raffety, F. W.

    Williams, T. (York, Don Valley)

    Jones, T. I. Mardy (Pontypridd)

    Ramage, Captain Cecl Beresford

    Willison, H.

    Jowett, Rt. Hon. F. W. (Bradford, E.)

    Raynes, W. R.

    Wilson, C. H (Shefield, Attercliffe)

    Kay, Sir R. Newbald

    Rea, W. Russell

    Wilson, R. J. (Jarrow)

    Keens, T.

    Rees, Sir Beddoe

    Windsor, Walter

    Kennedy, T.

    Rees, Capt. J. T. (Devon, Barnstaple)

    Wintringham, Margaret

    Kenyon, Barnet

    Richards, R.

    Wood, Major M. M. (Aberdeen, C.)

    Lansbury, George

    Richardson, R. (Houghton-le-Spring)

    Wright, W.

    Laverack, F. J.

    Ritson, J.

    Young, Andrew (Glasgow, Partick)

    Law, A.

    Robertson, J. (Lanark, Bothwell)

    Lawernce, Susan (East Ham, North)

    Robinson, S. W. (Essex, Chelmsford)

    TELLERS FOR THE NOES.—

    Mr. Frederick Hall and Mr. Warne.

    Division No. 135.]

    AYES.

    [7.10 p.m.

    Agg-Gardner, Rt. Hon. Sir James T.

    England, Colonel A.

    Nicholson, William G. (Petersfield)

    Apsley, Lord

    Erskine, James Malcolm Monteith

    Ormsby-Gore, Hon. William

    Balfour, George (Hampstead)

    Falle, Major Sir Bertam Godtray,

    Penny, Frederick George

    Banner, Sir John S. Harmood-

    Ferguson, H.

    Perkins, Colonel E. K.

    Barclay, R. Noton

    Franklin, L. B.

    Peering, William George

    Barnston, Major Sir Harry

    Gaunt, Rear-Admiral Sir Guy R.

    Pielou, D. P.

    Becker, Harry

    Hacking, Captain Douglas H.

    Raine, W.

    Beckett, Sir Gervase

    Hannon, Patrick Joseph Henry

    Reid, D. D. (County Down)

    Berry, Sir George

    Harland, A.

    Remnant, Sir James

    Bird, Sir R. B. (Wolverhampton, W.)

    Harmsworth, Hon. E. C. (Kent)

    Richardson, Lt.-Col. Sr P. (Chertsey)

    Blades, Sir George Rowland

    Hartington, Marquess of

    Roberts, Samuel (Hereford, Hereford)

    Bourne, Robert Croft

    Harvey, C.M.B. (Aberd'n & Kincardne)

    Sandeman, A. Stewart

    Bowyer, Capt. G. E. W.

    Henn, Sir Sydney H.

    Savery, S. S.

    Buckingham, Sir H.

    Herbert, Dennis (Hertford, Watford)

    Scott, Sir Leslie (Liverp'l, Exchange)

    Bull, Rt. Hon. Sir William James

    Hillary, A. E.

    Sheffield, Sir Berkeley

    Bullock, Captain M.

    Hood, Sir Joseph

    Somerville, A. A. (Windsor)

    Burman, J. B.

    Howard, Hn. D. (Cumberland, Northn.)

    Somerville, Daniel (Barrow-in-Furness)

    Butt, Sir Alfred

    Howard-Bury, Lieut.-Col. C. K.

    Spender-Clay, Lieut.-Colonel H. H.

    Caine, Gordon Hall

    Huntingfield, Lord

    Stuart, Hon. J. (Moray and Nairn)

    Cautley, Sir Henry S.

    Jackson, Lieut.-Colonel Hon. F. S.

    Sutcliffe, T.

    Cayzer, Maj. Sir Herbt.R.(Prtsmth. S.)

    James, Lieut.-Colonel Hon. Cuthbert

    Turton, Edmund Russborough

    Chilcott, Sir Warden

    Jenkins, W. A. (Brecon and Radnor)

    Waddington, R.

    Clarry, Reginald George

    Kedward, R. M.

    Ward, Lt.-Col. A. L. (Kingston-on-Hull)

    Cohen, Major J. Brunel

    Lumley, L. R.

    Warrender, Sir Victor

    Craik, Rt. Hon. Sir Henry

    MacDonald, R.

    Watson, Sir F. (Pudsey and Otley)

    Crooke, J. Smedley (Deritend)

    Marriott, Sir J. A. R.

    Weston, John Wakefield

    Cunliffe, Joseph Herbert

    Mason, Lieut.-Col. Glyn K.

    Wilson, Sir C. H. (Leeds, Central)

    Curzon, Captain Viscount

    Meller, R. J.

    Wood, Sir H. K. (Woolwich, West)

    Davies, Alfred Thomas (Lincoln)

    Milne, J. S. Wardlaw

    Wragg, Herbert

    Davies, Sir Thomas (Cirencester)

    Mitchell, W. F. (Saffron Walden)

    Yate, Colonel Sir Charles Edward

    Dawson, Sir Philip

    Mitchell, Sir W. Lane (Streatham)

    Yelburgh, Major Robert D. T.

    Dixey, A. C.

    Moore-Brabazon, Lieut.-Col. J. T. C.

    Duckworth. John

    Morden, Colonel Walter Grant

    TELLERS FOR THE AYES.—

    Dunn, J. Freeman

    Nall, Lieut.-Colonel Sir Joseph

    Mr. A. M. Samuel and Commander

    Elveden, Viscount

    Nicholson, O. (Westminister)

    Burney.

    NOES.

    Ackroyd, T. R.

    Climie, R.

    Gosling, Harry

    Adamson, Rt. Hon. William

    Cluse, W. S.

    Gould, Frederick (Somerset, Frome)

    Adamson, W. M. (Staff., Cannock)

    Cobb, Sir Cyril

    Graham, W. (Edinburgh, Central)

    Alden, Percy

    Colfox, Major Wm. Phillips

    Greene, W. P. Crawford

    Alexander. A. V. (Sheffield, Hillsbro')

    Collins, Sir Godfrey (Greenock)

    Greenwood, A. (Nelson and Colne)

    Allen, R. Wilberforce (Leicester, S.)

    Collins, Patrick (Walsall)

    Grenfell, D. R. (Glamorgan)

    Alstead, R.

    Compton, Joseph

    Grenfell, Edward C. (City of London)

    Ammon, Charles George

    Comyns-Carr, A. S.

    Griffiths, T. (Monmouth, Pontypool)

    Aske, Sir Robert William

    Cope, Major William

    Groves, T.

    Atholl, Duchess of

    Cove, W. G.

    Grundy, T. W.

    Attlee, Major Clement R.

    Cowan, D. M. (Scottish Universities)

    Guest, J. (York, Hemsworth)

    Ayles, W. H.

    Crittall, V. G.

    Gulnness, Lieut.-Col. Hon. W. E.

    Baker, Walter

    Dalkeith, Earl of

    Hall, G. H. (Merthyr Tydvil)

    Banton, G.

    Darbishire, C. W.

    Harbord, Arthur

    Barnes, A.

    Davidson, Major-General Sir J. H.

    Hardie, George D.

    Barrie, Sir Charles Coupar (Banff)

    Davies, David (Montgomery)

    Harney, E. A.

    Batey, Joseph

    Davies, Rhys John (Westhoughton)

    Harvey, T. E. (Dewsbury)

    Benn, Captain Wedgwood (Leith)

    Davison, J. E. (Smethwick)

    Hastings, Sir Patrick

    Bentinck, Lord Henry Cavendish-

    Deans, Richard Storry

    Hastings, Somerville (Reading)

    Birchall, Major J. Dearman

    Dickie, Captain J. P.

    Haycock, A. W.

    Blundell, F. N.

    Dickson, T.

    Hayday, Arthur

    Bondfield, Margaret

    Dodds, S. R.

    Hemmerde, E. G.

    Bonwick, A.

    Dukes, C.

    Henderson, Rt. Hon. A. (Burnley)

    Bowerman, Rt. Hon. Charles W.

    Duncan, C.

    Henderson, A. (Cardiff, South)

    Bramsdon, Sir Thomas

    Dunnico, H.

    Henderson, T. (Glasgow)

    Briant, Frank

    Eden, Captain Anthony

    Henderson, W. W. (Middlesex, Enfld.)

    Broad, F. A.

    Edmondson, Major A. J.

    Hennessy, Major J. R. G.

    Bromfield, William

    Edwards, G. (Norfolk, Southern)

    Hindle, F.

    Brown, A. E. (Warwick, Rugby)

    Egan, W. H.

    Hirst, G. H.

    Brown, James (Ayr and Bute)

    Emlyn-Jones, J. E. (Dorset, N.)

    Hobhouse, A. L.

    Buchanan, G.

    Eyres-Monsell, Com. Rt. Hon. B. M.

    Hodge, Lieut.-Col. J. P. (Preston)

    Buckle, J.

    Falconer, J.

    Hoffman, P. C.

    Burnie, Major J. (Bootle)

    Fisher, Rt. Hon. Herbert A. L.

    Hogg, Rt. Hon. Sir D. (St. Marylebone)

    Butler, Sir Geoffrey

    FitzRoy, Capt. Rt. Hon. Edward A.

    Hohler, Sir Gerald Fitzroy

    Cayzer, Sir C. (Chester, City)

    Fletcher, Lieut.-Com. R. T. H.

    Hope, rt. Hon. J. F. (Sheffield, C.)

    Cecil, Rt. Hon. Sir Evelyn (Aston)

    Foot, Isaac

    Howard, Hon. G. (Bedford, Luton)

    Cecil, Rt. Hon. Lord H. (Ox. Univ.)

    Gardner, B. W. (West Ham, Upton)

    Hudson, J. H.

    Chamberlain, Rt. Hn. J. A. (Birm. W.)

    Gardner, J. P. (Hammersmith, North)

    Hughes Collingwood

    Chamberlain, Rt. Hon. N. (Ladywood)

    Gates, Percy

    Isaacs, G. A.

    Chapman, Sir S.

    Gavan-Duffy, Thomas

    Jackson, R. F. (Ipswich)

    Chapple, Dr. William A.

    George, Major G. L. (Pembroke)

    Jenkins, W. (Glamorgan, Neath)

    Charleton, H. C.

    Gibbins, Joseph

    Jewson, Dorothea

    Clarke, A.

    Gilbert, James Daniel

    John, William (Rhondda, West)

    Clayton, G. C.

    Gillett, George M.

    Johnston, Thomas (Stirling)

    2058

    2059

    Jones, Henry Haydn (Merioneth)

    Murrell, Frank

    Stanley, Lord

    Jones, Rt. Hon. Leif (Camborne)

    Naylor, T. E.

    Starmer, Sir Charles

    Jones, Morgan (Caerphilly)

    Newman, Sir R. H. S. D. L. (Exeter)

    Steel, Samuel Strang

    Jones, T. I. Mardy (Pontypridd)

    Nichol, Robert

    Stephen, Campbell

    Jowett, Rt. Hon. F. W. (Bradford,E.)

    Nield, Rt. Hon. Sir Herbert

    Stewart, J. (St. Rollox)

    Jowitt, W. A. (The Hartlepools)

    Nixon, H.

    Sunlight, J.

    Kay, Sir R. Newbald

    O'Grady, Captain James

    Tattersall, J. L.

    Keens, T.

    Owen, Major G.

    Terrington, Lady

    Kennedy, T.

    Paling, W.

    Thomas, Rt. Hon. James H. (Derby)

    Kenyon, Barnet

    Palmer, E. T.

    Thomas, Sir Robert John (Anglesey)

    King, Capt. Henry Douglas

    Pattinson, S. (Horncastle)

    Thompson, Piers G. (Torquay)

    Lansbury, George

    Perry, S. F.

    Thomson, F. C. (Aberdeen, South)

    Laverack, F. J.

    Pethick-Lawrence, F. W.

    Thomson, Trevelyan (Middlesbro, W.)

    Law, A.

    Philipson, Mabel

    Thomson, Sir W.Mitchell-(Croydon,S.)

    Lawrence, Susan (East Ham, North)

    Phillipps, Vivian

    Thorne, G. R. (Wolverhampton, E.)

    Lawson, John James

    Pilkington, R. R.

    Thorne, W. (West Ham, Plaistow)

    Leach, W.

    Potts, John S.

    Thornton, Maxwell R.

    Lee, F.

    Pownall, Lieut.-Colonel Assheton

    Thurtle, E.

    Lessing, E.

    Purcell, A. A.

    Titchfield, Major the Marquess of.

    Lindley, F. W.

    Raffety, F. W.

    Tout, W. J.

    Linfield, F. C.

    Ramage, Captain Cecil Beresford

    Trevelyan, Rt. Hon. C. P.

    Livingstone, A. M.

    Raynes, W. R.

    Turner, Ben

    Loverseed, J. F.

    Rea, W. Russell

    Vaughan-Morgan, Col K. P.

    Lowth, T.

    Rees, Sir Beddoe

    Viant, S. P.

    Lunn, William

    Rees, Capt. J. T. (Devon, Barnstaple)

    Vivian, H.

    McCrae, Sir George

    Rhys, Hon. C. A. U.

    Wallhead, Richard C.

    McEntee, V. L.

    Richards, R.

    Ward, Col. J. (Stoke-upon-Trent)

    Macfadyen, E.

    Richardson, R. (Houghton-le-Spring)

    Warne, G. H.

    Mackinder, W.

    Ritson, J.

    Watson, W. M. (Dunfermline)

    Maclean, Neil (Glasgow, Govan)

    Robertson, J. (Lanark, Bothwell)

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Macnaghten, Hon. Sir Malcolm

    Robertson, T. A.

    Webb, Rt. Hon. Sidney

    Macnamara, Rt. Hon. Dr. T. J.

    Robinson, S. W. (Essex, Chelmsford)

    Wells, S. R.

    Maltland, Sir Arthur D. Steel-

    Robinson, Sir T. (Lancs, Stretford)

    Westwood, J.

    Makins, Brigadier-General E.

    Romeril, H. G.

    Wheatley, Rt. Hon. J.

    Mansel, Sir Courtenay

    Ropner, Major L.

    Whiteley, W.

    March, S.

    Rose, Frank H.

    Wignall, James

    Marks, Sir George Croydon

    Roundell, Colonel R. F.

    Williams, A. (York, W. R., Sowerby)

    Marley, James

    Royle, C.

    Williams, David (Swansea, E.)

    Martin, F. (Aberd'n & Kinc'dine, E.)

    Samuel, Samuel (W'dsworth, Putney)

    Williams, Col. P. (Middlesbrough, E.)

    Martin, W. H. (Dumbarton)

    Scrymgeour, E.

    Williams, Lt.-Col. T.S.B. (Kennington)

    Masterman, Rt. Hon. C. F. G.

    Scurr, John

    Williams, Maj. A.S.(Kent,Sevenoaks)

    Maxton, James

    Seely, H. M. (Norfolk, Eastern)

    Willison, H.

    Middleton, G.

    Sexton, James

    Wilson, C. H. (Sheffield, Attercliffe)

    Millar, J. D.

    Shepperson, E. W.

    Wilson, R. J. (Jarrow)

    Mills, J. E.

    Sherwood, George Henry

    Windsor, Walter

    Mitchell,R. M.(Perth & Kinross, Perth)

    Short, Alfred (Wednesbury)

    Windsor-Clive, Lieut.-Colonel George

    Mond, H.

    Simon, E. D. (Manchester, Withington)

    Wintringham, Margaret

    Montague, Frederick

    Simpson, J. Hope

    Wise, Sir Fredric

    Morel, E. D.

    Sinclair, Major Sir A. (Caithness)

    Wood, Major Rt Hon. Edward F. L.

    Morris, R. H.

    Smith, Ben (Bermondsey, Rotherhithe)

    Wood, Major M. M. (Aberdeen, C.)

    Morrison, Herbert (Hackney, South)

    Snell, Harry

    Woodwark, Lieut.-Colonel G. G.

    Morrison, R. C. (Tottenham, N.)

    Snowden, Rt. Hon. Philip

    Wright, W.

    Morrison-Bell, Major A. C. (Honiton)

    Spence, R.

    Young, Andrew (Glasgow, Patrick)

    Morse, W. E.

    Spencer, H. H. (Bradford, South)

    Mosley, Oswald

    Spero, Dr. G. E.

    TELLERS FOR THE NOES.—

    Moulton, Major Fletcher

    Spoor, B. G.

    Mr. Frederick Hall and Mr. Allen

    Muir, John W.

    Stamford, T. W.

    Parkinson.

    Murray, Robert

    NEW CLAUSE.—(Amendment of 10 and 11 Geo. V., c. 18, s. 15 (1).)
    In estimating the income of the previous year for an assessment of Super-tax, there shall be deducted the amount of Income Tax for each previous year which the individual shall have paid or be liable to pay.—[Mr. Hannon.]
    Brought up, and read the First time.
    Mr. HANNON: I beg to move, "That the Clause be read a Second time."
    This Clause brings before the Committee and the Chancellor of the Exchequer what I think is a very old grievance in relation to Income Tax administration. The Clause simply seeks
    2042
    to re-arrange the present methods of collecting Income Tax so as to give the Super-tax payer some credit for the Income Tax which he has previously paid, and which, in point of fact, never came into his possession at all. One would imagine that, in strict equity, if a man has paid, or is liable to pay, Income Tax he should be allowed that measure of abatement in the calculation of his Super-tax.
    The Chancellor may say that Super-tax is graded according to income, and that in the fixing of the gradation of Supertax, account was taken of the fact that no concession had been made on

    2043
    Income Tax previously paid or due to be paid, but even the gradation of Super-tax is not a justification for making the Income Taxpayer pay upon income which never goes into his pocket at all. We have had this question before the House several times. It affects a very considerable number of people who are largely concerned with industrial enterprises, and is a burden imposed upon those whose incomes are mainly contributing to the enlargement of the available working capital for industry. I would ask the right hon. Gentleman, notwithstanding the differences which are so apparent between us from time to time, to consider this Clause from the point of view of equity and of common sense. He knows better than anyone that one of the canons of taxation is that it must be just to the individual. Here you are actually taxing a man upon income which never goes into his pocket at all and from which he will derive no sort of benefit except contributing to the maintenance of the State. It is only fair to ask that some sort of consideration should be given to the Income Taxpayer from that point of view.
    Mr. SNOWDEN: The point of the Clause, which I can dispose of in a very few sentences, is to relieve Super-taxpayers of a very considerable part of the Income Tax and Super-tax which they pay under the existing method of assessment If the suggestion were adopted it would add to the injustice which may be felt by certain grades of Super-taxpayers. It would destroy the fairly regular grading which prevails at present in the assessment of Super-tax. The operation of this Clause would be to give far greater relief to Super-taxpayers with large incomes than to Super-taxpayers who have smaller incomes. For instance, the tax relief which would be given under the Clause to a. Super-taxpayer who was just above the exemption limit for Super-tax, say with an income of£2,100 a year, would be 1·86 per cent., but in the case of an income of£4,000 the effect would be a reduction of 10 per cent., and when we get to an income of£50,000 a year there would be a reduction of 14 per cent. The hon. Member would have no reason for saying that if this concession were made it would be a relief to the Income Taxpayer. It would not. I do
    2044
    not know if he knows what his proposal would cost. It would cost£20,000,000 a year. If I made that remission I should have to find the revenue from some other source, and there is only one source from which I could find it. I should have to impose increased taxation upon the same class that I have relieved by accepting this Clause. In the last two years Income Taxpayers have had remissions of taxation amount to£80,000,000 a year, and an enormous part of that has gone to the very people for whom the hon. Member is now pleading, and for whom he is asking a further remission of£20,000,000.
    Mr. HANNON: And whose capital is invested in the industries of the country.
    Mr. SNOWDEN: Not necessarily. At any rate there have been remissions of£80,000,000 in the last two years and the hon. Member is now suggesting another£20,000,000. I think the demand is perfectly preposterous and I am sure the Committee will not entertain it.
    Mr. HANNON: Does the right hon. Gentleman really think the present proportion between direct and indirect taxation is fair?
    Mr. SNOWDEN: That does not arise at all. We have had that question debated almost ad nauseam.
    Mr. A. M. SAMUEL: I do not take the same line as my hon. Friend below me, but the Chancellor of the Exchequer has gone off very adroitly at a tangent, and I should like to put my own point of view about the Clause. I support it but I do not ask for any remission of taxation. I do not ask for a single penny to be taken off so far as I am a Super-tax payer. All I ask is that I should pay Super-tax on what I have received. If you need to put the tax up do so and, if the small Income Tax payer who becomes a Super-tax payer receives by the new arrangement a less benefit than the big Super-tax payer, adjust the tax rate so that the taxpayer, whether big or small, pays to the State exactly the same amount that he contributes now. Suppose, for example, that I have£3,000 a year. The Income Tax at 4s. 6d. on that would be roughly£700. But I am assessed to Super-tax on£3,000, which I have not received. I have only received£2,300. I may be assessed for Super-tax at X shillings in the£. Let

    2045
    us call it 3s. I would rather pay the rough equivalent, say, 4s. in the£and be assessed on£2,300 than pay 3s. in the£and be assessed on£3,000. Let it be seen by the public that those who pay Super-tax are paying a higher rate on their incomes than the present rate of figures show. If I pay 4s. 6d. in the£Income Tax and 3s. more for Super-tax, people say I am paying 4s. 6d. and 3s. on my income. I am not. I am paying more likely 4s. 6d. and 4s. I am willing to pay the State what I am paying now but I ask to be assessed so that the truth shall come out as to what I am receiving and what I am really paying.
    Sir BEDDOE REES: It is probably my fault, but I cannot possibly follow the hon. Gentleman who has just sat down. I think there is a certain amount of confusion. Whether we pay Income Tax or Super-tax, it comes to the same thing. I think if we look upon it from the point of view that Super-tax is merely an additional Income Tax, we get the right point of view. At present we pay Income Tax up to£2,000 a year at 4s. 6d. in the £ and from that point we have a graduated Income Tax which we call Super-tax. I wish the word were abolished. If we had instead a graduated Income Tax, I think the Exchequer would not suffer and the general public would certainly understand it. Income Tax payers are paying a bigger sum than appears in many returns. I have every sympathy with those who have endeavoured to reduce the Income Tax. I moved to reduce it by 6d. on the Budget Resolution, but the Chancellor could not see his way to accept it. I wish he had. But I have very little sympathy when we come to deal with Super-tax. Those who have to pay Income Tax should not be unduly assessed, but I fail to see that there is any advantage to be gained from the Clause. So far as I understand it, what is proposed is that the sum that is paid in Income Tax shall be deducted from the total amount when it comes to assessment for Super-tax. Surely you are going to give a certain section of the taxpayers an advantage to which they are not entitled. I fail to see why we should be called upon to support this Clause. There are many others on the Paper which appeal to me very much more than this. There are two or three that I shall move myself. I hope the Chancellor may be persuaded to give us something. I am
    2046
    amazed when he tells us this would cast the colossal sum of£20,000,000. That in itself is sufficient to destroy any hope of its being accepted, and I hope that it will be withdrawn.
    Lieut.-Commander BURNEY: I agree with the hon. Member who has just spoken in regard to the difference between Income Tax and Super-tax, but it makes very little difference because Income Tax and Super-tax are graded from 4s. 6d. in the£right up to 11s in the £ There is one point the right hon. Gentleman did not deal with at all. Super-tax is paid not in the year in which the income is received, but in the year following. It should be deducted in the year in which it is due, because the fact that it is paid a year later presupposes that there is a stable price level. During the slump in 1920 many individuals and firms earned very large incomes and were assessed to Super-tax a year later, and they had to pay on an altogether different price level from that at which they received their money. In some cases they paid perhaps not 6s. in the£Super-tax, but probably 12s., because between 1920 and 1922 the price level varied from about 330 to 180. That seems to me to raise the whole question of the Budget. We have had no statement whatever as to what is the monetary policy of the Government, and whether they are going to maintain the price level at any given figure. Therefore the Clause has to be viewed not only from the technical point of view, to which the Chancellor very cleverly tried to turn the Committee's attention, but one has to consider it in regard to the whole monetary policy of the Government. It is impossible for any person to deal with any of these Amendments unless they know what is the fundamental basis of the Chancellor of the Exchequer's Budget, and what is the condition precedent to an estimate of any revenue. The whole question of an estimate of revenue must necessarily be based upon the price level in the country. That brings into question what is the attitude of the Government in regard to its monetary policy.
    The CHAIRMAN: I have been patient with the hon. Member. He seems to have gone wide of the Amendment.
    Lieut.-Commander BURNEY: I am sorry if I have gone wide of the Amendment. The point I am trying to make is that so long as taxes are paid in a

    2047
    different year from that in which they are received, and so long as the monetary policy of the Government is unstable, it is impossible to get a fair measure of taxation with any acceptable incidence of any certain tax. It is for that reason that I hope the Chancellor of the Exchequer will arrange, if he is in office next year when the next Budget is introduced, that there shall be some regard paid to that point.
    Question, "That the Clause be read a Second time," put, and negatived.

    NEW CLAUSE.—(Amendment of Finance Act, 1922, s. 21 (1).
    Section twenty-one, Sub-section (1), of the Finance Act. 1922, shall be amended so that the words "The said reasonable part of such income" shall be substituted for the words "The said income." in line fourteen of the Sub-section.—[Mr. A. M. Samuel.]
    Brought up, and read the First time.
    Mr. SAMUEL: I beg to move, "That the Clause be read a Second time."
    This is merely a drafting Amendment of the Act as it now stands. We wish to insert the words "reasonable part of such." We propose this new Clause in order to bring the first part of the first
    2060
    Sub-section of Section 21 of the Act of 1922 into complete harmony with the concluding words of the same Sub-section. We are trying to make the first part of the first part of the Sub-section harmonise with the words of the last part of the Sub-section, which read:
    "Provided that in determining whether any company has or has not distributed a reasonable part of its income as aforesaid the Commissioners shall have regard not only to the current requirements of the company's business, but also to such other requirements as may be necessary or advisable for the maintenance and development of that business."
    Under Section 21 of the Act of 1922 the Company to which this Section applies must distribute a, reasonable part of its

    2061
    profits so that the recipients will include that proportionate amount in their Super-tax returns. If the company does not distribute a reasonable part of its profits the Commissioners may direct that, for the purposes of assessment of its members for Super-tax, the said income of the company from all sources shall for the year or other period be deemed to be the income of the members. What is the "said" income? Why not "reasonable part"? I took a considerable part in getting this Clause substituted and put into the Act of 1922, and after remarks I made in the Debate upon the original Clause the late Chancellor of the Exchequer got up and said he would withdraw his original Clause. We had a consultation with him behind the Chair, and he then undertook to draw up this present Clause which we now seek to amend. We had no idea when we agreed to the Clause that it would be interpreted in the way it has been. We had no idea of the ambiguities that would arise out of it. May I give an instance to illustrate what I mean? If a company has made £20,000 in the year and it has decided to distribute £12,000 to its members and to hold back £8,000 for the development of the company, that may be thought to be a reasonable amount to hold back, and the Commissioners may consider it reasonable and accept £12,000 for Super-tax purposes; but if, by chance, the company has distributed only £11,000 and has reserved £9,000 the Commissioners may come along and say, "You have not distributed a reasonable amount," and then they have power under this Act to fix the assessment, not at the admittedly reasonable£12,000, but at£20,000, the whole amount of the profits for the year; and not the reasonable part of the profits. That is, I submit, a great hardship for the company, and it really defeats the intention of the Act, which provides for regard to be had for the maintenance and development of the concern. I suggest we ought to give the Commissioners discretion, and we can do that by importing into the Clause the words "reasonable part of the income," thereby making the earlier part of the Clause harmonise with the closing words of the Sub-section. For that reason, I beg to move that this new Clause be read a second time.
    The FINANCIAL SECRETARY to the TREASURY (Mr. William Graham): I am going to ask the hon. Member not
    2062
    to press this new Clause, because its effect will go very far beyond what he himself thinks. The Amendment in the Act of 1922 to which he has referred was designed to impose a check upon attempts to evade the payment of Super-tax. Where the amount distributed was regarded as a reasonable part of the income the Special Commissioners were given power to assess the income accordingly. I believe the difficulty suggested by the hon. Member has been more than met by the proviso which was inserted in the Act of 1922 to the effect that the Commissioners, in fixing the amount of the income, should have regard not only to the current requirements of the company but also to the needs of the business from the point of view of future development. I am advised that the effect of the hon. Member's new Clause would be to weaken the protective value of this Clause from the point of view of the evasion of Super-tax, and it would tend to put these people in a position to evade that Super-tax. If there is any doubt or ambiguity about the effect of the proviso in the Act of 1922 the Government would agree with the hon. Member in trying to remove it, provided also that we do not in any way weaken the safeguard which the Clause is intended to provide. If therefore the hon. Member will withdraw the Clause I am quite willing to look into the matter to see if there is any ambiguity as he has stated, and to try and remedy it between now and the Report stage. But we cannot possibly do anything which would weaken the Clause as regards the protection it affords against the evasion of the payment of Super-tax.
    Mr. SAMUEL: I am obliged to the hon. Gentleman, and I think if he will look at this matter from our point of view he will agree with our argument Let me say here and now we do not desire for a moment to weaken the safeguards of the Clause against Super-tax evasion. We will assist the hon. Gentleman in every possible way to get his proper and fair Super-tax, but I want to point out again that if a company has earned £20,000, and it can be deemed reasonable that it should distribute only £12,000 and reserve £8,000 for future requirements, we desire to have it made clear that the Commissioners have the power, if they think£12,000 is the right amount to distribute, and that they should assess the

    2063
    distributable income at £12,000, and not at £20,000, as they do now. They must be free to make allowance for the maintenance and development of the business. If the hon. Gentleman will meet us on these lines we will withdraw the Clause, as we have no wish to do anything to defeat the original intentions of the Clause as to Super-tax. I am certain that the way in which the Treasury or Revenue has interpreted the Clause is very penalising and unfair. If the hon. Gentleman is willing to come to some arrangement with us as to an amending Clause, I will withdraw my Clause on the understanding that he will not allow the Clause in the Act in future to be interpreted without discretion allowed to the Commissioners, as it is at the present moment.
    Mr. D. HERBERT: May I just remind the hon. Gentleman of an Amendment which stands in my name further down on the Paper to the effect that
    "The amount of income of any company which under Section 21 of the Finance Act, 1922, the Special Commissioners may direct shall for the purpose of assessment to Super-tax in any year or other period, be deemed to be the income of the Members, shall notwithstanding anything in that Section contained not exceed such part of the income of the company as for the purpose of that Section shall be a reasonable part thereof for the company to distribute."
    This Amendment is intended to meet the case quoted by my hon. Friend, and it does so in somewhat different words. I suggest there should be no difficulty in the Government accepting my Amendment. I would remind the Financial Secretary that I sent him a draft of that Amendment two or three weeks ago when the question had been raised in the City of London, and it had been assumed by some financial papers and authorities that there was an error in the drafting of the Finance Bill. For my part I have not the slightest doubt whatever that that is so. The hon. Member for Farnham (Mr. Samuel) will remember that it was due to an Amendment moved by me that the first draft of the Clause was withdrawn altogether, and the right hon. Member for Hillhead (Sir R. Horne) subsequently put in the present Clause. Never for one moment was it suggested that the person who honestly made a mistake or had a difference of opinion with the Income Tax
    2064
    Commissioners as to what was a reasonable amount to be distributed should be penalised simply because of an error of judgment. That seems to me to be grossly unfair. In view of the fact that the Government, until this afternoon, have given us no hope whatever of what they intend to do—on the contrary, the Financial Secretary wrote definitely to me that he feared there was no chance of the Government accepting my Amendment—and after what has passed now, I ask to have something a little more definite than the statement of the Financial Secretary, before this Amendment is withdrawn. I hope my hon. Friends will press with me for an assurance that, in any case, we shall receive the support of the Government in some Amendment which shall rectify the particular unfair penalty in the Clause as it now stands.
    Mr. H. H. SPENCER: This Amendment was put down on behalf of the Association of Chambers of Commerce. I appreciate the assurance that the Financial Secretary has given the Committee, but I think we might ask for some rather more definite assurance. I feel certainly that the Financial Secretary will agree with me in this. It is not an attempt in any way to enable the one-man company to dodge its Super-tax. I think the whole House agrees that the formation of a small company for the express purpose of not dividing the profits to dodge Super-tax is a thing we want to stop. But there are many companies which, for various purposes, do not wish to divide a great proportion of their profits. It may be that a company is in a bad financial position. There are hundreds of companies to-day, after the 1920 slump, who are only carrying on because their banks are allowing them to do so on the proviso that the profits shall go to reduce the assistance that the banks have given to them. If the members of that company do better, we do not ask for a moment that they shall be relieved from paying their Super-tax, but we do ask that if, for one reason or another, they decide not to distribute their profits, a reasonable arrangement shall be made between the Inland Revenue and the members of that company as to what a reasonable distribution is. At the present time the Commissioners of Income Tax have no power to make a reasonable arrangement. If they disagree as to the

    2065
    amount that should be divided, they are compelled to charge Super-tax on 100 per cent. of the profits. If the Financial Secretary will say that he will put in words which will meet that great hardship—and we do not want to assist anybody to dodge their fair Super-tax—I shall be only too glad, as my name is on the Amendment and as I am speaking as the secretary of the Associated Chambers of Commerce, to join my hon. Friend in withdrawing this Amendment. The Financial Secretary should bring in words to give a reasonable relief to the people who are unable, very often because of the financial pressure from their banks, to distribute their profits.
    Mr. NEVILLE CHAMBERLAIN: I think we have now a pretty clear idea of what it is we want to do, and what it is we do not want to do, in making any alteration in the law as it at present stands. I examined the Amendment with some care, and whilst I agree with the object of my hon. Friend the Member for Farnham, I do not think the Amendment is drafted in a way which the Financial Secretary could accept as it stands. In the Act itself the Special Commissioners are not directed to say what is a reasonable amount to be distributed by the company; they are only directed to say what is not a reasonable amount. I do not think the words, therefore, could stand as they are, because there is no reasonable amount mentioned in the Act. That objection, as the hon. Member for Watford (Mr. D. Herbert) has pointed out, does not appply to the Amendment which stands in his name. This Clause says that the amount to be charged is not to exceed such part of the income of the company as, for the purpose of that Section, shall be a reasonable part thereof for the company to distribute. That does not seem clearly to indicate who is to decide what is a reasonable part, but I want to suggest to the Financial Secretary that, if he amended the last line, so as to make it clear by whose authority the reasonable part ought to be decided, he might then quite well give an undertaking that he will accept the Clause of my hon. Friend in the words in which it is put down.
    Mr. D. HERBERT: My Amendment was particularly drawn in such a way as to meet the point raised. It is not to exceed such part of the income of the
    2066
    company as, for the purpose of that Section, shall be a reasonable part, and what is to be a reasonable part for the purpose of that Section is the very point which, under the Section as it at present stands, the Commissioners have to decide.
    Mr. CHAMBERLAIN: I do not quite agree. If the hon. Member will read the Section he will see that the Commissioners are not directed to say what is a reasonable part, but only what is not a reasonable part.
    Mr. KEENS: There is one point in Section 21 of the Act of 1922 in which there is a refund of Corporations Profits Tax in respect of the amount that is charged for Super-tax, and it therefore follows that Section 21 is entirely disturbed, and it is necessary that the whole matter should be taken into consideration. In dealing with this matter it is desirable to have regard to the actual position as we find it. In the case of a company that has not distributed a reasonable part of its income, it is the practice to treat that limited company as though it were a partnership, and the assessment therefore made upon the company for Income Tax—which forms the basis of the assessment for Super-tax, which is levied upon the person in the name of the company, as mentioned in Section 21—is not the amount of the distributable profits, but the amount of statutory income, calculated according to the Income Tax Act. As the Corporation Profits Tax ceases to be levied for any accounting period after the 30th June, the whole balance of the, treatment under this Section is lost, and I suggest to the Financial Secretary that he should agree, if this Clause is withdrawn, that the parties interested should be called into consultation, so that a new Clause should be inserted which restores the balance under the Act of 1922. No one who has had experience in the working of this Section will agree that the decision of the Special Commissioners as to the way in which this operates is what was intended when the Finance Act, 1922, was passed. It, was clearly intended then that a reasonable amount should be distributed, and that the reasonable amount should be brought into charge, but now we have the view of the Special Commissioners, who have held that they have no discretion in the matter if they have the slightest difference

    2067
    as to what they find is a reasonable amount, and they have no alternative but to bring in the whole assessment and to make that liable for Super-tax. That was not intended by the Finance Act, 1922. What is a reasonable amount must always be a matter of opinion, as it frequently happens that this is a matter of keen controversy between the directors. It is especially unfair that on a decision of the Special Commissioners as to what is a reasonable amount, and that amount differs from the view of the directors, the whole amount must be brought into charge for Super-tax. It must be remembered that the Special Commissioners are adjudicating at a later date, when it may be experience has falsified the perfectly justifiable expectations of the directors. I appeal to the Financial Secretary to the Treasury to come to the arrangement suggested by the hon. Member for Farnham (Mr. A. M. Samuel), so that the parties interested may find what is the real position contemplated by the Act of 1922, affected by the position as we find it to-day.
    Mr. W. GRAHAM: From the practical experience of Members of the Committee, there is a difference of opinion, not confined to one part of the House, as to the way in which this Section in the Act of 1922 works out. My own impression of the distribution has always been that there is adequate safeguard in the proviso to the main part of the Act of 1922, that part which I quoted earlier in the Debate, which indicates that regard must be had
    "not only to the current needs of the company's business, but also to such other requirements as may be necessary or advisable for the maintenance and development of that business."
    As I said earlier, if hon. Members will agree to withdraw their Clause, I will undertake to consult with them between now and the Deport stage, subject to the condition that there must be no weakening of this Section from the point of view of the safeguards against the one-man companies. On that basis, it is a matter which we might clearly discuss. Perhaps my hon. Friend will withdraw the Clause.
    Mr. HERBERT: Might I be allowed to put one further question? The proviso which an hon. Member put in at the end of his words just now, I am sorry to say does not altogether please me,
    2068
    because I have had it indicated to me pretty strongly in this letter, to which I have referred, that there was, a short time ago, a definite difference of opinion between the Government and ourselves, and, therefore, with all respect, and I hope the hon. Member will not think I am saying it offensively, I do not think that I quite like the proviso. I would rather like the Financial Secretary, if he prefers my Amendment to my hon. Friend's, to accept my Amendment. Let that go in now and then we shall have an earnest that this matter will be dealt with on the Report stage.
    Mr. A. M. SAMUEL: Let us be clear on this, as it is of so much importance to us, and the revenue does not get very much out of it one way or the other. Will the Financial Secretary meet us and see if we can draw up an Amendment to be put in on the Report stage? We shall be perfectly satisfied if he will merely adopt the words already in the Act.
    Question, "That the Clause be read a Second time," put, and negatived.

    NEW CLAUSE.—(Explanation of Income Tax deductions.)
    All persons, firms, or companies making payments by warrant or cheque of interest or dividends from which Income Tax is deducted shall, on making such payments, state as a separate calculation applicable to each payment the gross amount of interest or dividend due, the amount and rate of Income Tax deducted, and the net amount payable.—[Mr. A. M. Samuel.]
    Brought up, and read the First time.
    Mr. SAMUEL: I beg to move, "That the Clause be read a Second time."
    For some few years the secretaries of various companies have—I do not know why; it may be laziness—have omitted to give the same details of tax deduction on their dividend warrants as they gave in the past.. All that we ask that they should do is to adopt the same practice as that followed by the Bank of England. You cannot have a better model than that. When the Bank of England pays a dividend it shows on the dividend statement what the capital is, the rate and amount of Income Tax taken off, what the gross amount of interest or dividend is, and the net amount payable after the Income Tax is deducted. That is all we ask. I have here the top of a dividend warrant issued by one of the great railway companies. It was sent to me by a constituent. I am accustomed to these things, but I have had to take some time

    2069
    to unravel it. Apparently the person concerned had £499 in deferred stock. The dividend statement on the warrant shows that on each £100 of stock the gross dividend payable is £3 10s. less Income Tax at 4s. 7 ½d., 16s. 2¼d., net dividend£2 13s. 9 ¾d. Then the net amount is given as£13 8s. 6d. That is not the way to draw out a dividend warrant statement. The proper way is this. It should state: The capital is£499, the gross annual rate of dividend is£3 10s. per cent. Then it should show the gross dividend will amount to£17 9s. 3d. Then it should take off the Income Tax, stating what the rate is, 4s. 7 ½d. in the£, and that the total tax is £4 0s. 9d., and then it should show a net dividend payable of£13 8s. 6d.
    I do not like to say anything unkind of anyone, but it is gross impudence for the secretary of a great company to send out a warrant in the way complained of. This is a company with perhaps£300,000,000 of capital. The warrant is sent out in a lazy manner and the recipient will have trouble to unravel it. If my words can go further than this Chamber to-day I would say that if the proprietor of an investment in any company or concern receives a dividend warrant made out in a befogging way, or so that he cannot understand it, he should at once write and make himself very unpleasant to the secretary of the company. Proprietors should make the secretaries of companies realise that they are the servants of the proprietors, and not the proprietors the servants of the secretaries. Perhaps the Financial Secretary to the Treasury will, accepting the clause further my intention. Large numbers of people throughout the country have to make claims for repayments, and an immense amount of work trouble it gives inspectors and surveyors of taxes to unravel these things for taxpayers. That must be putting the revenue to a considerable expense. If the calculation were drawn out in a more lucid manner it would be much easier for the special commissioners, also, to understand what are the amounts at which Super-tax assessments are to be made. I will read a letter which I have received from a man totally unknown to me. He is not even in my own constituency, but he saw that I had put this Amendment on the Paper and this is what he wrote:
    "I am delighted to see that you are bringing forward a Motion with regard to
    2070
    the above (deduction of Income Tax from dividend). You will earn the hearty thanks of hundreds of people with small incomes who year after year have to make a claim for the recovery of Income Tax overcharge. I think companies evade their duty. They are bound to deduct the tax but they give you neither the amount of your dividend nor the amount of tax to be deducted, only a statement, worked out perhaps to three placer of decimals for a guide. I do not believe Parliament ever intended that slipshod method to be adopted. In my opinion it is a piece of impertinence on the part of directors to treat their shareholders in such a manner—the men who actually pay for offices and in many cases a costly staff."
    Whether it is in the power of the Secretary to the Treasury to put my Clause into operation or not I do not know, but I think that the ventilation here of this grievance ought to do some good, and may relieve many of the people of smaller incomes of a grievance of which they have every right to complain.
    Sir B. REES: I would like to add a few words to what the last speaker has said. In all these matters the Government should show a very good example themselves. In the Debate last week one hon. Gentleman pointed out that the Government in making their deduction from salaries paid to civil servants omitted to tell the civil servants on what rate the tax was based and how it was made up. If the Amendment were altered to include Government Departments as well, it would be a very good thing. As far as the Amendment is concerned, I hope that the Government will accept it for this special reason: A large number of poor people are paid very small dividends. They are not subject to Income Tax at all. They have great difficulty in reclaiming the amount so deducted by the Income Tax authorities. If there were stated on the Warrants not only the total amount, but the rate as well, it would be of great service when recipients came to reclaim the money from the Income Tax authorities.
    Mrs. PHILIPSON: I also wish to support this Amendment, which has been so ably brought forward by the hon. Member for Farnham (Mr. A. M. Samuel). I have no words to add to his plea to the Financial Secretary to the Treasury, except to ask the Financial Secretary to do his best in the matter, because I also have had complaints from many hundreds of women and men, who are absolutely at a loss to understand these warrants.
    Mr. W. GRAHAM: It is very difficult for some of us, who have advocated for years the fullest publicity in all industrial and financial transactions, to resist an Amendment of this kind. A word of explanation is necessary. A very large number of companies do show the full amount of the dividend which is due, and side by side with that the deduction of Income Tax at 4s. 6d. in the£, and then the net amount of dividend payable to the recipient. I should imagine that in such a case there should be no complaint of any kind. The Committee will observe, however, that this Amendment is directed only to the cases where dividend is paid subject to deduction of Income Tax, and as the Amendment is drawn, it is quite clear that it would not cover the very large number of cases where the dividend is paid free of tax, and, strictly speaking, it is in this category that the main difficulty arises. It demands of the recipient a calculation which he or she cannot make, or it compels the recipient to adjust the matter afterwards through a kindly tax officer, who will undertake the task. As drawn, the Amendment would not fully meet the situation.
    There are very large industrial concerns which have used the argument that, if a Clause of this kind were inserted in the Bill, it would involve a very large addition to their clerical staff. They have also suggested that it might add to the delay in the payment of dividend. These two arguments do not make a very strong appeal to me, because in the interests of publicity they must take proper steps to overcome a difficulty of the kind. After that explanation, perhaps the Clause can be withdrawn, and I will undertake to consult with the hon. Member for Farnham (Mr. A. M. Samuel) and others who are interested, before the Report stage of the Bill, with a view of framing a Clause which either the hon. Member for Farnham or the Government can put on the Paper in order to achieve the end which he has in view. I am advised that there would be no difficulty in adjusting a Clause of that kind, subject to the consideration that there must be some kind of penalty if firms do not comply with the Clause. It will not be sufficient to insert in an Act of Parliament a Clause merely requiring a firm or company to make a statement in this form unless by some device we are able
    2072
    to take appropriate steps in the event of the firm or company failing to carry out the directions.
    Mr. SAMUEL SAMUEL: Where dividends are paid free of Income Tax there is always inserted at the foot of the warrant the amount of Income Tax which is recoverable by people who are not liable to pay the tax.
    8.0 P.M.
    Mr. D. HERBERT: I would like to thank the Financial Secretary for his statement. Perhaps he goes farther than some of us intended. I have heard of certain objections not put forward to-day to this proposal because it is said this kind of thing should be forced on companies by their shareholders. In this case the company sending out the dividend warrants is, by virtue of legislation already in existence, in the position of a Government tax collector and the document which it sends out is a voucher for tax paid to the Government on behalf of the person to whom the dividend is payable. Therefore the same Government which makes the company a tax collector should, by the same law, make that tax collector give a proper voucher which can be "understanded of the people." I would suggest that a simple method of enforcing such a law would be to make the company liable to do so, and if they fail to do so then make them liable upon demand to supply such certificate. If you do so, you will find there are very few companies which will not do it in the first instance in order to save themselves trouble and to save themselves from being bombarded with letters which they could be compelled to answer, subject to a 40s. penalty or something of that kind.
    Mr. A. M. SAMUEL: Before we conclude the discussion of this Clause there is one small point which has to be taken into consideration. In these days when we have Income Tax rate in one year at so much, and the next year at so much, what is the Financial Secretary going to do about those people who pay mortgage interest subject to the deduction of tax or rent subject to the deduction of tax, often at varying rates? Accountants, lawyers and private people are very often responsible for such payments, and the recipients have to make certain adjust meats for claims with their own tax collectors. They will want to know exactly what has been taken off and at

    2073
    what rates it has been taken off. Therefore the Financial Secretary will have to make sure that these small people are included because of their difficulties when getting their tax claims adjusted. That is a matter which must be taken into consideration in order to relieve of a difficulty small people who do not understand how to reckon out the deductions. If the Financial Secretary proceeds on the lines he has indicated to carry out the assurance which he has given and puts a new Clause in during the Report stage to meet this grievance I shall have great pleasure with the leave of the Committee in with drawing the Motion for the Second Reading of this Clause.
    Motion and Clause, by leave, withdrawn.

    NEW CLAUSE.—(Income Tax of married persons.)
    If either a husband or a wife who are living together claims to be separately assessed for purposes of Income Tax, neither of them shall be liable to pay a larger sum in respect of Income Tax than they would be liable to pay if they were each unmarried.—[Lieut.-colonel Lambert Ward ]
    Brought up, and read the First time
    Lieut.-Colonel LAMBERT WARD: I beg to move, "That the Clause be read a Second time."
    The object of the Clause is to remedy the extraordinary inequality and injustice existing at the present time with regard to the assessment of married and unmarried people with regard to Income Tax. Of course, the same inequality and the same injustice apply to their assessment for Super-tax also, but I am not concerned with Super-tax to the same extent, because when people are in a position to pay Super-tax, minor in justices such as this do not affect them so materially as they affect other Income Tax payers. The people affected by this particular injustice, if we eliminate the Super-tax payers, are very largely, if not entirely, people of the somewhat poorer middle class, whose incomes may be sufficient to support them in comparative comfort, but when it comes to the question of bringing up a family and when they are people who take a pride in educating their family out of their own resources, the payment which they have to make under this assessment undoubtedly weighs very heavily upon them. This Clause has been before the
    2074
    House on several occasions, but I do not think it necessary for me to apologise on that ground, because the injustice is going on all the time.
    As things stand to-day, a man may live with whom he pleases other than his wife, and if he and the other person possess separate incomes, they are assessed separately. A man may live with his father or his mother, or his brother or his sister; he may even live with another man's wife, he may live in open sin with a woman who is not his wife, and their incomes are assessed for the purpose of Income Tax and Super-tax as two separate entities. But let him commit the mistake of marrying a woman, and from that moment their incomes for the purposes of Income Tax are assessed as one. There is a still more extraordinary feature about this matter which brings home to most people the gravity of the injustice. Although for the purposes of Income Tax the incomes of married people are as one, yet for the purposes of Death Duties the incomes are regarded as two incomes. One would naturally think that if the incomes were to be assessed as one for Income. Tax, they would be assessed in like manner for Death Duties, and that on the death of one of the partners to the union the property would pass without tax to the surviving partner, but that is not the case. For the purpose of Death Duties the incomes are treated as two separate entities, and on the death of one partner to the union the Death Duties have to be paid. If I may use a colloquialism, it is a case of the State having it both ways, which is repugnant to the most elementary sense of fair play. There is not the least doubt that this form of assessment is contrary to the spirit, if not the letter, of the Married Women's Property Act, 1882. May I point this argument by reading a Clause of that Act?
    "Every woman who marries after the commencement of this Act shall be entitled to have and to hold as her separate property all real and personal property which belonged to her at the time of her marriage or which shall be acquired by or devolve upon her on marriage."
    The Income Tax Act, as I say, is a direct violation of the spirit, if not the letter, of that law, and it says:
    "The profits of a married woman living with her husband shall be deemed to be profits of her husband and shall be assessed and charged in his name and not in her name or in the name of her trustee."

    2075
    You will notice this Act uses the words "living with her husband." She may live with another woman's husband, and her property in such circumstances is her own and is assessed separately for taxation. Therefore, what this law comes to is that it puts a tax upon marriage and puts a premium on people living together without going through the ceremony of marriage. It may be argued that the injustice is comparatively slight and the amount involved comparatively small, but I should like to point out to what extent this injustice affects people financially. Let us take as an illustration a man and woman each with an income of£500 a year. It is a reasonable income and one which is earned by many of the middle classes to-day. The man may be a senior clerk in a bank or a manager of a West End business; the woman may be a doctor, a writer, or a designer, or she may be manageress of a West End establishment. They are unmarried, and let us examine what each individual pays in taxation. From the £500 a year, we deduct one-tenth for earned income, which leaves £450. There is then the personal abatement or allowance of £135, which leaves £315 a year taxable income. At 2s. 3d. in the £ on the first £225 the amount of tax is £25 10s., and at 4s. 6d. in the £on the remainder the amount of tax is£20 10s., or a total of £46 a year each. That is the two of them assessed separately, pay a total of £92 a year. If these people are sufficiently misguided to marry, instead of living together unmarried, they pay £36 a year more. The statement of their income as a married couple is £1,000 a year. The 10 per cent. deduction reduces it to £900 and there is £225 abatement or allowance, which leaves£675 taxable income. At 2s. 3d in the £on £225 the amount of tax is £25 10s., and at 4s. 6d. in the£on the remaining £450 the amount is £102 10s., or a total of £128 tax.
    As I say, there is a tax or fine of £36 a year on these people who were foolish enough to marry. It may be said it is not a great amount. On the other hand, it would go far towards the education and upbringing of a child if they are not extravagantly-minded in their views on education and that, in these days, in my humble opinion, is a very serious thing. This is an injustice which has been felt for a very long time by the women of
    2076
    this country and it is one which they take seriously. It was inquired into by the Royal Commission, and I am aware that the Royal Commission in its Report advocated a continuance of the present system. Let us examine the constitution of that Commission. From first to last there were 26 Commissioners, of whom only one was a woman. That is not the sort of Commission which gives confidence in these days when women are in practically every respect the equals of men before the law. Evidence was given by 190 witnesses, of whom only four were women. There again, a Commission which carries on its inquiries in that manner is not one to give confidence to the womanhood of the country. Eleven persons gave evidence on the question of this marriage tax and eight were against it, and only three in favour of continuing the present system of assessment. Those three were all revenue officials, and one might not unfairly say they took a biassed view of the question.
    I know it will be said by the Financial Secretary that this proposal would cost a lot of money. I have seen an estimate that it might cost anything from £33,000,000 downwards, but I think an estimate of that kind is absurd. It is based on the assumption that every married couple in this country, directly this new proposal became law, would divide their property equally for the purpose of avoiding taxation. I think there is not the least chance of that. The risks are too great and men are too "canny" as a general rule to give over half their property to their wives, irrespective of what may happen in the future. That amount is only reached if Super-tax is also taken into account. I have purposely excluded the Super-tax payer from this Clause, which deals only with Income Tax, and the maximum advantage that any couple can obtain from the passing of this Clause is £36 a year, while I shall be very much astonished if the entire cost of making this concession and removing this obvious injustice will be more than £100,000 a year.
    Lieut.-Colonel Sir P. RICHARDSON: I should like to associate myself shortly with this Clause, and to ask the Financial Secretary to the Treasury whether he will deal with the matter on two lines, the one of justice and the other of expediency. This matter has been

    2077
    raised for a considerable number of years. In fact, I have looked back for some 13 years past, and I find that, if it has not been a hardy annual, at any rate it has been a matter that has called for a great deal of discussion in this House, and it has also been the subject of a great many questions. I have had the curiosity to see what answers have been given to those questions, and I find that so far it has been a matter of expediency and an estimate as to how much it would cost rather than dealing with the matter from the point of view of justice and of a marriage tax. In some countries bachelors are taxed, and I think we would all recognise, and many of us preach, that marriage is a desirable and necessary state, and one to be encouraged, but the law at present does not encourage matrimony, particularly amongst those of the middle and not altogether wealthy classes. Therefore, whereas it may be that the time is not ripe for a change, at any rate, I hope it will be made clear that, if there is any objection, it is not an objection on the grounds of justice, but of expediency only.
    Looking back at the records of the Debates on this subject, I find that it was stated, I think in 1922, that to remove this tax would be to take a tax from the rich and place it on the poor. I do not think that would be the case at all, but whether or not that was so, it seems to me that one should tax people fairly and not unfairly, whether they be rich or poor. Particularly nowadays, when women are demanding equality in all things, we should recognise that women feel very strongly that their position is not a just one, that, having an income of their own, for their own enjoyment, they should, upon marriage, suffer a disadvantage. It would be quite easy to devise some scheme by which taxes upon those who are unmarried might be increased in order to obtain justice for this case, and the expressions of opinion throughout the last 13 years, so far as I have been able to ascertain them £and I have gone very carefully into the records £show that there has been an increasing demand for this particular item of legislation and that it has been resisted only on the ground of its immediate cost. I think that that cost has been very greatly exaggerated, and, as the last speaker said, it has been based largely upon the assumption, first,
    2078
    that everybody would be anxious to evade the law, and, secondly, that everybody would take advantage of its provisions. I do not think there would be anything of that sort whatever, and I desire to support this Clause.
    Sir J. PENNEFATHER: The case for this new Clause has been so admirably put by my two hon. and gallant Friends that I do not intend to say much more than that I also desire to support it, on the ground that it is a common-sense Amendment. I was particularly struck by the argument used by the hon. and gallant Member for Chertsey (Sir P. Richardson), that this is a matter of great importance to the large number of women who are now among the electorate. Their position has very much changed since the clays when arguments were first brought against an Amendment of this nature, and in view of that change, a change, if I may say so, in the political status of women, I hope the Government will see their way to accept this Clause, and I would certainly join my hon. and gallant Friend who moved it in the Division Lobby, if necessary.
    Mr. W. GRAHAM: The three hon. Members who have supported this Clause have quite rightly reminded the Committee that it is a familiar one in Income Tax Debates, and, as the Mover himself indicated, it was considered at very great length by the Royal Commission on Income Tax in 1919. I think I can, without detaining the Committee at too great a length, summarise the arguments which exist in favour of this proposal, and then I think I can almost immediately make what we believe to be a very strong and, indeed, an overwhelming case against it. This proposal has two sides, one of a political character relating to citizenship at large, and the other—one that must be particularly regarded by the Committee to-night £the side which has regard entirely to revenue. As regards the political side, the Committee is aware that there is already provision for the separate assessment of married people, but when we come to the actual payment of the tax, the incomes of the two people are aggregated, and the tax is imposed upon the total of the two together. As regards separate assessments, I think that we have there a concession to what may be called the political or citizenship argu-

    2079
    ment, if hon. Members wish to press that to-night, although that is not really the case that is before the Committee. After all, what we have to consider are, first of all, the sums required from the country as a whole, and then the kind of taxation which we are imposing upon the family or home unit. Two people who have entered into a voluntary union for life, to the exclusion of all others, do, notwithstanding far-reaching developments in citizenship, undertake duties together which no system of taxation under the sun could ignore.
    One word as regards cost. I agree with hon. Members who suggest that it is no reply to such an Amendment to say that it will cost so many millions a year if, in fact, there is a substantial injustice which the new Clause is designed to prevent, but I ought to remind the Committee that there is no real injustice in this case when we get down to the facts. Before I come to that, in any event it would probably, if the change were to take place at a comparatively early date, cost the Exchequer at least£13,000,000 in a full year.
    Lieut. - Colonel LAMBERT WARD: Does that include Super-tax?
    Mr. GRAHAM: I think it refers only to Income Tax. Of course, the Committee must admit that if there were to be separate taxation, we could not logically defend the continuance of the substantial allowances already given to married people. I refer to the£250, in round figures, which is now provided by the Income Tax law as a concession to marriage as compared with the£150 allowed to single persons. The hon. and gallant Member who moved this Amendment made a great deal of the argument that this was a penalty on marriage, but may I remind the Committee of the actual facts regarding married people in this country? The Royal Commission in 1919 recommended a largely increased scale of allowances, and that was immediately adopted and incorporated in the Finance Act of 1920. I hardly think that any hon. Gentleman would raise the objection that the existing system is any penalty whatever upon marriage for the great mass of the smaller people in this country in view of the married allowances which are given. When we pass away from the smaller
    2080
    people to those whose incomes are larger we pass into the sphere of those who have real ability to pay, and, of course, their incomes carry a substantial part of the national burden.
    This was very carefully considered in detail by the Royal Commission in 1919, and, speaking from recollection, I am, I think, correct in saying that they unanimously came to the conclusion that there was no foundation for, or any case established for, the proposal contained in this proposed new Clause. They felt that in the circumstances suggested, the married allowance must logically disappear, and if the married allowance disappeared, the burden of taxation in many homes would be substantially increased, while, no doubt, they would be diminished in others. In point of fact, taking a long view of the change, and assuming we introduced this proposal, and systematically got rid of- the married allowance, I might even go the length of saying it would probably throw more taxation upon the very people whom my hon. Friend opposite has in mind; if I had time, I think I could prove that proposition. I have, however, said sufficient to show that not only is the verdict of the Royal Commission against it, but the facts of the present situation also are against it. There is no real hardship in the present method when we get down to the facts. The present method has in mind family unity, and I think all taxation must have regard to the facts of social life, which is really the bedrock in the consideration of this proposed new Clause.
    Question, "That the Clause be read a second time," put, and negatived.

    NEW CLAUSE.£(Provision, to allow deductions in respect of inherently wasting assets.)
    For the purpose of enabling deductions from revenue receipts of expired capital outlay on inherently wasting assets to be allowed by the additional Commissioners claims in respect of those deductions shall be included in the annual statement required to be delivered under the Income Tax Acts of the profits and gains of any trade, manufacture, adventure, or concern, and where such a deduction from the revenue receipts is made, and has been made, from the commencement of the actual employment of the inherently wasting assets in seeking profits, or during a period of not less than three years to the end of the usual financial year of the particular trade, manufacture, adventure, or concern, last

    2081
    prior to the year of assessment, and provided such deduction is so made as to prevent the same being available as profits, the additional Commissioners in assessing those profits and gains shall make such allowances in respect of these claims as they think just and reasonable.
    For the purpose of this Section the term "inherently wasting assets" means assets which necessarily waste in the process of seeking profits. Provided always that such wasting assets are not the value of transferred rights to future profits or increase which would have been chargeable with Income Tax if no transfer of such rights had been made.—[Lieut.-Colonel Pownall.]
    Brought up, and read the First time.
    Lieut.-Colonel POWNALL: I beg to move, "That the Clause be read a Second time."
    Mr. Basil Peto, then a Member of this House, dealt with this question in the corresponding discussion last year. In view of the fact that there are 12 or 14 proposed new Clauses on the Order Paper, I propose to be quite brief, and shall not go into the matter at any length, although it is one of those very difficult technical questions which, when once started, may go a long way. A Royal Commission sat five years ago largely upon this question. If I remember rightly the Financial Secretary to the Treasury was himself a member of the Commission, and to the best of my recollection signed this Report winch I am going to quote. No doubt. I shall have his sympathy. What the Report said was that
    "Subject always to the limitation that their life falls short of 35 years, we recommend that an allowance shall be given in respect of all inherently wasting material assets which had been created by the expenditure of capital such as buildings and foundations.… In every case the allowance should be calculated by reference not to the absolute but to the relative liability to waste."
    This was recommended by the Royal Commission. A great majority of the recommendations have been carried into effect. On this particular question nothing, to my knowledge, has been done. There is a further point. Some years ago, in 1884, there was a case which was heard in the Queen's Bench Division, and the Court held that no deduction from trade profits could be made in respect of premium paid in connection with the purchase of leases. A certain firm were tenants of a large house in Liverpool Street, City. Apart from the rent they paid £10,000 premium for a 10 years' lease, and asked to write off £1,000 per year for
    2082
    10 years. This was refused Q n the ground that the £10,000 was capital transaction, and that only the annual value of the house could be deducted.
    This Clause, obviously, is not of a party character. As I have just indicated, I hope to have a measure of support from the Financial Secretary to the Treasury. Also I am glad to see that my right hon. Friend the Member for Camborne (Mr. Leif Jones) has a similar Clause down on the Paper. A dozen years ago his leader, the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George.), when Chancellor of the Fxchequer, said, dealing with this matter:
    "There is here a real case, and it is one that has got to be dealt with."
    It has not been dealt with. Twelve years have elapsed since the right hon. Gentleman the Member for Carnarvon Boroughs made that statement. Four or five years have elapsed since the Royal Commission sat. I know quite well it would be hardly possible to expect this Clause as it stands to be accepted by the Government. What I do ask is that they will show sympathy, and say whether they cannot set up a Treasury Committee which will go very exhaustively into this extremely complicated question, consider the various interests involved, and see whether it is not possible to do something in regard to what is at present a serious injustice to a large section of the business community.
    Mr. LEIF JONES: I do not propose to argue the merits of the case. I think they are perfectly familiar to Members who have followed the question in the past years. It is really unnecessary to argue it, because I do not think anyone will be found to defend the justice of taxing wasting assets for Income Tax on the same basis as if the assets were not so. For the last 15 years almost every Chancellor has in turn promised to deal with the question in the coming year, but political events have intervened to prevent the fulfilment of the promise. So it has been during the last year. Last year the Chancellor of the Exchequer promised that a full inquiry should be made, and, if possible, satisfaction should be given. An election has taken place and a new Chancellor of the Exchequer is in office, and I hope that he, too, will give us a sympathetic answer, and, if I may say so, that he will be able to fulfil the promise that he makes.

    2083
    The question, I venture to say, is more urgent than ever before. These things did not matter much as long as the Income Tax was 5d. or 6d. in the £. But grievances that passed unnoticed then become intolerable when you are dealing with an Income Tax level of 4s. 6d. or 5s. in the £. From the point of view of Income Tax, which I regard as the greatest instrument for raising money that the Government has ever had in its hands, which I have defended as an alternative to the Capital Levy—for I believe that in Income Tax we have the most powerful means of raising revenue for the State that the Government can have—it is essential to remove these small injustices which may grow to large ones, and which create grievances in the minds of the taxpayers. The matter is far more urgent than ever before. I beg the Chancellor to have the matter looked into, and see whether we cannot put this grievance right before another 12 months is over.
    Mr. GRAHAM: Those who have supported this Motion have raised the question to which the Royal Commission of 1919 devoted much attention. Our reply is bound to be sympathetic in the nature of things. The Royal Commission drew attention to the wasting assets, and recommended that no allowance should be made where the life of the wasting asset is 35 years or longer, but short of that period, they recommended that there should be certain proportional allowances; and that the existing depreciation allowances in the case of factories, mills, and other establishments should presumably disappear, and be replaced by a more comprehensive scheme. Another recommendation was that this should not apply to any case of proprietorship of the natural resources of the country.
    I think I have said enough to show, as has already been indicated, that this is a very large problem, and clearly if this New Clause were adopted we should require a revised scheme. The Chancellor of the Exchequer authorises me to give this promise. Recognising, as we do, the injustice, we are willing to undertake that there should be an investigation of this matter. I do not think it is necessary to appoint a Treasury Committee. In the light of what has been recommended by the Royal Commission I think this question might be dealt with by the
    2084
    Board of Inland Revenue. I will undertake to have this matter looked into without delay, and I hope, if we are in office next year, we may, without pledging ourselves to any specific thing now, be able to place something on the Order Paper.
    Question, "That the Clause be read a Second time," put, and negatived.

    NEW CLAUSE.—(Allowance for traveling expenses.)
    In charging, whether under Schedule D, the profits or gains accruing from any trade, profession, employment, or vocation, or under Schedule E, the salary, fees, wages, or profits accruing from any office of employment, any person the amount of whose earned income, as estimated in accordance with the Income Tax Acts, shall not exceed five hundred pounds, such deduction may be allowed as the Commissioners, having jurisdiction in the matter, may consider just and reasonable as representing the expenses of travelling between the residence of the taxpayer and his place of business, provided that no such deduction shall exceed the sum of twenty pounds.£[Sir J. Pennefather.]
    Brought up, and read the First time.
    Sir J. PENNEFATHER: I beg to move, "That the Clause be read a Second time."
    This new Clause proposes to make an allowance for travelling expenses in the case of any person whose earned income does not exceed £500. There is a further limitation to the effect that any relief granted under this new Clause should be limited to the sum of £20 of duty in any one year. Although in that sense this proposal is a very moderate one, it is in another sense a very important one affecting a very large number of people mainly in our large cities, such as London, Liverpool, Manchester, Birmingham and places of that size.
    In all these places it is difficult, if not impossible for these people to live near their place of business, and in all these cases it would apply to what we might call the 'better trade class, the -artisan class, and manual labourers, who get good wages. It would apply also to clerks, managers of small businesses, people like lady stenographers and assistants in shops, and people of that kind, who are what we might term an industrious but struggling class. To these people the acceptance of this proposal by the Government would be a very great

    2085
    boon. A great many of these people really cannot live near their work, and even if they could, it is not desirable in many cases that they should do so. It is far more desirable that they should live further out from the centre. Hon. Members have no doubt seen these people going to business early in the morning hours and returning in +the evening. I am going to suggest to the Chancellor of the Exchequer that really when we are considering the wages or salaries of these people, we are misleading ourselves if we confuse the actual wages or salaries which they get with their nominal wages or salaries.
    I think it will be agreed on all sides that, before a man or woman can earn an income from their work at their place of business, it is necessary to reach that business, and that, having performed their daily work, it is necessary for them to get back to their homes. That being so, although the wages or the salary may be £5 a week, the actual wage or salary which the worker has in his or her pocket is not £5, but £5 less the cost of getting to the place where they earn it, and of getting back home again. I am informed that some of the General Commissioners of Income Tax take that view, and are quite disposed to allow the expenses to and from the place of business as a deduction from the salary, and tax only the actual net receipts.
    In this, however, they are hampered by two very narrow legal decisions given by the High Court, one in 1887 and the other in 1890, and in the face of these decisions those General Commissioners, who desire to carry out what is suggested in this new Clause, find themselves unable to do so. If this new Clause is included in the Bill many General Commissioners would gladly avail themselves of it, and it would give them authority to carry out what they themselves believe to be right and proper. I do not profess to be a lawyer, or to be well versed in legal matters, and, therefore, I do not propose to touch upon that point, but I suggest that, since those narrow legal decisions were given, things have changed. The later of them is 24 years old, and during those 24 years our great cities have grown in size geographically, and it is more and more necessary for people to go out and live in the outskirts. In many cases the houses
    2086
    in which people formerly lived have been demolished, and great business premises have been put up, and people are compelled by force of circumstances to-day, to a degree which was not the case 25 or 30 years ago, to incur these travelling expenses.
    It is not a question of a man electing to live at Southend or at. Brighton and travel first class to the City of London. People of that kind have more than £500 a year, and they could not pay such railway fares under the limit of £20 which is suggested. This is simply a matter for struggling men and women of very moderate means indeed, and it would just make this difference to them that, in runny cases, if this Clause were accepted, they would, perhaps, if they were living too close to the town to-day, be able to move out a little, or, if they were living on the outskirts, to go, perhaps, a little further still. That moans much, not only to the wage-earners themselves, but also to their wives and families, and it means much to the health of the rising generation. For all these reasons I urge upon the Chancellor of the Exchequer that he should, for once, give away something and make this concession. I assure him that. I am not moving it with any desire to wreck or spoil his Budget. I have refrained from taking part in several Divisions to-day, which shows that I do not desire to wreck his Budget, but I put this forward as a real, up-to-date contribution to the amenities of life and the well-being of a large class of very deserving people in constituencies like my own particularly, and in the large cities of this country.
    Mr. TURNER: I want to appeal to the Chancellor of the Exchequer to accept this proposal. In the great county of which he is a distinguished son, and one of the divisions of which he represents, a very considerable amount of travelling has to be done by workpeople going from the other side of the Pennine Range into the Colne Valley, and a very large amount of travelling has to be done by many of the work people in the industry with which I am connected in the West Riding. Again, this morning, when I caught the 7.40 train from home, I found several compartments crowded with people who have to travel six or eight miles every morning and return every night. That means a weekly charge of 3s., 5s. or 6s., and it is

    2087
    a tax upon the income which they earn by their labour. This is a question which has arisen within the last few years. Formerly, travelling did not trouble these people in connection with the question of Income Tax, but latterly it has arisen. This is a regular annual charge upon those who pay Income Tax, and, as Income Tax payers are more numerous to-day than they were a few years ago, owing to the changes that have been made, I appeal to the Chancellor of the Exchequer to bend a bit on this occasion, and see if he cannot just meet the case of these struggling industrial people. It is suggested that the concession be limited to incomes under £500, and shall not amount to more than £20. It seems to me, therefore, that it is one of those little easements that would mean a great deal to many workpeople, and I hope the right hon. Gentleman will accede to this request.
    Mr. SNOWDEN: I think that my hon. Friend who has just sat down has not very clearly grasped how this proposal would operate. He spoke of the number of workpeople who crowded into the compartment this morning in which he himself was journeying to London. I wonder how many of the workmen who were travelling in that train—
    Mr. TURNER: I was travelling third class.
    Mr. SNOWDEN: I wonder how many of those who were the companions of my hon. Friend this morning were liable to Income Tax. I venture to say that there was not a single one.
    Mr. TURNER: Oh, yes!
    Mr. SNOWDEN: It has to be remembered that a married man with an average family has to have an income of about £400 a year before he is liable to pay a single penny of Income Tax. I am quite certain that not one of those operatives who journey from one part of the Colne Valley to another every day has an income of £8 a week. No one knows better than my hon. Friend that wages of £8 a week are not earned now in the worsted factories of the West Riding, and, therefore, the people for whom my hon. Friend speaks would not be affected at all, and would not gain a single penny of benefit if this concession were granted. It is one of those proposals in favour of which a
    2088
    somewhat plausible case can be made, but, when we come to examine it, we find that there is very little substance and reality in the arguments which have been put forward. The Royal Commission on Income Tax very carefully investigated this question, and they were definite and unanimous in their Report on the matter. They came down unanimously and strongly against any allowance being made on account of travelling expenses in assessing Income Tax. The paragraph in their Report which deals with this matter is a short one, and I will trouble the Committee to hear it. They say:
    "Travelling expenses incurred by a taxpayer in going from his place of residence to his business should not, in our view, be allowed. The question of travelling expenses is one which reacts on other private expenses, such as the expenditure for rent and rates. It is more truly an expenditure or disposal of income than an expense essentially necessary to earn the income. We are of opinion that a general allowance for travelling expenses would result in very grave inequality."
    The Mover of the Clause referred to the increasing and very commendable desire of workpeople to get away from our crowded industrial centres into purer and healthier air, but I would remind him that, by the operation of economic laws, rent and rates are higher where accommodation is most dense, and it is a fact within the knowledge of every member of the Committee that, as a general thing, the difference between the expense a person has to incur in travelling to a place some miles from where he works, and the extra rent that he would have to pay if he lived near his work, makes him quite as well off, and in a great many cases better off, through living a considerable distance away. Coming to the practical operation of this proposal, it is suggested that the allowance for travelling expenses should be confined to those who have an earned income not exceeding £500 a year. Let us see how that would operate. A person with an income of £500 a year would be able to get an allowance of £20, but a person with an income of£501 would not be able to get a single penny. May I, further, point out a result of limiting it to earned income? Take the case of one of those season-ticket holders between London and Brighton. A man has an unearned income of £2,000 a year. He is a director of a company in London and travels up once a week, say, to a directors' meeting. His

    2089
    directors' fees amount, say, to £150 a year. That is earned income, and although that man would have an income of £2,150 he would be able to claim full travelling allowance up to £20 a year, because the Clause is confined to earned income, whereas a man who has an earned income of just over £500 would not get a single penny.
    9.0 P.M.
    A further point. The hon. Member laid very great stress on the fact that these travelling expenses were necessarily incurred by a man in the discharge of his occupation. But has he thought where it is going to lead? If a man lives a considerable distance from his work he has got to keep himself between arriving at the place where his work is and leaving it at night. He incurs considerable expense, and quite as strong a case could be made out for giving an allowance for meals, or sustenance; during the working day as can be made out in favour of giving him an allowance for travelling expenses. This proposal strikes at the whole structure of the Income Tax law. Hon. Members who are moving this and other Amendments do not seem to realise that we must have a certain amount of revenue, and if we cannot get it in one way we must get it in another. If I were to concede this, I should have to find some compensation for the revenue I am surrendering. I should have to get it either from these same people or from someone else, and if I put it on someone else I should simply be relieving these people of an amount of taxation and placing it on other people who are no better, and in many cases far less able to pay it. The kind of people who will be benefited by this Clause are not the people of very small means to whom the hon. Member has more than once referred, because a married man with an average family would require an income of £400 before he pays a single penny of Income Tax. The people who would benefit, the people between £300 and £500 a year, are no doubt in nearly every case living in houses which were liable to Inhabited House Duty. I am giving these people a very considerable relief of anything from £2 up to £5 a year. Really I cannot afford more. I am sure the hon. Member has no idea of the cost. As a matter of fact it would cost £1,000,000 a year.For these reasons, because I do not believe it is a sound thing to do, it is quite incon-
    2090
    sistent with the general structure of our Income Tax law, and if it were conceded it would involve the imposition of additional taxation upon other people, and the cost would be £1,000,000 a year, I am sorry I cannot accept it.
    Sir J. PENNEFATHER: I should like to correct the Chancellor in regard to a statement he made about the wording of the Clause. I am sure he would not desire to mislead the Committee, but the objections he has put forward are groundless. The Commissioners would not consider it just and reasonable for a man coming up once a week from Brighton to attend a directors' meeting to claim it. The Clause is carefully worded and it meets many of the right hon. Gentleman's objections.
    Mr. SNOWDEN: The hon. Member is quite wrong. I have not to consider what view the Commissioners might take. I have to consider the words of the Clause, and there is no doubt whatever that under his wording the man would be entitled in law to claim £20 a year.
    Mr. REMER: I should not have risen if it had not been for the hypothetical case the right hon. Gentleman has quoted. There are two points of view I should like to put before him upon that hypothetical case. The first is that a director living at Brighton could not come within the £20 limit because his railway travelling would be a great deal more than £20. The second thing is that I think a man living at Brighton coming up once a week to London under the present Income Tax laws is allowed his deduction in exactly the same way as Members of Parliament.
    Mr. SNOWDEN: The hon. Member is quite wrong. Travelling expenses are only allowed now when a man has, in connection with a single employment, to travel from one place of business to another.
    Mr. REMER: My second point, of course, falls to the ground, but I was going to refer to the question of Parliamentary salaries, because I think the smaller Income Tax payer has felt a very grave injustice that Members of Parliament are able to get this deduction while he is not. In many cases it is not a matter of mere convenience or being able to get cheaper houses that people live a long

    2091
    distance away from their business. It is more often than not because they cannot get houses anywhere else. If you take London, typists and that class of people are utterly unable to find either rooms or houses within a considerable distance of their place of business. On these grounds I hope, at any rate, we shall have some more encouragement than the right hon. Gentleman has given us. I think the young girl who has to come to the City as a stenographer, especially when she has no parents and has to provide her own living, is the class of person who would benefit under the Clause. I know one who does pay Income Tax, and who has to travel a considerable distance night and morning at considerable expense. It is utterly impossible for her to obtain any place of residence within easy distance of her place of business. Therefore, I would press upon the Chancellor of the Exchequer that this concession would be very favourably considered by a very large number of people, and I hope he will reconsider his decision.
    Question, "That the Clause be read a Second time" put, and negatived.
    The following new Clause stood on the Order Paper in the name of Mr. S. ROBERTS.

    NEW CLAUSE.—(Reduced excise duty on beer.)
    In lieu of the duty of excise payable in respect of beer brewed in Great Britain Northern Ireland there shall, as from the first day of June, nineteen hundred and twenty-four, be charged, levied, and paid the following duty (that is to say):

    £

    s.

    d.

    For every thirty-six gallons of worts of a specific gravity of one thousand and fifty-five degrees

    3

    10

    0

    and so in proportion for any difference in quantity or gravity.
    Mr. S. ROBERTS: This Clause has been put down in order to draw attention to the fact that the tax upon beer at the present time is about ten times what it was before the War, and is a very heavy burden upon such members of the community as desire to consume that commodity. Two years ago an Amendment of this sort was put down by some hon. Members who are now supporting the Government, but on that occasion, as it was thought by some who had gone into the figures carefully, that a reduction of
    2092
    ld. a pint could be obtained by a lower reduction of taxation and by some contribution being made by the trade, the Amendment was resisted. Last year a rebate of 20s. was made, and the licensed trade made some allowance out of their profits towards the reduction of 1d. a pint, which was brought into operation. It is felt that if no notice was taken of this high taxation this year, and if the matter was allowed to go entirely by default without any reference being made to it, it might be considered that the people who consume this commodity are satisfied with the price they have to pay. Somebody has said that, at the present time, the article which is sold as beer is made up of three things, water, science and tax, and that the greatest of these is tax. Certainly, far the most expensive part of it is tax. It is desired by those who are interested in this matter that the question should not go entirely by default. In that respect I should like to say that, as my name has appeared in connection with one or two of these Amendments, I have not the slightest interest in the licensed trade, either in the brewing or the public-house trade. In fact, I am fully qualified to be a licensing magistrate, because I have no personal interest in the matter. I realise that a concession was made last year and that no Chancellor of the Exchequer presenting a Budget this year would be able to accept this Amendment, that the amount involved is a very large sum. Therefore, having stated the facts and put in a sort of caveat, I do not propose to move the Amendment.

    NEW CLAUSE.—(Amendment of First Schedule to Income Tax Act, 8 and 9. Geo. V., c. 40.)
    Rule 13 of the general rules applicable to Schedules A, B, C, D, and E shall be amended by the addition, at the end thereof, of the following proviso:
    Provided that where a resident person carries on a bona fide agency business in the United Kingdom and receives in respect thereof adequate remuneration, being not less than the customary remuneration in that class of business, the resident person shall not be liable for payment of any tax for which any non-resident person may be chargeable in respect of business done through the agency business of the resident person, notwithstanding that the non-resident person may have been charged in the name of the resident person.—[Sir L. Worthington-Evans.]
    Brought up, and read the First time.
    Sir L. WORTHINGTON-EVANS: I beg to move, "That the Clause be read a Second time."
    This Amendment is not an endeavour to exempt anybody from paying the full rate of tax upon the profits he makes, but it does endeavour to carry out the intention which the Chancellor of the Exchequer, Mr. McKenna, had in mind at the time the amendment of the Act was originally made, to allow the full tax to be made on any principal, whether resident in this country or abroad. It will, however, exempt an agent carrying on an ordinary agency business from being taxed not merely on the profits made by him as agent but upon the profits made by the principal resident abroad, for whom he acts as agent. There was never any original intention to do more than tax the foreign principal, not by the agent but direct, except in the case of fraud, where the agent was not acting bona-fide but was carrying on a fictitious business in order to screen his principal from taxation. I am not asking that in any fictitious business the principal should be screened by the agent from taxation, but what I am asking for is that an agent carrying on a bona-fide business in this country as an agent should be taxed only upon his profits as agent, and should not be made the instrument of collecting tax which is due from his principal to the Treasury. Let me point out what Mr. McKenna said on the occasion of introducing the original Clause.
    "It an agent is doing a bona fide business and receiving his 1 per cent, the ordinary trade return, there will be no more Income Tax charged, except upon the agent's 1 per cent., but if there is a collusive arrangement whereby the agent gets no profit, he will be charged in respect of the proper profit of the agent. That is what Clause 3 says. Otherwise, we are not extending the existing law."
    I want the Chancellor of the Exchequer to carry out the original intention of the Act. Let me explain the class of case in which it arises and the damage that is being done to trade in this country by the pressure that is being brought to bear by the Somerset House authorities. The business carried on in the City of London is very largely carried on by agents acting for foreign principals or Dominion principals. Let me take, for example, the timber trade. A great many agents
    2094
    in this country are instructed by a foreign principal—whether he is an actual foreigner or a Canadian or an Australian matters not from this point of view—to sell a cargo of timber. He sells it, and the commission is 1 per cent. That is the sole profit he makes. He pays Income Tax upon that. What the Somerset House authorities are doing now is to assess him for the profits not made by him but by his principal out of the sale of that cargo of timber. That is unjust. That is what the original Clause was never intended to do.
    Mr. McKenna had it pointed out to him by Lord Banbury, who was then Member for the City of London, that this risk was being run, even at the time when the Clause was extended. In answer to that, Mr. McKenna made the statement which I have read, that in the case of a bona fide agency, the only tax would be a tax upon the commission earned by the agent. What is now happening is that the Somerset House authorities, not content with the tax upon the agent's actual profit, are assessing the agent for the principal's profit. That, surely, is wrong. What I ask is that where a resident person carries on a bona fide agency—if it is a fraudulent agency I do not- want to protect him—in the United Kingdom and receives in respect thereof adequate remuneration, being not less than the customary remuneration in that class of business, the resident person shall not be liable to pay any Income Tax, for which a non-resident person—that is the principal—may be chargeable, in respect of business done through the agency notwithstanding that the non-resident person may have been charged in the name of the resident person.
    To protect the agent it is necessary that he should be able to show that it is a bona fide agency, and that he is receiving not a sham commission but a proper commission customary in the trade. That is to protect the revenue against a sham agent being appointed and paid some infinitesimal commission in order that the non-resident may gain extra profit. See how unfair it is to assess on the profits of the principal. The agent knows nothing about the profits of the principal. He has no power to compel the principal to disclose what profit he is making on, say, the sale of a cargo of timber. It is true that he could refuse to do his business as an

    2095
    agent unless the principal did disclose the profit, but the effect would be that he would lose the business and it would very likely be lost to England altogether, and the revenue authtorities would lose the tax upon the profits of the agent, and not only upon the profits of the agent, because that sort of entrepot, for which the City of London is famed gains not only direct commission in direct business, but it also gains large sums per annum in the businesses ancillary to the direct transaction, such as insurance shipping freight, banking transactions, and all those things which make profit for the City of London and pay Income Tax to the Chancellor of the Exchequer.
    This is an exceedingly shortsighted method of speeding up by the income Tax authorities. It is going beyond what is legitimate to try to hold the agent in this country as a hostage for the payment of the tax by the principal. To show how ridiculous this may be, and how dangerous to business in this country, may I point out that it is not uncommon for a cargo to sail from, let us say, Canada or the United States without any final destination being determined before it sails. The cargo may be wheat or timber. After it sails the owners of the cargo on the other side telegraph to the agent on this side that the cargo is there, and they instruct them to sell it. The sale may take place not to somebody resident in this country at all. Say it takes place in Holland. The ship then will not even call at one of our ports. It may go direct to Amsterdam to discharge its cargo, and the State benefits by that transaction because the agent earns commission on it and pays Income Tax on that.
    What you are asking is not that the agent shall pay the Income Tax only on his profit, but that he shall pay the tax on the profits made by the owner of the cargo. What right have we to say that? What about Holland? In such a case as that they might also say, "We shall charge tax on the profits made on the cargo not only by the Canadian principal, but also by the English agent," and you may get, if you are not careful, retaliation under which the Canadian Government may claim Income Tax on the owner's profits, and also on the broker's profits. What we want to do is to keep the
    2096
    business in this country for our people here, so that they may not only earn those profits, but also earn the ancillary profits of shipping insurance and banking.
    I believe that the Amendment will protect the revenue so far as it is possible against fraudulent transaction. I do not know what the answer of the Chancellor of the Exchequer is going to be. I can imagine that he may say there may be cases of fraudulent agreement between principal and agent, and the revenue would probably be cheated of a legitimate subject of taxation. I do not want to deprive him of any power to tax or to collect tax from anybody whom he is legitimately entitled to tax, but I do say that, while he is entitled to devise any means to catch thieves or tax-dodgers, he is not entitled to hold up any man doing a legitimate business, and to assess him for tax in respect, not of the profit which he makes, but in respect of the profit which someone else makes. It is not a wise course, because it destroys the agency business, which is extremely valuable to the City of London.
    This has been an important matter, but it is much more important now than ever, because last year the Government took powers to reassess for six years in arrear, and it may well be—and the brokers and agents in the City are afraid to-day—that in the exercise of this power the Inland Revenue authorities may make an assessment upon them in respect of transactions dating back to last year and the year before, and back even to six years ago. Whatever powers they have got to protect themselves from default by refusing to enter into transactions, they have no power to protect themselves in respect of the past, and you may, therefore, under those powers of assessment, practically be assessing them, or entitled to assess them, for very large sums which they cannot possibly check, because they are the profits of principals of which they have no knowledge at all. What we ask is that the agent of a bona fide business should be liable to pay only on his own profits and not on the profits of other people.
    I hope the Chancellor of the Exchequer will be able to accept this Amendment. It certainly has a great deal of support in the City, and it seems to me to be elementary justice. I am surprised at having even to move it because I thought

    2097
    that it was one of the things which the Government themselves would have put down. They did in the original Rules put down a rule which was intended to protect the agent, but it has proved to be insufficient. The Chancellor, no doubt, is familiar with that. It is insufficient now, and I ask him to carry out the original intention and strengthen the rule, and, as Mr. McKenna said:
    "Do not interfere with the bona fide business even though you may have reason to strengthen in other directions methods for detecting and punishing fraud."
    Lieut.-Colonel POWNALL: I want, in a few words, to support what has been said by the right hon. Member for Colchester (Sir L. Worthington-Evans), because, generally speaking, I am in favour of the Inland Revenue doing all they can to collect what they legitimately can collect in the national interest. I do think in this instance they are really over-reaching themselves. I quite appreciate that when nine years ago this question was first raised by Mr. McKenna there were agreements of what might be called a quasi collusive nature between American firms and their London houses at a time when taxation in the United States was far lower than it is here, by which they could charge unduly high prices to their London houses without making any profit at all in this country, and throw all the profits into the pockets of the United States firm. These arrangements were obviously not fair to the British taxpayer. I consider the Inland Revenue were doing everything they could to stop it, and making it perfectly clear that the branches or agents of the American firms should pay their reasonable share to us. It seems to me the Inland Revenue are going far further than Mr. McKenna realised in 1915. In a speech, he said he would watch the action taken by the Inland Revenue regarding this particular matter very carefully indeed, and see that importing agents were protected. At present London acts as an intermediary in not only questions of finance but also in a very large number of ways. Insurance and shipping are of very great importance to us. It is all important to us that we should hold the position we won back after the War as the words great financial centre. If we are not going to carry this Clause, our agency business, I will not say will disappear altogether, but will disappear to a very
    2098
    considerable extent in view of our high taxation. Firms in other countries will not pay taxation even if the agent here could get it out of them. I have been looking very carefully into the sugar trade, and I have here a letter from the principal of a firm of brokers in the sugar trade, dealing with the effects the present arrangement would have unless this Clause be carried. He says:
    "If it is intended to tax a foreign shipper who sells through a broker to a British manufacturer, or wholesale importer, goods which the British importer distributes here, then an enormous trade gets upset to the detriment of the British Exchequer."
    He goes on to say:
    "But the question goes much further. In sugars we have during a lifetime, by obtaining and giving the most reliable information, succeeded in attracting to London a large business between foreign countries on which the British Exchequer collects substantial taxes. It sounds almost incredible, but we have become the medium of a very large business between Java and India, Java and China, or Australia and Vancouver; between Formosa and those countries; between Peru and Vancouver and France, Cuba and France, etc.; in fact, London has become the universal centre for sugar transactions and of all the banking, chartering, etc., connected therewith. If the Government has the intention of getting at the profits of all foreign shippers or producers on our books, they would simply find that they had destroyed the work of a lifetime and lost also individual taxes as our 'business would have ceased to exist."
    I have figures from the "Board of Trade Journal" which show that some £30,000,000 in commission is earned in this country through these commission services. I have no hesitation in saying that unless steps are taken on similar lines to this Clause to safeguard the interests of commission agents doing their legitimate business, a very considerable portion of this £13,000,000 will not be earned, and indirect profits the country is now taking for shipping, insurance, etc., will go elsewhere. I will give a simple illustration of what I am now stating. We import large quantities of coffee from Brazil. The agents here have to pay Income Tax on the profits made after handling that coffee. If we are going to try and get Income Tax paid by the Brazilian coffee house, what is to stop the Brazilian end from retaliation. In another place, yesterday afternoon, figures were given with regard to the appalling burden of taxation that is now borne in this country by our own manu-

    2099
    facturers. What will happen if, in addition to our own taxation, they adopt a measure of retaliation for the action taken by the Inland Revenue, and we find ourselves up against taxes, made in foreign countries, on goods shipped to them? I venture to say it will put us in an impossible position. The City of London, as far as I can make out, is keen not to avoid legitimate taxation. Where efforts have been made to evade taxation, it is quite right that the Inland Revenue should act. I ask the Chancellor to go very carefully, indeed, otherwise, he will find it a very considerable loss to the Exchequer as well as a loss to the mercantile community in London.
    Mr. KEENS: My experience has been that, so far as evasion is concerned, the evasion has been practiced to a very much larger extent by the branch than by the agency. I was controller, under the Trading with the Enemy Act during the War, of such a foreign firm, and I discovered, after having been in the place a very few days, that for years a system of fraud had been carried on. But these frauds were not carried on with an agent, but with the branch in the city, and by the simple method of the people over there invoicing over here at a price which, if the goods were sold, they would not make a profit for the branch. It is only fair to assume that, if the manager had succeeded in showing a profit, he would have got the sack. But this does not deal with the agency question. It is an enormous question. Let us for a moment consider what is likely to happen if this new Clause is not passed, and if the Inland Revenue propose to continue the policy which they are now pursuing.
    First of all, I take it, the foreign firms could dispense with their agents altogether, in which case there would be an enormous loss to the revenue on earnings of that character in this country. There would be a loss of revenue on the agent's earnings and a loss of employment as well, for there is a considerable amount of employment in the City on these lines. The agent could be removed to a neighbouring country. I know a large number of businesses in the City which are profitable and contribute a great deal to the revenue, but from the very nature of their undertaking they could be conducted as well from any Continental port
    2100
    as from London, in which case we stand to lose not only the revenue on those agencies, but we should also stand to lose an enormous amount of that trade to which the right hon. Gentleman has referred. One has to remember there are many cases in which an agency in this country means that goods are sold, not in this country, but in every part of the world. They could dispense with an agent altogether and the foreign firm could do its business in this country by a traveller or through the post. The consequence would be exactly the same—a loss of revenue to the Exchequer and no gain whatever to this country.
    Suppose, for a moment, the agent is retained, and is still liable to account for the profits made on the other side. Then he will have no option but to add to the prices of the goods the amount of profit for which he may be liable. There is also the question of the assessment for back years. He may be liable to assessment on figures which he could not control, and it is safe to say he could never recover the amount of that assessment. It would exceed the amount of his commission by a considerable sum. But if the agent is retained, the cost is added to the price of the goods. I am quite aware it is usually assumed that agents in this country are assessed on the sales of manufactured goods. That has been the way in which this case has been argued for years past. As a matter of fact there are certain essential raw materials which are imported into this country, and we still must have them whatever may be the conditions attached to them. If this proviso is not accepted, the only effect must be to raise the price of the goods if the agent is retained in this country; we must either retain the agent and put up with that increase of price, or the agent must go abroad, or the firm must do its business through the post or by means of travellers.
    After all, we are the greatest exporting nation in the world. It is not unreasonable to suppose that action of this description may lead to reprisals. I have a recollection that a little while ago we got into trouble with American shipping on the same lines, and we had to bring it to an end. The arrangement also met with reprisals from Spanish shipping which I am afraid has not yet been satisfactorily settled. Whatever the policy of

    2101
    the future may be, at any rate we must agree it is perfectly monstrous to attempt to assess an agent on the past four years for money which he has no possibility of recovering in any way whatever. It is most unfair that if trade done through a traveller or through the post or by a broker cannot be subject to taxation, the trade done through an agent should be subjected to this double taxation all the way through. There is no real difficulty in the way of conducting the business. It is merely a matter of organisation. The agency must be a convenience to both buyers and sellers, and it is proper we should lay it down that profits only should be taxed where they are made. They are made where capital and labour are employed in the manufacture. We have no right to tax them here. The tax is in restraint of trade and it upsets established business methods. It is inequitable, and it cannot be collected. It prepares the way for reprisals and international complications. It has been condemned by the British National Committee of the International Chamber of Commerce and by the Economic Section of the League of Nations. It is not in keeping with Mr. McKenna's declaration, and the argument that it is unfair competition with British manufacturers I think can be speedily disposed of. Finally, I would suggest it is absolutely impossible to discriminate between manufacturer's profits and merchant's profits, and for these reasons I hope the Chancellor of the Exchequer will see his way to accept the Clause, which I believe will not only be a good thing for the City of London, but will result in good for the trade of the country and for the revenue generally.
    Mr. E. C. GRENFELL: We have no objection to the action of Somerset House in this matter, because I understand it is their duty only to interpret the law as they find it, and if they find it to be different to what Mr. McKenna intended it to be, I hope the Chancellor of the Exchequer will see his way to carry out Mr. McKenna's wishes. We are in a very different position from what we were in 1915. We have the good will of the agencies. We have pre-eminence in shipping. During the War and after the War our competitors in America, thinking they saw a way to pick up our business, went into the various trades in which we
    2102
    had been pre-eminent. They went into the shipping business, and I do not think they can congratulate themselves on the financial results of their operations. They went into the insurance business, and as there were not enough insurance people to do the business, several of the banks established subsidiary branches to help finance the insurance business, and a study of their balance sheets shows that those banks in America which indulged in this subsidiary orgy have had to write off enormous sums and eventually to retire from the business. That is extremely satisfactory at any rate to us. Another thing that excited their attention was our foreign banking business. In the last 80 years several foreign banks, by which I mean English banks working in the East and in foreign countries, have slowly accumulated a goodwill that is the envy of the world. There were one or two, I think three, American banks established in the East and elsewhere, and two or three years ago they went through the painful process of writing off two or three hundred millions of dollars for their experiment. Since the War, we have emerged crippled in many ways. But we still have our great agency business in London; not an imposing business, not a business with great buildings, but a small business, with one or two rooms in Mincing Lane and elsewhere, making no show, but, I believe, contributing largely to the revenue. These still exist. They are run by the men who made them, or by their sons, and they enjoy the goodwill of the world and almost universal confidence as compared with other agencies. Although our shipping is suffering, I do not think anyone to-day is able to teach us much in this business. Even if it is a losing business, I think, perhaps, we are losing less than other people. In the insurance world we are undoubtedly supreme.
    We owe £40,000,000 annually to the American Government. We are left to-day to pay our foreign debts, our balance of imports; and exports, and our £40,000,000, out of goods and services. The goods do not suffice, and we are left with the services. It is all important that these agencies should be allowed still to go on, and not to have confidence in them impaired. I would also refer to the centre we occupy as the headquarters of the tea, the rubber and many other industries. Further, the

    2103
    agency fees charged here by the regular agents are extremely moderate. I think, in the sugar trade, the usual commission is about a half or 1 per cent., and the other commissions generally vary according to the trade, up to about 2½ per cent. That is not exorbitant, and is a fee that the foreigner is ready to pay. But if he is asked not only to pay that, but to pay Income Tax unknown when he sells the goods, he is going to refuse to pay them, refuse to show his accounts, and he will let his agent, if he can, pay these duties, and eventually switch off his business to foreign countries. That is going to be a serious loss. The agent here receives a telegram from Java, offering sugar. That sugar is possibly sold across the street in Hongkong or Singapore. It is because the agent here enjoys the Java merchant's confidence, because the Java merchant knows of his agent's experience, that he puts his affairs in his hands, and, having done so, he asks that agent, probably, to arrange the freight, find the ship, insure the goods, and, eventually, the drawing for those goods is done through one of these very foreign English-owned banks we speak of. It is impossible to give real figures, but it should be possible to get them at Somerset House. I have, however, got the figures regarding the years 1921, 1922 and 1923 with regard to a few merchants trading from Java. These figures show that the amount of finance done through these English-foreign banks is £24,000,000; the amount of brokerage to London, £225,000; insurance premiums paid into British insurance companies, £80,000; and the freight paid to British shipowners, and shipbrokers' commissions, £800,000. Needless to say, these merchants and brokers are not anxious to tell me all their affairs, but I have secured these facts out of courtesy. In addition to that, these agents and brokers in London have buildings, small or great. They pay their clerks and their managers, presumably, fair salaries, and I believe that the Chancellor, if he has figures that are really reliable—and they are difficult to get—will find that by running the risk of switching off these agencies to foreign countries, he will lose more in Income Tax and more in Super-tax than he will gain by running after a few foreigners who are defeating the law here. I maintain that it is possible that Somerset House could
    2104
    exercise more supervision over the foreigners who have multiple houses. They should devote themselves to that rather than taxing agents in a general way.
    Mr. S. SAMUEL: I wish to speak on this subject because when Mr. McKenna introduced these taxes I strenuously opposed them. I pointed out at the time that it was very dangerous for people who live in glass houses to throw stones. We have found in foreign countries that advantage has been taken to imitate us in trying to tax the foreigner, and that it is utterly impossible. The original idea in these taxes was to protect our manufacturers, because foreign manufacturers on the Continent, especially in Germany, were doing a considerable trade, or had been before the War, in their wares, but I do not want to enter into the question of Protection. We all know that before the War, the German manufacturers, Austrian manufacturers and Americans, had branches in this country, and many of them were employing British firms in distributing the goods of their industries which were sold in his country. I pointed out to Mr. McKenna at the time, and I wish to point out to the present Chancellor of the Exchequer, that it is just as easy for a manufacturer abroad to send a traveller through the country to take the orders and deliver them direct, without the employment of any agent at all, thus killing the goose that lays the golden egg, because you eliminate the British agent who is paying Income Tax, who is paying rates and taxes, and contributing in many ways to the upkeep of the country.
    You have only to visit to-day the great industrial centres of this country, Manchester, Liverpool or Bradford, and you will find there that many of the rooms at the hotels are occupied by travelers representing Continental firms. They come here and probably travel England for three or four months of the year. They collect their orders, eliminating the British agent, which was perhaps not the intention of Mr. McKenna, and they take back their orders and pay absolutely nothing towards the taxation of this country. In that respect the remedy is in the hands of the Continental and American industrials, and they have already taken steps to protect themselves. You never can, and you never will, be able to tax them. Their trade will go

    2105
    on in this country in future as it has in the past, but it will not be done through British agencies. In these matters it is useless for me to say anything further. But there is one thing that I wish to bring to the notice of the Chancellor of the Exchequer, because it creates an exceedingly serious and dangerous position for this country. As the last speaker said, we have through generations, by the integrity of our commercial classes, established connections in every part of the world. We have brought to this country the produce of all the countries in the world, the produce required for every industry. We have done that simply on our reputation, which has been proved to be better than that of any other nationality.
    Before the War we were in great competition with Continental countries, especially in the creating of markets for some of the most stable articles. I will mention one which is enormously important. That is wool. London is the centre of the wool markets of the world. We have in London bi-monthly sales, and wool from Australia, from the Cape, from the Persian Gulf and from the Argentine, comes to London, where we have an army of experts who are able to classify the wools and sort them out. Every two months you have only to visit the neighbourhood of the London Docks to find the representatives of industry from every part of Europe, as well as from England, trooping down to inspect the wool. Every bale of that wool is consigned to this country. Hardly a bale is brought here for the account of a British firm, because it is necessary for the buyers who require specialities to visit and select their own clips of wool. The sales are bi-monthly, and often the purchases made at the sales are very small. But during the time between the sales the buyers who have been here make notes of the various parcels offered, and as they require to buy for their consumption in their industries they send their orders to the brokers here to purchase in the open market the wool which has been inspected.
    10.0 P.M.
    You run great risk if you attempt to tax the farmers by making them pay Income Tax on some fictitious sum which they may repudiate altogether. Now it is said that the agent to whom that wool is sent is to be liable to pay on a fictitious profit which you say the producer has
    2106
    made. The consequence will be that Havre, which is making provision for attracting the wool trade, will be immediately in competition with this country, and Hamburg, where there is a magnificent port, will offer all sorts of facilities for the wool trade. Our Yorkshire industrials will then not come to London for their requirements, but will be forced to some Continental port every two months to buy what they require. You will lose not only the revenue which you raise at present on the income of the agents, but you will lose the employment of thousands of men who manipulate this wool, you will lose the dock charges which are paid here, and the dock companies will have less profits on which to pay Income Tax, and you will lose the revenue on the handling of all this material.
    I have mentioned only one article, but it is one of the most important articles which you are threatening with destruction in the markets of this country. From 50 years' experience as a merchant, I could name a dozen or more articles which are essential to the industries of this country. If you attempt to tax the agents, the producers in other countries through the agents, you will drive ail these trades out of the country, and you will compel the industrials of this country to go abroad, and you will deprive yourself of an enormous revenue which you have had in the past from this entrepôt trade, established through the hard work and honesty of our merchants for generations.
    Sir J. PENNEFATHER: I would like to reinforce what has been said by the representatives of trade in various parts of the country by drawing attention to a remarkably unanimous resolution which has been passed on this subject by the United Trade Association of Liverpool. It is an association of associations, and comprises 14 trades, among them being cotton, corn, timber, wool, provisions, sugar, fruit, seed oil and cake, general brokers, shipping forwarding agents, West African merchants, and the Co-operative Wholesale Society, Limited. This important association, consisting of 14 other large associations, is rarely able to come to an agreement on any point, the various interests as a rule being in conflict. But on this point the association has written and have asked me to support this new Clause. I think

    2107
    that fact, coupled with the speeches which have been delivered, should be sufficient to convince the Chancellor of the Exchequer that this proposal is made in a businesslike spirit, that its acceptance will have the approval of very large masses of the business people of this country, and that its rejection will cause them grave uneasiness.
    Mr. W. GRAHAM: The Debate to which the Committee has just listened has covered a wide field on what is, from some points of view, a rather difficult Amendment, but which I think in the last resort is a comparatively simple proposition. May I at the outset take the Committee back to the exact proposal of the right hon. Gentleman, who put forward this Clause. In effect it comes to this, that where there is a bona fide agent acting in this country for a non-resident principal, we shall depart from what has been the practice hitherto in matters of Income Tax, and not expose that bona fide agent to liability for the tax for which the principal would have been responsible. I need not detain the Committee by reminding hon. Members of the very clear limitations which the right hon. Gentleman himself laid down. He stipulated for a bona fide agency. He also made it perfectly clear that there was to be no interference with the taxation of the agent in his capacity as an agent. What he wanted to do was to try to get the agent clear of this responsibility for the principal resident elsewhere in order to facilitate this agency business and the very large trade which depends upon it in this country. May I say at once that on the face of it that appears to be a fair proposition until we come to examine certain important facts which I think throw an entirely new light on the proposal. I stop hero to say only a word or two about double taxation. There cannot be any issue of double taxation in this Debate, and, even if there were, I should think the Committee would agree that this is not the proper method of dealing with it. In so far as we in this country have been able to overtake the problem of double taxation, the results of our efforts will be found in the Finance Bills of recent years, and there is, of course, a certain extension in the matter of shipping to the Colonies in the
    2108
    Finance Bill now under discussion. Therefore, that point need not detain us long.
    I come to two points which have been raised, one by the hon. Member for Aylesbury (Mr. Keens), and another by hon. Members in other parts of the House which involve questions first about the brokers and secondly about of trade between non-residents. On these points I cannot do better than repeat two passages from the Schedule of the Income Tax (Consolidation) Act, 1918, because, first of all, in the matter of brokers and in the second place, in the matter of trade between non-residents, there is again the question of an entrepot trade which may not touch our shores at all or which just touches our shores, and these two passages in this Act of Parliament go far to indicate that already there is substantial protection and that what hon. Members have held out to the Committee to-night are feelers rather than realities. Take the case of the brokers. Rule 10 of the general rules applicable to Schedules A to E as contained in the Act of 1918 says:
    "Nothing in these rules shall render a non-resident person chargeable in the name of a broker or general commission agent or in the name of an agent not being an authorised person carrying on the regular agency of the non-resident person or a person chargeable as if he were an agent in pursuance of these rules in respect of profits or gains arising from sales of transactions carried out through such a looker or agent."
    That, I think, is ample protection on that point, and on the question of trade as between non-residents Rule 11 is perfectly plain:
    "The fact that a non-resident person executes sales or carries out transactions with other non-residents in circumstances which would make him chargeable in pursuance of these rules in the name of a resident person shall not of itself make him chargeable in respect of profits arising from these sales or transactions."
    That of course would entirely cover certain of the transactions described by hon. Members to-night. I think certain of the criticism at all events on those two points has proceeded without clearly remembering the passages in the Act of 1918 to which I have referred. I now come to the central point which is before the Committee. Everybody who knows anything about economic conditions in this country is aware of the enormous im-

    2109
    portance of the entrepot trade and we are all aware also of the very valuable part which is played by legitimate agents of all kinds. I am saying nothing for the illegitimate or unworthy agents in whose support I take it no hon. Member enters the lists to-night. But it is perfectly clear while we want to do everything we can to encourage legitimate agency in this country and facilitate the great volume of trade which depends upon it, we must be just at the same time to other traders within this country in competition with that trade who are exposed to the great burden of taxation which, presumably, if this Clause were adopted, these agents or their principals would escape.
    That takes us back to the practice of recent years. It has been the practice in Income Tax administration to have recourse against the agent for the profits arising from these transactions. May I ask one simple question. If in fact we have no recourse against an agent in this country then against whom have we any recourse at all for the recovery of tax, it may be on a very large enterprise conducted within the borders of Great Britain? That is the real issue before the Committee. Here is a trade or enterprise carried on undoubtedly to a very large extent within these shores. At the present time we have recourse against the agent for the recovery of tax due by the non-resident principals. We have obviously no jurisdiction whatever so far as the non-resident principal is concerned, and therefore if the Clause were carried it would be entirely nugatory as regards the non-resident person. We should have no power to recover against him and we should be deprived of our power to recover against the agent. Notice at once the state of affairs which would result from a condition of this kind. Here is a trade carried on in this country by large numbers of people who are exposed to the admittedly heavy burden of Income Tax, and it may be Super-tax, within Great Britain. Side by side with that trade you have the other trade conducted through these agents here. It is proposed in this Clause to deprive us of the effective power of remedy as regards a tax which, undoubtedly, should be paid. I am familiar with certain forms of Protection which have been urged by hon. Members in different parts of the House, but I never expected to find this novel form of Protection, which would, in
    2110
    fact, inure very largely, under this Clause, to the advantage of the non-resident trader, inasmuch as there is no real remedy against anybody in respect of the trade which he is conducting. That would be a perfectly intolerable proposition, from the point of view of traders in this country. In fact, it could not be defended. There is a real protection to legitimate agencies under the Clause that I have quoted, and on all those grounds this Clause should be rejected.
    Sir L. WORTHINGTON-EVANS: The reply of the Financial Secretary to the Treasury has disappointed me. It is a flat refusal to consider this Amendment in any shape or form, but let me examine his arguments. First of all, he quotes Rule 10 of the Act of 1918, as if that were a protection to the bona fide broker and the bona fide agent carrying on business in this country. It is not a protection, because the Inland Revenue to-day are, notwithstanding Rule 10, endeavouring to assess the agent for the profits made by a foreign principal. If that were a protection, I should not have put this Amendment on the Paper, and the assessments would not have taken place, so that the hon. Gentleman feels that he has to apologise to the Committee for doing what is obviously unjust, namely, assessing the agent for the principal, and he apologises by saying that the agent is already protected by Rule 10. Mark the rest of his arguments. He said we have an effective power and remedy over the agent in order in put the tax on the principal. What does that mean? It means that you can, because the agent is living in this country, distrain upon him for a tax, not payable by him, but by a foreign principal. That is the effective remedy. You have him in a trap. You are not attempting to justify this on the ground of equity. You are justifying it solely from a Treasury point of view. You say, "We have got him there, we can squeeze him, and we will not let him go."
    Mr. GRAHAM: Surely that is not the point. The real point is that this trade, in competition with trade in this country, must be taxed. I invite the right hon. Gentleman to tell us, if we have not a remedy through the agent, where have we a remedy at all?
    Sir L. WORTHINGTON-EVANS: I am not going to shirk that point, but let the Committee mark again that the hon. Gentleman says, "If we have not a remedy through the agent, where have we a remedy?" It is not a justification of taxing the agent because the agent ought to be taxed, but a justification for using a machinery, however unjust, because it is the only way in which you can get it. Now, is it the only way? If you really do mean, as your arguments seem to suggest, that you want to protect the British manufacturer against an importation into this country which does not pay taxes, put the tax on in the right place. [HON. MEMBERS: "Oh!"] Let the Committee observe that I did not advance this argument in support of this Amendment, but that the Secretary to the Treasury is driven to this argument in order to justify his position. He says that if you do not tax through the agent—and, mind you, he has never said a word in justification of taxing through the agent—that being the only machinery open to us, you are going to let an unfair competition arise with the manufacturers of this country. We know that, and we have the remedy, and so has the Treasury, if it would only use it. Put the tax on in the right place, at the Customs, and then you can equalise the taxation between the foreign manufacturer and the British manufacturer. I did not want to raise the tariff issue. I am always willing to do so, but at the proper time. I did not raise it, and I did not expect it would be raised, in connection with this Amendment. The Financial Secretary cannot justify his position without raising that. And I say to him—and I am entitled to say to him—put the tax in the right place. He does not pretend that this agent is anything but a useful bit of machinery. He does not pretend that the agent or broker is not carrying on a legitimate business. He is not pretending that the profits he is taxing are the profits of the agent or broker. He admits they are the profits of the foreign principal, but what he says is: I have got an effective method by squeezing the agent. Yes, but he will squeeze him to death! Is it fair to the agent in the great entrepot trade of this country, an entrepot trade which is being seriously endangered by this tax? If the Chancellor of the Exchequer is going to deal with this at all I should
    2112
    like to know what his justification is? Under the Act of last year you can go back six years. Does he propose to go back six years and put these six years' deductions, which ought to be paid by the foreign principal, upon the British agent who has no power whatever to recover from the foreign principal, and, indeed, may have ceased to do business for that particular foreign principal? Are you going to tax retrospectively that English broker or agent for having carried on a perfectly legitimate business? All I can say is that, if that is the only answer which the Treasury can give it is an admission that the Amendment which I am asking the Committee to accept is a proper Amendment, doing nothing but justice, and only opposed on the ground that there is no other machinery than the very complicated and big machinery they have got.
    The ATTORNEY-GENERAL (Sir Patrick Hastings): I only desire to say a very few words on this, because I really believe the matter has been summed up pretty well. Might I ask the Committee just to let me quote the Finance Act as to what the position is of the income-tax law at the moment in regard to the foreigner who is trading in this country, for it is quite simple. He is obliged to pay Income Tax on his earnings in this country just as if he were a resident, and I appeal to the Committee that this is not only natural, but it is right. Whether right or not it is not dealt with by this Amendment. Therefore, one starts on the principle that the foreigner who lives in this country has to pay the same tax on the profits of his industry as does the resident here. Rule 10 of the Act of 1918 has been referred to. It is really quite clear in its interpretation. My right hon. Friend said that the Income Tax authorities are engaged every day in trying to get something to which they are not entitled—
    Sir L. WORTHINGTON-EVANS: The right hon. and learned Gentleman must either quote, or not quote; and if he does quote to quote me correctly. What I said was that the Financial Secretary to the Treasury had claimed that there was protection already given by Rule 10. I said, notwithstanding Rule 10 the Inland Revenue authorities are now endeavouring to assess agents for the branches of

    2113
    foreign principals so that the Rule is not the protection that the Financial Secretary claims it is.
    The ATTORNEY-GENERAL: Really Rule 10 is quite clear. It says that where a man is the agent he is not taxed at all. The only case in which the agent is taxed is where he is a special agent for a foreign principal. I will give as an illustration the case of a man abroad who manufactures champagne. If he sells the champagne here in this country through a mere broker, that broker is not charged. But if he has an established agency here, then he is a special agent and he is charged. In a case where a foreign principal has not an established agency in this country, the agent would not be liable to be assessed for the tax. My right hon. Friend the Member for Colchester (Sir L. Worthington-Evans) is quite right when he speaks of squeezing. Our point is that if the foreign principal cannot be assessed through his agent there is no hardship. The agent here enters into the transaction knowing he is assessable for his principal, and it is quite easy for that agent to see that the requisite amount shall remain in his hands for that purpose.
    It would be better if my right hon. Friend really wanted to effect a change not to put in an Amendment to the effect that you shall not be able to charge the agent. If he means the foreign principal I could understand it. The foreign principal is selling in this country, and he should pay the tax, but the right hon. Gentleman is now proposing to remove the only method by which we can make him pay. I thought the Committee would desire this case to be stated, and I want the Committee to know what happened in these cases. What does my right hon. Friend suggest? If the foreign principal is to be taxed, and there is no suggestion in the Amendment that he should not be taxed, how does my right hon Friend suggest that he should be taxed.
    Mr. S. SAMUEL: Is the Attorney-General aware that the method he proposed would eliminate the agent altogether, and that the manufacturer abroad would sell direct to the consumer? The custom of the trade is that the agent takes the order, but he does not handle the money. The manufacturer or the shipper draws direct upon the people to whom the agent sells.
    The ATTORNEY-GENERAL: I am sure my hon. Friend does not want to mislead the Committee, but under this Amendment you are proposing nothing, and we are simply saying that the law as it stands should continue to stand.
    Mr. MILLS: It is Tory law.
    The ATTORNEY-GENERAL: If you desire to alter the law as to the foreign principal paying, why put down an Amendment saying that they need not pay? It is no good putting down an Amendment which says that they ought to pay and which, at the same time, takes away the only method of making them pay. If my right hon. Friend or anyone else can suggest a method by which the tax can be assured without taxing the agent, I am sure the Chancellor of the Exchequer would consider it.
    Lieut.-Colonel L. WARD: How can you tax the foreign principal when he only employs a general agent?
    The ATTORNEY-GENERAL: The whole principle of Rule 10 is, surely, this, that it would not be fair to say to a general broker, who has not regular business arrangements with his employer, "At any moment we an come down and say to you, "You are liable for the whole of the tax of your principal.'" The right hon. Gentleman says that that is what we are asking, but I have had these cases before me every day, and we are doing nothing of the sort. In a case which was decided within the last two months, the Court said, "The question is, is the person a broker or a special agent? If he is a broker, he is not liable for the tax at all, and cannot be assessed under Rule 10, but if he is a general agent for the purpose of a special business he can be assessed." If my right hon. Friend can suggest any alternative. I am sure the Chancellor of the Exchequer will consider it, but it is really no good asking the Committee to vote without knowing the real facts. If the foreigner is to pay the tax, there is, as far as I know, no means of getting the money except from the agent.
    Sir VANSITTART BOWATER: I am sure it must be very gratifying to Members on this side of the Committee to find some of those on the Front Government Bench at last coming round to Protection. I am quite sure that every Member on this side is very anxious that the foreigner

    2115
    should pay something, but if you are going to put a tax on foreign goods that come into this country, then, even if it is called an Income Tax, it is still a tax, and, whatever Members on the other side may say, it must be against their principles, if they have any principles, of Free Trade. If you have a bona fide agent in this country, whether he be the agent of only one firm or not, and he is simply earning his commission in a bona fide way, how can the Government or anyone else come upon him and expect him to pay the Income Tax on the profit that the manufacturer makes? How is that agent to find out? The manufacturer is not so stupid as to let the agent know what profit he is making. Whether he is an English manufacturer employing agents abroad, or a foreign manufacturer employing agents in this country, he does not confide in his agent to the extent of telling him what profit he had made. If we insist on taxing the agent, what does it mean? It means that we either force the agent to become a merchant, in which case not another penny of tax would be obtained, because his profit would be the same, or you force the foreigner to dispense with the agent and do the business direct, saving the agent's commission, which the consumer will not get. Hon. Members opposite profess to be endeavouring to find work for the unemployed, but that would be one of the first things to throw a great many people out of employment. It is all very well for hon. Members opposite to laugh, but it is a fact that if you do away with the agent, and the foreigner does his business direct, you will not get the tax from him, because you cannot get at him, and the agent and all his employés will be thrown out of employment.
    In addition to that, will not the foreigner retaliate? Any number of big manufacturers in this country have their agents all over the world, and is it to be thought that the foreigner, in addition to the taxes we already have to pay on our goods that go into foreign countries, will not put on an impost, and make the agents pay Income Tax on the profits that are made by people in this country? I hope the Chancellor will see his way to accept the Clause. It is most reasonable. If Rule 10 protects the agent, how is it that the Income Tax collector is
    2116
    worrying the agents at present? I will read a few lines from a letter I have received during the last few days:
    "Your news that the matter is to come before the House to-day possibly accounts for our receiving yesterday forms to fill in on behalf of foreign principals. Of our various principals we have only been attacked on account of one. The officials select one presumably to try to establish that we are a branch. I find those are the usual tactics."
    If Rule 10 protects the agent, why are the Income Tax people bullying people in this way? [An HON. MEMBER: "What firm is that?"] A very responsible firm in the City of London. I am prepared to give the Chancellor of the Exchequer the name, but not all the hon. Members opposite. I was pleased to see an hon. Member opposite strongly supporting the arguments which have been used by several Members on this side, and I think there is a very strong case for the Chancellor of the Exchequer to take into consideration and to accept the Clause.
    Mr. D. HERBERT: I have had a certain amount of direct personal experience in these matters. It seems to me that there has been a certain confusion running through the whole Debate, created to a great extent by a fear as to the action of the Inland Revenue. The Attorney-General realises that this Clause is directed immediately to relieving from personal liability an agent who is not in receipt of the profits that he wants to tax, and who may quite possibly be absolutely unable to recover from his principal. If the revenue cannot recover from the principal, it is at least possible, and in most cases probable, that the agent also cannot recover from the principal. If that is so, it is, of course, contrary to all the principles of equity that because you cannot get the tax out of the principals, sooner than go without it you should get it out of some poor, harmless individual, who has done nothing to deserve being penalised in that way. There are cases, of course, which are quite different from that, where the agent may be said to be in league with his principals. An hon. Member opposite referred to a case in which he was concerned as a Controller during the War. I was concerned in an absolutely similar case, one, probably, very well known to the Attorney-General, and certainly to many Members of the House, where a German firm established

    2117
    a factory over here, ran it as an English company and took care that not a penny of profit was made by the English firm, but it was all made by the German firm, who owned the shares and bought the product and resold it to merchants in London. Then, by a piece of book-keeping, they put all the profit into Berlin instead of this country. The Attorney-General asks how we are going to get at these people, if not through the agent? I suggest that it is not beyond the capacity of English law to get at these people, so long as there are assets in this country.
    The ATTORNEY-GENERAL: Where there are assets in this country the position might be met, but in 99 cases out of 100 they are cases where there are no assets and no business in this country. The only business is the business of sale or exchange, which is conducted agents, and there are no assets.
    Mr. HERBERT: I am much obliged for that statement, but I think the Attorney-General is a little wrong when he says that in 99 cases out of 100 there are no assets. My point is that in an immense number of cases, I will not say 99 per cent., but 50 per cent., there are assets in this country. Where it is a case of fraud, the arm of the English law is strong enough to get at them. [HON. MEMBERS: "Divide!"] I am trying to meet the points which the Attorney-General and the Financial Secretary have quite properly made. Is it right, in order to try to deal with a comparatively few thoroughly dishonest people, instead of resorting to a process based upon the allegation of fraud, to pass a law under which you penalise and make personally liable for the tax a perfectly innocent agent, who is less able to recover the tax than the revenue authorities are. [HON. MEMBERS: "Divide!"] If hon. Members on the Back Benches opposite would only be as polite and perhaps as intelligent as those who have been good enough to listen to me from their own Front Bench—
    Mr. E. BROWN: I have tried to listen to the hon. Member for the last 20 minutes and hon. Members on his own Front Bench have prevented my doing so.
    Mr. HERBERT: I want to put the matter in plain words. In most cases it
    2118
    will be admited that if recovery can be made against the foreigner no one is better able than the Crown, with all their special resources, to recover. Let me remind the Attorney-General that the Crown has certain machinery, which it has endeavoured to put into operation within the last few years, under the Crown Suits Acts, a process which is not for a private individual in this country. The Crown has a greater power to recover from the foreigner than has a private individual. If the Crown is unable to recover from the foreigner it is grossly unfair that the Crown should pass a law that a private individual, who may be absolutely innocent, should be compelled to pay for the principal when he is utterly unable to recover the money.
    There is the other point which has caused so much disturbance in the City of London. The Attorney-General referred to the rule under the Income Tax Act of 1918, which is copied from the Act of 1915. I think that I am right in understanding him to say that the foreigner is considered to be chargeable where there is a special agent carrying on trade or business in this country. That I think is a great part of the disturbance in the City of London. What is the meaning of "special agent," and what is the meaning of "exercising or carrying on trade or business in this country?" The class of case which the revenue have been endeavouring to tax lately, and which has caused this disturbance, is this type of case. Producing companies in the Colonies or abroad, whether they produce tea, sugar, coffee, nitrate, rubber or whatever it is, in some cases sell their produce by going to no end of different general brokers, and I understand that the hon. and learned Gentleman says that they are not taxable. I rather gather from what he says that if instead of doing that they go to one firm of brokers and say, "We wish to arrange for the disposal of the whole of our crop through you, and you will incidentally make advances to us" it means that there is a special agency. I understand that the Attorney-General assents to this.
    This does affect the very root of the whole of our entrepot trade on which the great financial business of the City of London is based. The hon. and learned Member shakes his head. I will not for a moment attempt to argue upon the law with him, but I have, perhaps, more

    2119
    personal experience of this particular kind of business in the City of London than he has, and an immense number of these companies, particularly in these days, find it necessary to go to a special agent as their broker or their produce merchant, because it is through them they get financed, and get all sorts and kinds of advantages which result from having a definite correspondent in the financial world. It has always been considered, until lately, that the rule to which the hon. and learned Gentleman referred relived those companies from taxation. In reference to the company of which I am speaking, and which he says would be chargeable, may I ask with what is it chargeable, and on what profits is it chargeable? Suppose it to be rubber, the rubber is grown, all the labour in connection with it is done, all the expense is paid, and all the goods are collected in a foreign country. [Interruption.] I am endeavouring to be as short as I can. I can assure hon. Members opposite, who do not realized the importance of this question, that as long as I am able to stand up, and that as long as representatives of the Government are good enough to listen to me, I am not going to be stopped by the Back Benches, so the sooner I can get on, the sooner I shall finish.
    The point I am making is this. One of these companies producing rubber, tea, sugar or whatever it is, sends it produce all over the world, spends the whole of its money in producing these products abroad, and the only thing that is done in this country is that the broker or agent who earns a profit in the form
    of the commission he makes on the contract with the buyer and gives the particulars of that contract to the foreign company in order that they may deliver the goods. Is that company, because it has made a special agreement to deal with one general broker only, to be liable to pay tax. The Attorney-General must give us a definite answer to this one way or another. He shakes his head now, but he nodded his head in the affirmative when I asked him whether the making of an agreement with one broker constituted a special agent. [Interruption.] I suggest to the Chancellor of the Exchequer that it is of the utmost importance that these companies should not be thought liable for taxation. It is of the greatest importance that those engaged in merchant businesses in London should—[Interruption.]
    Mr. REID: May we hear what the hon Member has to say?
    The DEPUTY-CHARIMAN: If hon. Members would exhibit a little more patience, we might get on.
    Mr. HERBERT: I want the Chancellor of the Exchequer—and no one realizes better than himself—[Interruptions.] If I am allowed one more minute I will finish—
    Mr. SNOWDEN rose in his place, and claimed to more, "That the Question be now put."
    Question put accordingly, "That the Clause be read a Second time."
    The Committee divided: Ayes, 156. Noes, 260.

    Division No. 136.]

    AYES.

    [11.1 p.m.

    Agg-Gardner. Rt. Hon. Sir James T.

    Cayzer, Maj. Sir Herbt R.(Prtsinth. S.)

    Edmondson, Major A. J.

    Amery, Rt. Hon. Leopold C. M. S.

    Cecil, Rt. Hon. Sir Evelyn (Aston)

    Elveden, Viscount

    Baldwin, Rt. Hon. Stanley

    Chadwick, Sir Robert Burton

    Erskine, James Malcolm Monteith

    Balfour, George (Hampstead)

    Chamberlain, Rt. Hon. N. (Ladywood)

    Falle, Major Sir Bertram Godfray

    Barnston, Major Sir Harry

    Chapman, Sir S.

    Ferguson, H.

    Beckett, Sir Gervase

    Chilcott, Sir Warden

    FitzRoy, Capt. Rt. Hon. Edward A.

    Bellairs, Commander Carlyon W.

    Clarry, Reginald George

    Forestier-Walker, L.

    Betterton, Henry B.

    Clayton, G. C.

    Gates, Percy

    Birchall, Major J. Dearman

    Cockerill, Brigadier-General G. K.

    Gaunt, Rear-Admiral Sir Guy R.

    Bird, Sir R. B. (Wolverhampton, W.)

    Colfax, Major Wm. Phillips

    Greene, W. P. Crawford

    Blades, Sir George Rowland

    Cope, Major William

    Greenwood, William (Stockport)

    Blundell, F. N.

    Courthope, Lieut.-Col. George L.

    Grenfell, Edward C. (City of London)

    Bourne, Robert Croft

    Crooke, J. Smedley (Deritend)

    Gretton, Colonel John

    Bowater, Sir T. Vansittart

    Cunliffe, Joseph Herbert

    Guinness, Lieut.-Col. Rt. Hon. W. E.

    Bowyer, Capt. G. E. W.

    Curzon, Captain Viscount

    Hacking, Captain Douglas H.

    Briscoe, Captain Richard George

    Dalkeith, Earl of

    Hall, Lieut.-Col. Sir F (Dulwich)

    Bullock, Captain M.

    Davies, David (Montgomery)

    Hannon, Patrick Joseph Henry

    Burman, J. B.

    Davies, Maj. Geo. F.(Somerset, Yeovil)

    Harland, A.

    Burney, Lieut.-Com. Charles D.

    Dawson, Sir Philip

    Harmsworth, Hon. E. C. (Kent)

    Butler, Sir Geoffrey

    Deans, Richard Storry

    Henn, Sir Sydney H.

    Butt, Sir Alfred

    Dixon, Herbert

    Hennessy, Major J. R G

    Cautley, Sir Henry S.

    Eden, Captain Anthony

    Herbert, Dennis (Hertford, Watford)

    Hogg, Rt. Hon. Sir D. (St. Marylebone)

    Pease, William Edwin

    Stanley, Lord

    Hope, Rt. Hon. J. F. (Sheffield, C.)

    Pennefather, Sir John

    Steel Samuel Strang

    Howard, Hn. D.(Cumberland,Northrn.)

    Penny, Frederick George

    Sutcliffe, T.

    Howard-Bury, Lieut.-Col. C. K.

    Percy, Lord Eustace (Hastings)

    Tattersall, J. L.

    Huntingfield, Lord

    Perkins, Colonel E. K.

    Thomas, Sir Robert John (Anglesey)

    Jackson, Lieut.-Colonel Hon. F. S.

    Perring, William George

    Thompson, Luke (Sunderland)

    Jones, Henry Haydn (Merioneth)

    Philipson, Mabel

    Thomson, F. C. (Aberdeen, South)

    Keens, T.

    Pielou, D. P.

    Thomson, Sir W. Mitchell-(Croydon, S.)

    Kindersley, Major G. M.

    Pownall, Lieut.-Colonel Assheton

    Titchfield, Major the Marquess of

    King, Captain Henry Douglas

    Raine, W.

    Turton, Edmund Russborough

    Lane-Fox, George R.

    Rankin, James S.

    Vaughan-Morgan, Col. K. P.

    Lloyd, Cyril E. (Dudley)

    Reid, D. D. (County Down)

    Waddington, R.

    Lord, Walter Greaves-

    Remer, J. R.

    Ward, Lt.-Col.A. L. (Kingston-on-Hull)

    Lumley, L. R.

    Rhys, Hon. C. A. U.

    Warrender, Sir Victor

    MacDonald, R.

    Richardson, Lt.-Col. Sir P. (Chertsey)

    Watson Sir F. (Pudsey and Otley)

    Maitland, Sir Arthur D. Steel-

    Roberts, Samuel (Hereford, Hereford)

    Wells, S. R.

    Makins, Brigadier-General E

    Ropner, Major L.

    Weston, John Wakefield

    Marriott, Sir J. A. R.

    Roundell, Colonel R. F.

    Wheler, Lieut.-Col. Granville C. H.

    Mason, Lieut.-Col. Glyn K.

    Russell, Alexander West (Tynemouth)

    Wilson, Sir C. H. (Leeds, Central)

    Meller, R. J.

    Samuel, A. M. (Surrey, Farnham)

    Wilson, Col. M. J. (Richmond)

    Milne, J. S. Wardlaw

    Samuel, Samuel (W'dsworth, Putney)

    Windop-Clive, Lieut.-Colonel George

    Mitchell, W. F. (Saffron Walden)

    Sandeman, A, Stewart

    Wintringham, Margaret

    Mitchell, Sir W. Lane (Streatham)

    Savery, S. S.

    Wise, Sir Fredric

    Moore-Brabazon, Lieut.-Col. J. T. C.

    Sheffield, Sir Berkeley

    Wood, Major Rt. Hon. Edward F. L.

    Nall, Lieut.-Colonel Sir Joseph

    Shepperson, E. W.

    Wood, Sir H. K. (Woolwich, West)

    Newton, Sir D. G. C. (Cambridge)

    Simms, Dr. John M. (Co. Down)

    Worthington-Evans, Rt. Hon. Sir L.

    Nicholson, O. (Westminster)

    Sinclair, Col. T.(Queen's Univ., Belfst.)

    Wragg, Herbert

    Nicholson, William G. (Petersfield)

    Smith-Carington, Neville W.

    Yerburgh, Major Robert D. T.

    Oman, Sir Charles William C.

    Somerville, A. A. (Windsor)

    O'Neill, Rt. Hon. Hugh

    Somerville, Daniel (Barrow-in-Furness)

    TELLERS FOR THE AYES.—

    Owen, Major G.

    Spender-Clay, Lieut.-Colonel H. H.

    Commander B. Eyres-Monsell and

    Colonel Gibbs.

    NOES.

    Ackroyd, T. R.

    Davies Ellis (Denbigh, Denbigh)

    Henderson, T. (Glasgow)

    Adamson, Rt. Hon. William

    Davies, Evan (Ebbw Vale)

    Henderson, W. W. (Middlesex,Enfield)

    Adamson, W. M. (Staff., Cannock)

    Davies, Rhys John Westhoughton

    Hillary, A. E.

    Alden, Percy

    Davison, J. E. (Smethwick)

    Hindle, F.

    Alexander, A. V. (Sheffield, Hillsbro')

    Dickie, Captain J. P.

    Hirst, G. H.

    Allen, R. Wilberforce (Leicester, S.)

    Dickson, T.

    Hobhouse, A. L.

    Ammon, Charles George

    Dodds, S. R.

    Hodges, Frank

    Aske, Sir Robert William

    Duckworth, John

    Hoffman, P.C.

    Attlee, Major Clement R.

    Dukes, C.

    Hore-Belisha, Major Leslie

    Ayles, W. H.

    Duncan, C.

    Baker, Walter

    Dunnico, H.

    Banton, G.

    Edwards, G. (Norfolk, Southern)

    Hudson, J. H.

    Barclay, R. Noton

    Egan, W. H.

    Isaacs, G. A.

    Barker, G. (Monmouth, Abertillery)

    Emlyn-Jones, J. E. (Dorset, N.)

    Jackson, R. F. (Ipswich)

    Barnes, A.

    England. Colonel A.

    Jonkins, W. (Glamorgan, Neath)

    Batey, Joseph

    Falconer, J.

    Jenkins, W. A. (Brecon and Radnor)

    Becker, Harry

    Foot, Isaac

    Jewson, Dorothea

    Benn, Captain Wedgwood (Leith)

    Franklin, L. B.

    John, William (Rhondda, West)

    Berkeley, Captain Reginald

    Gardner, B. W. (West Ham, Upton)

    Johnston, Thomas (Stirling)

    Birkett, W. N.

    Gardner, J. P. (Hammersmith, North)

    Johnstone, Harcourt (Willesden, East)

    Bondfield, Margaret

    Gavan-Duffy, Thomas

    Jones, C. Sydney (Liverpool,W.Derby)

    Bonwick, A.

    George, Major G. L. (Pembroke)

    Jones, J. J. (West Ham, Silvertown)

    Bowerman, Rt. Hon. Charles W.

    Gibbins, Joseph

    Jones, Morgan (Caerphilly)

    Briant, Frank

    Gillett, George M.

    Jones, T. I. Mardy (Pontypridd)

    Broad, F. A.

    Gorman, William

    Jowett, Rt. Hon. F. W. (Bradford,E.)

    Bromfield, William

    Gosling, Harry

    Jowitt, W. A. (The Hartlepools)

    Brown, A. E. (Warwick, Rugby)

    Gould, Frederick (Somerset, Frome)

    Kay, Sir R. Newbald

    Brown, James (Ayr and Bute)

    Graham, W. (Edinburgh, Central)

    Kedward, R. M.

    Buchanan, G.

    Greenwood, A. (Nelson and Colne)

    Kennedy, T.

    Buckingham, Sir H.

    Grenfell, D. R. (Glamorgan)

    Kenworthy, Lt.-Com. Hon. Joseph M.

    Buckle, J.

    Griffiths, T. (Monmouth, Pontypool)

    Kenyon, Barnet

    Burnie, Major J. (Bootle)

    Groves, T.

    Kirkwood, D.

    Buxton, Rt. Hon. Noel

    Grundy, T. W.

    Lansbury, George

    Chapple, Dr. William A.

    Guest, J. (York, Hemsworth)

    Laverack, F. J.

    Charleton, H. C.

    Guest, Dr. L. Haden (Southwark, N.)

    Law, A.

    Clarke, A.

    Hall, F. (York, W.R., Normanton)

    Lawrence, Susan (East Ham, North)

    Climie, R.

    Hall, G. H. (Merthyr Tydvil)

    Lawson, John James

    Cluse W. S.

    Harbord, Arthur

    Leach, W.

    Clynes, Rt. Hon. John R.

    Hardle, George D.

    Lee, F.

    Collins, Sir Godfrey (Greenock)

    Harris, Percy A.

    Lessing, E.

    Collins, Patrick (Walsall)

    Hartshorn, Rt. Hon. Vernon

    Linfield, F. C.

    Compton, Joseph

    Harvey, T. E. (Dewsbury)

    Livingstone, A. M.

    Comyns-Carr, A. S.

    Hastings, Sir Patrick

    Loverseed, J. F.

    Costello, L. W. J.

    Hastings, Somerville (Reading)

    Lowth, T.

    Cove, W. G.

    Haycock, A. W.

    Lunn, William

    Cowan, D. M. (Scottish Universities)

    Hayday, Arthur

    McCrae, Sir George

    Crittall, V. G.

    Hemmerde, E. G.

    McEntee, V. L.

    Darbishire, C. W.

    Henderson, Rt. Hon. A. (Burnley)

    Macfadyen, E.

    Davies, Alfred Thomas (Lincoln)

    Henderdson, A. (Cardiff, South)

    Mackinder, W.

    Maclean, Neil (Glasgow, Govan)

    Macnaghten, Hon. Sir Malcolm

    2122

    2123

    Mansel, Sir Courtenay

    Rees, Sir Beddoe

    Thomson, Trevelyan (Middlesbro, W.)

    March, S.

    Rees, Capt. J. T. (Devon, Barnstaple)

    Thorne, G. R. (Wolverhampton, E.)

    Marks, Sir George Croydon

    Richards, R.

    Thornton Maxwell R.

    Marley, James

    Richardson, R. (Houghton-le-Spring)

    Thurtle, E.

    Martin, F. (Aberd'n & Kinc'dine, E.)

    Ritson, J.

    Toole, J.

    Martin, W. H. (Dumbarton)

    Robertson, J, (Lanark, Bothwell)

    Tout, W. J.

    Masterman, Rt. Hon. C. F. G.

    Robertson, T. A.

    Trevelyan, Rt. Hon. C. P.

    Maxton, James

    Robinson, S. W. (Essex, Cheimsford)

    Turner, Ben

    Middleton, G.

    Romeril, H. G.

    Viant, S. P.

    Millar, J. D.

    Rose, Frank H.

    Vivian, H.

    Mills, J. E.

    Royle, C.

    Wallhead, Richard C.

    Mitchell, R.M. (Perth & Kinross, Perth)

    Scrymgeour, E.

    Ward, G. (Leicester, Bosworth)

    Mond, H.

    Scurr, John

    Watson, W. M. (Dunfermline)

    Montague, Frederick

    Seely, H. M. (Norfolk, Eastern)

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Morel, E. D.

    Sexton, James

    Webb, Lieut.-Col. Sir H. (Cardiff, E.)

    Morris, R. H.

    Shaw, Rt. Hon. Thomas (Preston)

    Webb, Rt. Hon. Sidney

    Morrison, Herbert (Hackney, South)

    Sherwood, George Henry

    Wedgwood, Col. Rt. Hon. Josiah C.

    Morrison, R. C. (Tottenham, N.)

    Short, Alfred (Wednesbury)

    Wheatley, Rt. Hon. J.

    Morse, W. E.

    Simon, E. D. (Manchester, Withington)

    Whiteley, W.

    Mosley, Oswald

    Sinclair, Major Sir A. (Caithness)

    Wignall, James

    Moulton, Major Fletcher

    Smith Ben (Bermondsey, Rotherhithe)

    Williams, A. (York, W. R., Sowerby)

    Murray, Robert

    Smith, W. R. (Norwich)

    Williams, David (Swansea, E.)

    Murrell, Frank

    Snell, Harry

    Williams, Dr. J. H. (Llanelly)

    Naylor, T. E.

    Snowden, Rt. Hon. Philip

    Williams, Col. P. (Middlesbrough, E.)

    Nixon, H.

    Spence, R.

    Williams, Lt.-Col. T.S.B. (Kennington)

    O'Grady, Captain James

    Spencer, H. H. (Bradford, South)

    Williams, Maj. A.S. (Kent, Sevenoaks)

    Oliver, P. M. (Manchester, Blackley)

    Spero, Dr. G. E.

    Williams, T. (York, Don Valley)

    Paling, W.

    Spoor, B. G.

    Willison, H.

    Palmer, E. T.

    Stamford, T. W.

    Wilson, C. H. (Sheffield, Attercliffe)

    Pattinson, S. (Horncastle)

    Starmer, Sir Charles

    Wilson, R. J. (Jarrow)

    Perry, S. F.

    Stephen, Campbell

    Windsor, Walter

    Pethick-Lawrence, F. W.

    Stewart, J. (St. Rollox)

    Wood, Major M. M. (Aberdeen, C.)

    Phillipps, Vivian

    Stranger, Innes Harold

    Woodwark, Lieut.-Colonel G. G.

    Potts, John S.

    Sturrock, J. Leng

    Wright, W.

    Purcell, A. A.

    Sunlight, J.

    Young, Andrew (Glasgow, Patrick)

    Raffety, F. W.

    Sutherland, Rt. Hon. Sir William

    Rathbone, Hugh H.

    Terrington, Lady

    TELLERS FOR THE NOES.—

    Raynes, W. R.

    Thomas, Rt. Hon. James H. (Derby)

    Mr. Allen Parkinson and Mr.

    Rea, W. Russell

    Thompson, Piers G. (Torquay)

    Warne.

    Question, "That the Question be now put," put, agreed to.

    NEW CLAUSE.—(Rebate Upon beer brewed of malt and hops of Home pro- duction.)
    Where it is proved to the satisfaction of the Commissioners of Customs and Excise that any beer brewed in Great Britain or Northern Ireland on or after the first day of April, nineteen hundred and twenty-four, is brewed solely from malt and hops of Home Production there shall be allowed in respect of such beer the following rebate from the excise duty payable in respect thereof, that is to say:—
    In the case of beer brewed by a brewer of beer for sale, for every thirty-six galloons of beer of whatever original gravity charged with duty and delivered from a brewery a rebate of ten shillings;
    In the case of beer brewed by any brewer other than a brewer for sale, for every thirty-six gallons of worts of a specific gravity of one thousand and fifty-five degrees charged with duty a rebate of twelve shillings and sixpence, and so on in proportion for any difference in quantity.—[Mr. Shepperson.]
    Brought up, and read the First time.
    Mr. SHEPPERSON: I beg to move "That the Clause be read a Second time."
    I wish to assure hon. Members, not only those above the Gangway but those below the Gangway opposite, who support the Government, that I do not move
    2124
    this Clause for any purpose of obstruction. Nor do I move it with any idea of criticising the proposals of the Chancellor of the Exchequer. I move it simply from a sense of duty to my constituents, and I should have moved it whatever Government was in power. It may be said that this Clause is moved for the purpose of achieving popularity by reducing taxation, but I do not move it to gain popularity. I recognise that while reduced taxation should be very popular in one respect it would be unpopular with the Chancellor of the Exchequer, who has to balance the national accounts. I wish to assure the right hon. Gentleman that this proposal will cost the country but little, if anything at all. The subject of the Clause is beer. The question is often asked, "What is beer" I have always made it a rule not to speak in this House on a subject which I do not understand, and before I rose to speak on this subject. I took steps to understand something about beer. I took steps to find out the answer to the question "What is beer"?—[HON. MEMBERS: "Where?"]—not in the place supposed by hon. Members, but in the dictionary. I consulted Webster's Dictionary and Webster informs me that beer is

    2125
    "a fermented liquor made from any malted grain but commonly from barley malt with hops."
    I looked up the Dictionary of Dr. Murray, from which I learn that beer is
    "an alcoholic liquor obtained from the fermentation of malt flavoured with hops."
    It is well within the knowledge of the Committee that the beer we drink does not fulfil these definitions and the object of my Clause is not to gain popularity by the reduction of taxation, but is to cause the beer produced in the country to fulfil those definitions. Usually a proposal made by me would have the support of hon. Members on this side of the Committee and the opposition of hon. Members on the other side, particularly if it had anything to do with the industry of which we are supposed to be supporters.
    In this case, that is not so, because this new Clause is not agreed to by hon. Members on this side who have an interest in brewing. I asked them, before introducing the new Clause, and they assured me that it is not practicable, because the British public's palate would not accept a pure beer to-day. I wanted to be assured whether that statement was or was not correct, and so I went to inquire of the British public its opinion. In doing so, I did not ask the opinion of the man who drinks a bottle of Bass for his lunch, but of the real connoisseur—[HON. MEMBERS: "Name!"]—a man whose only alcoholic drink had been beer, a man whose palate had not been ruined by wines and spirits. I put it to that man: "What do you think of the beer you drank in your youth? "He was very ready with his reply. He said: "In the old days, beer was beer." I came to the conclusion, therefore, that the taste of the public had not altered and that the reason why the brewing industry informed me that the British public would not consume a pure beer to-day was because it is easier and cheaper for them to manufacture beer that is not pure, but that contains the many substitutes with which they manufacture it to-day.
    One of my objects in introducing this Clause is to assure that this beverage shall be what it ought to be, that is, beer, but that is not my main object. There is another condition attached to it, and that is that there shall be no reduction of Excise duty unless it is shown, not only
    2126
    that the beer is brewed from malt and hops, but that the malt and hops are of home production. It is not for the sake of the consumers of the beer or of the brewer that I move this Clause, but in the interests of British agriculture, which should be growing the hops and barley.
    The Committee know that the agricultural industry of the country is quite capable of growing all the barley necessary for the malt, and all the hops necessary to manufacture the beer for the brewing industry. The Committee also know at the present time that though the brewers do use malt and hops they do not use them wholly. If the beer consumed in this country were brewed from barley and hops grown in this country, it would mean an increase of national wealth owing to the considerable increase of the arable land under cultivation. The Minister of Agriculture and the Parliamentary Secretary to the Ministry both sit as representatives of Eastern counties. They know the distressed condition of agriculture. If this Clause were adopted it would help the growth and sale of barley in this country, and that would, to a certain extent, find a partial remedy at all events for the distressed condition of agriculture in the Eastern counties. Any proposed Clause may be opposed by Members who are interested in the bewing industry. I myself would be a supporter of a Pure Beer Bill, but such a Bill is not before the Committee now. I cannot use that help, so I am doing the next best thing by trying to use a certain amount of peaceful persuasion. I recognise, knowing the brewers, but also knowing human nature, that the method of peaceful persuasion is the same as financial persuasion. This Clause which I am introducing would bring that financial persuasion to bear upon the brewer because there would be a reduction of excise if they showed to the satisfaction of the authorities that they were brewing their beer from malt and hops grown in this country. I am confident if this proposed Clause were accepted that it would not be long before the British palate was able to again consume pure beer. It has been considerably difficult for me to move this new Clause, but I want to appeal to the Chancellor of the Exchequer, and to say that this Clause was drawn up so as not to invite undue criticism, but to be as helpful as I could be to the Government

    2127
    and the interests of the constituency I represent.
    Mr. SEXTON: On a point of Order. I should like to ask if the hon. Member, in expressing his opinion, is influenced in any way by recent personal experience [HON. MEMBERS: "Withdraw! Withdraw!"]
    The DEPUTY - CHAIRMAN (Mr. Entwistle): If the hon. Member for St. Helens (Mr. Sexton) means any personal imputation, he had better withdraw it.
    Mr. JONES: The hon. Member for St. Helens can drink as much as anybody else, if somebody else will pay for it. [Interruption.]
    The DEPUTY-CHAIRMAN: I think hon. Members had better allow the hon. Member for Leominster (Mr. Shepperson) to proceed.
    Mr. SHEPPERSON: I was not aware of the point of Order which has been raised. It has been said on this side that the Minister of Labour has been unable to do a certain conjuring trick—is to produce a rabbit out of a hat. I want to inform the Committee that he is not the only Minister who would like to do a conjuring trick in that way. The Minister of Agriculture is equally anxious to do that trick, and the rabbit that he would like to produce is something which would be a definite help to British arable agriculture. I submit that the Clause I am moving is a rabbit that would give help to the Minister of Agriculture. If I were merely a party politician, I should not give this trick away to the Minister of Agriculture, but. I put agriculture before party politics, and ask the Government to accept the proposals that I have put in this new Clause. I appeal to the Chancellor of the Exchequer to assent to the principle of my proposal, and I assure him that if he will assent to it he will get the thanks of his colleague the Minister of Agriculture and of all the consumers of beer in this country. He will also get the grateful thanks of the agriculturists of this country, and for these reasons I ask for the acceptance of this new Clause.
    Mr. J. JONES: I can understand the laughter, because one recalls the line
    "And the loud laugh that spoke the vacant mind."
    2128
    But, so far as I am concerned, I am not here to apologise for the fact that I drink beer. Others would be better if they did the same. I believe that the hon. Member who has moved this Clause honestly believes that he is doing the right thing. Therefore I am not going to charge him with being insincere, or with being "full of his subject." But, after all, we have such a thing as a Food Adulteration Act, and whether we like it or not—some people, of course, do not, and they look it—[An HON. MEMBER: "Some people do, and they look it!"]. The less they like it, the more miserable they seem to become. But, as far as some of us are concerned, why should we not have pure beer? To-day we have poor beer, and the poorer we are the poorer is our beer. We get fed up with chemicals—and full of them, sometimes. Some of you would never get full up of anything but gas. I would rather get decently drunk on decent beer than preach Puritanism on cold water.
    Mr. BECKER: On a point of Order. Is it in Order for an hon. Member of this House to say he would be "decently drunk"? Is it possible?
    The DEPUTY-CHAIRMAN: I do not think that that is a point of Order; but I would draw the hon. Member's attention to the fact that this Clause deals with a remission of the duty on beer brewed with home-grown hops. We are not really discussing the question of pure beer.
    Mr. JONES: Being a home-grown hop-picker myself, I want to see some preference given in this instance. Why not? After all, we believe we are the best people in the world. I have heard hon. Members say we are the greatest people in the world, and talk about the splendid things we have done. We grow hops. We grow them in Kent. The best hops in the world are grown on the other side of the river opposite where I live. The only things that grow where I live are empty condensed milk cans. But, after all, if the best is the best, why not support the best?
    Apart altogether from any question whether you drink or whether you do not, the great mass of the workers of this country do drink beer, and you will have an awful job on if you try to stop them, because, in spite of all your attempts to

    2129
    introduce Prohibition by instalments, it will not come off. What is being asked for is pure food, because, after all, in the eyes of the great mass of the workers of Great Britain—I am excluding, of course, some parts where the wild men come from—[HON. MEMBERS: "Which ones?"] I am one of them, though on certain issues we are at variance. The point, however, is this: Here is an attempt being made to reduce the tax upon a home-grown product, against those who try to adulterate one of the things that people use, and I, therefore, think that the Clause which the hon. Member has moved has some justification. It may not be carried, but, as far as I am personally concerned, I want to say, speaking for the class to which I belong—the ordinary workers of the country—that we are not going to be always led by the nose by those who tell us that cold water is the only decent thing to drink. I know some Members of our party do not believe in beer. They prefer champagne. I am going to stand up for the man who drinks a glass of beer against the people who are always canting about their morality.
    Mr. SNOWDEN: The hon. Member who moved the Clause is certainly entitled to the courtesy of a few words of reply. He
    said he was moving it in the interests of the Chancellor of the Exchequer. He has strange ideas of serving the interests of the Chancellor of the Exchequer, for the Clause, if it were adopted, would involve a loss of revenue of £10,000,000 a year. The hon. Member talked a good deal about pure beer and that, I understand, is one of the purposes which induced him to submit the Clause. I think the real object he has in view is expressed in the latter part of his speech—that he has put it forward for the benefit or protection of certain branches of British agriculture, in other words, for the protection of the British grower of hops. But he falls short of fully realising his object, because he is confining this to the production of beer. A very considerable quantity of malt is used in the production of spirits, and under the Clause that would receive no benefit. However, my main objection to that is that it involves a reduction in the revenue. It is no part of my duty, as Chancellor of the Exchequer, to enter upon the highly debateable question of pure or impure beer.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 136; Noes, 253.

    Division No. 137.]

    AYES.

    [11.41 p.m.

    Amery, Rt. Hon. Leopold C. M. S.

    Dalkeith, Earl of

    Howard Bury, Lieut.-Col. C. K.

    Baldwin, Rt. Hon. Stanley

    Davidson, Major-General Sir J. H.

    Hughes, Collingwood

    Balfour, George (Hampstead)

    Davies, Maj. Geo. F. (Somerset. Yeovil)

    Inskip, Sir Thomas Walker H.

    Barnston, Major Sir Harry

    Dawson, Sir Philip

    Jackson, Lieut.- Colonel Hon. F. S.

    Becker, Harry

    Deans, Richard Storry

    Kindersley, Major G. M.

    Bellairs, Commander Carlyon W.

    Dixey, A. C.

    King, Captain Henry Douglas

    Betterton, Henry B.

    Doyle, Sir N. Grattan

    Lamb, J. Q.

    Birchall, Major J. Dearman

    Eden, Captain Anthony

    Lane-Fox, George R.

    Bird, Sir R. B. (Wolverhampton, W.)

    Edmondson, Major A. J.

    Lloyd, Cyril E. (Dudley)

    Blades, Sir George Rowland

    Elvedon, Viscount

    Lord, Walter Greaves

    Blundell, F. N.

    Erskine, James Malcolm Monteith

    Lumley, L. R.

    Bourne, Robert Croft

    Eyres-Monseil, Com. Rt. Hon. B. M.

    Macnaghten, Hon. Sir Malcolm

    Bowater, Sir T. Vansittart

    Falle. Major Sir Bertram Godfray

    Maitland, Sir Arthur D. Steel

    Bowerman, Rt. Hon. Charles W.

    Ferguson, H.

    Makins, Brigadier-General E.

    Bowyer, Capt. G. E. W.

    FitzRoy, Capt. Rt. Hon. Edward A.

    Milne, J. S. Wardlaw

    Bridgeman, Rt. Hon. William Clive

    Forestier-Walker, L.

    Mitchell, W. F. (Saffron Walden)

    Briscoe, Captain Richard George

    Gaunt, Rear-Admiral Sir Guy R.

    Moore-Brabazon, Lieut.-Col. J. T. C.

    Bullock, Captain M.

    Gibbs, Col. Rt. Hon. George Abraham

    Nall, Lieut.-Colonel Sir Joseph

    Burman, J. B.

    Greene, W. P. Crawford

    Newton, Sir D. G. C. (Cambridge)

    Burney, Lieut.-Com. Charles D.

    Greenwood, William (Stockport)

    Nicholson, O. (Westminster)

    Butler, Sir Geoffrey

    Grenfell, Edward C. (City of London)

    Nield, Rt. Hon. Sir Herbert

    Butt, Sir Alfred

    Guinness, Lieut.-Col. Rt. Hon. W. E.

    Oman, Sir Charles William C.

    Cayzer, Maj. Sir Herbt. R. (Prtsmth. S.)

    Hacking, Captain Douglas H.

    Pease. William Edwin

    Chadwick, Sir Robert Burton

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Pennefather, Sir John

    Chamberlain, Rt. Hon. N. (Ladywood)

    Hannon, Patrick Joseph Henry

    Penny, Frederick George

    Chilcott, Sir Warden

    Harland, A.

    Percy, Lord Eustace (Hastings)

    Clarry, Reginald George

    Harmsworth, Hon. E C. (Kent)

    Perkins, Colonel E. K.

    Clayton, G. C.

    Harvey, C.M.B. (Aberd'n & Kincardne)

    Perring, William George

    Cockerill, Brigadier-General G. K.

    Henn, Sir Sydney H.

    Philipson, Mabel

    Colfox, Major Wm. Phillips

    Hennessy, Major J. R. G.

    Pielou, D. P.

    Cope, Major William

    Herbert, Dennis (Hertford, Watford)

    Pownall, Lieut.-Colonel Assheton

    Courthope, Lieut.-Col. George L.

    Hogg, Rt. Hon. Sir D. (St. Marylebone)

    Raine, W.

    Crooke, J. Smedley (Deritend)

    Hope, Rt. Hon. J. F. (Sheffield, C.)

    Rankin, James S.

    Curzon, Captain Viscount

    Howard, Hn. D. (Cumberland, Northrn.)

    Remer, J. R.

    Rhys, Hon. C. A. U.

    Somerville, Daniel (Barrow-in-Furness)

    Watson, Sir F. (Pedsey and Otley)

    Richardson, Lt.-Col, Sir P. (Chertsey)

    Spencer-Clay, Lieut.-Colonel H. H.

    Wilson, Sir Charles H. (Leeds, Central)

    Roberts, Samuel (Hereford, Hereford)

    Stanley, Lord

    Windsor-Clive, Lieut.-Colonel George

    Ropner, Major L.

    Steel, Samuel Strang

    Wise, Sir Fredric

    Russell, Alexander West (Tynemouth)

    Stuart, Hon. J. (Moray and Nairn)

    Wood, Major Rt. Hon. Edward F. L.

    Samuel, A. M. (Surrey, Farnham)

    Sutcliffe, T.

    Wood, Sir H. K. (Woolwich, West)

    Samuel, Samuel (W'dsworth, Putney)

    Thomson, Sir W. Mitchell-(Croydon, S.)

    Wragg, Herbert

    Sandeman, A. Stewart

    Titchfield. Major the Marquess of

    Yerburgh, Major Robert D. T.

    Savery, S. S.

    Turton, Edmund Russborough

    Sheffield, Sir Berkeley

    Vaughan-Morgan, Col. K. P.

    TELLERS FOR THE AYES.—

    Shepperson, E. W.

    Waddington, R.

    Lieutenant-Colonel Wheler and

    Smith-Carington, Neville W.

    Ward, Lt.-Col. A.L.(Kingston-on-Hull)

    Lord Huntingfield

    Somerville, A. A. (Windsor)

    Warrender, Sir Victor

    NOES.

    Ackroyd, T. R.

    Gosling, Harry

    Maclean, Neil (Glasgow, Govan)

    Adamson, Rt. Hon. William

    Gould, Frederick (Somerset, Frome)

    Mansel, Sir Courtenay

    Adamson, W. M. (Staff., Cannock)

    Graham, W. (Edinburgh, Central)

    March, S.

    Agg-Gardner, Rt. Hon. Sir James T.

    Greenwood, A. (Nelson and Colne)

    Marley, James

    Alexander, A. V. (Sheffield, Hillsbro')

    Grenfell, D. R. (Glamorgan)

    Marriott, Sir J. A. R.

    Ammon, Charles George

    Griffiths, T. (Monmouth, Pontypool)

    Martin, F. (Aberdeen & Kinc'dine, E.)

    Aske, Sir Robert William

    Groves, T.

    Martin, W. H. (Dumbarton)

    Attlee, Major Clement R.

    Grundy, T. W.

    Mason, Lieut.-Col. Glyn K.

    Ayles, W. H.

    Guest, J. (York, Hemsworth)

    Masterman, Rt. Hon. C. F. G.

    Baker, Walter

    Guest, Dr. L. Haden (Southwark, N.)

    Maxton, James

    Banton, G.

    Hall, F. (York, W. R., Normanton)

    Middleton, G.

    Barclay, R. Noton

    Hall, G. H. (Merthyr Tydvil)

    Millar, J. D.

    Barker, G. (Monmouth, Abertillery)

    Harbord, Arthur

    Mills, J. E.

    Barnes, A.

    Hardie, George D.

    Mitchell R. M. (Perth & Kinross, Perth)

    Batey, Joseph

    Harris, Percy A.

    Mond, H.

    Benn, Captain Wedgwood (Leith)

    Hartshorn, Rt. Hon. Vernon

    Montague, Frederick

    Berkeley, Captain Reginald

    Harvey, T. E. (Dewsbury)

    Morris, R. H.

    Birkett, W. N.

    Hastings, Sir Patrick

    Morrison, Herbert (Hackney, South)

    Bonwick, Alfred J.

    Haycock, A. W.

    Morrison, R. C. (Tottenham, N.)

    Briant, Frank

    Hayday, Arthur

    Morse, W. E.

    Broad, F. A.

    Henderson, Rt. Hon. A. (Burnley)

    Moulton, Major Fletcher

    Bromfield, William

    Henderson, A. (Cardiff, South)

    Muir, Ramsay (Rochdate)

    Brown, A. E. (Warwick, Rugby)

    Henderson, T. (Glasgow)

    Murray, Robert

    Brown, James (Ayr and Bute)

    Henderson, W. W. (Middlesex, Enfld.)

    Murrell, Frank

    Buchanan, G.

    Hillary, A. E.

    Naylor, T. E.

    Buckingham, Sir H.

    Hindle, F.

    Newman, Sir R. H. S. D. L. (Exeter)

    Buckle, J.

    Hirst, G. H.

    Nixon, H.

    Chapman, Sir S.

    Hobhouse, A. L.

    Oliver, P. M. (Manchester, Blackley)

    Chapple, Dr. William A.

    Hodges, Frank

    Owen, Major G.

    Charleton, H. C.

    Hoffman, P. C.

    Paling, W.

    Clarke, A.

    Hore-Belisha, Major Leslie

    Palmer, E. T.

    Climie, R.

    Howard, Hon. G. (Bedford, Luton)

    Pattinson, S. (Horncastle)

    Cluse, W. S.

    Hudson, J. H.

    Perry, S. F.

    Clynes, Rt. Hon. John R.

    Isaacs, G. A.

    Pathick-Lawrence, F. W.

    Collins, Sir Godfrey (Greenock)

    Jackson, R. F. (Ipswich)

    Phillipps, Vivian

    Collins, Patrick (Walsall)

    Jenkins, W. (Glamorgan, Neath)

    Potts, John S.

    Compton, Joseph

    Jenkins, W. A. (Brecon and Radnor)

    Purcell, A. A.

    Comyns-Carr, A. S.

    Jewson, Dorothea

    Raffety, F. W.

    Costello, L. W. J.

    John, William (Rhondda, West)

    Ramage, Captain Cecil Beresford

    Cove, W. G.

    Johnston, Thomas (Stirling)

    Rathbone, Hugh R.

    Cowan, D. M. (Scottish Universities)

    Johnstone, Harcourt (Willesden, East)

    Raynes, W. R.

    Crittall, V. G,

    Jones, C. Sydney (Liverpool, W. Derby)

    Rea, W. Russell

    Darbishire, C. W.

    Jones, Henry Haydn (Merioneth)

    Rees, Capt. J. T. (Devon, Barnstaple)

    Davies, Alfred Thomas (Lincoln)

    Jones, Rt. Hon. Leif (Camborne)

    Rees, Sir Beddoe

    Davies, David (Montgomery)

    Jones, Morgan (Caerphilly)

    Richards, R.

    Davies, Rhys John (Westhoughton)

    Jones, T. I. Mardy (Pontypridd)

    Richardson, R. (Houghton-le-Spring)

    Davison, J. E. (Smethwick)

    Jowett, Rt. Hon. F. W. (Bradford, E.)

    Ritson, J.

    Dickie, Captain J. P.

    Jowitt, W. A,(The Hartlepools)

    Robertson, J. (Lanark, Bothwell)

    Dickson, T.

    Kay, Sir R. Newbald

    Robertson, T. A.

    Dodds, S. R.

    Kedward, R. M.

    Robinson, S. W. (Essex, Chemisford)

    Duckworth, John

    Keens, T.

    Robinson, Sir T. (lancs., Stretford)

    Dukes, C.

    Kennedy, T.

    Romeril, H. G.

    Duncan, Charles

    Kenworthy, Lt.-Com. Hon. Joseph M.

    Roase, Frank H.

    Dunnico, H.

    Kirkwood, D.

    Roundell, Colonel R. F.

    Edwards, G. (Norfolk, Southern)

    Lansbury, George

    Royle, C.

    Egan, W. H.

    Laverack, F.J.

    Scurr, John

    Emlyn-Jones, J. E. (Dorset, N.)

    Law, A.

    Seely, H. M. (Norfolk, Eastern)

    England, Colonel A.

    Lawrence, Susan (East Ham, North)

    Sexton, James

    Falconer, J.

    Lawson, John James

    Shaw, Rt. Hon. Thomas (Preston)

    Fletcher, Lieut.-Com. R. T. H.

    Leach, W.

    Sherwood, George Henry

    Foot, Isaac

    Lee, F.

    Short, Alfred (Wednesbury)

    Gardner, B. W. (West Ham, Upton)

    Linfield, F. C.

    Simon, E. D. (Manchester, Withington)

    Gardner, J. P. (Hammersmith, North)

    Livingstone, A. M.

    Simon, Rt. Hon. Sir John

    Gates, Percy

    Loverseed, J. F.

    Sinclair, Major Sir A. (Calthness)

    Gavan-Duffy, Thomas

    Lunn, William

    Smith, Ben (Bermondsey, Rotherhithe)

    George, Major G. L. (Pembroke)

    McCrae, Sir George

    Smith, W. R. (Norwich)

    Gibbins, Joseph

    McEntee, V. L.

    Snell, Harry

    Gillett, George M.

    Macfadyen, E.

    Snowden, Rt. Hon. Philip

    Gorman, William

    Mackinder, W.

    Spears, Brigadier-General E. L.

    2132

    2133

    Spence, R.

    Thornton, Maxwell R.

    Williams, Col. P. (Middlesbrough, E.)

    Spencer, H. H. (Bradford, South)

    Thurtle, E.

    Williams, Maj. A. S. (Kent, Sevenoaks)

    Spero, Dr. G. E.

    Toole, J.

    Williams, T. (York, Don Valley)

    Spoor, B. G.

    Tout, W. J.

    Williams, Lt.-Col. T.S.B. (Kennington)

    Stamford, T. W.

    Trevelyan, Rt. Hon. C. P.

    Willison, H.

    Starmer, Sir Charles

    Turner, Ben

    Wilson, C. H. (Sheffield, Attercliffe)

    Stephen, Campbell

    Viant, S. P.

    Wilson, R. J. (Jarrow)

    Stewart, J. (St. Rollox)

    Vivian, H.

    Windsor, Walter

    Stranger, Innes Harold

    Wallhead, Richard C.

    Wintringham, Margaret

    Sturrock, J. Leng

    Watson, W. M. (Dunfermline)

    Wood, Major M. M. (Aberdeen, C.)

    Sunlight, J.

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Woodwark, Lieut.-Colonel G. G.

    Tattersall, J. L.

    Webb, Rt. Hon. Sidney

    Wright, W.

    Terrington, Lady

    Wedgwood, Col. Rt. Hon. Josiah C.

    Young, Andrew (Glasgow, Partick)

    Thomas, Sir Robert John (Anglesey)

    Whiteley, W.

    Thompson, Piers G. (Torquay)

    Williams, David (Swansea, E.)

    TELLERS FOR THE NOES.—

    Thomson, Trevelyan (Middlesbro, W.)

    Williams, Dr. J. H. (Llanelly)

    Mr. Parkinson and Mr. Warne.

    Thorne, G. R. (Wolverhampton, E.)

    NEW CLAUSE.—(Amendment to 10 and 11 Geo. V., c. 18, s. 20.)
    Section twenty of The Finance Act, 1920 (which provides for a deduction from assessable income in respect of a widowed mother, etc.), shall have effect as if for the words "forty-five pounds" there were substituted the word "seventy-five pounds—[Mr. R. Richardson.]
    Brought up, and read the First time.
    Mr. R. RICHARDSON: I beg to move, "That the Clause be read a Second time."
    This Clause is most desirable, as it will take a burden from the shoulders of a class who are most worthy of consideration. I have known in my own career cases of men of twenty-one who, in addition to supporting a widowed mother, supported a brother and sister, and were the means of bringing up the family. I trust that the Chancellor will take these cases into consideration. I do not think it necessary to plead for them at any length. This Clause is the mere act of justice to these people who make such sacrifices, and I hope that it will be passed.
    Mr. SNOWDEN: I have every sympathy with those who have been asking for a larger allowance, and I am going to offer some concessions. The figure that is suggested in this Amendment is £75. I could not possibly make a concession in respect of a widowd mother without extending the same allowance in other cases. If my hon. Friend who is responsible for this Amendment will withdraw it now, when we reach the Report stage I will bring forward Amendments which will increase the allowance in this case and also in the case of the ordinary housekeeper.
    HON. MEMBERS: How much?
    Mr. RICHARDSON: In view of the statements made by the Chancellor of the
    2134
    Exchequer, I beg to ask leave to withdraw the Clause.
    Motion and Clause, by leave, withdrawn.

    NEW CLAUSE.—(Income Tax exemptions for "maintenance" of farm build- ings, etc.)
    Rule 8 (2) of No. V. of Schedule A of The Income Tax Act, 1918, shall read: "For the purpose of this rule, the term 'maintenance' shall include the replacement or erection of farmhouses, farm buildings, cottages, fences, and other works."—[Lieut.-Colonel Spender-Clay.]
    Brought up, and read the First time.
    Lieut.-Colonel SPENDER-CLAY: I beg to move, "That the Clause be read a Second time."
    I desire to move it chiefly for two reasons. The first reason is that I wish to see better housing conditions for those engaged in the work of agriculture. Anybody who is at all acquainted with housing conditions in rural areas is well aware that the provision in that respect for agricultural labourers is most deplorable at the present time, and that there is a great shortage of accommodation. I think the provisions of this Clause would result in more houses being built, and that, of course, would benefit the workers on the land. I believe, too, that one effect. of the operation of this Clause would be to lead to a more intensive system of farming. There are now many large farms which would be split up into small holdings with good results. If hon. Members on the Front Bench opposite below the Gangway will allow me, I will apologise for interrupting their conversation, but I am anxious to put before the Committee the case for this Clause. I believe one result of its working would be to place more people on the land.
    I am well aware that certain objections will be raised to my proposal. The

    2135
    Chancellor of the Exchequer will probably object, in the first place, to the proposal on the ground that it is laid down in the Act that relief of income tax should only be given on maintenance and not on capital expenditure. But I cannot help thinking that when he takes into consideration all the advantages the Chancellor of the Exchequer will be well advised in accepting this proposal. The second objection which the right hon. Gentleman may raise will be, possibly, that the acceptance of the Clause would lead the owner to put up his rents, and that it would mean subsidising the land-owner with taxpayers' money. In regard to that I am prepared, with the consent of the right hon. Gentleman, to add words at the end of the Clause providing that the relief shall only be applied in cases where the rent is not raised by reason of the expenditure on the buildings. That would cover the ground that would ensure that the landowner did not reap the benefit of the concession. The Clause would promote the improvement of housing conditions; it would encourage the creation of small holdings; and it would bring about the erection of more modern farm buildings. Therefore I hope that the right hon. Gentleman will accept it. There is another Amendment down on the Paper, in the name of an hon. and gallant Member, which does not go quite so far as my Clause. At the moment there is great ambiguity regarding the exacting meaning of the word "replacement," and some of the Inspectors of the Government accept, things under the term which others refuse to recognise. For instance, take the case of a cow shed. If a modern concrete floor is laid, and improved fittings are introduced, the work is very often not treated as replacement, and consequently there is no encouragement to replace the old-fashioned style of building and to bring it more in accord with modern requirements. I do hope the right hon. Gentleman, even if he cannot go so far as I propose, will at least do something which will remove existing ambiguities in this matter.
    12 M.
    Mr. W. GRAHAM: The hon. and gallant Member who moved this amendment very largely destroyed the case he sought to make for it by the proviso he himself was going to insert. The Committee will remember that there is already, in
    2136
    the case of lands, including farm-houses and farm buildings, an allowance of one-eighth of the annual value and, in the case of houses and other buildings, a varying allowance for maintenance. I think the hon. and gallant Member and other Members of the Committee are not familiar with the working of this Clause, and have forgotten the additional provision that, where the maintenance has exceeded the limit I have described over a period of five years on the amount of the expenditure, there may be given an addition, in other words, the tax may be remitted from that sum. I venture to suggest to the Committee that the two provisions, taken together, go a long way to meet the situation. But "maintenance," as the hon. and gallant Member himself has suggested, is of course conditional upon the proviso that it must be for the maintenance of existing buildings, so if the additional words he proposes were inserted I have not the least hesitation in saying the position could not be substantially different from what it is now. It has been made plain from the discussions in past years that hon. Members intended to go far beyond the existing allowance and they themselves are not hesitating to put forward in support of that case arguments from the condition of agriculture and the burdens falling upon the agricultural community, but it is perfectly clear it passes well away from ordinary maintenance or anything included under that head. They go right out into the region of capital expenditure. To that extent it would substantially increase the expense to the community as a whole. That is a principle which can never be admitted. For these reasons my right hon. friend feels the existing provision is generous and is unable to accept the Clause the hon. and gallant Gentleman has proposed.
    Major WHELER: I am exceedingly disappointed at the reply of the Financial Secretary. I do not think he has grasped the point. We want to get exemption for a certain class of case. Suppose you take a farm where a couple of cottages are required. That is a case where we want remission under this Clause. There is the case where we want to keep the farm up to date and in accordance with improved agricultural ideas. Many landlords

    2137
    who are short of capital could go to the additional expense required if they had this concession. It is to meet cases of that kind that we are asking for an alteration in the law. It is not a question of higher rent, but a question which is vital in many parts of the country in regard to homesteads and the appurtenances thereof. Take dairies, It is very essential in the interests of milik production that there should be improved dairies put up if the people of the country are to get pure milk. The owner who wishes to carry out such improvements realises, however, that if he does so he will not get the relief which we are seeking for him. If the Chancellor of the Exchequer wants to encourage such improvements, I ask him to reconsider his position. He will be doing more for agriculture by this means than by giving subsidies to houses and things of that sort.
    Major STEEL: Although my name is not attached to this particular Amendment, I have on the Paper another Amendment which I had hoped would have been discussed, and accepted by the Chancellor. My object is to try to improve housing conditions! We have spent a great deal of time since the War on housing questions, but all our efforts up to now have been devoted to the building of new houses. A side of the question which has been entirely neglected is the improvement of existing houses. The object of this Amendment is to encourage the owners of property to improve the existing cottages on their estates. The Financial Secretary said that what we intended was to go a great deal further than was at present allowed under the Income Tax rules, and that we wanted to include in maintenance claims all sorts, not only of replacements, but of improvements which could not be called replacements but were in the nature of capital expenditure. We do not seek to include in maintenance claims those items which are admitted by many collectors of taxes, but we do seek to include many items which are rejected by some collectors of taxes. One of the principal grievances which we have now is that this term "replacement" and what it includes and does not include are interpreted differently by different collectors of taxes throughout the country. Another grievance is the narrow
    2138
    interpretation which is put upon the word "replacement" by certain of these collectors. We had a Debate upon this question on the Finance Bill of 1922 and, as a result, the Chancellor of the Exchequer promised that instructions would be issued to collectors of taxes to ensure that all replacements which were necessary in the repair of cottages would be allowed—including repairs to comply with modern requirements. Either those instructions have not been issued or they are not being carried out. At all events there are many collectors of taxes who to-day will not allow to be included as maintenance, repairs which are necessary in order to bring cottages up to the modern standard. As the matter is difficult to explain, I should like to give two instances which have occurred since 1922, when these instructions are supposed to have been issued. The first is the case of two very bad cottages which had no back doors, no sculleries and no bath-rooms. The owner decided to convert these two small bad cottages into one decent cottage, which involved building up one of the front doors, converting two little lobbies into a small bedroom, converting a small back room into a scullery and bathroom, and making a back door. When it was sought to in elude these necessary improvements in the maintenance claim the official reply was that it was not possible to admit allowances beyond those on account of sums necessary for renewing the interior woodwork of the two cottages, and that the expenditure due to, or on account of, the alterations could be eliminated from the maintenance claim. On this basis there would be eliminated the plumber's account for the bathroom and piping which came to £151; a proportion of the basement work due to alterations to doors and windows, and a proportion of the joinery work due to the same alterations, and to alterations in the internal arrangements. This illustrates the obstacles put in the way of a proprietor who wishes to improve housing conditions of the people on his estate. I should add that there was no question of extra rent.
    The other case is one which is at present sub judice because it has been referred to the highest authority, but one of the chief inspectors in the country has given an adverse decision with regard to it which indicates the view taken by many

    2139
    of the collectors. It is the case of two very bad semi-detached cottages, the proprietor of which had practically decided to reconstruct them by taking off the roofs, raising the walls and converting them into two four-roomed cottages, each with scullery, pantry and w.c. A representative of the proprietor wrote to the inspector of taxes to inquire if this expenditure would be allowed to rank in full in the maintenance claim. The inspector gave a non-committal answer indicating that it would not be wholly allowed. I subsequently called at his office and discussed the matter with his assistant, who expressed the view that the additional office accommodation would be allowed, but that, if the walls were raised and additional bedrooms provided, that was an improvement that would not be allowed in the maintenance claim. I said that I did not accept that decision, and I asked that it should be referred to the Board of Inland Revenue. If the decision is adverse, it is clearly a discouragement to landowners to provide a better standard of accommodation in farm cottages. Those are the only two instances that I propose to give, but I believe that there are innumerable other instances. I realize the difficulty of the Chancellor of the Exchequer, and I realize that he has to protect himself against extravagant alterations and improvements, which the owner may seek to include in his maintenance claims and which are far beyond what is really necessary to meet modern requirements. I am only out to try and ensure that the real improvements which are necessary to meet modern requirements should be allowed, and I hope the right hon. Gentleman will be able to accept something on the lines of my Amendment which appears later on the Paper.
    Major MOULTON: If a farmer has an old plough which is worn out, it is reasonable that he should get an up-to-date plough for his work, and similarly, I think, it is reasonable that very old farm cottages should be put into a reasonable condition for occupation. I think we ought to do everything we can to encourage better housing in the rural districts, and if, by allowing something off the Income Tax, we can persuade a farmer to build, at his own expense, instead of asking for a Government subsidy with which to build, it seems to
    2140
    me that we are making a very great gain. Personally, I should have preferred this proposed new Clause if there had been the word "necessary" inserted in front of the words "farm houses, farm buildings," &c. I daresay that that would meet the wishes of the movers of the Amendment, and if the Chancellor of the Exchequer would accept that addition, I do not think there would be any difficulty placed in the way by the supporters of the Clause. I would ask the right hon. Gentleman to consider whether he cannot make some concession on this question.
    Mr. NEVILLE CHAMBERLAIN: I had hoped that, after the appeals made to the Chancellor of the Exchequer by my hon. and gallant Friends behind me, he would have had something more to say on this proposed new Clause. The answer given by the Financial Secretary did not seem to me to indicate that the question was being regarded with any desire to meet the real grievance represented by the new Clause, and surely, if the Chancellor of the Exchequer desires to do anything to encourage owners, when they are repairing old cottages, to do something to bring them up nearer to modern standards, it is not beyond his power to devise some means which will safeguard him against many of the dangers which the Financial Secretary suggested might occur. I am sure that my hon. Friend has no desire in this proposed Clause to introduce any dangerous principle into our finance. It is not desired to bring capital expenditure into a category that it ought not to be in. The Chancellor may think another form of words more acceptable. I confess I would have preferred different wording. However that may be it should not prevent the Chancellor from giving that relief that would help to improve the standard of housing in the country, and to give better cottages. He ought really to help to do something that would tend to bring the cottages up to more like our modern ideas on the subject.
    Mr. SNOWDEN: I am rather surprised that my right hon. Friend should have associated himself with this proposed new Clause, or demand, because, having himself filled the office I now fill, he must see the implications of it. Take the case cited where two cottages had been made into one, and certain modern improvements added. They were really altered

    2141
    not as old but as new property. The landlord generously incurred the expenditure knowing that he would have to meet the charge in connection with the higher assessable value, because capital expenditure had been employed upon the new erection. The right hon. Gentleman knows the fundamental condition of capital expenditure in relation to Income Tax, and this proposed new Clause traverses that fundamental principle. We submit that the allowance now made is sufficiently generous to encourage any landlord to carry out these improvements, the desirability of which we all admit. [HON. MEMBERS: "Speak up!"] Experience shows both in regard to the wording and administration of the Regulations a generous view is better. I should be very sorry to turn down any proposal of this kind without good reasons, but I cannot see my way to make any further concession in this direction.
    Mr. LEIF JONES: The right hon. Gentleman has really not faced the situation of the rural landlords, All this is really maintenance expenditure to maintain the farm and the cottages and much of it is made without any return at all. The instances given by the mover of this Clause are frequent cases and there is no increase of rent, and the probability is that the landlord will get no return for his expenditure. It would be different if there was any increase of the rent. The Clause may be too wide but the right hon. Gentleman can do more to assist rural housing by improving old cottages than by subsidies. I have been a warm supporter of this Budget but I hope the Chancellor of the Exchequer will seriously consider whether he cannot increase this maintenance allowance to landlords who improve the farmhouses and cottages on their estates. This cannot be properly called capital expenditure which is going to be accompanied by increased rents and therefore I hope the Chancellor of the Exchequer will face this question. The tax collectors are now very much hampered with this problem and in some cases they are more generous to the landlords than in others. There ought to be more uniformity of practice and the landlord should be encouraged to make this expenditure upon the cottages. This is really an issue which ought to be faced by the Chancellor of the Exchequer, because justice has not been done to the rural dis-
    2142
    tricts and I am afraid that in housing schemes generally there is a tendency to neglect those districts. As a rule it is only in the large towns that we can contemplate any increase of the rates for the building of houses. Personally I do not believe that there is any better way in which the Government could assist in providing more houses than by encouraging rural building by making larger allowances in the direction provided for in this new Clause.
    Mr. SNOWDEN: I shall be very sorry to oppose any proposal that would be detrimental to the encouragement and improvement of rural houses, but it must be obvious that this Amendment would not do at all. In the form in which it appears on the Paper I could not possibly accept it. But I will take it ad Avizandum, as the Scottish people say, and if the Committee will agree I will consider it between now and Report and see whether some Amendment of the Rules by a new Clause in the Bill can be devised. That, I think, is the desire of the whole Committee.
    Mr. N. CHAMBERLAIN: Will the right hon. Gentleman take the hon. Members on this side of the House and in other parts of the House into consultation in considering this question?
    Mr. SNOWDEN: I shall be most happy to consider any representations.
    Question, "That the Clause be read a Second time," put, and negatived.

    NEW CLAUSE.—(Relief in respect of expenditure for the welfare of employés.)
    Where any person shall after the thirty-first day of December, nineteen hundred and eighteen, have expended any capital sum on buildings or equipment, or which shall be provided in pursuance of any statute or regulation, or which in the opinion a the General Commissioners shall be for the benefit of his employes, such person in computing the amount of the profits or gains to be assessed to income tax in respect of his trade or business may after the passing of this Act deduct such an amount as shall be equivalent to interest on such capital expenditure at the rate of five per cent. per annum.—[Mr. Hannan.]
    Brought up, and read the First time.
    Mr. HANNON: I beg to move "That the Clause be read a Second time."
    I am afraid after the emphasis which the Chancellor of the Exchequer has laid

    2143
    that under the fundamental principle in Income Tax law administration no allowance can be made in relation to capital expenditure. I am put in a somewhat awkward position in submitting this Clause to the Committee. I would plead, however, that the capital expenditure incurred on welfare work which essentially has for its Objective the improvement of the conditions of work-people in the factories of this country ought to receive special consideration, even although it may be described as capital expenditure. This question has been before the House on previous occasions. In 1921 the right hon. Gentleman who is now the Chancellor of the Duchy of Lancaster a colleague of my right hon. Friend the Chancellor of the Exchequer made a powerful appeal to this House for the same object for which I am pleading and his Clause was practically on all fours with the one I am submitting to-night. In a speech to the House on that occasion he said:
    "what we now want to do is to press on the Government—
    of course he was pressing on another Government at that time—
    "the urgent necessity of treating money spent on putting up buildings for welfare work as a legitimate reduction of profits for Income Tax as calculated under this new Clause."
    I am asking the Chancellor of the Exchequer whether he will make an allowance or a rate of interest not exceeding 5 per cent. on capital expenditure incurred for this purpose. The progress of welfare work throughout the country during the past five or six years is one of the most interesting aspects of industrial organisation, and I am sure nobody in this House has a more friendly feeling towards social work of that character than the Chancellor of the Exchequer himself. There are a great many employers in this country who have expended a considerable sum upon this admirable work, and many people say that work of this kind is a very good business in itself; it enhances the efficiency of the workers and raises the productive capacity of the establishment in which they work. But the Chancellor of the Exchequer will also realise this that if he desires to have welfare work of this quality extended right through the country some inducement ought to be
    2144
    offered to a great many persons responsible for employment who have not the same generous conception of their public responsibility or those who have already taken up this work. It is mainly to bring within the fold those who have not taken a share in this work that I am moving this Clause. We are doing nothing better in this country to-day than the promotion of various schemes of this nature, and if the Chancellor of the Exchequer can help in promoting that work, even if he violates one of the great fundamental principles upon which Income Tax administration is based, he will be rendering a very great service to the country.
    Mr. CLARRY: I have a Clause down in my name later on the Paper which is to the same effect in some respects, as the Clause before the Committee. It is a matter of opinion, I should say, as to whether welfare work is a capital charge or not. Without doubt it is of very great value to the workers and to the industry itself. It makes for much greater contentment amongst the workers. I hope the Chancellor of the Exchequer will consider one or other of the Clauses or an amalgamation of the two in dealing with this matter.
    Mr. SNOWDEN: I do not think that the hon. Gentleman who moved this Amendment will quarrel with me when I say that this is the most impossible Amendment which has been put before the Committee during the course of the Debate. It not only violates the fundamental basis or conditions of the Income Tax law, but is a proposal to relieve employers from taxation of capital expenditure which has been employed by them for the sake, as was admitted by the hon. Gentleman, of increasing the profits of their business.
    Mr. HANNON: That statement is entirely too sweeping. There are limitations.
    Mr. SNOWDEN: But the hon. Gentleman who made the statement made no limitations. I remember having a conversation with Lord Leverhulme in the dining room in the House some time ago and he told me that in his early days, when he kept horses, he groomed them well and fed them well, and he found that they worked better for it. Then he said, "when I became an employer of labour

    2145
    and remembered my experience with horses, I tried it on men and found that men were like horses in that respect, that they responded to good treatment."
    Of course any employer will spend money on welfare work because, as the American said to me, it pays. May I add that, under the existing law, annual contributions made by the employers for the maintenance of the welfare institutions are exempt.
    Mr. HANNON: I beg to ask leave to withdraw the Clause.
    Motion and Clause, by leave, withdrawn.

    NEW CLAUSE.—(Estate Duty).
    For determining the rate of estate duty to be paid on property passing on the death of the deceased any property so passing which, under a disposition not made by the deceased, passes immediately on the death of the deceased to some person other than the wife or husband, or a lineal ancestor, or a lineal descendant of the deceased, shall not be aggregated with any other property, but shall be an estate by itself, and the estate duty shall be levied at the proper graduated rate on the principal value thereof.—[Mr. Dennis Herbert.]
    Brought up, and read the First time.
    Mr. HERBERT: I beg to move, "That the Clause be read a Second time."
    This is an amendment designed to remove a curious case of hardship in regard to the incidence of Estate Duty. At the present time if a fund is settled by a rich man for the benefit of, let us say, three or four people, one after the other taking an interest for life, with remainder, say, to a child of one of those persons, then that particular trust fund has to be aggregated with the estate of the deceased person as a whole, and bears the same rate of duty which is applicable to the whole estate. Take the case of a millionaire who has a very old servant, an old widow perhaps, for whom he wants to provide; she may have an only daughter who would by that time be an oldish woman herself; and he leaves, say, £2,000. upon trust after his wife's death for the old woman for her life with remainder to her daughter. In such a case, when the Estate Duty has to be aggregated, notwithstanding the fact that it is only a matter of £2,000, for people who do not possess any other money in the world, that has to bear duty at the rate which is applicable to the estate of the deceased. When
    2146
    this was Moved from the Liberal benches last year the answer which was given by the then Solicitor-General was that the matter had been dealt with by a Commission which inquired into this matter in the year 1899. But it was then pointed out by the hon. Member in question who Moved, and also by myself, that considerable changes had taken place which altered the position since that Commission sat in 1899. First of all, since that time the Estate Duties have been largely increased, and they have been much more steeply graded. Therefore, so far as there is an injustice, it is very much more exaggerated now than it was in those days.
    But there is another point which I think entirely throws out of court any real reason for relying on the Report of that Commission, and that is that Estate Duty in the case of a separate fund is now payable an the death of every person who dies who has an interest for life. In the days when that Commission sat, Estate Duty was only payable once during the occurrence of the settlement, but if you take this tax together with the increase in the rate of Duty, the steeper graduation of the duty, and the fact that the duty is now payable on every life tentant's death, instead of only once during the occurrence of the settlement, think there is a very considerable answer to the argument that the Commission found against in 1899. I only regret that the hon. and learned Member of the Liberal party who moved this Amendment last year is unable to move it now because he is Deputy Chairman. He moved it with the sympathy of, I think, the greater number of the Conservative party, and with the sympathy and the active support of his own party, while the party to which the Chancellor of the Exchequer belongs also supported it. There is so much support for this Amendment among all those who have any experience of Death Duties that I do ask the Chancellor of the Exchequer to consider this question and see whether, in spite of the money involved, he cannot remedy this hardship. This will get rid of a hardship which penalises the poor classes.
    Mr. GRAHAM: I am sure that the Committee will forgive me if I do not enter into detail on this question, as I

    2147
    think the case can be quite shortly stated. It is true, as suggested, that this was originally in force in the Finance Act, 1894, but after inquiry that was amended in the Finance Act, 1900, and, as I understand the hon Member, he proposes to put the position back as it was in 1894—that is to say to take out of the aggregation for the purposes of Estate Duty, this estate, in respect of which the deceased party did not make a will, under his disposition. It is perfectly plain, that for all practical purposes to-day, that cuts across the principle of aggregation for Estate Duty purposes. I take the Report of that very distinguished Committee which considered this matter in 1899–1900. They made it perfectly clear that any hardship which existed would be removed by their proviso. In the light of their Report and the Finance Act, 1900, as it amended the position, I am afraid it would be impossible to depart from that at the present day. The Committee will not expect a longer reply because it is impossible to night to make an inroad into the accepted principle of aggregation for the purpose of Death Duty without exposing ourselves to very great risks in several directions and substantial loss of revenue.
    Question, "That the Clause be read a Second time," put, and negatived.

    NEW CLAUSE.—(Provisions as to tem- porary residence.
    The following rule shall be substituted for Rule 2 of the miscellaneous rules applicable to Schedule D:—
    A person shall not he charged to tax under this schedule as a person residing in the United Kingdom in respect of profits or gains received in respect of possessions or securities out of the United Kingdom who is in the United Kingdom for some temporary purpose only, and not with any view or intent of establishing his residence therein, and who has not actually resided in the United Kingdom at one time or several times for a period equal in the whole to fifteen months in any two consecutive years of assessment, subject nevertheless as follows:—

    (a) in the case of a person who is ordinarily resident in any foreign country and who is in the United Kingdom for any period, or periods, exceeding in the whole twelve months in two consecutive years of assessment the foregoing provision shall not apply for a period of five
    2148
    years from the end of the second consecutive year of assessment as aforesaid, but such person shall not be charged to tax under this schedule within the said period of five years unless in any year of assessment within that period of five years he resides in the United Kingdom at one time, or several times, for a period exceeding in the whole six months;

    (b) in the case of a person who is ordinarily resident in any of His Majesty's dominions, and who is in the United Kingdom for any period or periods exceeding in the whole twelve months in two consecutive years of assessment the foregoing provision shall not apply for a period of ten years from the end of the second consecutive year of assessment as aforesaid; but such person shall not be charged to tax under this Schedule within the said period of ten years unless in any year of assessment within that period of ten years he resides in the United Kingdom at one time or several times for a period exceeding in the whole six months. "His Majesty's dominions" means any British possessions or any territory which is under His Majesty's protection or in respect of which a mandate is being exercised by the Government or any part of His Majesty's dominions.—[Mr. D. Herbert.]

    Brought up, and read the First time.
    Mr. HERBERT: I beg to move, "That the Clause be read a Second time."
    I have not much hope that the Chancellor of the. Exchequer will accept this. It is a Clause which is designed to give a little more latitude to foreign visitors to stay here a little longer than at present without rendering themselves liable to Income Tax. The reasons which actuate those who support this Amendment are that at the present time a large number of wealthy foreigners. Americans and others, come over to this country every few years. Many of them want to stop here for more than six months, and they are just the people we want here because they are wealthy and spend a very large amount of money in the country: At present what happens is that before the six months are up they go across to France, Belgium, or some other country on the Continent, and these countries get the benefit of expenditure which we would have got here if they were not in danger of rendering themselves liable to Income Tax. What is suggested is that they should be allowed to stay for a period of 15 months without being liable

    2149
    to tax, but if they do stay for that time they must not pay another visit to this country—that would render them liable to tax—for a period of ten years or five years. You will preserve your right of taxing these people if they do become residents and attempt to dodge the tax by going away for short periods. I hope the Chancellor of the Exchequer will go into this question and prevent what we see happening every year—large numbers of these people who are spending large sums of money going away and this country losing the benefit of what they would have spent.
    Mr. GRAHAM: My hon. Friend, in moving this Clause, indicated that he hardly thought we should be able to accept it, and I am afraid that is the case. I am quite certain he will not accuse any Scotsman in this House, and probably no Englishman, of seeking to do anything to discourage the visits of Americans or others who spend money in this country. We are, however, bound to keep in view the dangers of extension of the present position. If a foreign visitor stay in this country for a period of six months within the year of assessment, he becomes liable for tax, but I ought to explain to the Committee that in practice visitors can come to this country for five months within one year and five months in another year of assessment, or ten or eleven months of our calendar year, without exposing themselves to taxation at all. Probably the practice of making a visit elsewhere would continue in any event. I think there is no real grievance, and I am advised also that if we tried to embody in the Finance Act of this year the suggested Clause, it would be practically unworkable, as it would involve keeping certain records which would be a very difficult matter for the Inland Revenue authorities. Apart from that, the Royal Commission on Income Tax which dealt with this problem took the view, if I remember rightly, that so far from extending facilities it was probably our duty to tighten the grip we have upon the visitor who does acquire residence. In all the circumstances I feel there is no hardship in the existing conditions, and that there is reasonable precaution for the revenue. For these reasons the Chancellor of the Exchequer feels he could not adopt the Clause.
    Mr. HERBERT: I beg to ask leave to withdraw the Clause. This Amendment is not designed to assist those people who, in fact, establish a sort of residence here. What I do want to urge is that one gets the answer over and over again in cases of this kind that this is too difficult a question to go into and too complex to be introduced into the Bill this year. The Revenue would do well to try and see if in future years they can get the Government to put forward something or other which would be satisfactory to meet the grievances and troubles involved in these various Amendments.
    Motion and Clause, by leave, withdrawn.

    NEW CLAUSE.—(Allowances for a spirit used for the manufacture of per- fumery).
    If any person proves to the satisfaction a the Commissioners of Customs and Excise that any spirits in respect of which the duties imposed by this Act have been paid have been delivered to him and used solely in the manufacture or preparation of perfumery, he shall, subject to such regulations as the Commissioners of Customs and Excise may prescribe, be entitled to obtain from the Commissioners repayment of the sum of thirty-seven shillings in respect of every gallon, computed at proof, of spirit so used.—[Sir K. Wood.]
    Brought up, and read the First time.
    Sir KINGSLEY WOOD: I beg to move, "That the Clause be read a Second time."
    1.0 A.M.
    It is my privilege to explain to the Committee what I conceive the purpose of the Amendment to be. I would refer to a 'Memorandum which no doubt many Members of the House have received from a trade, which I have no doubt many of them would desire to encourage at the present time. This Clause is for the purpose of assisting, if possible, the perfumery manufacturers of this country. They complain very much of the prejudicial effect on their industry of the existing high duty on the spirit used in the manufacture of their products. They state the British perfumery trade is burdened by serious disabilities as the result of this excessive duty and the position is intensified by the adverse conditions which the industry has to contend with in competition with foreign manufacturers. They state that

    2151
    the loss of alcohol in process of manufacture is considerable, amounting on the average to 10 per cent. As far as their home trade is concerned, all these losses have to be borne by the British manufacturers. Therefore the suggestion is that they should be entitled to be repaid the sum of 37s. on every gallon of spirit so used. I hope the Chancellor of the Exchequer will consider sympathetically the request made by this important industry and accept this new Clause.
    Mr. CLAYTON: I should like to speak in support of what has been said of the great disadvantages the British manufacturers of perfumery work under as compared with manufacturers in France. In France they manufacture perfumery with the alcohol duty free, but we in this country have to pay the full Excise Duty on the alcohol used in the perfumery manufacture. Then, as the hon. Member has said, when the French perfumery comes into this country it is charged excise on the alcohol the perfumery takes, whereas in this country we have to pay the full duty on the alcohol used in the manufacture and about 10 per cent. of the alcohol is lost in the manufacture. There is thus another disadvantage. The case of the perfumery industry presents a similar case to that of the early days of the dye industry. The first dye was discovered in this country, and the first manufactory of dyes was put up in this country. But it was driven out because the Government at that time would not allow the manufacturers duty free alcohol which was necessary for its manufacture. Germany gave that facility to their manufacturers. Consequently the first factory in this country was dismantled and the industry went to Germany. I am sure the Chancellor of the Exchequer is not anxious to drive any other industry out of this country, and I ask him to make some concession on that account in order to maintain in this country what is a struggling industry.
    Mr. SNOWDEN: The hon. Member who was unexpectedly called upon to father this Amendment did not put forward the Motion with any great enthusiasm, and had he understood it a little more, he would probably have had even less enthusiasm. The hon. Member who has just sat down conveyed the impression,
    2152
    by his reference to the competition the industry is supposed to suffer at the hands of France, that by the heavy duty, something over 70s., on a gallon of spirit, the British manufacturers are at a disadvantage with their French competitors. But he ought to be aware of the fact that there is a heavy import duty on the French perfumeries which come into this country in competition with the English manufacturers. There is a specific import duty of £6 3s. 5d. per gallon, and that fact disposes of the contention that the British perfumeries, notwithstanding the heavy duty on spirit, are placed at a disadvantage. There is no foundation either for the assumption that the British perfumery trade is disappearing through French competition. As a matter of fact, in recent years the imports from France have fallen. I have not seen the circular which the hon. Member quoted, but no doubt reference is made to the alleged disappearance of the British trade. If it is not, then the statement has been made by the supporters of a reduction in the Spirit Duty. Had there been a falling away in the demand, it must be explained by other reasons, perhaps a lessened capacity of the British people to spend money on expensive luxuries.
    Lieut. - Commander KENWORTHY: What about the export trade?
    Mr. SNOWDEN: This is a retail trade. The cost of the Amendment would be a million pounds a year and it would simply be defending a luxury trade. In these circumstances I do not think any case has been made out for the Amendment and I am sorry I cannot accept it.
    Question, "That the Clause be read a Second time," put, and negatived.

    NEW CLAUSE.—(Returns by savings banks.)
    The requirement contained in paragraph (ii) of the proviso to Sub-section (3) (b) of Section thirty-nine of the Income Tax Act, 1918, as to the making of returns by a savings bank and any branch thereof as a condition of the right of such bank to exemption from tax under Schedules C and D in respect of interest paid or credited to depositors shall only apply with respect to depositors to whom interest is paid or credited in the year for which exemption is claimed by the bank out of the income of its funds other than interest and dividends arising from investments with the National Debt Commissioners and to an amount exceeding in the case of any such depositor

    2153
    the said sum of fifteen pounds.—[Mr. N. Chamberlain.]
    Brought up, and read the First time.
    Mr. N. CHAMBERLAIN: I beg to move, "That the Clause be read a Second time."
    The two Clauses which stand in my name I am going to move in the interests of the Trustees Savings Bank and the Birmingham Municipal Bank, which is associated with them in this matter The first of these two Clauses looks rather complicated, but it is not really so complicated as it appears, and I think in a very few minutes I can make clear what it is desired to do. There are really two objects to be achieved by this Clause. The first is this. Under the Income Tax Act, 1918, the savings banks are exempted from Income Tax upon the income derived from funds invested with the National Debt Commissioners and that is the fund connected with what is called the ordinary department of the savings banks. Some of the banks, however, have another department which is called the special investment department, and the funds of that department are invested in certain statutory securities selected by the trustees and approved by the Treasury. They are required by the same Act to give a return of the depositors and the addresses of the depositors who have interest credited to them of five per cent. per annum where they are claiming exemption from Income Tax under the proper schedules. The object of the first Clause is to make it clear that the requirements should apply only to the special investment department and not to the deposits in the ordinary department and I hope the Chancellor of the Exchequer will see his way to accept it. It is obvious that if it is not accepted depositors in the banks which have only an ordinary department will be prejudiced as compared with those who have also a special investment department. The second object is to increase the amount which shall be excluded from the return for the purpose of Income Tax, to increase the amount from £5 as it stands at present under the Act of 1918 to £15. The second Clause would apply that extension to the cases where there is no special investment department or only such a
    2154
    department as is carried on by the Birmingham Municipal Bank.
    Mr. SNOWDEN: I quite agree that the right hon. Gentleman has made out a case for consideration. As he pointed out, the Amendment which he is now moving is in a way connected with the next Amendment on the Paper, and if it will be satisfactory to the right hon. Gentleman, I will take the matter into consideration, and try to bring forward an Amendment on Report.
    Mr. CHAMBERLAIN: On the assurance of the Chancellor of the Exchequer, for which I beg to thank him, I ask leave to withdraw the Clause.…
    Motion and Clause, by leave, withdrawn.

    NEW CLAUSE.—(Death Duties of married persons.)
    In the case of any person dying after the passing of this Act no estate duty or legacy or succession duty shall be levied in respect of any property which passes on the death of such person to the husband or wife of such person.—[Lien.-Colonel Guinness.]
    Brought up, and read the First. Time.
    Lieut.-Colonel GUINNESS: I beg to move, "That the Clause be read a Second time."
    I want just briefly to raise this Amendment. Perhaps the Chancellor of the Exchequer in connection with other grievances that he is looking into may feel disposed to do something in this matter. It is a new Amendment and the Committee may be more disposed to consider it in that it has never been voted upon on any former occasion and we all enjoy a blameless past in this matter. Up to 1910 legacies between husband and wife were altogether exempt from Legacy and Succession Duty. Since 1910 in the case at all events of large legacies, these duties were levied. There may not be any great grievance if the estates of husbands and wives were always treated separately. But as we have heard in the Debates this evening at an earlier stage that is not so. In the case of Income Tax the estates of married people are considered together, while in the case of Death Duties the whole claim for the tax depends on the fact that the estates are kept separate and the Treasury really is in the position of a wolf which says to the sheep one

    2155
    moment, "Give me your wool because you share it with your wife," and having levied a very heavy impost, then turn round and say, "Give me more because you are to be treated separately." That is absolutely unjust, and I ask the Government if it is too expensive to deal with this inconsistency from the point of view of Income Tax to take it up from the side of Death Duties. We have been told on the Income Tax Amendment this evening as applied to married people that there was a strong political argument, but it was overridden by the financial argument which the Financial Secretary says might involve a loss of about 11 millions a year. But I believe in this case the financial aspect is much less, and I appeal to the Treasury to try to deal with this grievance. At the present time they are taking up an attitude of heads I win and tails I lose.
    Mr. GRAHAM: It is quite clear that my hon. and gallant Friend, a predecessor in office, does not expect us to accept this Amendment. The system of the Estate Duties is well known to hon. Members in all parts of the Committee that it is simply a duty upon the aggregation of property without any preference to the destination. It will be very dangerous from many points of view to introduce the kind of principle which the hon. and gallant Member suggests. If the proposal of the Mover of the Amendment were adopted the cost would be approximately seven millions per annum. That being so, it is quite unnecessary for me to use other arguments that my right hon. Friend cannot afford that sum.
    Question, "That the Clause be read a Second time," put, and negatived.

    NEW CLAUSE.—(Collectors of Taxes.)
    Collectors of taxes, whether appointed by the General Commissioners of Taxes or the Commissioners of Inland Revenue, shall hold office during the will and pleasure of the appointing authority.—[Sir K. Wood.]
    Brought up, and read the First time.
    Sir K. WOOD: I beg to move, "That the Clause be read a Second time."
    This Clause relates to an important body of men who are known as Collectors of Taxes, and I think the Chancellor of the Exchequer will agree that a large measure of the success of his Budget
    2156
    depends upon the efforts of these important officials. This Clause is designed to give them some better security of tenure. At the present time the method of appointment of Collectors varies in different parts of the Kingdom, but, with the exception of Scotland, the appointment is only for the Income Tax year of assessment, without any certainty whatever of its continuance for subsequent years. In England the General Commissioners, acting in the various divisions, make the appointments, except in certain cases where the right of appointment has passed to the Commissioners of Inland Revenue. In Scotland the appointments are in the hands of the Treasury, while in Ireland the Commissioners for Special Purposes exercise the right. The Committee will, therefore, see that whilst this body of men, who in many cases are responsible for very large sums of money, have, so far as their security of office is concerned, a purely temporary appointment for one year, under the terms of their appointment they are put in this curious position, that they can be called upon in subsequent years to continue their work which may be left over from the year for which they were definitely appointed. Their status is a most peculiar one and thoroughly unsatisfactory. Their appointment in a large number of cases is in the hands of one authority, whilst their remuneration is in that of another. I am sure that when claims are put forward on behalf of the collectors for concessions the Treasury often object with the statement that collectors are the temporary employés of the General Commissioners, notwithstanding the fact that the Commissioners of Inland Revenue are responsible for the appointment of at least one-fourth of their number. The defects of the present system are flagrant, and this grievance of the Collectors of Taxes has existed for a very long time. These men have been very patient, and I think the time has now come when something ought to be done in respect of them. It is said, with some truth, that the annual appointment of these collectors has long been regarded as irksome and a handicapping survival of the early days of the tax, which, in view of its now admitted permanent character, should be abandoned. Taking the great body of the men, they are a very

    2157
    efficient body of collectors. They have adopted practically every constitutional means of obtaining an amendment of the law in relation to their appointment without success, and this evening we are asking that at any rate some slight improvement shall be made in their status, and that they shall now be appointed during the will and pleasure of the appointing authority. That I suppose takes with it the fact, as with other appointments under similar terms, that they will practically hold office under good behaviour.
    This matter has been the subject of correspondence between the association of these collectors and the Secretary to the Treasury, and it is fair to say that the Secretary to the Treasury has written a very sympathetic letter on the 2nd May reviewing the present position of these men, and he has referred to the fact, which is quite true, that the matter, in his opinion, is dependent upon these men being appointed permanently by the Board of Inland Revenue, and in a measure he has sought in this communication to make the matter of the status of these men dependent upon that course being adopted. The Chancellor of the Exchequer may have been present at a meeting of Members of the House when this matter was considered some little time ago, and the view was then taken by a very large number of Members, I think some 100 attended, that it was undesirable for these men's appointments to go to the Board of Inland Revenue, but that they should remain with the General Commissioners. At this time that may well be held to be a disputable point, but I venture to urge on the Chancellor of the Exchequer that that ought not to stand in the way of these men's appointments being better secured. I hope if the Clause be adopted that better terms and conditions will follow, because, as the Chancellor of the Exchequer knows, some of these men who are responsible for many hundreds of thousands of pounds in some districts only receive remuneration of some £900, £1,000 or £1,100 a year. The Clause is simply regarded as a step in the direction which I hope will put them in a better position. As showing the long time this matter has been under discussion and the patience that has been exercised by this body of very efficient servants of the State, I may
    2158
    say that it was in 1907, and the present Chancellor of the Exchequer headed a deputation to the Chancellor of the Exchequer of that year, I think the right hon. Gentleman the Member for Paisley (Mr. Asquith). When that is remembered, together with the fact that they have done such efficient service, it is not asking too much for this minor step to be taken and these men secured so far as possible in their appointments, and I hope they will attain better terms and conditions, including a pension, which I am sure will not only be for their benefit but for the benefit of the service as a whole.
    Mr. HANNON: This Amendment seeks to do some measure of justice to a most estimable body of public servants who for some extraordinary reason, owing to the curious anomalies of our public life, have no security in the positions which they hold. Two of these officers of whom I have had personal experience have served for periods of nearly 40 years in the discharge of this responsible duty of extracting revenue from the pockets of the taxpayer. One of these has served for a comparatively small salary, and he pays the cost of his own office and his own elerical establishment, and in doing that has inflicted injury on his own health. The Inland Revenue Authorities desire to get the whole of this service centralised and to bring it under the control of the Inland Revenue itself. The tendency is to eliminate the older men and to bring younger men into the service. I think the Chancellor would be doing a mere act of justice if he were to accept the Amendment.
    Mr. SNOWDEN: I have taken an interest in this body of public servants for the last twenty years. It is quite true that I introduced a deputation to the then Chancellor of the Exchequer which put their grievances before him. Everybody who knows much about the actual conditions of the service of these tax collectors knows that the whole case is fundamentally and radically wrong and unsatisfactory. The speech of the hon. Member who has just sat down was concerned with a number of grievances not one of which would be touched in the Amendment before the House. I do not think it would make the slightest difference to security in practice. The men are in practice re-appointed from year to year, and if the Amendment

    2159
    were accepted it would be within the power of the General Commissioners to dismiss these men if their services were not satisfactory. There is now annual re-appointment unless their conduct has been unsatisfactory. The appointment is renewed each year as a matter of course. This is probably the least of the many grievances from which this class of public servants suffer, and it seems unwise to begin to tinker with a big problem. It may to some extent prejudice the future dealing with the question in a comprehensive manner. I should have no strong objection to the Committee accepting this Amendment, but I do not think it is going to do any good, and it might prejudice the general consideration of the whole question in the future. I am glad the hon. Member has raised this question, and with that expression, and in the hope that in the not distant future the whole question of their position will be considered, I trust that he will withdraw it.
    Mr. HANNON: Does the right hon. Gentleman give the assurance that these older servants and their interests will be adequately protected within the comprehensive scheme?
    Mr. SNOWDEN: I should not have the slightest hesitation in giving that assurance.
    Mr. D. HERBERT: I hope the hon. Member will not withdraw his Amendment. The Chancellor of the Exchequer does not seem to object strongly to it. If it be such a small remedy for removing a small but not a big grievance, surely, if the right hon. Gentleman remain in power, he will not relax his efforts to remedy those larger grievances because one has been removed. The point is that these men wish for this themselves.
    Mr. SNOWDEN: That ignores the most substantial argument, and if we accept it, it would prejudice the consideration of the whole matter.
    Mr. REMER: I hope the hon. Member will press the Amendment, which is desired by the people themselves. The Chancellor of the Exchequer says he has been trying to get this remedied for the last 20 years.
    Sir HARRY BRITTAIN: I do not want to press this matter unduly upon the Chancellor of the Exchequer, but I venture to urge the acceptance of this Clause. It has been drafted and put down on behalf of the Association of Collectors of Taxes themselves. Their appointments are annual. They never know where they are. The result is that some of these men have for 30 or 40 years been holding these temporary annual appointments. I do not understand why the Chancellor of the Exchequer says this will prejudice their case. Obviously any further scheme in connection with these men will have to be incorporated in an Act of Parliament, and anything in these words could be varied in any new scheme. I do not wish to press this to a Division unless it be necessary.
    Mr. GATES: May I say a few words. As a Commissioner of Taxes, I have been called upon every year to make these appointments of men who have been in our service as many as 30 or 40 years, and it seems to many of my colleagues to be an absolute farce. I think they have a case which deserves the sympathetic consideration of the Chancellor of the Exchequer.
    Mr. GRAHAM: I feel the Committee would like one or two words of additional explanation on our attitude towards this Clause. A week or two ago I saw representatives of the collectors. So the matter can be quite briefly stated. There are about 4,000 of these collectors, of whom 3,200 are appointed by the local Commissioners and about 800 by the Board of Inland Revenue. The Royal Commission on Income Tax in 1919 considered the whole administrative structure of the Inland Revenue for the Income Tax collection, and recommended that this collection should be undertaken by the Board of Inland Revenue, that these collectors should be servants of the Board, and that in larger areas they should be given full-time appointments. I will only state, in conclusion, the present position and show the dangers involved in the acceptance of this Clause. There is the very warmest sympathy for these men and the fullest appreciation of the work they have done. But about 1,300 of these collectors are men who enjoy a remuneration of £25 or less per annum. We considered recently, on their

    2161
    recommendation, certain proposals of superannuation, but it, must be perfectly obvious to the Committee that you cannot really consider a scheme of superannuation or security of tenure when you are dealing with a large proportion of people who work on the very low basis of remuneration I have stated. My right hon. Friend and I are in perfect sympathy with the claims of these men, but I entirely agree with him that this Amendment could not achieve anything in particular. I am afraid it will mean a difficulty when we come to deal, as we hope to do in the near future, with a proper scheme for these men. I strongly urge upon my hon. Friend that from that point of view it would not be in the interests of the men themselves to press this Clause. I assure the Committee that the interests of the men are under consideration, and will be safeguarded when we come to consider the wider and larger scheme.
    Mr. HANNON: What is the intention of the Chancellor? What are his good
    intentions towards these men? It is all very well to say they will be considered, but they have been considered for 20 years, and nothing has been accomplished.
    Mr. REMER: May I also ask what is the, position by which they will be prejudiced if this Amendment be accepted?
    Mr. GRAHAM: The short point is that there are all kinds of conditions attaching to their appointments, and if this Clause be inserted in the Finance Act this year, it will clearly set up a variation which will mean a difficulty when we come to consider a scheme. In 1921 the scheme aroused widespread controversy. There is the keenest desire to see that these men have justice, and I do not think the hon. Gentleman's Amendment would do that because, in my judgment, it would introduce an unnecessary obligation.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 138; Noes, 172.

    Division No. 138.]

    AYES.

    [1.47 a.m.

    Amery, Rt. Hon. Leopold C. M. S.

    Gates, Percy

    Owen, Major G.

    Aske, Sir Robert William

    Gaunt, Rear-Admiral Sir Guy R.

    Pattinson, S. (Horncastle)

    Baldwin, Rt. Hon. Stanley

    Gibbs, Col. Rt. Hon. George Abraham

    Penny, Frederick George

    Balfour, George (Hampstead)

    Gorman, William

    Percy, Lord Eustace (Hastings)

    Banks, Reginald Mitchell

    Gould, Frederick (Somerset, Frame)

    Perkins, Colonel E. K.

    Barnston, Major Sir Harry

    Greene, W. P. Crawford

    Philipson, Mabel

    Becker, Harry

    Greenwood, William (Stockport)

    Pielou, D. P.

    Betterton, Henry B.

    Guinness, Lieut.-Col. Rt. Hon. W. E.

    Pownall, Lieut.-Colonel Assheton

    Birchall, Mater J. Dearman

    Hacking, Captain Douglas H.

    Raine, W.

    Bird, Sir R. B. (Wolverhampton, W.)

    Hail, Lieut.-Col. Sir F. (Dulwich)

    Rathbone, Hugh R.

    Blades, Sir George Rowland

    Harbord, Arthur

    Rees, Sir Beddoe

    Blundell, F. N.

    Harland, A.

    Remer, J. R.

    Bourne, Robert Croft

    Harmsworth, Hon. E. C. (Kent)

    Rhys, Hon. C. A. U.

    Bowyer, Capt. G. E. W.

    Hartington, Marquess of

    Richardson, Lt.-Col. Sir P. (Chertsey)

    Briant, Frank

    Harvey, C. M. B.(Aberd'n & Kincardne)

    Roberts, Samuel (Hereford, Hereford)

    Briscoe, Captain Richard George

    Harvey, T. E. (Dewsbury)

    Robinson. Sir T. (Lancs., Stretford)

    Brittain, Sir Harry

    Hennessy, Major J. R. G.

    Ropner, Major L.

    Bullock, Captain M.

    Herbert, Dennis (Hertford, Watford)

    Roundell, Colonel R. F.

    Burman, J. B.

    Hindle, F.

    Russell, Alexander West (Tynemouth)

    Butler, Sir Geoffrey

    Hope, Rt. Hon. J. F. (Sheffield, C.)

    Samuel, A. M. (Surrey, Farnham)

    Butt, Sir Alfred

    Howard, Hn. D.(Cumberland, Northrn.)

    Sandeman. A. Stewart

    Chadwick, Sir Robert Burton

    Hughes, Collingwood

    Sassoon, Sir Philip Albert Gustave D.

    Chamberlain, Rt. Hon. N. (Ladywood)

    Inskip, Sir Thomas Walker H.

    Savery, S. S.

    Chapman, Sir S.

    Jackson, Lieut.-Colonel Hon. F. S.

    Sheffield, Sir Berkeley

    Chilcott, Sir Warden

    Kay, Sir R. Newbakld

    Shepperson. E. W.

    Clayton, G. C.

    Keens, T.

    Simon, E. D.(Manchester, Withington)

    Cluse, W. S.

    Kenworthy, Lt.-Com. Hon. Joseph M.

    Smith-Carington, Neville W.

    Cope, Major William

    Kindersley, Major G. M.

    Somerville, Daniel (Barrow-in-Furness)

    Courthope, Lieut.-Col. George L.

    King, Captain Henry Douglas

    Spears, Brig.-Gen. E. L.

    Crooke, J. Smedley (Deritend)

    Lamb, J. Q.

    Snowier-Clay, Lieut.-Coloner H. H.

    Curzon, Captain Viscount

    Lloyd, Cyril E. (Dudley)

    Spero, Dr. G. E.

    Dalkeith, Earl of

    Lumley, L. R.

    Starmer, Sir Charles

    Davidson, Major-General Sir J. H.

    Makins, Brigadier-General E.

    Steel, Samuel Strang

    Dawson, Sir Philip

    Milne, J. S. Wardlaw

    Stuart, Hon. J. (Moray and Nairn)

    Deans, Richard Storry

    Moore-Brabazon, Lieut.-Col. J. T. C.

    Tattersall, J. L.

    Dixey, A. C.

    Morrison-Bell, MajorSir A. C. (Honiton)

    Thompson, Luke (Sunderland)

    Duckworth, John

    Morse, W. E.

    Thompson, Piers G. (Torquay)

    Eden, Captain Anthony

    Moulton, Major Fletcher

    Tichfield, Major the Marquess of

    England, Colonel A.

    Murrell, Frank

    Ward, G (Leicester, Bosworth)

    Eyres-Monsell, Com. Rt. Hon. B. M.

    Newman, Sir R. H. S. D. L. (Exeter)

    Warrender, Sir Victor

    Falle, Major Sir Bertram Godfray

    Nicholson, O. (Westminster)

    Watson, Sir F. (Padsey and Otley)

    Ferguson, H.

    Nield, Rt. Hon. Sir Herbert

    Wells, S. R.

    FitzRoy, Captain Rt. Hon. Edward A.

    O'Neill, Rt. Hon. Hugh

    Wheler, Lieut.-Col. Granville C. H.

    Fletcher, Lieut.-Com. R. T. H.

    Oliver, P. M. (Manchester, Blackley)

    Williams, A. (York, W. R., Sowerby)

    Williams, Maj. A.S. (Kent, Sevenoaks)

    Wise, Sir Fredric

    TELLERS FOR THE AYES.—

    Wilson, Sir C. H. (Leeds, Central)

    Wragg, Herbert

    Sir Kingsley Wood and Mr.

    Windsor-Clive, Lieut.-Colonel George

    Yerburgh, Major Robert D. T.

    Hanon.

    NOES.

    Ackroyd, T. R.

    Henderson, T. (Glasgow)

    Parkinson, John Alien (Wigan)

    Adamson, Rt. Hon. William

    Henderson, W. W. (Milddlesex, Enfield)

    Perry, S. F.

    Adamson, W. M. (Staff., Cannock)

    Hillary, A. E.

    Pethick-Lawrence, F. W.

    Alexander, A. V. (Sheffield, Hillsbro')

    Hirst, G. H.

    Phillipps, Vivian

    Ammon, Charles George

    Hobhouse, A. L.

    Potts, John S.

    Attlee, Major Clement R.

    Hodges, Frank

    Purcell, A. A.

    Baker, Walter

    Hoffman, P. C.

    Raffety, F. W.

    Banton, G.

    Howard, Hon. G. (Bedford, Luton)

    Ramage, Captain Cecil Beresford

    Barclay, R. Noton

    Hudson, J. H.

    Rea, W. Russell

    Barnes, A.

    Isaacs, G. A.

    Richards, R.

    Batey, Joseph

    Jackson, R. F. (Ipswich)

    Richardson, R. (Houghton-le-Spring)

    Benn, Captain Wedgwood (Leith)

    Jenkins, W. (Glamorgan, Neath)

    Robertson, J. (Lanark, Bothwell)

    Birkett, W. N.

    Jewson, Dorothea

    Romeril, H. G.

    Bonwick, A

    John, William (Rhondda, West)

    Royle, C.

    Broad, F. A.

    Johnston, Thomas (Stirling)

    Scurr, John

    Bromfield, William

    Johnstone, Harcourt (Willesden, East)

    Seely. H. M. (Norfolk, Eastern)

    Brown, A. E. (Warwick, Rugby)

    Jones, C. Sydney (Liverpool, W. Derby)

    Sexton, James

    Brown, James (Ayr and Bute)

    Jones, Henry Haydn (Merioneth)

    Shaw, Rt. Hon. Thomas (Preston)

    Buckle, J.

    Jones, J. J. (West Ham, Silvertown)

    Sherwood, George Henry

    Charleton, H. C.

    Jones, Rt. Hon. Leif (Camborne)

    Short, Alfred (Wednesbury)

    Clarke, A.

    Jones, Morgan (Caerphilly)

    Smith, Ben (Bermondsey, Rotherhithe)

    Climie, R.

    Jones, T. I. Mardy (Pontypridd)

    Smith, W. R. (Norwich)

    Collins, Sir Godfrey (Greenock)

    Jowitt, W. A. (The Hartiepools)

    Snell, Harry

    Compton, Joseph

    Kedward, R. M.

    Snowden, Rt. Hon. Philip

    Comyns-Carr, A. S.

    Kirkwood, D.

    Spence, R.

    Costello, L. W. J.

    Lansbury, George

    Spoor, B. G.

    Cove, W. G.

    Laverack, F. J.

    Stamford, T. W.

    Cowan, D. M. (Scottish Universities)

    Law, A.

    Stranger, Innes Harold

    Crittall, V. G.

    Lawrence, Susan (East Ham, North)

    Sturrock, J. Leng

    Darbishire, C. W.

    Lawson, John James

    Sunlight, J.

    Davies, David (Montgomery)

    Leach, W.

    Terrington, Lady

    Davies, Rhys John (Westhoughton)

    Lee, F.

    Thomson, Trevelyan (Middlesbro, W.)

    Dickie, Captain J. P.

    Lessing, E.

    Thorne, G. R. (Wolverhampton, E.)

    Dickson, T.

    Lintield, F. C.

    Thornton, Maxwell R.

    Dodds, S. R.

    Loverseed, J. F.

    Thurtle, E.

    Dukes, C.

    Lunn, William

    Toole, J.

    Duncan, C.

    McEntee, V. L.

    Tout, W. J.

    Edwards, G. (Norfolk, Southern)

    Macfadyen, E.

    Vivian, H.

    Egan, W. H.

    Mackinder, W.

    Wallhead, Richard C.

    Falconer, J.

    Maclean, Nell (Glasgow, Govan)

    Watson, W. M. (Dunfermline)

    Foot, Isaac

    Mansel, Sir Courtenay

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Gardner, B. W. (West Ham, Upton)

    March, S.

    Webb, Rt. Hon. Sidney

    Gibbins, Joseph

    Marley, James

    Wedgwood, Col. Rt. Hon. Josiah C.

    Gillett, George M.

    Martin, F. (Aberdeen & Kinc'dine, E.)

    Whiteley, W.

    Gosling, Harry

    Martin, W. H. (Dumbarton)

    Williams, David (Swansea, E.)

    Graham, W. (Edinburgh, Central)

    Middleton, G.

    Williams, Dr. J. H. (Lianelly)

    Greenwood, A. (Nelson and Coine)

    Mills, J. E.

    Williams, Col. P. (Middlesbrough, E)

    Grenfell, D. R. (Glamorgan)

    Mond, H.

    Williams, T. (York Don Valley)

    Grundy, T. W.

    Morris, R. H.

    Williams, Lt.-Col. T.S.B. (Kennington)

    Guest, Dr. L. Haden (Southwark, N.)

    Morrison, Herbert (Hackney, South)

    Willison, H.

    Hall, Fredk. (Yorks, Normanton)

    Morrison, R. C. (Tottenham, N.)

    Wilson, C. H. (Sheffield, Attercliffe)

    Hall, G. H. (Merthyr Tydvil)

    Mosley, Oswald

    Wilson, R. J. (Jarrow)

    Hardie, George D.

    Murray, Robert

    Windsor, Walter

    Harris, Percy A.

    Naylor, T. E.

    Wright, W.

    Hartshorn, Rt. Hon. Vernon

    Nixon, H.

    Young, Andrew (Glasgow, Partick)

    Hastings, Sir Patrick

    O'Grady, Captain James

    Haycock, A. W.

    Paling, W.

    TELLERS FOR THE NOES.—

    Hayday, Arthur

    Palmer, E. T.

    Mr. Kennedy and Mr. Warne.

    Henderson, A. (Cardiff, South)

    NEW CLAUSE.—(Duty on cycles.)
    Paragraph (1) of the Second Schedule to the Finance Act, 1920, which prescribes the rates of duty on cycles shall have effect by the addition thereto of rates of duty for mechanically assisted pedal cycles as follows:—

    £

    s.

    Bicycles propelled by pedals assisted with a mechanical motor attachment not exceeding 100 1bs. in weight unladen

    0

    10

    2164

    Tricycles propelled by pedals assisted with a mechanical motor attachment not exceeding 200 1bs. in weight unladen.

    1

    10

    —[Mr. Toole.]
    Brought up, and read the First time.
    Mr. TOOLE: I beg to move, "That the Clause be read a Second time."
    It is quite a simple matter as I understand it, and will not cost very much.
    The MINISTER of TRANSPORT (Mr. Gosling): This proposed Clause cannot be accepted in its present form, as it would include light-weight motor cycles; in fact, apparently all one would have to do would be to put pedals on these vehicles, in order to bring them within the suggested Clause, though doubtless the real intention is to deal with what are known as "auto-wheel attachments." As far as the second part of the Amendment is concerned, the Ministry of Transport dealt with this matter as long ago as January, 1921, and on the 28th of that month, in Information Circular No. 2 then issued, there appeared the following information:
    "Auto-wheels, bicycles and tricycles primarily constructed to be propelled by pedals and fitted with an auto-wheel attachment
    as an additional or alternative method of propulsion should only be charged with duty at the annual rate of 30s."
    As far as the Ministry of Transport is aware, this paragraph has been acted upon throughout the country ever since that date. In these circumstances I cannot accept this Clause.
    Mr. TOOLE: I should like to ask if the Minister of Transport has any opinion of his own on the matter.
    Mr. GOSLING: The opinions that I have of my own are opinions which I form after having good advice.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 76; Noes, 214.

    Division No. 139.]

    AYES.

    [2.0 a.m.

    Balfour, George (Hampstead)

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Rhys, Hon. C. A. U.

    Banks, Reginald Mitchell

    Hannon, Patrick Joseph Henry

    Richardson, Lt-Col. Sir P. (Chertsey)

    Barnston, Major Sir Harry

    Harland, A.

    Roberts, Samuel (Hereford, Hereford)

    Becker, Harry

    Harmsworth, Hon. E. C. (Kent)

    Ropner, Major L.

    Birchall, Major J. Dearman

    Hartington, Marquess of

    Roundell, Colonel R. F.

    Bird, Sir R. B. (Wolverhampton, W.)

    Hennessy, Major J. R. G.

    Russell, Alexander West (Tynemouth)

    Blades, Sir George Rowland

    Herbert, Dennis (Hertford, Walford)

    Samuel, A. M. (Surrey, Farnham)

    Bowyer, Capt. G. E. W.

    Howard, Hn, D. (Cumberland,Northrn.)

    Sandeman, A. Stewart

    Brittain, Sir Harry

    Hughes, Collingwood

    Sassoon, Sir Philip Albert Gustave D.

    Burman, J. B.

    Jackson, Lieut.-Colonel Hon. F. S.

    Savery, S. S.

    Butler, Sir Geoffrey

    Kindersley, Major G. M.

    Sheffield, Sir Berkeley

    Butt, Sir Alfred

    King, Captain Henry Douglas

    Somerville, Daniel (Barrow-in-Furness)

    Chadwick, Sir Robert Burton

    Lumley, L. R.

    Spender-Clay, Lieut.-Colonel H. H.

    Cope, Major William

    Makins, Brigadier-General E.

    Steel, Samuel Strang

    Courthope, Lieut.-Col. George L.

    Milne, J. S. Wardlaw

    Stuart, Hon. J. (Moray and Nairn)

    Crooke, J. Smedley (Deritend)

    Moore-Brabazon, Lieut.-Col. J. T. C.

    Titchfield, Major the Marquess of

    Curzon, Captain Viscount

    Morrison-Bell, Major A. C. (Honiton)

    Warrender, Sir Victor

    Dalkeith, Earl of

    Nicholson, O. (Westminster)

    Watson, Sir F. (Pudsey and Otley)

    Davidson, Major-General Sir J. H.

    Nield, Rt. Hon. Sir Herbert

    Wheler, Lieut.-Col. Granville C. H.

    Dawson, Sir Philip

    O'Neill, Rt. Hon. Hugh

    Wilson, Sir Charles H. (Leeds,Central)

    Dixey, A. C.

    Penny, Frederick George

    Wise, Sir Fredric

    Eden, Captain Anthony

    Perkins, Colonel E. K.

    Wragg, Herbert

    Eyres-Monsell, Com. Rt. Hon. B. M.

    Philipson, Mabel

    Yerburgh, Major Robert D. T.

    Falle, Major Sir Bertram Godfray

    Pielou, D. P.

    Ferguson, H.

    Pownall, Lieut.-Colonel Assheton

    TELLERS FOR THE AYES.—

    Greenwood, William (Stockport)

    Raine, W.

    Mr. Deans and Mr. Remer.

    Hacking, Captain Douglas H.

    NOES.

    Ackroyd, T. R.

    Clayton, G. C.

    Foot, Isaac

    Adamson, Rt. Hon. William

    Climie. R.

    Gardner, B. W. (West Ham, Upton)

    Adamson, W. M. (Staff., Cannock)

    Cluse, W. S.

    Gates, Percy

    Alexander, A. V. (Sheffield, Hillsbro')

    Collins, Sir Godfrey (Greenock)

    Gaunt, Rear-Admiral Sir Guy R.

    Ammon, Charles George

    Compton, Joseph

    George, Major G. L. (Pembroke)

    Aske, Sir Robert William

    Comyns-Carr, A. S.

    Gibbins, Joseph

    Attlee, Major Clement R.

    Costello, L. W. J.

    Gillett, George M.

    Baker, Walter

    Cove, W. G.

    Gorman, William

    Banton, G.

    Cowan, D. M. (Scottish Universities)

    Gosling, Harry

    Barclay, R. Noton

    Crittall, V. G.

    Gould, Frederick (Somerset, Frome)

    Barnes, A.

    Darbishire, C. W.

    Graham, W. (Edinburgh, Central)

    Batey, Joseph

    Davies, David (Montgomery)

    Greene. W. P. Crawford

    Benn, Captain Wedgwood (Leith)

    Davies, Rhys John (Westhoughton)

    Greenwood, A. (Nelson and Colne)

    Birkett, W. N.

    Dickie, Captain J. P.

    Grenfell, D. R. (Glamorgan)

    Blundell, F. N.

    Dickson, T.

    Grundy, T. W.

    Bonwick, Alfred J.

    Dodds, S. R.

    Guest, Dr. L. Haden (Southwark, N.)

    Briant, Frank

    Duckworth, John

    Hall, F. (York, W. R., Normanton)

    Broad, F. A.

    Dukes, C.

    Hall, G. H. (Merthyr Tydvil)

    Bromfield, William

    Duncan, C.

    Harbord, Arthur

    Brown, A. E. (Warwick, Rugby)

    Edwards, G. (Norfolk, Southern)

    Hardie, George D.

    Brown, James (Ayr and Bute)

    Egan, W. H.

    Harris, Percy A.

    Buckle, J.

    England, Colonel A.

    Hartshorn, Rt. Hon. Vernon

    Charleton, H. C.

    Falconer, J.

    Harvey,C.M.B.(Aberd'n & Kincardne)

    Clarke, A.

    Fletcher, Lieut.-Com. R. T. H.

    Harvey, T. E. (Dewsbury)

    Hastings, Sir Patrick

    Mansel, Sir Courtenay

    Smith, Ben (Bermondsey, Rotherhlthe)

    Haycock, A. W.

    March, S.

    Smith, W. R. (Norwich)

    Hayday, Arthur

    Marley, James

    Smith-Carington, Neville W.

    Henderson, A. (Cardiff, South)

    Martin, F. (Aberdeen & Kinc'dine, E.)

    Snell, Harry

    Henderson, T. (Glasgow)

    Martin, W. H. (Dumbarton)

    Snowden, Rt. Hon. Philip

    Henderson, W. W. (Middlesex, Enfld.)

    Middleton, G.

    Spence, R.

    Hillary, A. E.

    Mills, J. E.

    Spero, Dr. G. E.

    Hindle, F.

    Mond, H.

    Spoor, B. G.

    Hirst, G. H.

    Morris, R. H.

    Stamford, T. W.

    Hobhouse, A. L.

    Morrison, Herbert (Hackney, South)

    Starmer, Sir Charles

    Hodges, Frank

    Morrison, R. C. (Tottenham. N.)

    Stranger, Innes Harold

    Hoffman, P. C.

    Morse, W. E.

    Sturrock, J. Leng

    Howard, Hon. G. (Bedford, Luton)

    Mosley, Oswald

    Sunlight. J.

    Hudson, J. H.

    Moulton, Major Fletcher

    Tattersall, J. L.

    Isaacs, G. A.

    Murray, Robert

    Terrington, Lady

    Jackson, R. F. (Ipswich)

    Murrell, Frank

    Thompson, Piers G. (Torquay)

    Jenkins, W. (Glamorgan, Neath)

    Naylor, T. E.

    Thomson, Trevelyan (Middlesbro, W.)

    Jenkins, W. A. (Brecon and Radnor)

    Newman, Sir R. H. S. D. L. (Exeter)

    Thorne, G. R. (Wolverhampton, E.)

    John, William (Rhondda, West)

    Nixon, H.

    Thornton, Maxwell R.

    Johnston, Thomas (Stirling)

    O'Grady, Captain James

    Thurtle, E.

    Johnstone, Harcourt (Willesden, East)

    Oliver, P. M. (Manchester, Blackley)

    Toole, J.

    Jones, C. Sydney (Liverpool, W. Derby)

    Owen, Major G.

    Tout, W. J.

    Jones, Henry Haydn (Merioneth)

    Paling, W.

    Vivian, H.

    Jones, J. J. (West Ham, Silvertown)

    Palmer, E. T.

    Wallhead, Richard C.

    Jones. Rt. Hon. Leif (Camborne)

    Parkinson, John Allen (Wigan)

    Ward, G. (Leicester, Bosworth)

    Jones, Morgan (Caerphilly)

    Pattinson, S. (Horncastle)

    Watson, W. M. (Dunfermline)

    Jones, T. I. Mardy (Pontypridd)

    Perry, S. F.

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Jowitt, W. A. (The Hartlepools)

    Pethick-Lawrence, F. W.

    Webb, Rt. Hon. Sidney

    Kay, Sir R. Newbald

    Philllpps, Vivian

    Wedgwood, Col. Rt. Hon. Josiah C.

    Kedward, R. M.

    Potts, John S.

    Wells, S. R.

    Keens, T.

    Purcell, A. A.

    Whiteley, W.

    Kenworthy, Lt.-Com. Hon. Joseph M.

    Rattety, F. W.

    Williams, A. (York, W.R., Sowerby)

    Kirkwood, D.

    Ramage, Captain Cecil Beresford

    Williams, David (Swansea, E.)

    Lamb, J. Q.

    Rathbone, Hugh R.

    Williams, Dr. J. H. (Llanelly)

    Lansbury, George

    Rea, W. Russell

    Williams, Col. P. (Middlesbrough, E.)

    Laverack, F. J.

    Rees, Sir Beddoe

    Williams, Maj. A. S. (Kent, Sevenoaks)

    Law, A.

    Richards, R.

    Williams, T. (York, Don Valley)

    Lawson, John James

    Richardson, R. (Houghton-le-Spring)

    Williams, Lt.-Col. T.S.B. (Kennington)

    Leach, W.

    Robertson, J. (Lanark, Bothwell)

    Willison, H.

    Lee, F.

    Robinson, Sir T. (Lancs., Stretford)

    Wilson, C. H. (Sheffield, Attercliffe)

    Lessing, E.

    Romeril, H. G.

    Wilson, R. J. (Jarrow)

    Linfield, F. C.

    Royle, C.

    Windsor, Walter

    Lloyd, Cyril E. (Dudley)

    Scurr, John

    Windsor-Clive, Lieut.-Colonel George

    Loverseed, J. F.

    Seely, H. M. (Norfolk, Eastern)

    Wright, W.

    Lunn, William

    Sexton, James

    Young, Andrew (Glasgow, Partick)

    McEntee, V. L.

    Shepperson, E. W.

    Macfadyen, E.

    Sherwood, George Henry

    TELLERS FOR THE NOES.ߞ

    Mackinder, W.

    Short, Alfred (Wednesbury)

    Mr. Kennedy and Mr. Warne.

    Maclean, Neil (Glasgow, Govan)

    NEW CLAUSE.—(Exemption of clubs from entertainments duty.)
    "The Entertainments Duty imposed by The Finance (New Duties) Act. 1916, as amended by any subsequent enactment, shall not be levied on any club, the annual subscription to which is ten shillings a year or less, except for any entertainment given in the club for which special tickets are sold or a special price charged for admission."—[Lieut.-Commander Kenworthy.]
    Brought up, and read the First time.
    Lieut.-Commander KENWORTHY: I beg to move, "That the Clause be read a Second time."
    This Clause proposes to exempt certain clubs from Entertainments Duty. It has arisen out of a very curious question. During the last few months an attempt has been made by certain Commissioners of Inland Revenue to tax working men's clubs on the annual subscription of each member because the members occasionally have Saturday night sing-songs
    2168
    in their clubs. The business started in Hull, but it exists in other Members' constituencies as well. It began with the Carlton Club, of Hull. This is a working men's club, the annual subscription to which is 4s. The amenities of a club are provided—newspapers, billiards, games, and so on. Five or six times during the winter a Saturday night concert is given by the members to the members. No charge is made at all. On one occasion a subscription was taken up for a local charity. This is a matter affecting thousands of working men in their clubs. I do ask the Committee to give me their support. The Commissioners of Inland Revenue declare that this 4s. is paid in anticipation of these concerts and entertainments, and they want to charge each Member 9d. per year. I would ask the Chancellor of the Exchequer where this sort of thing is going to end. We have in the same city a Dickens Association for the study of the works of the great English novelists.

    2169
    Lectures are given once a month, and in between the lectures artistes perform and songs are given. This society, which is not very large, has been asked to pay a sum of £13 for the last five years. Masonic lodges are being taxed because the members themselves give concerts after their lodge meetings. It is only a step from this to a citizen being taxed because he has a wireless apparatus, because he has a gramophone he plays for his children, or because his daughter plays a piano in the evenings.
    This tax is not levied equally. There is another Carlton Club, in London, and very entertaining exhibitions are given there. Ex-Ministers of the Crown associate within its walls, and Governments are destroyed there. One of the few good things done within the walls of the Carlton Club was the destruction of the Coalition Government. No Entertainments Duty is levied on the Carlton Club in anticipation of interesting, enlightening and elevating speeches being delivered there by Noble Lords, Privy Councillors, and even my right hon. Friend the Member for the Bewdley Division of Worcester (Mr. Baldwin). I do ask the Chancellor of the Exchequer to prevent this attempt at what is an abuse of the original intention of the Entertainments Duty. This sort of thing is bringing the machinery of taxation into disrepute. This was intended to be levied upon entertainments paid for by the public, and which were looked upon in the days in which it was imposed as a luxury. The Amendment exempts all clubs with a subscription of under 10s., except where they give entertainments for which tickets are issued or prices charged. The Chancellor of the Exchequer had exempted the poorer users of theatre and cinema seats. The same exemption should be given to the poorer users of clubs.
    Mr. SNOWDEN: The hon. and gallant Member has spent a great deal of energy and eloquence on this Amendment which is altogether unnecessary. His concluding observation referred to the fact that I had made certain concessions with regard to the duty on low-priced seats. Under these arrangements, any working men's club which have a subscription of less than 10s. per year will be exempt.
    Lieut.-Commander KENWORTHY: I beg to ask leave to withdraw the Clause. This is the only Amendment I am moving,
    2170
    and I am grateful to the right hon. Gentleman.
    Motion and Clause, by leave, withdrawn.

    NEW CLAUSE.—(Amendment as to moneys payable under policies of life insur- ance effected for purposes of estate duty.)
    If any person makes an insurance on his life, or on the life of any other person, with any insurance company legally established in the United Kingdom, or in any British possession, or lawfully carrying on business in the United Kingdom, and the policy of insurance expressly states that such insurance is made with the primary object of providing for estate duty which may become payable on the death of the assured, and that so much as the holder of such policy or his legal personal representatives may direct of the capital sum payable there under will on the death of the assured be payable by the insurance company direct to the Commissioners of Inland Revenue for the purpose of being applied in or towards the payment of such estate duty then to the extent to which such capital sum is so paid and applied the same shall not be aggregated with any other property for the purpose of fixing the rate of estate duty but shall form an estate by itself.—[Colonel Courthope.]
    Brought up, and read the First time.
    Colonel COURTHOPE: I beg to move, "That the Clause be read a Second time."
    The purpose of the Clause is to encourage the provision by insurance for the payment of Death Duties. The Death Duties in their conception were described by Sir William Harcourt as deferred Income Tax. If that analogy is maintained it is clearly not right that insurance during the lifetime of any individual for the provision of the sum which will become payable by way of estate duty at his death should itself be subject to Death Duties. In other words, in a case where an insurance provides on the face of it that on death the sum shall be paid to the Commissioners of Inland Revenue—that it can be applied for no other purpose—the capital sum of that insurance shall not go into the aggregate of the deceased's estate for the purpose of assessing that estate for Death Duties.
    Mr. GRAHAM: I hope that the hon. and gallant Member will not find it necessary to go to a Division. The object of the Amendment is perfectly clear. It seeks to obtain a preference for provision made by way of insurance for the payment of

    2171
    Death Duties. I think that would be a differentiation with regard to Income Tax in favour of one form of saving. Apart altogether from the departure from the method usually adopted it would undoubtedly cost the Exchequer in a full year not less than £800,000. That is a fatal difficulty in the case. There are other difficulties. The unfair differentiation of the benefit would inure to the large rather than the small estates. For these reasons the Government are unable to accept the Clause, and I hope the hon. and gallant Member will not press it.
    Question, "That the Clause be read a Second time, "put, and negatived.

    NEW CLAUSE.—(Exemption, from Income Tax of research fellowships.)
    Income arising from a studentship or fellowship granted by a trust to a person exclusively for the purpose of his pursuing research studies under the auspices of any university in Great Britain shall be exempt from Income Tax (including Super-tax), and no account shall be taken of any such income in computing the amount of income for the purposes of the Income Tax Acts.—[Sir G. Butler.]
    Brought up, and read the First time.
    Sir GEOFFREY BUTLER: I beg to move, "That the Clause be read a Second time."
    This Clause does not seek to establish any new principle, but aims at clearing up doubt as to the application of a principle already admitted, because under Section 28 of the Finance Act, 1920, scholarships of various kinds are exempted from Income Tax if a person be receiving instruction at a university, college, school or other educational establishment. The Committee will notice that what is exempted up to date is a scholar receiving, so to speak, his ordinary education. If he has passed through the ordinary preliminary stage and taken up research work, I have never heard that the exemption from Income Tax was thereby lost. Certain individuals come into the picture only at the later stage. I can instance some important foundations, such as the famous 1851 Exhibitions, which have done so much in promoting scientific research, the Beit research fellowships and a few others. These are given to men and women after graduation. I find that the average sum is about £250 per
    2172
    annum, and I calculate there will not be more than 250 persons affected. One might well ask why such persons should not be exempted. I maintain the Government have admitted the case, because the grants for research training given by the Scientific and Industrial Research Board are already exempted. When I pointed that out to the Financial Secretary to the Treasury I received, as one would expect, a very kind letter which I cannot believe was framed by his luminous brain, but rather by a Treasury casuist, in which he argued that these were grants for training in research as opposed to research work and laid stress upon their eleemosynary character. The only comment I will make on that letter is that it would make a Venetian Jesuit of the 18th Century blush.
    I make my appeal to the Chancellor on the very fact that it is pure and undiluted research work for which I ask exemption. One does have sometimes the impression that great discoveries spring full-fledged from the brain of an individual, and I think that nobody will contradict me when I say scientific advance nowadays is more often the product of a school of thought and that a great research worker is, beside being that, the organiser of an army, a kind of Chief of a general staff. The Germans realised that for about 100 years yet the weakness of the German system was that the professors and leading scientists sapped the strength of the assistant workers. That we have so far avoided in England, but we shall rival German research only in so far as we are able to keep it free from that tendency and keep a constant supply of men of first-rate ability flowing into the centres of research. It seems to me that wise legislation would aim at encouraging these young scientists just at a time when they have taken their degrees. It is a very poor outlook at this moment when he has to choose between academic work on one hand, and on the other a calling more remunerative. I have seen only this week a man of great ability who might have devoted himself to the purely scientific side, having to do scientific research work for commercial firms. It is very difficult when one has young people to advise to tell them to go in for scientific research. It is

    2173
    perfectly easy to say that the answer to this is to found bigger scholarships, but it is not really so, because then fewer men will be helped. It is an old principle that the Government should co-operate with private effort. We have just a few of these scholarships and foundations established. It is very difficult to get money. I do appeal to the Financial Secretary, whose mind I know to be a mixture of justice and mercy, and to the Chancellor of the Exchequer, who has exactly the same qualities. I am sorry to have kept the House so long, but the subject is so important. I do urge it in the name of a great many research workers who are working at a great disadvantage.
    Mr. GRAHAM: I find it very difficult to resist the appeal made by my hon. Friend, but, unfortunately, it is the painful duty of anyone who occupies this office to set facts without mercy before the Committee. The position as regards these scholarships is that, under the law as it stands, there is an exemption from Income Tax of the scholarship or whatever the form of the exhibition may be which is held by anyone receiving full-time instruction at a University, school, etc. Already there is a very large measure of exemption from Income Tax in the direction which the hon. Member has in mind. But he proceeds beyond that in this Clause, and in particular cites the case of those grants and exhibitions under the Department for Scientific and Industrial Research. I must take the responsibility for the reply which was sent from the Treasury, because these grants are given under certain definite Regulations, and they are not really of the nature of scholarships or awards in a kind of honorific sense. They are rather
    grants to enable people who receive, them to postpone taking up paid work, and they are strictly related to the circumstances of the recipient, which rather emphasises—although I do not stress the point—their character. I feel, however, that, having regard to the two classes of exemptions which exist, it would be very difficult for any Chancellor of the Exchequer to make a further departure without a serious inroad upon recognised Income Tax practice. It does not matter very much who stands at this Box, or to which party he belongs, there are certain traditions and principles in the Income Tax by which he must abide. If we are going to assist the universities on educational research, or whatever it may be, in a sphere which we have all at heart, the way to do that is obviously by direct grant, and not by the indirect route. Our experience on the Royal Commission on Income Tax made it abundantly plain that the more you introduce exemptions into Income Tax, the more you exempt particular callings here and there, then the more you tend to break down the whole structure, and you only create a great mass of anomalies which inevitably give rise to the need for a Royal Commission doing its best to patch them all up. The logic of the situation points to a limitation of the concession to the extent to which it has already gone, and, accordingly, while having the greatest sympathy with the object of my hon. Friend, I am obliged to tell him that the Chancellor of the Exchequer is unable to accept this Clause.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 100; Noes, 185.

    Division No. 140.]

    AYES.

    [2.36 a.m.

    Amery, Rt. Hon. Leopold C. M. S.

    Cowan, D. M. (Scottish Universities)

    Hacking, Captain Douglas H.

    Baldwin, Rt. Hon. Stanley

    Crooke, J. Smedley (Deritend)

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Banks, Reginald Mitchell

    Curzen, Captain Viscount

    Hannon, Patrick Joseph Henry

    Barnston, Major Sir Harry

    Dalkeith, Earl of

    Harland, A.

    Becker, Harry

    Davidson, Major-General Sir J. H.

    Harmsworth, Hon. E. C. (Kent)

    Birchall, Major J. Dearman

    Davies, David (Montgomery)

    Hartington, Marquess of

    Bird, Sir R. B. (Wolverhampton, W.)

    Dawson, Sir Philip

    Harvey, C. M. B.(Aberd'n & Kincardne)

    Blades, Sir George Rowland

    Deans, Richard Storry

    Hennessy, Major J. R. G.

    Blundell, F. N.

    Dixey, A. C.

    Herbert, Dennis (Hertford, Watford)

    Bowyer, Capt. G. E. W.

    Eden, Captain Anthony

    Hope, Rt. Hon. J. F. (Sheffield, C.)

    Brittain, Sir Harry

    Eyres-Monsell, Com. Rt. Hon. B. M.

    Howard, Hn. D.(Cumberland, Northrn.)

    Burman, J. B.

    Ferguson, H.

    Hughes, Collingwood

    Butt, Sir Alfred

    Gates, Percy

    Inskip, Sir Thomas Walker H.

    Chadwick, Sir Robert Burton

    Gaunt, Rear-Admiral Sir Guy R.

    Jackson, Lieut.-Colonel Hon. F. S.

    Chamberlain, Rt. Hon. N. (Ladywood)

    Gibbs, Col. Rt. Hon. George Abraham

    Kay, Sir R. Newbald

    Clayton. G. C.

    Greene, W. P. Crawford

    Kindersley, Major G. M.

    Cope, Major William

    Greenwood, William (Stockport)

    King, Captain Henry Douglas

    Courthope, Lieut.-Col. George L.

    Guinness, Lieut.-Col. Rt. Hon. W. E.

    Lamb, J. Q.

    Lumley, L. R.

    Remer, J. R.

    Steel, Samuel Strang

    Makins, Brigadier-General E.

    Rhys, Hon. C. A. U.

    Stuart, Hon, J. (Moray and Nairn)

    Milne, J. S. Wardlaw

    Richardson, Lt. Col. Sir P. (Chertsey)

    Sunlight, J

    Moore-Brabazon, Lieut.-Col. J. T. C.

    Roberts, Samuel (Hereford, Hereford)

    Tichlield, Major the Marquess of

    Morrison-Bell, Majord Sir A. C. (Honiton)

    Ropner, Major L.

    Warrender, Sir Victor

    Newman, Sir R. H. S. D. L. (Exeter)

    Roundell, Colonel R. F.

    Wells. S. R.

    Nicholson, O. (Westminster)

    Russell, Alexander West (Tynemouth)

    Wheler, Lient.-Col. Granville C. H.

    Nield, Rt. Hon. Sir Herbert

    Samuel, A. M. (Surrey, Farnham)

    Wilson, Sir C. H. (Leeds, Central)

    O'Neill, Rt. Hon. Hugh

    Sandeman, A. Stewart

    Windsor-Clive, Lieut.-Colonel George

    Owen, Major G.

    Sassoon, Sir Philip Albert Gustave D.

    Wise, Sir Fredric

    Penny, Frederick George

    Savery, S. S.

    Wragg, Herbert

    Percy, Lord Estate (Hastings)

    Sheffield, Sir Berkeley

    Yerburgh, Major Robert D. T.

    Perkins, Colonel E. K.

    Shepperson, E. W.

    Philipson, Mabel

    Smith-Carington, Neville W.

    TELLERS FOR THE AYES—

    Pielou; D. P.

    Somerville, Daniel (Barrow-in-Furness)

    Sir Geoffrey Butler and Mr

    Pownall, Lieut.-Colonel Assheton

    Spero, Dr. G. E.

    Balfour.

    Raine, W.

    Starmer, Sir Charles

    NOES.

    Ackroyd, T. R.

    Henderson, T. (Glasgow)

    Palmer, E. T.

    Adamson, Rt. Hon. William

    Henderson, W. W. (Middlesex, Enfield)

    Parkinson, John Allen (Wigan)

    Adamson, W. M. (Staff., Cannock)

    Hillary, A. E.

    Pattinson, S. (Horncastle)

    Alexander, A. V. (Sheffield, Hillsbro')

    Hindle, F.

    Perry, S. F.

    Ammon, Charles George

    Hirst, G. H.

    Pethick-Lawrence, F. W.

    Aske, Sir Robert William

    Hobhouse, A. L.

    Phillipps, Vivian

    Attlee, Major Clement R.

    Hodges, Frank

    Potts, John S.

    Baker, Walter

    Hoffman, P. C.

    Purcell, A. A.

    Banton, G.

    Howard, Hon. G. (Bedford, Luton)

    Raffety, F. W.

    Barclay, R. Noton

    Hudson, J. H.

    Ramage, Captain Cecil Beresford

    Barnes, A.

    Issacs, G. A.

    Rathbone, Hugh R.

    Batey, Joseph

    Jackson, R. F. (Ipswich)

    Rea, W. Russell

    Birkett, W. N.

    Jenkins, W. (Glamorgan, Neath)

    Rees, Sir Beddoe

    Bonwick, A.

    Jenkins, W. A. (Brecon and Radnor)

    Richards, R.

    Briant, Frank

    John, William (Rhondda, West)

    Richardson, R. (Houghton-le-Spring)

    Broad, F. A.

    Johnston, Thomas (Stirling)

    Romeril, H. G.

    Bromfield, William

    Johnstone, Hearcourt (Willesden, East)

    Royle, C.

    Brown, A. E.(Warwick, Rugby)

    Jones, C. Sydney (Liverpool, W. Derby)

    Scurr, John

    Brown, James (Ayr and Bute)

    Jones, Henry Haydn (Merioneth)

    Seely, H. M. (Norfolk, Eastern)

    Buckle, J.

    Jones, J. J. (West Ham, Silvertown)

    Sexton, James

    Charleton, H. C.

    Jones, Rt. Hon. Leif (Camborne)

    Sherwood, George Henry

    Clarke, A.

    Jones, Morgan (Caerphilly)

    Short, Alfred (Wednesbury)

    Climie, R.

    Jones, T. I. Mardy (Pontypridd)

    Smith, Ben (Bermondsey, Rotherhithe)

    Collins, Sir Godfrey (Greenock)

    Jowitt, W. A. (The Hartlepools)

    Smith, W. R. (Norwich)

    Compton, Joseph

    Kedward, R. M.

    Snell, Harry

    Comyns-Carr, A. S.

    Keens, T.

    Snowden, Rt. Hon. Philip

    Costello, L. W. J.

    Kennedy, T.

    Spence, R.

    Cove, W. G.

    Kenworthy, Lt.-Com. Hon. Joseph M.

    Spoor, B. G.

    Crittall, V. G.

    Kirkwood, D.

    Stamford, T. W.

    Darbishire, C. W.

    Lansbury, George

    Stranger, Innes Harold

    Davies, Rhys John (Westhoughton)

    Laverack, F. J.

    Sturrock, J. Leng

    Dickie, Captain J. P.

    Law, A.

    Tattersall, J. L.

    Dickson, T.

    Lawson, John James

    Terrington, Lady

    Dodds, S. R.

    Leach, W.

    Thomson, Trevelyan (Middlesbro, W.)

    Duckworth, John

    Lee, F.

    Thornton, Maxwell R.

    Dukes, C.

    Lessing, E.

    Thurtle, E.

    Duncan, C.

    Linfield, F. C.

    Toole, J.

    Edwards, G. (Norfolk, Southern)

    Loverseed, J. F.

    Tout, W. J.

    Egan, W. H.

    Lunn, William

    Vivian, H.

    England, Colonel A.

    McEntee, V. L.

    Wallhead, Richard C.

    Falconer, J.

    Macfadyen, E.

    Ward, G. (Leicester, Bosworth)

    Fletcher, Lieut.-Com. R. T H.

    Mackinder, W.

    Watson, W. M. (Dunfermilne)

    Gardner, B. W. (West Ham, Upton)

    Maclean, Neil (Glasgow, Govan)

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    George, Major G. W. (Pembroke)

    Mansel, Sir Courtenay

    Webb, Rt. Hon. Sidney

    Gibbins, Joseph

    March, S.

    Wedgwood, Col. Rt. Hon. Josiah C.

    Gillett, George M.

    Marley, James

    Whiteley, W.

    Gorman, William

    Martin, F. (Aberdeen & Kinc'dine, E.)

    Williams, A. (York, W. R., Sowerby)

    Gosling, Harry

    Martin, W. H. (Dumbarton)

    Williams, David (Swansea, E.)

    Gould, Frederick (Somerset, Frome)

    Middleton, G.

    Williams, Dr. J. H. (Lianelly)

    Graham, W. (Edinburgh, Central)

    Milis, J. E.

    Williams, Col. P. (Middlesbrough E.)

    Greenwood, A. (Nelson and Colne)

    Mond, H.

    Williams, Maj. A. S. (Kent, Sevenoaks)

    Grenfell, D. R. (Glamorgan)

    Morris, R. H.

    Williams, T. (York, Don Valley)

    Grundy, T. W.

    Morrison, Herbert (Hackney, South)

    Williams, Lt.-Col. T.S.B. (Kennington)

    Hall, Fredk. (Yorks, Normanton)

    Morrison, R. C. (Tottenham, N.)

    Willison, H.

    Hall, G. H. (Merthyr Tydvil)

    Morse, W. E.

    Wilson, C. H. (Sheffield, Attercliffe)

    Harbord, Arthur

    Mosley, Oswald

    Wilson, R. J. (Jarrow)

    Hardie, George D.

    Moulton, Major Fletcher

    Windsor, Walter

    Harris, Percy A.

    Murray, Robert

    Wright, W.

    Hartshorn, Rt. Hon. Vernon

    Murrell, Frank

    Young, Andrew (Glasgow, Partick)

    Harvey, T. E. (Dewsbury)

    Naylor, T. E.

    Haycock, A. W.

    Nixon, H.

    TELLERS FOR THE NOES.—

    Hayday, Arthur

    Oliver, P. M. (Manchester, Blackley)

    Mr. John Robertson and M.

    Henderson, A. (Cardiff, South)

    Paling, W.

    Warne.

    NEW CLAUSE.—(Amendment of Section 32 of Finance Act, 1921.)
    Paragraphs (c) and (d) of Sub-section (3) of Section thirty-two of the Finance Act, 1921. (which provides for exemption of superannuation funds for Income Tax), shall cease to have effect.—[Mr. Laic.]
    Brought up, and read the First time.
    Mr. LAW: I beg to move, "That the Clause be read a Second time."
    Major MOULTON: On a point of Order. Would not this new Clause impose a charge? It proposes to repeal a Section which provides for the remission of Income Tax on superannuation funds.
    The DEPUTY- CHAIRMAN (Mr. Entwistle): I think it is a remission of taxation; it does not increase a tax.
    Mr. LAW: I have to appeal to the Committee for its sympathy, for the first reason because of my own timidity in a new experience, and for the second reason because of the importance of the Clause which it is my privilege to propose. I make my appeal not only to the Chancellor of the Exchequer or the Financial Secretary, but I make it to the Members of the House, because it is essential that the House should always see that the clearly expressed intention which the House records from time to time is not frustrated by any technical arrangements. I am quite sure that it is the clearly expressed intention of the House in the Finance Acts of past years and in the Income Tax Acts that organisations of working people who provide a superannuation fund shall have that fund exempt from Income Tax. In the Finance Acts of previous years you make special provision that friendly societies which pay friendly benefits, but in connection with the payment of their friendly benefits they maintain a separate fund for superannuation benefit alone, shall have their superannuation funds exempt from Income Tax. You also extend a similar consideration to trade union organisations which provide superannuation funds. A trade union can have its superannuation fund exempted from the payment of Income Tax, You also have the clear and definite intention that a number of employees in a given industry or in a given firm can have a superannuation fund established and they can get exemption from Income Tax on the one condition that the employer is a
    2178
    contributor to the superannuation fund. I am interested in pressing this appeal because of an organisation of working people, spoken of in the counties of Lancashire, Yorkshire, Cheshire and Derbyshire as managers in some cases, overlookers, spinning masters, carders, and so on. They are male employees in the whole of the cotton trade of these counties, and they have an organisation with friendly benefits connected. They pay sickness benefit, they provide medical benefit, they pay funeral benefit, they pay unemployment benefit, and they pay benefits connected with slackness of industry. They are all weekly wage earners. Therefore, it seems to me that with the clearly expressed intention of Finance Acts of previous years, and the Income Tax Acts which govern the Chancellor of the Exchequer, these people are reasonably entitled to have their superannuation fund exempt from the payment of Income Tax. For that reason I propose this Clause. These people are entitled to have exemption from Income Tax the superannuation fund that they have created, and which is maintained separate and distinct from the other fund from which friendly benefits are paid. They have been advised that they were a friendly society, but they have been ruled out as a friendly society by the Registrar because they are confined to membership of employés in a given industry. It has been suggested that they should be recognised as trade unions, but they have been ruled out of the title of trade unions because they do not pursue the function of collective bargaining. The freedom from Income Tax of superannuation funds should be extended to these people.
    Mr. GRAHAM: This is one of many Amendments or new Clauses recommended to the Committee for which, at first sight, there appears to be a good deal to say. I think I will give an explanation which will satisfy most hon Members that there is a very sound case on the other side. Section 32 of the Act of 1921, to which the hon. Member refers, provides that employers and employés may take into account, for the computation of Income Tax assessment, contributions they pay to a superannuation fund, and that investments under the fund itself shall be exempt from tax. The two Sub sections to which the hon. Member referred are really conditions embodied

    2179
    in the Act. The first condition is that the employers must be contributors to the fund, and the second that both employers and workers recognise the fund. The recommendations of the Royal Commission make it perfectly clear that this substantial measure of relief will be confined to what are clearly superannuation funds, and shall not be extended out into thrift or provident spheres. If the two provisos are taken away, we should come to this, that any voluntary association might obtain the large exemption from Income Tax. I am not sure it is a thing which this House should encourage at the present time. It would not be controlled under the Registrar of Friendly Societies. My hon. Friend would open a very dangerous door. Much of the difficulty might be overcome by registration as a friendly society. If there is any difficulty on that point I am willing to consider the main method which would remove the obstacle. In any case, the method suggested in this Amendment is one which we could not possibly accept. It would go right into the existing regulations regarding superannuation funds, and as soon as it was understood by large numbers of workers themselves it would be rather keenly resented. I hope the hon. Member will not find it necessary to press the Clause.
    Sir THOMAS INSKIP: The Financial Secretary has not told the Committee, although many Members are no doubt familiar with it, that the Commissioners have really the matter in their own hands, because the Section provides that the Commissioners may approve a superannuation fund. The Commissioners have a stock form of clauses which they rightly try to enforce upon persons applying for approval. If these stock Clauses are not accepted the Commissioners enter a non possumus and the fund fails to be approved. If it is a genuine superannuation fund the Commissioners have the power in their own hands. Sometimes these stringent conditions have prevented what are genuine super-annuation
    funds from being approved. If (c) and (d) are withdrawn it will give the Commissioners wider powers and no exemption would be granted if the Commissioners did not give their approval. I hope the matter will be given consideration in view of the fact that the regulations are enforced strictly before they give their approval.
    Mr. LAW: I should like to have an answer to the question put by the hon. and learned Member for Central Bristol (Sir T. Inskip). I am perfectly satisfied that this superannuation fund is a bona fide superannuation fund and entitled to the provisions of the Acts.
    Mr. GRAHAM: I am indebted to the hon. and learned Member for central Bristol (Sir T. Inskip) for reminding me of the existence of this section in the Act I should think that in Part II of the provision probably the difficulty is met. It does give them the power to approve where the leading purpose of the fund is to provide such annuities, although that may not be the exclusive object of the scheme. That being so I think the difficulty has very largely disappeared.
    3.0 A.M.
    Mr. G. BALFOUR: I think this is one of the most substantial Amendments moved. I have studied it closely and have arrived at the same conclusion as my right hon. and learned Friend below me (Sir T. Inskip). It strikes me that if these two Sub-sections (c) and (d) were removed the Commissioners would have power to amply protect against any abuse, but would not have the Regulations so rigid. It would be wise, I think, for the Chancellor to go to the length of saying that he would see his way between now and the Report stage to adopt this Amendment or some other words which would give effect to the Amendment.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 89; Noes, 190.

    Division No.141.]

    AYES.

    [3.3 a.m.

    Balfour, George (Hampstead)

    Bowyer, Captain G. E. W.

    Cope, Major William

    Barnston, Major Sir Harry

    Brittain, Sir Harry

    Courthope, Lieut.-Col. George L.

    Becker, Harry

    Burman, J. B.

    Crooke, J. Smedley (Deritend)

    Birchall, Major J. Dearman

    Butler, Sir Geoffrey

    Curzon, Captain Viscount

    Bird, Sir R. B. (Wolverhampton, W.)

    Butt, Sir Alfred

    Dalkeith, Earl of

    Blades. Sir George Rowland

    Chadwick, Sir Robert Burton

    Davidson, Major-General Sir J. H.

    Blundell, F. N.

    Clayton, G. C

    Dawson, Sir Philip

    Dixey, A. C.

    King, Captain Henry Douglas

    Russell, Alexander West (Tynemouth)

    Eden, Captain Anthony

    Larnb, J. Q.

    Samuel, A. M. (Surrey, Farnham)

    Eyres-Monsell, Com. Rt. Hon. B. M.

    Law, A.

    Sandeman, A. Stewart

    Ferguson, H.

    Lumley, L. R.

    Sassoon, Sir Philip Albert Gustave D.

    Gates, Percy

    Maitland, Sir Arthur D. Steel-

    Savery, S. S.

    Gaunt, Rear-Admiral Sir Guy R.

    Makins, Brigadier., General E.

    Sheffield, Sir Berkeley

    Gibbs, Col. Rt. Hon. George Abraham

    Milne, J. S. Wardiaw

    Shepperson, E. W.

    Greene, W. P. Crawford

    Moore-Brabazon, Lieut.-Col. J. T. C.

    Smith-Carington, Neville W.

    Greenwood, William (Stockport)

    Morrison Bell, Major A. C. (Honiton)

    Somerville, Daniel (Barrow-in-Furness)

    Guinness, Lieut.-Col. Rt. Hon, W. E.

    Nicholson, O. (Westminster)

    Steel, Samuel Strang

    Hacking, Captain Douglas H.

    Nield, Rt. Hon. Sir Herbert

    Stuart, Hon. J. (Moray and Nairn)

    Hall, Lieut.-Col. Sir F. (Dulwich)

    O'Neill, Rt. Hon. Hugh

    Titchfield, Major the Marquess of

    Hannon, Patrick Joseph Henry

    Penny, Frederick George

    Warrender, Sir Victor

    Harland, A.

    Percy, Lord Eustace (Hastings)

    Wells, S. R.

    Harmsworth, Hon. E. C. (Kent)

    Perkins, Colonel E. K.

    Wheler, Lieut.-Col. Granville C. H.

    Harvey, C. M. B. (Aberd'n & Kincardne)

    Philipson, Mabel

    Wilson, Sir Charles H. (Leeds, Central)

    Hennesay, Major J. R. G.

    Pielou, D. P.

    Windsor-Clive, Lieut.-Colonel George

    Herbert, Dennis (Hertford, Watford)

    Pownall, Lieut.-Colonel Assheton

    Wise, Sir Fredric

    Hope, Rt. Hon. J. F. (Sheffield, C.)

    Raine, W.

    Wragg, Herbert

    Howard, Hn. D.(Cumberland, Northrn.)

    Rhys, Hon. C. A. U.

    Yerburgh, Major Robert D. T.

    Hughes. Collingwood

    Richardson, Lt.-Col. Sir P. (Chertsey)

    Inskip, Sir Thomas Walker H.

    Roberts, Samuel (Hereford, Hereford)

    TELLERS FOR THE AYES.—

    Jackson, Lieut. Colonel Hon. F. S.

    Ropner, Major L.

    Mr. Romer and Mr. Deans.

    Kindersley, Major G. M.

    Roundell. Colonel R. F.

    NOES.

    Ackroyd, T. R.

    Hall, G. H. (Merthyr Tydvil)

    Morris, R. H.

    Adamson, Rt. Hon. William

    Harbord, Arthur

    Morrison, Herbert (Hackney, South)

    Adamson, W. M. (Staff., Cannock)

    Hardie, George D.

    Morrison, R. C. (Tottenham, N.)

    Alexander, A. V. (Sheffield, Hillsbro')

    Hartshorn, Rt. Hon. Vernon

    Morse, W. E.

    Ammon, Charles George

    Harvey, T. E. (Dewsbury)

    Mosley, Oswald

    Aske, Sir Robert William

    Haycock, A. W.

    Moulton, Major Fletcher

    Attlee, Major Clement R.

    Hayday, Arthur

    Murray, Robert

    Baker, Walter

    Henderson, A. (Cardiff, South)

    Murrell, Frank

    Banton, G.

    Henderson, T. (Glasgow)

    Naylor, T. E.

    Barclay, R. Noton

    Henderson, W. W. (Middlesex, Enfld.)

    Nixon, H.

    Barnes, A.

    Hillary, A. E.

    Oliver, P. M. (Manchester, Blackley)

    Batey, Joseph

    Hindle, F.

    Owen, Major G.

    Birkett, W. N.

    Hirst, G. H.

    Paling, W.

    Bonwick, A.

    Hobhouse, A. L.

    Palmer, E. T.

    Briant, Frank

    Hodges, Frank

    Pattinson, S. (Horncastle)

    Broad, F. A.

    Hoffman, P. C.

    Perry, S. F.

    Bromfield, William

    Howard, Hon. G. (Bedford, Luton)

    Pethick-Lawrence, F. W.

    Brown, A. E. (Warwick, Rugby)

    Hudson, J. H.

    Phillipps, Vivian

    Brown, James (Ayr and Bute)

    Isaacs, G. A.

    Potts, John S.

    Buckle, J.

    Jackson, R. F. (Ipswich)

    Purcell, A. A.

    Charleton, H. C.

    Jenkins, W. (Glamorgan, Neath)

    Raffety, F. W.

    Clarke, A.

    Jenkins, W. A. (Brecon and Radnor)

    Ramage, Captain Cecil Berestord

    Climie, R.

    John, William (Rhondda, West)

    Rathbone, Hugh R.

    Collins, Sir Godfrey (Greenock)

    Johnston, Thomas (Stirling)

    Rea, W. Russell

    Compton, Joseph

    Johnstone, Harcourt (Willesden, East)

    Rees, Sir Beddoe

    Comyns-Carr, A. S.

    Jones, C. Sydney (Liverpool, W. Derby)

    Richards, R.

    Costello, L. W. J.

    Jones, Henry Haydn (Merioneth)

    Richardson, R. (Houghton-le-Spring)

    Cove, W. G.

    Jones, J. J. (West Ham, Silvertown)

    Robertson, J. (Lanark, Bothwell)

    Cowan, D. M. (Scottish Universities)

    Jones, Rt. Hon. Leif (Camborne)

    Romeril, H. G.

    Crittall, V. G.

    Jones, Morgan (Caerphilly)

    Royle, C.

    Darbishlre, C. W.

    Jones, T. I. Mardy (Pontypridd)

    Scurr, John

    Davies, David (Montgomery)

    Jowitt, W. A. (The Hartlepools)

    Seely. H. M. (Norfolk, Eastern)

    Davies, Rhys John (Westhoughton)

    Kay, Sir R. Newbald

    Sexton, James

    Dickie, Captain J. P.

    Kedward, R. M.

    Sherwood, George Henry

    Dickson. T.

    Keens, T.

    Short, Alfred (Wednesbury)

    Dodds, S. R.

    Kenworthy, Lt. Com. Hon. Joseph M.

    Smith, Ben (Bermondsey, Rotherhithe)

    Duckworth, John

    Kirkwood, D,

    Smith. W. R. (Norwich)

    Dukes, C.

    Lansbury, George

    Snell, Harry

    Duncan, C.

    Laverack, F. J.

    Snowden, Rt. Hon. Philip

    Edwards, G. (Norfolk, Southern)

    Lawson, John James

    Spence, R.

    Egan, W. H.

    Leach, W.

    Spero, Dr. G. E.

    England, Colonel A.

    Lee, F.

    Spoor, B. G.

    Falconer, J.

    Lessing, E.

    Stamford, T. W.

    Fletcher, Lieut. Com. R. T. H.

    Linfield, F, C.

    Starmer, Sir Charles

    Gardner, B. W. (West Ham, Upton)

    Loverseed, J. F.

    Stranger, Innes Harold

    George, Major G. L. (Pembroke)

    Lunn, William

    Sturrock, J. Leng

    Gibbins, Joseph

    McEntee, V. L.

    Sunlight, J.

    Gillett, George M.

    Mackinder, W.

    Tattersall, J. L.

    Gorman, William

    Maclean, Neil (Glasgow, Govan)

    Terrington, Lady

    Gosling, Harry

    Mansel, Sir Courtenay

    Thomson, Trevelyan (Middlesbro, W.)

    Gould, Frederick (Somerset, Frome)

    March, S.

    Thornton, Maxwell R.

    Graham, W. (Edinburgh, Central)

    Marley, James

    Thurtle, E.

    Greenwood, A. (Nelson and Colne)

    Martin, F. (Aberdeen & Kinc'dine, E.)

    Toole, J.

    Grenfell, D. R. (Glamorgan)

    Martin. W. H. (Dumbarton)

    Tout, W. J.

    Grundy, T. W.

    Middleton, G

    Vivian, H.

    Guest, Dr. L. Haden (Southwark, N.)

    Mills, J. E.

    Wallhead, Richard C.

    Hall, F. (York, W. R., Normanton)

    Mond, H.

    Ward, G. (Leicester, Bosworth)

    2182

    2183

    Warne, G. H.

    Williams, Dr, J. H. (Llancily)

    Wilson, R. J. (Jarrow)

    Watson, W. M. (Dunfermline)

    Williams, Col. P. (Middlesbrough, E.)

    Windsor, Walter

    Watis-Morgan, Lt.-Col. D. (Rhondda)

    Williams, Maj. A. S. (Kent, Sevenoaks)

    Wright, W.

    Webb, Rt. Hon. Sidney

    Williams, T. (York, Don Valley)

    Young, Andrew (Glasgow, Partick)

    Wedgwood, Col. Rt. Hon. Josiah C.

    Williams, Lt.-Col. T.S.B. (Kennington)

    Whiteley, W.

    Willison, H.

    TELLERS FOR THE NOES.—

    Williams, A. (York, W.R., Sowerby)

    Wilson, C. H. (Sheffield, Attercliffe)

    Mr. Kennedy and Mr. Parkinson.

    Williams, David (Swansea, E.)

    Question put, and agreed to.

    NEW CLAUSE.—(Amendment as to Stamp Duty on leases of certain dwelling- houses.)
    Paragraph (1) of the heading "Lease or Tack," in the First Schedule to The Stamp Act, 1891 (which relates to the stamp duty on a lease or tack of any dwelling-house or part of a dwelling-house for a definite term not exceeding a year at a rent not exceeding the rate of ten pounds per annum), and paragraph (a) of Subsection (1) of Section seventy-eight of the said Act (which provides that the duty on any such lease or tack as is mentioned in the said paragraph (1) may be denoted by an adhesive stamp) shall have effect as though "forty pounds" were therein substituted for "ten pounds."—[Mr. T. Johnston.]
    Brought up, and read the First time.
    Mr. T. JOHNSTON: I beg to move, "That the Clause be read a Second time."
    I trust that I shall be able to explain the Amendment to the Committee. About a year ago about the time of the last Budget I endeavoured to induce the then Financial Secretary to agree to it, and although I failed to get it incorporated in his Budget last year I induced him and the Treasury to see that there was something in it, and finally I got word that the matter would be brought before the Chancellor's Department, who notified me
    "that the suggestion made had been noted with a view to some action being taken when an opportunity presented itself."
    By the Stamp Act of 1891 lord subsequently amended by the Budget of 1910, the Stamp Duty payable by a tenant for a house rented over £5 and not exceeding £10 is 1s., over £10 and under £15 the duty is 3s., over £15 and under £20, 4s.; over £20 and under £25, 5s.; and over £25 up to £50, 10s. Obviously these taxes defeat themselves. Very few tenants and very few landlords are now paying these taxes because the missives are illegal, and where the case goes into Court the pesiding Sheriff cannot look at the missive because it is illegal. These missives are held to be illegal, and the tenant has no protection nor has the landlord in some cases where a missive is
    2184
    not signed. There is the case of a lady who having resided for seven years in one property in Glasgow went down last Tuesday to cite the missive. She asked the factor for the reason of the charge of 10s., and he informed her that the notice to quit broke the contract, that she now ranked as a new tenant and that Stamp Duty had to be paid. All that is proposed in the Amendment is that £10 should now read £40. I submit this to the Chancellor of the Exchequer, that if he lean see his way to agree to this Amendment the revenue will actually benefit.
    Mr. SNOWDEN: My hon. Friend has submitted this new Clause with so much lucidity and persuasiveness, together with the assurance that the revenue is likely to benefit, that I have no option but to accept it.
    Clause read a Second time, and added to the Bill.

    NEW CLAUSE.—(Foreign businesses.)
    Rule 1 of Rules applicable to Case V of Schedule D of the First Schedule to the Income Tax Act of 1918 shall be amended by the insertion after the words "as directed in Case I" of the words "subject to the provisions of Rules 1, 8 and 9 applicable to Cases I and II of Schedule D.—[Sir. A. Steel-Maitland.]
    Brought up, and read the First time.
    Sir A. STEEL-MAITLAND: I beg to move, "That the Clause be read a Second time."
    This deals with an intricate part of the law and where a certain amount of injustice in practice is at present thought to prevail. The Amendment does not make it absolutely clear upon the face of it. I will explain it if desired, but I understand that either the Chancellor of the Exchequer or the Financial Secretary is ready to consider whether the same object cannot he obtained by administrative means instead of having the Clause. If I get that assurance, I will not detain the Committee further.
    Mr. GRAHAM: I agree from an examination of the position of these businesses and the manner in which they are assessed, more particularly in their early years, that there is a case which could be considered here. I am under the impression at the moment that an administrative solution may be found, and with that assurance I have no doubt my right hon. Friend will withdraw the Clause. Between now and the Report stage we shall go into it from the administrative point of view along with him.
    Motion and Clause, by leave, withdrawn.

    NEW CLAUSE.—(Extension of relief for earned income.)
    Section sixteen of the Finance Act, 1920 (which deals with allowance in respect of earned income), shall be read as though "one-fifth'' were substituted for "one-tenth." and "six hundred pounds" for "two hundred pounds."—[Mr. Comyns-Care.]
    Brought up, and read the First time.
    Mr. COMYNS-CARR: I beg to move, "That the Clause be read a Second time."
    The object is to restore in part the extent of the relief in favour of earned incomes as against unearned income which was originally granted by the Budget of 1907. The original relief was granted by way of reduction in the rate of tax, instead of by reduction in the amount of assessable income, and the extent of the relief was 25 per cent. The tax at that time was at the rate of 1s. on unearned income and 9d. on earned. That relief was afterwards increased in 1910 when, the rate on unearned income was increased to 1s. 2d., while the rate on earned income remained at 9d. The Finance Act of 1920 introduced a new system by allowing relief by way of deduction from the amount of assessable income instead of by way of reduction in the rate of tax, and the rate of relief was reduced to 10 per cent. In my submission that was a retrograde step which should be retraced. I have not suggested the full amount of the relief originally granted in 1907, but, I would restore it to 20 per cent., and the other part of the Amendment proposes to extend the total amount which may be deducted from the assessable income under this head from £200 to £600. It will be clear that I am
    2186
    not in a position to put forward the whole of the proposals which I really wish to put forward, because the other part of it would be out of order. For that reason I do not wish to press this Amendment to a Division. I wish to make it clear that I do not wish to relieve one section of Income Taxpayers at the expense of other taxpayers. What I am proposing is not relief of the Income Taxpaying class at the expense of the indirect taxpaying class but a readjustment of the burden of taxation as between Income payers themselves. Therefore, in saying that I am advocating an extension of relief to earned income, I mean that I am advocating an extension of relief at the expense of unearned. What I propose is that as between a man earning any particular income up to £3,000, if it is earned, there should be relief from taxation to the extent of 20 per cent., as against a man who receives the same amount of income but does not earn it. As I am not in a position to move the necessary proposals for raising the revenue which would be sacrificed by this Amendment, I do not propose to press it, but I would ask the Chancellor of the Exchequer to reconsider the matter if be should be in a position to deal with it in another year, so as to restore something like the extent of the relief that used to be given to earned income. In my view, the recommendations of the Royal Commission on Income Tax were of a retrograde character in this respect.
    Mr. SNOWDEN: I make no complaint that the hon. and learned Member has taken advantage of the opportunity to raise this question. I quite agree with him that the House is not compelled to regard the recommendations of the Royal Commission on Income Tax as sacrosanct. Members who were present in the earlier part of the discussion may remember that I said that there were a good many possible minor improvements and readjustments in the Income Tax law which must be accepted. But I think it would be a mistake to begin to pick out one here and there and to adopt them without relation to all the other possible adjustments. I said then that I thought some Chancellor of the Exchequer in the not very distant future would be compelled to review the reforms incorporated in the Finance Act, 1920, on the recommendation of the Royal Commission.

    2187
    When the time comes for doing that, I am certain that the present relations between earned and unearned income will be one of the points dealt with.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 69; Noes, 187.

    Division No. 142.]

    AYES.

    [3.34 a.m.

    Balfour, George (Hampstead)

    Hannon, Patrick Joseph Henry

    Raine, W.

    Barnston, Major Sir Harry

    Harland, A.

    Rhys, Hon. C. A. U.

    Birchall, Major J. Dearman

    Harmsworth, Hon. E. C. (Kent)

    Richardson, Lt.-Col. Sir P. (Chertsey)

    Bird, Sir R. B. (Wolverhampton, W.)

    Hartington, Marquess of

    Roberts, Samuel (Hereford, Hereford)

    Blades, Sir George Rowland

    Harvey, C. M. B. (Aberd'n & Kincardne)

    Ropner, Major L.

    Blundell, F. N.

    Hennessy, Major J. R. G.

    Roundell, Colonel R. F.

    Bowyer, Capt. G. E. W.

    Herbert, Dennis (Hertford, Watford)

    Russell, Alexander West (Tynemouth)

    Brittain, Sir Harry

    Hughes, Collingwood

    Samuel, A. M. (Surrey, Farnham)

    Burman, J. B.

    Kedward, R. M.

    Sandeman. A. Stewart

    Chadwick, Sir Robert Burton

    Keens, T.

    Sheffield, Sir Berkeley

    Cope, Major William

    Kindersley, Major G. M.

    Shepperson, E. W.

    Courthope, Lieut.-Col. George L.

    King, Capt. Henry Douglas

    Smith-Carington, Neville W.

    Crooke, J. Smedley (Deritend)

    Lumley, L. R.

    Spero, Dr. G. E.

    Curzon, Captain Viscount

    Maitland, Sir Arthur D. Steel.

    Steel, Samuel Strang

    Dalkeith, Earl of

    Milne, J. S. Wardlaw

    Titchfield, Major the Marquess of

    Dawson, Sir Philip

    Moore-Brabazon, Lieut.-Col. J. T. C

    Warrender, Sir Victor

    Dixey, A. C.

    Nicholson, O. (Westminster)

    Wells, S. R.

    Eden, Captain Anthony

    Nield, Rt. Hon. Sir Herbert

    Williams, A. (York, W. R., Sowerby)

    Ferguson, H.

    O'Neill, Rt. Hon. Hugh

    Wilson, Sir C. H. (Leeds, Central)

    Gaunt, Rear-Admiral Sir Guy R.

    Penny, Frederick George

    Wise, Sir Fredric

    Greene, W. P. Crawford

    Perkins, Colonel E. K.

    Yerburgh, Major Robert D. T.

    Greenwood, William (Stockport)

    Philipson, Mabel

    Hacking, Captain Douglas H.

    Pielou, D. P.

    TELLERS FOR THE AYES.—

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Pownall, Lieut.-Colonel Assheton

    Mr. Remer and Mr. Storry-Deans.

    NOES.

    Ackroyd, T. R.

    Gillett, George M.

    Law, A.

    Adamson, Rt. Hon. William

    Gorman, William

    Lawson, John James

    Adamson, W. M. (Staff., Cannock)

    Gosling, Harry

    Leach, W.

    Alexander, A. V. (Sheffield, Hillsbro')

    Gould, Frederick (Somerset, Frome)

    Lee, F.

    Ammon, Charles George

    Graham, W. (Edinburgh, Central)

    Linfield. F. C.

    Aske, Sir Robert William

    Greenwood, A. (Nelson and Colne)

    Loverseed, J. F.

    Attlee, Major Clement R.

    Grenfell, D. R. (Glamorgan)

    Lunn, William

    Baker, Walter

    Grundy, T. W.

    McEntee, V. L.

    Banton, G.

    Guest, Dr. L. Haden (Southwark, N.)

    Mackinder, W.

    Barclay, R. Noton

    Hall, F. (York, W.R., Normanton)

    Maclean, Nell (Glasgow, Govan)

    Barnes, A.

    Hall, G. H. (Merthyr Tydvil)

    Makins, Brigadier-General E.

    Batey, Joseph

    Hardie. George D.

    Mansel, Sir Courtenay

    Birkett, W. N.

    Hartshorn, Rt. Hon. Vernon

    March, S.

    Bonwick, A.

    Harvey, T. E. (Dewsbury)

    Marley, James

    Briant, Frank

    Haycock, A. W.

    Martin, F. (Aberdeen & Kinc'dine, E.)

    Broad, F. A.

    Hayday, Arthur

    Martin, W. H. (Dumbarton)

    Bromfield, William

    Henderson, A. (Cardiff, South)

    Middleton, G.

    Brown, A. E. (Warwick, Rugby)

    Henderson, T. (Glasgow)

    Mills, J. E.

    Brown. James (Ayr and Bute)

    Henderson, W. W. (Middlesex, Enfld.)

    Mond, H.

    Buckle, J.

    Hillary, A. E.

    Morris, R. H.

    Charleton, H. C.

    Hindle, F.

    Morrison, Herbert (Hackney, South)

    Clarke, A.

    Hirst, G. H.

    Morrison, R. C. (Tottenham, N.)

    Clayton, G. C.

    Hobhouse, A. L.

    Morrison Bell, Major Sir A.C. (Honiton)

    Climie, R.

    Hodges, Frank

    Morse, W. E.

    Collins, Sir Godfrey (Greenock)

    Hoffman, P. C.

    Mosley, Oswald

    Compton, Joseph

    Howard, Hn. D.(Cumberland, North.)

    Moulton, Major Fletcher

    Costeilo, L. W. J.

    Howard, Hon. G. (Bedford, Luton)

    Murray, Robert

    Cove, W. G.

    Hudson, J. H.

    Murrell, Frank

    Cowan, D. M. (Scottish Universities)

    Isaacs, G. A.

    Newman, Sir R. H. S. D. L. (Exeter)

    Crittall, V. G.

    Jackson, R. F. (Ipswich)

    Nixon, H.

    Darbishire, C. W.

    Jenkins, W. (Glamorgan, Neath)

    Oliver, P M. (Manchester, Blackley)

    Davies, David (Montgomery)

    Jenkins, W. A. (Brecon and Radnor)

    Owen, Major G.

    Davies, Rhys John (Westhoughton)

    John, William (Rhondda, West)

    Paling, W.

    Dickie, Captain J. P.

    Johnstone, Harcourt (Willesden, East)

    Palmer, E. T.

    Dickson, T.

    Jones, C. Sydney (Liverpool, W. Derby)

    Parkinson, John Allen (Wigan)

    Dodds, S. R.

    Jones, Henry Haydn (Merioneth)

    Pattinson, S. (Horncastle)

    Duckworth, John

    Jones, J. J. (West Ham, Slivertown)

    Perry, S. F.

    Dukes, C.

    Jones, Rt. Hon. Leif (Camborne)

    Pethick-Lawrence, F. W.

    Duncan, C.

    Jones, Morgan (Caerphilly)

    Phillipps, Vivian

    Edwards, G. (Norfolk, Southern)

    Jones, T. I. Mardy (Pontypridd)

    Potts, John S.

    Egan, W. H.

    Jowitt, W. A. (The Hartlepools)

    Purcell, A. A.

    England, Colonel A.

    Kay, Sir R. Newbald

    Raffely, F. W.

    Falconer, J.

    Kennedy, T.

    Rathbone, Hugh R.

    Gardner, B. W. (West Ham, Upton)

    Kirkwood, D.

    Rea, W. Russell

    Gates, Percy

    Lamb, J. Q.

    Rees, Sir Beddoe

    George, Major G. L. (Pembroke)

    Lansbury, George

    Richards, R.

    Gibbins, Joseph

    Laverack, F. J.

    Richardson, R. (Houghton-le-Spring)

    Romeril, H. G.

    Sturrock, J. Leng

    Williams, Dr. J. H. (Llanelly)

    Royle, C.

    Sunlight, J.

    Williams, Col. P. (Middlesbrough, E.)

    Savery, S. S.

    Tattersall, J. L.

    Williams, Lt.-Col. T.S.B. (Kenningtn.)

    Scurr, John

    Terrington, Lady

    Williams, Maj. A.S. (Kent. Sevenoaks)

    Seely, H. M. (Norfolk, Eastern)

    Thomson, Trevelyan (Middlesbro, W.)

    Williams, T. (York, Don Valley)

    Sexton, James

    Thornton, Maxwell R.

    Willison, H.

    Sherwood, George Henry

    Thurtle, E.

    Wilson, C. H. (Sheffield, Attercliffe)

    Short, Alfred (Wednesbury)

    Toole, J.

    Wilson, R. J. (Jarrow)

    Smith, Ben (Bermondsey, Rotherhithe)

    Tout, W. J.

    Windsor, Walter

    Smith, W. R. (Norwich)

    Vivian, H.

    Windsor-Clive, Lieut.-Colonel George

    Snell, Harry

    Wallhead, Richard C.

    Wright, W.

    Snowden, Rt. Hon. Philip

    Ward, G. (Leicester, Bosworth)

    Young, Andrew (Glasgow, Partick)

    Spence, R.

    Watson, W. M. (Dunfermline)

    Spoor, B. G.

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    TELLERS FOR THE NOES.—

    Stamford, T. W.

    Wedgwood, Col. Rt. Hon. Josiah C.

    Mr. Warne and Mr. John

    Starmer, Sir Charles

    Whiteley, W.

    Robertson.

    Stranger, Innes Harold

    Williams, David (Swansea, E.)

    New CLAUSE.—(Exemption of profits of agricultural and forestry societies from Income Tax.)
    No Income Tax shall be payable on the profits of any society or institution carried on for the sole purpose of promoting the advance and improvement of agriculture, livestock breeding, horticulture, or forestry.—[Mr. Hothouse.]
    Brought up, and read the First time.
    Mr. HOBHOUSE: I beg to move, "That the Clause be read a Second time."
    This Clause is to exempt the profits of agricultural societies from Income Tax. I believe I speak not only for the hon. and right hon. Gentlemen in whose names this Clause stands, but for Members in every part of the House. This matter is not unknown to the Financial Secretary, who recently received a deputation from the Agricultural Committee of the House of Commons with a view to setting right this hardship to agricultural societies. The object aimed at is to exempt the surplus profits of agricultural shows from Income Tax. These profits are not profits in the ordinary sense. They are never distributed to members of the societies and they may be said to be used as reserve funds against future losses which they may sustain. I might give an example, in the case of the Three Counties Show this year, when the weather landed the society in a total loss. As these so-called profits are devoted to the improvement of agriculture, through agricultural shows, it seems to me the Chancellor of the Exchequer might well consider whether this Clause might not be accepted. I would like to refer to a case which came before the High Court recently in which the Royal Agricultural Society appealed against a decision of the Commissioners of Income Tax, in
    2190
    which case it was held that a surplus income amounting to not much more than £3,000 was subject to Income Tax claim. I mention that to show that the amount involved was not great. I should like, in conclusion, to say that if the principle of this new Clause can be accepted it would not only remove this hardship, which is felt by many agricultural societies throughout the country, but it would be appreciated by the agricultural Members of this House.
    Mr. SNOWDEN: This is one of a number of Amendments on the Paper aiming at the exemption of agricultural and other societies from Income Tax. I think we may assume that these Amendments are supported by Members from ail parts of the House with considerable sympathy. I am prepared to consider the matter, but I could not possibly accept the Amendment moved by the hon. Member, because, if I may be permitted to say so, it is by far the worst of the Amendments dealing with this matter. If the hon. Member who moved the Amendment is prepared to withdraw it, I will consider some Amendment, or form of words, which I hope will meet the wishes of the Committee.
    Mr. HOBHOUSE: In view of that assurance, I beg to ask leave to withdraw the Clause.
    Motion and Clause, by leave, withdrawn.

    NEW CLAUSE.—(Amendment of 10 & 11 Geo. V, c. 18, s. 22.)
    Section twenty-two of the Finance Act, 1920 (which provides for a deduction from assessable income in respect of dependent relatives), shall have effect as if for the words "twenty-five pounds" there were substituted the words "fifty pounds."—[Mr. W. A. Jenkins.]
    Brought up, and read the First time.
    Mr. JENKINS: I beg to move, "That the Clause be read a Second time."
    Mr. SNOWDEN: This proposal falls within the category of those minor Amendments of the Income Tax which might be considered when a favourable opportunity arises, but it is quite impossible that I should accept this Amendment. I have already promised two concessions, and really I would ask the Mover to postpone this proposal, for which there is a great deal to be said on its merits. When the opportunity comes for trying to remove the pinch where it is rather severely felt, this is one of the matters which should receive attention.
    Mr. JENKINS: In view of the sympathetic remarks of the Chancellor of the Exchequer, I beg to ask leave to withdraw the Clause.
    HON. MEMBERS: No!
    Mr. D. HERBERT: May we ask the Chancellor of the Exchequer to tell us what would be the cost of this concession? That seems to be the important thing in this Amendment. [An HON. MEMBER: "Enough to buy another hat!"]
    Mr. BALFOUR: If the Chancellor has now refreshed his memory, I hope he will have sufficient time to tell us what the cost would be.
    Mr. SNOWDEN: I did not need to refresh my memory on that matter. The cost would be £500,000.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 80; Noes, 180.

    Division No. 143.]

    AYES.

    [3.50 a.m.

    Aske, Sir Robert William

    Hacking, Captain Douglas H.

    Philipson, Mabel

    Balfour, George (Hampstead)

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Pielou, D. P.

    Barnston, Major Sir Harry

    Hannon, Patrick Joseph Henry

    Pownall, Lieut.-Colonel Assheton

    Birchall, Major J. Dearman

    Harland, A.

    Raine, W.

    Bird, Sir R. B. (Wolverhampton, W.)

    Harmsworth, Hon. E. C. (Kent)

    Rhys, Hon. C. A. V.

    Blades, Sir George Rowland

    Harvey, C.M.B. (Aberd'n & Kincardne)

    Roberts, Samuel (Hereford, Hereford)

    Bowyer, Captain G. E. W.

    Hennessy, Major J. R. G.

    Ropner, Major L.

    Brlttatn, Sir Harry

    Herbert, Dennis (Hertford, Watford)

    Roundell, Colonel R. F.

    Burman, J. B.

    Howard, Hn. D. (Cumberland, Northrn.)

    Russell, Alexander West (Tynemouth)

    Chadwick, Sir Robert Burton

    Hughes, Collingwood

    Samuel, A. M. (Surrey, Farnham)

    Clayton, G. C.

    Inskip, Sir Thomas Walker H.

    Sandeman, A. Stewart

    Cope, Major William

    Jenkins, W. A. (Brecon and Radnor)

    Savery, S. S.

    Courthope, Lieut.-Col. George L.

    Kedward, R. M.

    Sheffield, Sir Berkeley

    Crooke, J. Smedley (Deritend)

    Kindersley, Major G. M.

    Shepperson, E. W.

    Curzon, Captain Viscount

    King, Captain Henry Douglas

    Smith-Carington, Neville W.

    Dalkeith, Earl of

    Lamb, J. Q.

    Spero, Dr. G. E,

    Dawson, Sir Philip

    Lumley, L. R.

    Steel, Samuel Strang

    Deans, Richard Storry

    Maitland, Sir Arthur D. Steel-

    Warrender, Sir Victor

    Dixey, A. C.

    Makins, Brigadier-General E.

    Wells, S. R.

    Eden, Captain Anthony

    Moore-Brabazon, Lieut.-Col. J. T. C

    Wheler, Lieut.-Col. Granville C. H.

    England, Colonel A.

    Morrison-Bell, Major A. C. (Honiton)

    Wilson, Sir Charles H. (Leeds, Central)

    Eyres-Monsell, Com. Rt. Hon. B. M.

    Newman, Sir R. H. S. D. L. (Exeter)

    Windsor-Clive, Lieut.-Colonel George

    Ferguson, H.

    Nicholson, O. (Westminster)

    Wise, Sir Fredric

    Gates, Percy

    Nield, Rt. Hon. Sir Herbert

    Yerburgh, Major Robert D. T.

    Gaunt, Rear-Admiral Sir Guy R.

    O'Neill, Rt. Hon. Hugh

    Gibbs. Col. Rt. Hon. George Abraham

    Penny, Frederick George

    TELLERS FOR THE AYES.—

    Greene, W, P. Crawford

    Percy, Lord Eustace (Hastings)

    Sir Philip Richardson and Mr

    Greenwood, William (Stockport)

    Perkins, Colonel E. K.

    Remer.

    NOES.

    Ackroyd, T. R.

    Clarke, A.

    Falconer, J.

    Adamson, Rt. Hon. William

    Climie, R.

    Fletcher, Lieut.-Com. R. T. H.

    Adamson, W. M. (Staff., Cannock)

    Collins, Sir Godfrey (Greenock)

    Gardner, B. W. (West Ham, Upton)

    Alexander, A. V. (Sheffield, Hillsbro)

    Compton, Joseph

    George, Major G. L. (Pembroke)

    Ammon, Charles George

    Comyns-Carr, A. S.

    Gibbins, Joseph

    Attlee, Major Clement R.

    Costello, L. W. J.

    Gillett, George M.

    Baker, Walter

    Cove. W. G.

    Gorman, William

    Banton, G.

    Cowan, D. M. (Scottish Universities)

    Gosling, Harry

    Barclay, R. Noton

    Crittall, V. G.

    Gould, Frederick (Somerset, Frome)

    Barnes, A.

    Darbishire, C. W.

    Graham, W. (Edinburgh, Central)

    Batey, Joseph

    Davies, David (Montgomery)

    Greenwood, A. (Nelson and Coine)

    Birkett, W. N.

    Davies, Rhys John (Westhoughton)

    Grentell, D. R. (Glamorgan)

    Bondwick, A. J.

    Dickie, Captain J. P.

    Grundy, T. W.

    Briant, Frank

    Dickson, T.

    Guest, Dr. L. Haden (Southwark, N.)

    Broad, F. A.

    Dodds, S. R.

    Hall, F. (York, W. R., Normanton)

    Bromfield, William

    Duckworth, John

    Hall, G. H. (Merthyr Tydvll)

    Brown, A. E. (Warwick, Rugby)

    Dukes, C.

    Hardle, George D.

    Brown, James (Ayr and Bute)

    Duncan, C.

    Hartshorn, Rt. Hon. Vernon

    Buckle, J.

    Edwards, G.(Norfolk, Southern)

    Harvey, T. E. (Dewsbury)

    Charleton, H. C.

    Egan, W. H

    Haycock, A. W.

    Hayday, Arthur

    Mansel, Sir Courtenay

    Smith, W. R. (Norwich)

    Henderson, A. (Cardiff, South)

    March, S.

    Snell, Harry

    Henderson, T. (Glasgow)

    Marley, James

    Snowden, Rt. Hon. Philip

    Henderson, W. W. (Middlesex, Enfld.)

    Martin, F. (Aberdeen & Kinc'dine, E.)

    Spence, R.

    Hillary, A. E.

    Martin, W. H. (Dumbarton)

    Spoor, B. G.

    Hindle, F.

    Middleton, G.

    Stamford, T. W.

    Hirst, G. H.

    Mills, J. E.

    Starmer, Sir Charles

    Hobhouse, A. L.

    Mond, H.

    Stranger, Innes Harold

    Hodges, Frank

    Morris, R. H.

    Sturrock, J. Leng

    Hoffman, P. C.

    Morrison, Herbert (Hackney, South)

    Sunlight, J.

    Howard, Hon. G. (Bedford, Luton)

    Morrison, R, C. (Tottenham, N.)

    Tattersall, J. L.

    Hudson, J. H.

    Morse, W. E.

    Terrington, Lady

    Isaacs, G. A.

    Mosley, Oswald

    Thomas, Rt. Hon. James H. (Derby)

    Jackson, R. F. (Ipswich)

    Moulton, Major Fletcher

    Thomson, Trevelyan (Mlddlesbro. W.)

    Jenkins, W. (Glamorgan, Neath)

    Murray, Robert

    Thornton, Maxwell R.

    John, William (Rhondda, West)

    Murrell, Frank

    Thurtle, E.

    Johnston, Thomas (Stirling)

    Naylor, T. E.

    Tout, W. J.

    Johnstone, Harcourt (Willesden, East)

    Nixon, H.

    Vivian, H.

    Jones, C. Sydney (Liverpool, W. Derby)

    Oliver, P. M. (Manchester, Blackley)

    Wallhead, Richard C.

    Jones, Henry Haydn (Merioneth)

    Owen, Major G.

    Ward, G. (Leicester, Bosworth)

    Jones, J. J. (West Ham, Silvertown)

    Paling, W.

    Watson, W. M. (Dunfermline)

    Jones, Rt. Hon. Leif (Camborne)

    Palmer, E. T.

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Jones, Morgan (Caerphilly)

    Parkinson, John Allen (Wigan)

    Wedgwood, Col. Rt. Hon. Joslah C.

    Jones, T. I. Mardy (Pontypridd)

    Pattinson, S. (Horncastle)

    Whiteley, W.

    Jowitt, W. A. (The Hartlepools)

    Perry, S. F.

    Williams, A. (York, W. R., Sowerby)

    Kay, Sir R. Newbald

    Pethick-Lawrence, F. W.

    Williams, David (Swansea, E.)

    Keens, T.

    Phillipps, Vivian

    Williams, Dr. J. H. (Llanelly)

    Kennedy, T.

    Potts, John S.

    Williams, Col. P. (Middlesbrough, E.)

    Kirkwood, D.

    Purcell, A. A.

    Williams, Lt.-Col. T.S.B. (Kenningtn.)

    Lansbury, George

    Raffety, F. W.

    Williams, Maj. R. (Kent, Sevenoaks)

    Laverack, F. J.

    Rathbone, Hugh R.

    Williams, T. (York, Don Valley)

    Law, A.

    Rea, W. Russell

    Willison, H.

    Lawson, John James

    Richards, R.

    Wilson, C. H. (Sheffield, Attercliffe)

    Leach, W.

    Richardson, R. (Houghton-le-Spring)

    Wilson, Colonel M. J. (Richmond)

    Lee, F.

    Romeril, H. G.

    Wilson, R. J. (Jarrow)

    Lessing, E.

    Royle, C.

    Windsor, Walter

    Linfield, F. C.

    Scurr, John

    Wright, W.

    Loverseed, J. F.

    Seely, H. M. (Norfolk, Eastern)

    Young, Andrew (Glasgow, Partick)

    Lunn, William

    Sexton, James

    McEntee, V. L.

    Sherwood, George Henry

    TELLERS FOR THE NOES.—

    Mackinder, W.

    Short, Alfred (Wednesbury)

    Mr. John Robertson and Mr.

    Maclean, Neil (Glasgow, Govan)

    Smith, Ben (Bermondsey, R'hithe)

    Warne.

    NEW CLAUSE.—(Exemption of income of regimental benevolent funds.)
    No Income Tax shall be payable on the income of any regimental benevolent association fund or society carried on for the solo purpose of promoting the well-being and assisting the welfare of those connected in the past or the present with the regiment concerned.—[Brigodier-General Makins.]
    Brought up, and read the First time.
    Brigadier-General MAKINS: I beg to move, "That the Clause be read a Second time."
    I asked a question of the Chancellor of the Exchequer only last Tuesday, and he courteously replied that he would look into any particular case that I brought before him. I find it is not a question of a particular case, but a question of the general policy towards regimental benevolent associations. In the first place, the object of these associations is to look after soldiers' wives and their dependants. The income is derived from annual subscriptions and from dividends on invested funds. The regiments for which I have a particular brief are fourteen cavalry regiments which were banded together under one central
    2194
    association. They are banded in this way in order to avoid extra expense, organisation, secretaryships, and so on. There is one particular case in which I am interested, the case of my own regiment. In 1910 I formed all its funds into a trust myself, under the Public Trustee. Later at the end of the War there were further legacies left and further funds, and the Public Trustee was asked to invest these funds, and he wrote the following letter: "The Public Trustee much regrets he has now no power to accept this Trust, as he is prevented by the Act of 1906 from accepting a Trust which is exclusively charitable." The Public Trustee at that time was a great lawyer, and he ought to know what is a charitable trust and what is not.
    4.0 A.M.
    Now, this bombshell has been burst upon us, and we are told we are not to receive the rebate of Income Tax any longer. A letter has been 4.0 A.M. received from the Chief Inspector of Taxes saying that the claim for repayment has been under consideration, and from the evidence supplied it would appear that the objects and constitution of the association were

    2195
    such that it could no longer be regarded as falling within the legal definition of a charity. The chairman of the association interviewed the Chief Inspector of Taxes, and was told that we could no longer be regarded as a charity, as the rules were no longer stabilised, and though the funds were used in the past for charity, there was no guarantee that they would be in the future. One might almost call that a quibble. The object of the association was to promote the welfare of soldiers and assist those who were no longer able to earn their own livelihood. I can only speak of absolute knowledge of 14 regiments, but I understand that other regiments are in exactly the same position, and the Guards and the Royal Artillery and the Royal Engineers are likewise not going to get this rebate which they have always had in the past. Curiously, two cavalry regiments had forms sent to them to state the income used for charitable purposes. It showed a mix up if two regiments got those forms, but were told they would not get the rebate in the future. Those benevolent associations did a great deal of good, and there was not much money involved. They looked after men who did not want to go to a charitable institution or ask for charity, but who liked to think that their old regiment would look after them, and they assisted in unemployment, and to a certain extent in emigration. They also assisted men's wives and dependants. The money involved was very small. In the case of my own regiment, it is under £25, and I do not suppose the total would involve more than £2,000 at the outside. The net might have to be drawn fairly close, but I am sure the officials of the Inland Revenue Department would rather act with justice and safeguard the public rather than act as sleuth-hounds. I feel that the Chancellor of the Exchequer will either accept this Clause or give an assurance that this, what I might almost call a ramp, will not be proceeded with.
    Mr. GRAHAM: I am quite sure that on reconsideration the hon. and gallant Member would hardly apply the term "ramp" to the existing state of the law. The truth is that, going no further back to-night than the time of Queen Elizabeth, the term "charitable relief" could in point of fact for Income Tax purposes
    2196
    be held to include the relief of poverty, the advancement of education and religion, and nearly anything for the welfare of the community. There is a Section in the Act. of 1918 which, I think, completely covers the kind of case which the hon. and gallant Member has in mind, and it lays down that, if the organisation devotes its funds and resources to a purely charitable purpose it can get complete exemption from the tax. The difficulty is that a certain number of associations do not confine their efforts merely to the relief or the assistance of their members, or what may accurately be called charitable objects. They are, in fact, engaged in other enterprises which are quite properly the subject of taxation, and if they were not taxed, there would be injustice to other classes of taxpayers upon whom the burden would fall. A line must be drawn in all these cases in any system, but if any society or organisation of this kind will give a binding guarantee to apply its funds exclusively to the charitable objects which he has described there is not the slightest difficulty in getting complete exemption. That being so, the Amendment would appear to be unnecessary.
    One word, in conclusion, about the so-called "ramp." Quite properly, the Inland Revenue authorities have had to direct their attention to the activities of these organisations in certain cases, and to the fact that they are engaging in other than charitable enterprises. That being so, there may be some alteration in an exemption which they have hitherto enjoyed, but, quite clearly, they no longer satisfy the terms of the exemption in the Act of 1918. We are always willing to look into any particular case, but looking to the fact that you can get the exemption if the society confines itself to charitable terms, I suggest that the new Clause is unnecessary.
    Mr. LUMLEY: May I refer to a society the objects of which are clearly stated in their printed rules: There are only two of them, which I will read—

    "(1) To promote the welfare of discharged and serving soldiers of the regiment and to assist those who through no fault of their own are unable to earn their own livelihood.

    (2) To assist the wives and families of old or serving Royals who are in distressed circumstances."

    2197
    I suggest that these objects are purely charitable objects, and ought to be exempted.
    Lord EUSTACE PERCY: May I ask one question. The Financial Secretary says that various of these associations have been engaged, or are engaged, in enterprises which are properly subject to taxation. Can he give us an instance of what these enterprises are?
    Mr. GRAHAM: There are cases of some of them being engaged in minor forms of trade. It would be difficult offhand to give examples, but I know some which have gone in for the provision of hostels and institutions which are not
    strictly of the nature of charitable assistance or relief, and which, I am afraid, take them out of the strict category of charitable organizations. In reply to the hon. Member for East Hull (Mr. Lumley), I can only suggest at the moment that in all probability the society has failed under the first rule—that it has imported into its activities some element which is not strictly of a charitable character. That may be the explanation, but it is only a suggestion, as I am not in possession of the details.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 83; Noes, 176.

    Division No. 144.]

    AYES.

    [4.13 a.m.

    Balfour, George (Hampstead)

    Hannon, Patrick Joseph Henry

    Ralne, W.

    Barnston, Major Sir Harry

    Harland, A.

    Rhys, Hon. C. A. U.

    Birchall, Major J. Dearman

    Harmsworth, Hon. E. C. (Kent)

    Richardson, Lt.-Col. Sir P. (Chrtsy)

    Bird, Sir R. B. (Wolverhampton, W.)

    Huntington, Marquess of

    Roberts, Samuel (Hereford, Hereford)

    Blades, Sir George Rowland

    Harvey, C. M. B. (Aberd'n & Kincardne)

    Ropner, Major L.

    Bowyer, Capt. G. E. W.

    Hennessy, Major J. R. G.

    Roundell, Colonel R. F.

    Briant, Frank

    Herbert, Dennis (Hertford, Watford)

    Russell, Alexander West (Tynemouth)

    Brittain, Sir Harry

    Hope, Rt. Hon. J. F. (Sheffield, C.)

    Samuel, A. M. (Surrey, Farnham)

    Burman, J. B.

    Howard, Hn. D. (Cumberland, Northn.)

    Sandeman, A. Stewart

    Chadwick, Sir Robert Burton

    Hughes, Collingwood

    Savery, S. S.

    Chamberlain, Rt. Hon. N. (Ladywood)

    Inskip, Sir Thomas Walker H.

    Shelfield., Sir Berkeley

    Clayton, G. C.

    Kindersley, Major G. M.

    Shepperson, E. W.

    Cope, Major William

    King, Captain Henry Douglas

    Smith-Carington, Neville W.

    Courthope, Lieut-Col. George L.

    Lumley, L. R.

    Spero, Dr, G. E.

    Crooke, J. Smedley (Deritend)

    Maitland, Sir Arthur D. Steel-

    Starmer, Sir Charles

    Curzon, Captain Viscount

    Makins, Brigadier-General E.

    Steel, Samuel Strang

    Dalkeith, Earl of

    Moore-Brabazon, Lieut-Col. J. T. C.

    Warrender, Sir Victor

    Dawson, Sir Philip

    Morrison Bell, Major Sir A. C. (Honiton)

    Wells, S. R.

    Dixey, A. C.

    Moulton, Major Fletcher

    Wheler, Lieut.-Col. Granville C.H.

    Eden, Captain Anthony

    Newman, Sir R. H. S. D. L. (Exeter)

    Williams, A. (York, W. R., Sowerby)

    Eyres-Monself, Com. Rt. Hon. B. M.

    Nicholson, O. (Westminster)

    Williams, Maj. A.S. (Kent, Sevenoaks)

    Ferguson, H.

    Nield, Rt. Hon. Sir Herbert

    Wllson, Sir C. H. (Leeds, Central)

    Gates, Percy

    O Neill, Rt. Hon. Hugh,

    Windsor Clive, Lieut.-Colonel George

    Gaunt, Rear-Admiral Sir Guy R.

    Penny, Frederick George

    Wise, Sir Fredric

    Gibbs, Col Rt. Hon. George Abraham

    Percy, Lord Eustace (Hastings)

    Yerburgh, Major Robert D.T.

    Greene, W. P. Crawford

    Perkins, Colonel E. K.

    Greenwood, William (Stockport)

    Philipson, Mabel

    TELLERS FOR THE AYES.—

    Hacking, Captain Douglas H.

    Pielou, D. P.

    Mr. Storry. Deans and Mr. Remer.

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Pownall, Lieut. Colonet Assheton

    NOES.

    Ackroyd, T. R.

    Compton, Joseph

    Graham W. (Edinburgh Central)

    Acland, Rt. Hon. Francis Dyke

    Comyns-Carr, A. S.

    Greenwood, A. (Nelson and Colne)

    Adamson, Rt. Hon. William

    Costello, L. W. J.

    Grenfell, D. R. (Glamorgan)

    Adamson, W. M. (Staff., Cannock)

    Cove, W. G.

    Grundy, T. W.

    Alexander, A. V. (Sheffield, Hillsdro')

    Cowan, D. M. (Scottish Universities)

    Guest, Dr. L. Haden (Southwark, N.)

    Ammon, Charles George

    Crittall, V. G.

    Hall, F. (York, W.R., Normanton)

    Aske, Sir Robert William

    Darblshire, C. W.

    Hall, G. H. (Merthyr Tydvil)

    Attlee, Major Clement R.

    Davies, Rhys John (Westhoughton)

    Hardle, George D.

    Baker, Walter

    Dickie, Captain J. P.

    Hartshorn, Rt. Hon Vernon

    Banton, G.

    Dickson. T.

    Harvey, T. E. (Dewsbury)

    Barclay, R. Noton

    Dodds, S. R.

    Haycock, A. W.

    Barnes, A.

    Duckworth, John

    Hayday, Arthur

    Batey, Joseph

    Dukes, C.

    Henderson, A. (Cardiff, South)

    Birkett, W. N.

    Duncan, C.

    Henderson, T. (Glascow)

    Bonwick, A.

    Edwards, G. (Norfolk, Southern)

    Henderson, W. W. (Middlesex, Enfld)

    Broad, F. A.

    Egan, W. H.

    Hillary, A. E.

    Bromfield, William

    Falconer, J.

    Hindle, F.

    Brown, A. E. (Warwick, Rugby)

    Fletcher, Lieut. Com, R. T. H.

    Hirst, G. H.

    Brown, James (Ayr and Bute)

    Gardner. B. W. (West Ham, Upton)

    Hobhouse, A. L.

    Buckle, J.

    George, Major G. L. (Pembroke)

    Hodges, Frank

    Charleton, H. C.

    Gibbins, Joseph

    Hoffman, P. C.

    Clarke, A.

    Gillett, George M.

    Howard, Hon. G. (Bedford, Luton)

    Climie, R.

    Gosling, Harry

    Hudson, J. H.

    Collins, Sir Godfrey (Greenock)

    Gould, Frederick (Somerset, Frome)

    Isaacs, G. A.

    Jackson, R.F. (Ipswich)

    Mills, J. E.

    Snell, Harry

    Jenkins, W. (Glamorgan, Neath)

    Mond, H.

    Snowden, Rt. Hon. Philip

    Jenkins, W. A. (Brecon and Radnor)

    Morris, R. H.

    Spence, R.

    John, William (Rhondda, West)

    Morrison, Herbert (Hackney, South)

    Spoor, B. G.

    Johnston, Thomas (Stirling)

    Morrison, R. C. (Tottenham, N.)

    Stamford, T. W.

    Johnstone Harrcourt (Willesden, East)

    Morse, W. E.

    Stranger, Innes Harold

    Jones, C. Sydney (Liverpool, W. Derby)

    Mosley, Oswald

    Sturrock, J. Leng

    Jones, J.J. (West Ham, Silvertown)

    Murray, Robert

    Sunlight, J.

    Jones, Rt. Hon. Leif (Comborne)

    Murrell, Frank

    Tattersall, J. L.

    Jones, Morgan (Caerphilly)

    Naylor, T.E.

    Terrington, Lady

    Jones, T. I. Mardy (Pontypridd)

    Nixon, H.

    Thomson, Trevelyan (Middlesbro. W.)

    Jowitt, W. A. (The Hartlepools)

    Oliver, P. M. (Manchester, Blackley)

    Thornton, Maxwell R.

    Kay, Sir R. Newbald

    Paling, W.

    Thurtle E.

    Kedward, R. M.

    Palmer, E. T.

    Tout, W. J.

    Keens, T.

    Parkinson, John Allen (Wigan)

    Vivian, H.

    Kirkwood, D.

    Pattinson, S. (Horncastle)

    Wallhead, Richard C.

    Lamb, J. Q.

    Perry, S. F.

    Ward, G. (Leicester, Bosworth)

    Lansbury, George

    Pethick-Lawrence, F. W.

    Watson, W. M. (Dunfermline)

    Laverack, F. J.

    Phillipps, Vivian

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Law, A.

    Potts, John S.

    Wedgwood, Col. Rt. Hon. Josiah C.

    Lawson, John James

    Purcell, A. A

    Whiteley, W.

    Leach, W.

    Raffety, F, W.

    Williams, David (Swansea, E.)

    Lee, F.

    Rathbone, Hugh R.

    Williams, Dr. J. H. (Llanelly)

    Lessing, E.

    Rea, W, Russell

    Williams, Col. P. (Middlesbrough,E.)

    Linfield, F. C.

    Richards, R.

    Williams Lt.-Col. T.S.B. (Kenningtn.)

    Loverseed, J.F.

    Richardson, R. (Houghton-le-Spring)

    Williams, T. (York, Don Valley)

    Lunn, William

    Robertson, J. (Lanark, Bothwell)

    Willison, H

    Mc Entee, V. L.

    Romeril, H. G.

    Wilson, C. H. (Sheffield, Attercliffe)

    Mackinder, W.

    Royle, C.

    Wilson, R. J. (Jarrow)

    Maclean, Neil (Glasgow, Govan)

    Scurr, John

    Windsor, Walter

    Mansel, Sir Courtenay

    Seely, H. M. (Norfolk, Eastern)

    Wright, W.

    March, S.

    Sexton, James

    Young, Andrew (Glasgow, Partick)

    Marley, James

    Sherwood, George Henry

    TELLERS FOR THE NOES—

    Martin, F. (Aberdeen & Kinc'dine, E.)

    Short, Alfred (Wednesbury)

    Mr. Kennedy and Mr. Warne.

    Martin, W. H. (Dumbarton)

    Smith, Ben (Bermondsey, Rotherhithe)

    Middleton, G.

    Smith, W. R. (Norwich)

    NEW CLAUSE.—(Amendment of 8 & 9 Geo. V., c 5, Schedule E, Rule 9.)
    In charging under Schedule E the salary, fees, wages, or profits of a person appointed to exercise the office of Recorder (required to hold Courts of quarter sessions otherwise than in and for the City of London) there shall be allowed such person by way of deduction such reasonable sums in respect of travelling expenses between his place of business or residence and the place where the said Courts of quarter sessions shall be held by him, and also such incidental expenses and expenditure of money wholly, exclusively, and necessarily incurred and expended by him in the performance of the said duties, as may be allowed by the Commissioners having jurisdiction.—[Sir Herbert Nield.]
    Brought up, and read the First time.
    Sir H. NIELD: I beg to move, "That the Clause be read a Second time."
    It is unfortunate that I should have to address the Committee at 20 minutes past four on a subject which can only be said to be one of the greatest injustices produced by the working of the Income Tax Act. Nobody has ever dreamt of this Amendment of mine. [Interruption.] I am sorry, I made a mistake. A great number of Members have dreamt and have paid no attention to the Debate. What I want to express is this, that the revenue has never sought to make this deduction until the present time. I think I am right in saying that the deduction
    2200
    in practice has never been made, although the decision on which the case was decided last week is some 20 years old. A commercial traveler traveling for his firm is entitled to deduct his expenses from the profits made, but when you get to Schedule E of the Act of 1918 which is a question of service—[Interruption.] Will hon. Members be serious? No wonder lawyers and Courts have difficulty in deciding what this House means when it makes the laws. Rule 9 of Schedule E says:
    "If the holder of an office or employment of profit is necessarily obliged to incur and defray out of the emoluments thereof the expenses of travelling in the performance of the duties of the office or employment, or otherwise to expend money wholly, exclusively, and necessarily in the performance of the said duties, he may claim as a deduction from the emoluments to be assessed the expenses so necessarily incurred and defrayed. The cost of travelling between the place of residence and the place of employment is not allowable."
    One would have thought that the travelling expenses of His Majesty's Judges appointed for dealing with the minor offences against the law would have come within that Statute, but no. According to the decision come to in 1900, it was decided that a clerk could not deduct his travelling expenses in making his return. That decision remained unacted upon until

    2201
    quite recently, and it has never been levied until rather more than a week ago, when the case was decided which raised this issue. The Recorded asked exemption of his traveling expenses and other details, which I will not discuss. The Judge in giving judgment said:
    "The Recorded must by Statute be a barrister of five years' standing, and that meant in nine cases out of ten that he must travel from London to perform his duties."
    I am quoting from the "Times" Law Report, as the official Report has not yet been published. The Judge goes on to say:
    "The Statute did not say that he must be a practising barrister, still less did it say that he must be a barrister practicing in London, and where he practised was at his own discretion to select. In whose circumstances there was only one decision which could be given."
    Rather earlier in his judgment he said:
    "Although the case did raise a question of hardship and the position was unreasonable in that the expenses sometimes might more than eat up the emoluments which were not allowed to be deducted, yet on the authorities judgment must be given for the Crown that a man could not charge the expenses of travelling from his residence to his office."
    That is the expression of the learned judge who has to deal with the case before him last week. Where is the sense of it? It is based upon a decision which is based upon the traveling of a clerk to and from his residence to his work. But surely Recorders are not in the position of clerks? I want to point this out to the Committee that a Recorded is bound to go to his town four times a year by Statute. It might be said that the only answer is that he must live in the town, but it was clearly undesirable that a Judge of the Court of Session should live in the town in which he has to act as judge. There is at the moment before the House the Criminal Justice Bill which is down for Second Reading and which proposes to give a very much enlarged jurisdiction to the Courts in order to ease His Majesty's Judges at the Assizes. Then we must have men appointed as recorders who can claim by their position at the Bar to be perfectly competent to discharge these duties. You must have a practising barrister, and having him you ought to allow him to deduct from his Income Tax the actual cost of his expenses travelling backwards and forwards. Does the House appreciate that the Re-
    2202
    corder of Berwick-on-Tweed has to go 300 or 400 miles four times a year to his town, that the Recorded of Penzance has also to go 300 miles, that there are 16 Recorders who travel more than 300 miles, 2 over 250 miles and 72 who travel over 100 miles. To try to apply to these officers who go backwards and forwards to their duties the case of a clerk was a violent misinterpretation of the intention of the Statute. There are 119 Recorders in all, and of these 109 only travel 50 miles or upwards four times a year. Those of Liverpool, Birmingham and the large centres have to hold more frequent Sessions, and therefore the hardship is increased. I hope the Committee will realise that there is no real substantial difference between paying His Majesty's Judges the full travelling expenses and the County Court Judges the full travelling expenses of their circuit, and to deny travelling expenses to these Judges who are compelled to perform the relative duties to the County Court Judges only on the criminal side of the Judicature.
    Mr. SNOWDEN: The right hon. and learned Gentleman who has put forward this proposal is himself, I believe, a Recorder, and therefore he can speak with sympathy. I do not think that the right hon. and learned Gentleman has established a case at all for the concession which he asks the House of Commons to give. Hon. Members of the Committee will remember that in the early stages of yesterday afternoon we discussed a proposal that an allowance should be made from Income Tax of travelling expenses to persons whose income was below £500 a year. The House of Commons by a large majority rejected that proposal. There is a very close analogy between the case put forward yesterday and the case which the right hon. and learned Gentleman put forward just now. It is the established practice that a person is not entitled to travelling expenses between his residence and his place of business. The reason for that is that the man selects his own house. There is no reason in the world why the right hon. and learned Gentleman should not go to live at York or within a reasonable distance.
    Sir H NIELD: Did the right hon. Gentleman hear me quote the rule of the Home Office?
    Mr. SNOWDEN: Let us take a Judge in the High Court. I suppose there are very few Judges of the High Court who live in London—at any rate, they live a considerable distance away from the Law Courts—but they are not entitled to charge their travelling expenses or to get deductions from Income Tax upon their travelling expenses between the place in which they may live in the country and the Courts of Justice. That is a perfectly analogous case. But I would like to point out that the right hon. Gentleman's proposal goes very much further than travelling expenses. There was not only travelling expenses, but also such incidental expenditure of money wholly, exclusively and necessarily incurred or expended by him in the performance of his duties. That means he would be able to charge the whole of his maintenance expenses, as well as his travelling expenses. The right hon. Gentleman knows what has been the practice in the past, now confirmed by the decision of the High Court. When Recorders took their appointments, they knew perfectly well what were the conditions.
    Sir T. INSKIP: I think the opening sentence, with which the right hon. Gentleman commented upon the perfectly justifiable speech which my right hon. Friend (Sir H. Nield) made, was intolerable. I have never been a Recorder, I am never likely to be a Recorder, and I have no interest in this matter. So I am not bound to the most unjustifiable taunt of the right hon. Gentleman. Let me request him to abstain from taunts of that sort.
    Mr. SNOWDEN: I shall not require any advice from the hon. and learned Gentleman. I go further, and say that I think it was not in the lest seemly that the right hon. Gentleman the Member for Ealing (Sir H. Nield) should have raised a question in which he is so directly and personally interested.
    Sir T. INSKIP: Whether the right hon. Gentleman will take the advice which I offered is entirely a matter for him, but when he proceeds to add to what he has said the statement that my right hon. Friend did something which was wrong in raising this question because he is a Recorder, he seems to have forgotten that he himself and his party
    2204
    did not think of that objection when they discussed the payment of railway fares for Members. I would not say a word about a mater which might be discussed without any heat if the right hon. Gentleman had not thought fit to introduce heat into it, and I shall say what I please without the leave of hon. Members opposite. [Interruption.] The suggestion was made by the right hon. Gentleman that it would be perfectly proper, and indeed, natural for anybody who wishes to avoid travelling expenses to go and live in the neighbourhood of the town of which he was the Recorder. The right hon. Gentleman knows very well that to a large extent the community is largely dependent upon the proper administration of justice by the Recorders of this land, and my right hon. Friend has pointed out there is an increasing burden in the administration of justice which is being placed on the Recorders to relieve Assizes. It would be most undesirable that any Recorder, who has been charged often with the duties of Recorder for twenty years, should not be familiar with the everyday administration of the law. How any Recorder is to keep himself abreast of the practice of the law in order that he may administer justice and yet live in some out-of-the-way village or place where he is unable to practice his profession, I am sure the right hon. Gentleman could not say. Hon. Members opposite may raise a groan about that, but let any hon. Member, if he can forget for the moment the prejudice which the heat may have caused, ask himself whether he would like himself or his trade union, or any society or friend or comrade to be tried by a man whose knowledge of the law and practice of the rules of evidence was rusty and absolete and old-fashioned. Let me ask whether it is satisfactory that any Recorder should administer justice without keeping himself abreast of the administration of the law, and in the next place whether it is possible for him to keep himself abreast. Nearly every Recorder so far as I know, is living in the place, or near the place, where he may carry on his profession, namely, in London. A few of them live in the neighbourhood of great centres of population where there is a legal bar, such as Liverpool or Birmingham or Bristol, and where there are opportunities of keeping abreast of the

    2205
    practice and study of the law. In those cases the traveling expenses would be from those places to the place where the Recordership is held and carried on. There is much more analogy between the position of Members of Parliament and Recorders than any other case that has been cited.
    It might just as well be said to any hon. Member that he is bound to live in London instead of near his constituency. I think the answer would be perfectly good that it is right and proper that a Member of Parliament should be in or near his constituency in order to be familiar with the needs of is constituency [An HON. MEMBER: "Carpet beggers!"] That taunt cannot at any rate be made against me. I was both born and educated in my constituency, but a Member of Parliament lives near his constituency because it is necessary for him to be there for the proper discharge of his duties. That is the theory of the travelling expenses. For the same reason a Recorder lives in London, where the law is practiced, where he can keep abreast of his profession, where he can keep abreast of his profession in order that he may better discharge the duties of his position. I think this House would be doing credit to itself if it allowed this perfectly ridiculous sum. There are 119 Recorders, many of whom would charge no expenses at all, because they are Recorders of districts near London. The House would be doing itself credit and honouring a body of the whom it has no reason to reproach for failure to perform their duties if it allowed this Amendment to pass into law.
    Mr. T. WILLIAMS: I would like to remind the hon. Member who has just spoken when the Finance Bill of last year was under review. I than moved an Amendment which would have had the result of granting an allowance to work-people who were compelled to travel to and from their daily work, not through any fault of their own, but very largely due to the failure of past Governments to supply them with houses near their employment. Many of these men were called upon to pay from 5s. to 10s. a week in travelling expenses out of wages varying from £2 to £3 a week. The than Government, of which the hon. and learned Member was one of the leading Members,
    2206
    refused to make any concession whatsoever.
    Mr. HARCOURT JOHNSTONE: Were these people liable to pay Income Tax.
    Mr. WILLIAMS: Obviously, or the concession would have cost the Government nothing. Now an appeal is made for slightly over 100 well-paid people, worthy of the remuneration they receive, but infinitely better off then the work-people I was referring to. The fact that they have only to travel four times a year seems to me not only to justify the refusal of the concession, but if there are any concessions to make in that direction they ought to have been made when the last Amendment was moved, namely, to grant a concession when the income is less than £500 a year.
    Mr. D. HERBERT: Might I call attention to just one point in connection with the analogy the Chancellor of the Exchequer attempted to draw between this case and the case of a High Court Judge living out of London and going up to the Courts day by day. Such a Judge when traveling the country in assize gets the Recorder's job. It is a part-time job and he only goes for a few days four times a year to a distant part of the country. He is not paid a salary which will keep him for a whole year there. [HON MEMBERS: "What is the salary?"] The salary is in the region of £200 a year.
    Sri T INSKIP: The great majority of the salaries of Recorders are under £25 to £75 and to £100.
    Mr. HERBERT: The whole thing affects the work to be done. If it is to be done as efficiently as it is at the present time at so small a salary, and if practically the only place in which barristers can make their living is London, this journey has to be undertaken in the interests of the office held, and is comparable to the journey of a High Court Judge on Assize. If it is necessary to divide the Committee. I hope to have the support generally of the Committee in protesting against a change in custom on the part of the Revenue after years in which they have apparently never thought it was proper to disallow

    2207
    this deduction. All at once, for some unknown reason, they do this which they were quite competent to do for 20 years. If we have come to the time that the Revenue has got the thick-skinnedness to
    act in this way, it is time Parliament put the matter right.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 85; Noes, 164.

    Division No. 145.]

    AYES.

    [4.57 a.m.

    Barnston, Major Sir Harry

    Harland, A.

    Perkins, Colonel E. K.

    Birchall, Major J. Dearman

    Harmsworth, Hon. E. C. (Kent)

    Philipson, Mabel

    Bird, Sir R. B. (Wolverhampton, W.)

    Hartington, Marquess of

    Pielou, D. P.

    Birkett, W. N.

    Harvey, C. M. B. (Aberd'n & Kincardne)

    Pownall, Lieut.-Colonel Assheton

    Blades, Sir George Rowland

    Harvey, T. E. (Dewsbury)

    Raine, W.

    Bowyer, Captain G. E. W.

    Hennessy, Major J. R. G.

    Remer, J. R.

    Burman, J. B.

    Herbert, Dennis (Hertford, Watford)

    Richardson, Lt.-Col. Sir P. (Chertsey)

    Chandwick, Sir Robert Burton

    Hope, Rt. Hon. J. F. (Sheffield, C.)

    Roberts, Samuel (Hereford, Hereford)

    Chamberlain, Rt. Hon N. (Ladywood)

    Howard, Hn. D. (Cumberland, Northrn.)

    Ropner, Major L.

    Clayton, G. C.

    Hughes, Collingwood

    Roundeil, Colonel R. F.

    Cope, Major William

    Inskip, Sir Thomas Walker H.

    Russell, Alexander West (Tynemouth)

    Courthope, Lieut.-Col. George L.

    Jenkins, W. A. (Brecon and Radnor)

    Samuel, A. M. (Surrey, Farnham)

    Cowan, D. M. (Scottish Universities)

    Johnstone, Harcourt (Willesden, East)

    Sandeman, A. Stewart

    Curzon, Captain Viscount

    Jowitt, W. A. (The Hartlepools)

    Sheffield, Sir Berkeley

    Dawson, Sir Philip

    Kay, Sir R. Newbald

    Shepperson, E. W.

    Deans, Richard Storry

    Kindersley, Major G. M.

    Smith-Carington, Neville W.

    Dixey, A. C.

    King, Captain Henry Douglas

    Steel, Samuel Strang

    Duckworth, John

    Lamb, J. Q.

    Thornton, Maxwell R.

    Eden, Captain Anthony

    Lumley, L. R.

    Warrender, Sir Victor

    Eyres-Monsell, Com. Rt. Hon. B. M.

    Maitland, Sir Arthur D. Steel-

    Wells, S. R.

    Ferguson, H.

    Makins, Brigadier-General E.

    Williams, A. (York, W. R., Sowerby)

    Fletcher, Lieut.-Com. R. T. H.

    Martin, F. (Aberdeen & Kinc'dine, E.)

    Wilson, Sir Charles, H. (Leeds, Central)

    Gates, Percy

    Moore-Brabazon, Lieut.-Col. J. T. C.

    Windsor-Clive, Lieut.-Colonel George

    Gaunt, Rear-Admiral Sir Guy R.

    Morrison-Bell, Major Sir A. C. (Honiton)

    Wise, Sir Fredric

    George, Major G. L. (Pembroke)

    Newman, Sir R. H. S. D. L. (Exeter)

    Yerburgh, Major Robert D. T.

    Gibbs. Col. Rt. Hon. George Abraham

    Nicholson, O. (Westminster)

    Greene, W. P. Crawford

    Nield, Rt. Hon. Sir Herbert

    TELLERS FOR THE AYES.—

    Greenwood, William (Stockport)

    O'Neill, Rt. Hon. Hugh

    Mr. George Balfour and Sir

    Hacking, Captain Douglas H.

    Penny, Frederick George

    Frederick Hall.

    Hannon, Patrick Joseph Henry

    Percy, Lord Eustace (Hastings)

    NOES.

    Ackroyd, T. R.

    Gibbins, Joseph

    Kirkwood, D.

    Acland, Rt. Hon. Francis Dyke

    Gillett, George M.

    Lansbury, George

    Adamson, Rt. Hon. William

    Gosling, Harry

    Laverack, F. J.

    Adamson, W. M. (Staff., Cannock)

    Gould, Frederick (Somerset, Frome)

    Law, A.

    Alexander, A. V. (Sheffield, Hillsbro')

    Graham, W. (Edinburgh, Central)

    Lawson, John James.

    Ammon, Charles George

    Greenwood, A. (Nelson and Colne)

    Leach, W.

    Aske, Sir Robert William

    Grenfell, D. R. (Glamorgan)

    Lee, F.

    Attlee, Major Clement R.

    Grundy, T. W.

    Lessing, E.

    Baker, Walter

    Guest, Dr. L. Haden (Southwark, N.)

    Linfield, F. C.

    Banton, G.

    Hall, F. (York, W. R., Normanton)

    Loverseed, J. F.

    Barclay, R. Noton

    Hall, G. H. (Merthyr Tydvil)

    McEntee, V. L.

    Barnes, A.

    Hardle, George D.

    Mackinder, W.

    Batey, Joseph

    Hartshorn, Rt. Hon. Vernon

    Maclean, Nell (Glasgow, Govan)

    Bonwick, A.

    Haycock, A. W.

    Mansel, Sir Courtenay

    Briant, Frank

    Hayday, Arthur

    March, S.

    Broad, F. A.

    Henderson, A. (Cardiff, South)

    Marley, James

    Bromfield, William

    Henderson, T. (Glasgow)

    Martin, W. H. (Dumbarton)

    Brown, A. E. (Warwick, Rugby)

    Henderson, W. W. (Middlesex, Enfld.)

    Middleton, G.

    Brown, James (Ayr and Bute)

    Hillary, A. E.

    Mills, J. E.

    Buckle, J.

    Hindle, F.

    Mond, H.

    Charleton, H. C.

    Hirst, G. H.

    Morris, R. H.

    Clarke, A.

    Hobhouse, A. L.

    Morrison, Herbert (Hackney, South)

    Climie, R.

    Hodges, Frank

    Morrison, R. C. (Tottenham, N.)

    Compton, Joseph

    Hoffman, P.C.

    Morse, W. E.

    Comyns-Carr, A. S.

    Howard, Hon. G. (Bedford, Luton)

    Mosley, Oswald

    Costello, L. W. J.

    Hudson, J. H.

    Moulton, Major Fletcher

    Cove, W. G.

    Isaacs, G. A.

    Murray, Robert

    Crittall, V. G.

    Jackson, R. F. (Ipswich)

    Murrell, Frank

    Darbishire, C. W.

    Jenkins, W. (Glamorgan, Neath)

    Naylor, T. E.

    Davies, Rhys John (Westhoughton)

    John, William (Rhondda, West)

    Nixon, H.

    Dickie, Captain J. P.

    Johnston, Thomas (Stirling)

    Oliver, P. M. (Manchester, Blackley)

    Dickson, T.

    Jones, C. Sydney (Liverpool, W. Derby)

    Paling, W.

    Dodds, S. R.

    Jones, J. J. (West Ham, Silvertown)

    Palmer, E. T.

    Dukes, C.

    Jones, Morgan (Caerphilly)

    Parkinson, John Allen (Wigan)

    Duncan, C

    Jones, T. I. Mardy (Pontypridd)

    Pattinson, S. (Horncastle)

    Edwards, G. (Norfolk, Southern)

    Kedward, R. M.

    Perry, S. F.

    Egan, W. H.

    Keens, T.

    Pethick-Lawrence, F. W.

    Gardner, B. W. (West Ham, Upton)

    Kennedy, T.

    Phillipps, Vivian

    Potts, John S.

    Spence, R.

    Wedgwood, Col. Rt. Hon. Josiah C.

    Purcell, A. A.

    Spero, Dr. G. E.

    Whiteley, W.

    Raffety, F. W.

    Spoor, B. G.

    Williams, David (Swansea, E.)

    Rathbone, Hugh R.

    Stamford, T. W.

    Williams, Dr. J. H. (Llanelly)

    Rea, W. Russell

    Starmer, Sir Charles

    Williams, Col. P. (Middlesbrough, E.)

    Rhys, Hon. C. A. U.

    Stranger, Innes Harold

    Williams, Lt.-Col. T.S.B. (Kenningtn.)

    Richards, R.

    Sturrock, J. Leng

    Williams, Maj. A. S. (Kent, Sevenoaks)

    Richardson, R. (Houghton-le-Spring)

    Sunlight, J.

    Williams, T. (York, Don Valley)

    Romeril, H. G.

    Tattersall, J. L.

    Willison, H.

    Scurr, Jhon

    Terrington, Lady

    Wilson, C. H. (Sheffield, Attercliffe)

    Seely, H. M. (Norfolk, Eastern)

    Thomson, Trevelyan (Middlesbro. W.)

    Wilson, R. J. (Jarrow)

    Sexton, James

    Thurtle, E.

    Windsor, Walter

    Sherwood George Henry

    Tout, W. J.

    Wright, W.

    Short, Alfred (Wednesbury)

    Vivian, H.

    Young, Andrew (Glasgow, Partick)

    Smith Ben (Bermondsey, Rotherhithe)

    Wallhead, Richard C.

    Smith, W. R. (Norwich)

    Ward, G. (Leicester, Bosworth)

    TELLERS FOR THE NOES.—

    Snell, Harry

    Watson, W. M (Dunfermline)

    Mr. John Robertson and Mr. Warne.

    Snowden, Rt. Hon. Philip

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Question put, and agreed to.

    NEW CLAUSE.—(Annual value for the purpose of duty on excise licences.)
    (1) The annual value of any premises for the purpose of the duty on any Excise Licence charged by reference to the annual value shall be in Great Britain—

    (a) the income Tax value, if there is such a value applicable; and

    (b) if there is no Income Tax value applicable, such amount as, in the opinion of the Commissioners of Customs and Excise, represents the annual rent which a free tenant might reasonably be expected, taking one year with another, to pay for the premises, if the tenant undertook to pay all usual tenant's rates and taxes, and title commutation rentcharge, if any, and if the landlord undertook to bear the cost of the repairs and insurance, and the other expenses, if any, necessary to maintain the premises in a state to command that rent.

    For the purpose of this provision the Income Tax value means the value adopted for the purpose of Income Tax under Schedule A of the Income Tax Act, 1918, and the Income Tax value shall be deemed to be applicable if the premises to which a value is attached for the purpose of that tax correspond with the premises the annual value of which is required for the purpose of the charge of duty on the licence.
    (2) In the case of premises to which the Valuation (Metropolis) Act, 1869, does not apply, the person applying for any such Excise licence as aforesaid may, if the Income Tax value applicable to the premises is the amount of a rent paid for the premises, require the Commissioners of Customs and Excise to assess the annual value of the premises for the purposes of the duty to be charged on the licence as if there were no Income Tax value applicable.
    (3) Any person dissatisfied with the annual value of any premises fixed by the said Commissioners under this Section may appeal to the General Commissioners of Income Tax for the division in which the premises are situate, who shall hear the appeal and determine the annual value, in accordance with the provisions of Sub-section (1) (b) of this Section.
    (4) The provisions of the Income Tax Acts relating to appeals against assessments to Income Tax under Schedule A, including the provisions relating to the statement of a case for the opinion of the High Court shall, so far as they are applicable, apply to any such appeal, and any person nominated in that behalf by the Commissioners of Customs and Excise shall have the same powers at, and on the determination of, any such appeal as a surveyor of taxes has at, and on the determination of, an appeal under the provisions of the Income Tax Act, 1918, against an assessment to Income Tax under Schedule A.
    (5) In this Section the expression "free tenant" means a tenant who is not under any direct or indirect obligation of any kind to obtain a supply of intoxicating liquor from any person.—[Mr. S. Roberts.]
    Brought up, and read the First time.
    Mr. S. ROBERTS: I beg to move, "That the Clause be read a Second time."
    It is rather a complicated Amendment and, in order to save time, perhaps the Chancellor of the Exchequer will be good enough to indicate if it is one he can accept.
    Mr. SNOWDEN: The Amendment concerns Inhabited House Duty, and is a necessary one. I hope the Committee will accept it. It deals with the basis of assessment.
    Clause read a Second time, and added to the Bill.

    NEW CLAUSE.—(Development fund.)
    Where any part of the profits of a company registered under the Companies' Acts, 1908 to 1917, is transferred to a special fund, to be called the development fund, the rate of Income Tax upon such transferred profits shall be half the standard rate.
    Provided that any sums transferred from the development fund and distributed either in cash or as bonus shares shall be included in the profits chargeable to Income Tax at the rate current in the year in which

    2211
    the transfer is made.—[Mr. N. Chamberlain.]
    Brought up, and read the First time.
    Mr. N. CHAMBERLAIN: I beg to move, "That the Clause be read a Second time."
    In the course of the Debate on the Budget I expressed the view that it would be a good thing for the trade of this country if manufacturers could be induced to put more money into bringing their machinery and equipment up to date, even at the cost of a lesser distribution to shareholders. I went so far as to say it was a mistake in my view to consider that surplus and profits were the same thing, and that an appreciable part of the surplus at the end of the year ought really not to be considered as profits at all, because they should constitute a fund from which machinery and plant ought to be kept in accordance with the highest standards, and not allowed to become obsolescent. It would be possible to deal with this matter by way of increased allowances for depreciation, but that method does not commend itself to me because it would enable one to set aside something in the nature of secret reserves. When I spoke on the subject before there were indications from some of the Members opposite that they desired to know whether it was not possible to frame a Clause to carry out the idea I had in mind. An attempt was made by Sir Alfred Mond who framed a Clause. It was slightly different from that which I have here and it was not accepted. My Noble Friend the Member for Hastings (Lord E. Percy) has also put down a Clause with the same general object as mine, but as that has not been called, I hope we may have an expression from the Chancellor of the Exchequer on the Clause before us. There are of course possible abuses to be guarded against in a proposal such as this, which is to give some remission of Income Tax on that part of the surplus set aside for the particular purpose of improving the capacity of the business, but the proviso in my Clause is a safeguard, for it ties up the money for the particular purpose intended so tightly that whether distribution be in the form of cash or bonus on shares the full rate of Income Tax is payable on money so brought back, so that one and a half times Income Tax would be paid instead of the ordinary rate. There would
    2212
    be therefore the strongest possible check on any attempt to elude this provision. I hope the right hon. Gentleman will see that this is a serious proposal and that I have endeavoured to provide for any difficulties which seem likely to arise from the adoption of the Amendment. I feel very strongly that this is a matter which is worthy of attention. We are going possibly to find ourselves very seriously menaced by competition from the Continent, where the great profits that were made by industrialists in Germany in particular during the period of inflation were largely invested in bringing up to date their factories. I am anxious, in view of this, to see our manufacturers here encouraged to put aside money for this particular purpose, and I hope very much the Chancellor of the Exchequer may see his way to accept this proposal.
    Mr. GRAHAM: Within a very few minutes I will try to indicate the views we take of the proposal which the right hon. Gentleman has made. No Member of the Committee could deny for a moment when looking to existing industrial conditions in this country that it is important that manufacturers and others should make a definite provision for the improvement and the enlargement of our industrial capacity, and in saying that I hope we on this side, as, indeed, all Members in different parts of the House, keep in view the bearing of an effort of that kind upon employment in Great Britain. In that brief introduction I have indicated that, as regards the general principle, there cannot probably be very much difference of opinion between us. But I want to point out that there are two or three very grave difficulties in the way of a Clause of this kind which I have no doubt the right hon. Gentleman himself fully appreciates, because he was Chancellor of the Exchequer, and he knows exactly the far-reaching character of the proposal of this nature. There are certain administrative difficulties. This Clause provides a safeguard as regards the use of the sum put to reserve. Other Clauses have been suggested by other hon. Members which did not provide a real safeguard, and it is very difficult to see under their proposals whether or not these reserves may have been distributed at some later date. That is only one of the administrative difficulties which would arise. But the more substantial

    2213
    administrative difficulty is that this would involve some injustice or anomaly as amongst taxpayers themselves.
    The right hon. Gentleman's Clause is confined to companies, and it must be plain to the House that it would be difficult to refuse a similar concession in the case of very large numbers of private individuals who were also making provision against this increased industrial capacity. If the case were made out, and I think there would be very little difficulty in making it out, then the cost of this to the Exchequer would very speedily grow until in the long run it would be of very large dimensions. As the Clause stands it could hardly be inserted in any Finance Bill because in the first year of its operation all these anomalies would arise. The House will agree that they would be substantial in character and not of a nature which could be redressed by subsequent legislation. We should require amending legislation in the future in order to put all on the same footing. I have mentioned these things because it is only just to the Committee that they should be familiar with the difficulties as they are seen by the Treasury. The final objection is, of course, the cost of this proposal. When the right hon. Member for Hillhead (Sir R. Horne) made a suggestion of this kind during the second reading of the Finance Bill, I understood him in the course of my reply to refer to public companies and to suggest that the whole of the standard rate, namely, 4s. 6d., should be conceded, whereas the right hon. Gentleman now proposes only one-half of that rate. Quite clearly if the original proposal at the full rate we had then in mind were put forward that would cost in a full year anything between 25 and 50 million pounds. But on the basis of the proposals submitted now there is no doubt whatever that the cost would be between 12 and 20 millions per annum. There is the further difficulty that this raises a large issue in Income Tax administration in that it looks to the destination of the profits which have been earned. Once we get out into the field of discussing destination, we are exposed to almost every difficulty under the sun in Income Tax administration. The House recognises quite frankly that we cannot accept this Clause, because of the cost and the other difficulties. But
    2214
    in making that announcement on behalf of my right hon. Friend, and on behalf of every Member on this side of the House, we are not blind to the importance of improving the industrial capacity of this country, and we do not ignore, from the point of view we have in mind, the importance of an improvement in the conditions for the recovery of trade.
    Lord E. PERCY: There is just one thing I should like to say in further elucidation of this question. The Financial Secretary to the Treasury, as usual, has endeavoured to give the House a very fair and clear survey of the difficulties. But I think he has given the Committee the impression that we are in this matter embarking on a new field that it is impossible to say what would be the effect when we have numbers of intricate difficulties to meet, and that the cost will be enormous, not only to begin with, but permanent. May I point out that we are not really embarking on any new scheme at all Roughly speaking, this system is the Dutch Income Tax system, which is actually in operation. The exemption of reserve funds of this kind is actually in operation.
    Mr. A. M. SAMUEL: It is actually in operation in this country under Section 21 of the Act of 1922.
    Lord E. PERCY: If my hon Friend will look at the Amendment he will see that I carefully dealt with Section 21 in the new Clause I propose. Anyway, I want to clear up the point. It is actually in operation, and I think the Financial Secretary will admit, when once instituted and working for a few years, the revenue will suffer no loss at all. It does not really matter one little bit whether you tap your wealth as we tap it now at a point where it is going back into capital, or whether you tap it later on when it comes out as increased wealth when it is distributed. That is the basis on which the Dutch Government have gone, and I believe they have been fully justified by results. If any system of this kind is going to be of benefit to our manufacturers it must be of benefit to our trade.
    One word more. The Financial Secretary points out that the cost of taking off the Income Tax altogether on reserves would be between £20,000,000 and £25,000,000 in a full year. Once and for all get rid of the economic absurdity of

    2215
    talking about Income Tax as direct taxation. The Financial Secretary's figures show that between one-fifth and one-sixth of the taxation of this country is taxation of the most indirect kind, that it is a tax on the cost of production, a tax on the consumer, and a tax on employment. Having suffered now many days from hearing a discussion of this and other objects on the basis that all Income Tax is direct taxation, and that any relief of Income Tax is relief of direct taxation, let us after this revelation from the Financial Secretary definitely resolve that we will never talk economic absurdities like this again.
    Mr. KEENS: We have heard that Section 21 allows exemption of reserves for Income Tax. That is surely a mistake As far as my experience goes, I know of no procedure by which Income Tax has ever been allowed on reserves. I know of Income Tax having been allowed by way of depreciation, and special claims for obsolescence, but certainly nothing in the nature of reserves. I suggest that the proposition now made is extremely novel
    and should not be accepted, because it would be possible in a one-man company, where all the shares except one are held by one individual, that the whole of the profits could be placed to development, if the individual had sufficient investments outside to live on.
    Mr. SAMUEL: Under the Section the Commissioners can allow such a sum as they consider is necessary for the maintenance and development of the business. That means that a certain sum put to reserve to develop the business is excused a certain payment. I would like to elaborate the view of the Noble Lord. If you are going to allow certain monies to be excused certain taxes, it is true the revenue to-day may lose those taxes, but that money going back into the business yields revenue sooner or later, and if the State allows that money to go without taxation for a year it gets the profit a year later.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 66; Noes, 174.

    Division No. 146.]

    AYES.

    [5.29 a.m.

    Balfour, George (Hampstead)

    Harland, A.

    Pielou, D. P.

    Barnston, Major Sir Harry

    Hartington, Marquess of

    Pownall. Lieut.-Colonel Assheton

    Birchall, Major J. Dearman

    Harvey, C.M.B. (Aberd'n & Kincardne)

    Raine, W.

    Bird, Sir R. B. (Wolverhampton, W.)

    Hennessy, Major J. R. G.

    Remer, J. R.

    Blades, Sir George Rowland

    Herbert, Dennis (Hertford, Watford)

    Rhys, Hon. C. A. U.

    Bowyer, Captain G. E. W.

    Hope, Rt. Hon. J. F. (Sheffield, C.)

    Richardson, Lt.-Col. Sir P. (Chertsey)

    Burman, J. B.

    Howard, Hn. D. (Cumberland, Northrn.)

    Roberts, Samuel (Hereford, Hereford)

    Chadwick, Sir Robert Burton

    Hughes, Collingwood

    Ropner, Major L.

    Chamberlain, Rt. Hon. N. (Ladywood)

    Inskip, Sir Thomas Walker H.

    Roundell, Colonel R. F.

    Clayton, G. C.

    Kindersley, Major G. M.

    Russell, Alexander West (Tynemouth)

    Cope, Major William

    King, Captain Henry Douglas

    Samuel, A. M. (Surrey, Farnham)

    Courthope, Lieut.-Col. George L.

    Lamb, J. Q.

    Sandeman, A. Stewart

    Dawson, Sir Philip

    Lumley, L. R.

    Sheffield, Sir Berkeley

    Dixey, A. C.

    Maitland, Sir Arthur D. Steel-

    Shepperson, E W.

    Eden, Captain Anthony

    Makins, Brigadier-General E.

    Smith-Carington, Neville W.

    Eyres-Monsell, Com. Rt. Hon. B. M.

    Moore-Brabazon, Lieut.-Col. J. T. C.

    Warrender, Sir Victor

    Ferguson, H.

    Morrison-Bell, MajorSir A. C. (Honiton)

    Wells, S. R.

    Gates, Percy

    Newman, Sir R. H. S. D. L. (Exeter)

    Wilson, Sir Charles H. (Leeds, Central)

    Gaunt, Rear-Admiral Sir Guy R.

    Nicholson, O. (Westminster)

    Windsor-Clive, Lieut.-Colonel George

    Gibbs, Col. Rt. Hon. George Abraham

    O'Neill, Rt. Hon. Hugh

    Wise, Sir Fredric

    Greene, W. P. Crawford

    Penny, Frederick George

    Yerburgh, Major Robert D. T.

    Greenwood, William (Stockport)

    Percy, Lord Eustace (Hastings)

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Perkins, Colonel E. K.

    TELLERS FOR THE AYES.—

    Hannon, Patrick Joseph Henry

    Philipson, Mabel

    Captain Hacking and Captain

    Douglas King.

    NOES.

    Ackroyd, T. R.

    Briant, Frank

    Darbishire, C. W.

    Acland, Rt. Hon. Francis Dyke

    Broad, F. A.

    Davies, Rhys John (Westhoughton)

    Adamson, Rt. Hon. William

    Bromfield, William

    Dickie, Captain J. P.

    Adamson, W. M. (Staff., Cannock)

    Brown, A. E. (Warwick, Rugby)

    Dickson, T.

    Alexander, A. V, (Sheffield, Hillsbro')

    Brown, James (Ayr and Bute)

    Dodds, S. R.

    Ammon, Charles George

    Buckle, J.

    Dukes, C.

    Aske, Sir Robert William

    Charleton, H. C.

    Duncan, C.

    Attlee, Major Clement R.

    Clarke, A.

    Edwards, G. (Norfolk, Southern)

    Baker, Walter

    Climie, R.

    Egan, W. H.

    Banton, G.

    Compton, Joseph

    Fletcher, Lieut.-Com. R. T. H.

    Barclay, R. Noton

    Comyns-Carr, A. S.

    Gardner, B. W. (West Ham, Upton)

    Barnes, A.

    Costello, L. W. J.

    George, Major G. L. (Pembroke)

    Batey, Joseph

    Cove, W. G.

    Gibbins, Joseph

    Birkett, W. N.

    Cowan, D. M. (Scottish Universities)

    Gillett, George M.

    Bonwick, A.

    Crittall, V. G.

    Gosling, Harry

    Gould, Frederick (Somerset, Frome)

    Lawson, John James

    Scurr, John

    Graham, W. (Edinburgh, Central)

    Leach, W.

    Seely, H. M. (Norfolk, Eastern)

    Greenwood, A. (Nelson and Colne)

    Lee, F.

    Sexton, James

    Grentell, D. R. (Glamorgan)

    Leasing, E.

    Sherwood, George Henry

    Grundy, T. W.

    Linfield, F. C.

    Short, Alfred (Wednesday)

    Guest, Dr. L. Haden (Southwark, N.)

    Loverseed, J. F.

    Smith, Ben (Bermondsey, Rotherhithe)

    Hall, F. (York, W. R., Normanton)

    McEntee, V. L.

    Smith, W. R. (Norwich)

    Hall, G. H. (Merthyr Tydvil)

    Mackinder, W.

    Snell, Harry

    Hardie, George D.

    Maclean, Neil (Glasgow, Govan)

    Snowden, Rt. Hon. Philip

    Hartshorn, Rt. Hon. Vernon

    Mansel, Sir Courtenay

    Spence, R.

    Harvey, T. E. (Dewsbury)

    March, S.

    Spero, Dr. G. E.

    Haycock, A. W.

    Marley, James

    Spoor, B. G.

    Hayday, Arthur

    Martin, F. (Aberdeen & Kinc'dine, E.)

    Stamford, T. W.

    Henderson, A. (Cardiff, South)

    Martin, W. H. (Dumbarton)

    Starmer, Sir Charles

    Henderson, T. (Glasgow)

    Middleton, G.

    Stranger, Innes Harold

    Henderson, W. W. (Middlesex, Enfld.)

    Mills, J. E.

    Sturrock, J. Leng

    Hillary, A. E.

    Mond, H.

    Sunlight, J.

    Hindle, F.

    Morris, R. H.

    Tattersall, J. L.

    Hirst, G. H.

    Morrison, Herbert (Hackney, South)

    Thomson, Trevelyan (Middlesbro. W.)

    Hobhouse, A. L.

    Morrison, R. C. (Tottenham, N.)

    Thornton, Maxwell R.

    Hodges, Frank

    Morse, W. E.

    Thurtle, E.

    Hoffman, P. C.

    Mosley, Oswald

    Tout, W. J.

    Howard, Hon. G. (Bedford, Luton)

    Moulton, Major Fletcher

    Vivian, H.

    Hudson, J. H.

    Murray, Robert

    Wallhead, Richard C.

    Isaacs, G. A.

    Murrell, Frank

    Ward, G. (Leicester, Bosworth)

    Jackson, R. F. (Ipswich)

    Naylor, T. E.

    Watson, W. M (Dunfermline)

    Jenkins, W. (Glamorgan, Neath)

    Nixon, H.

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Jenkins, W. A. (Brecon and Radnor)

    Oliver, P. M. (Manchester, Blackley)

    Wedgwood, Col. Rt. Hon. Josiah C.

    John, William (Rhondda, West)

    Paling, W.

    Whiteley, W.

    Johnston, Thomas (Stirling)

    Palmer, E. T.

    Williams, A. (York, W.R., Sowerby)

    Johnstone, Harcourt (Willesden, East)

    Parkinson, John Allen (Wigan)

    Williams, David (Swansea, E.)

    Jones, C. Sydney (Liverpool, W. Derby)

    Pattinson, S. (Horncastle)

    Williams, Dr. J. H. (Llanelly)

    Jones, J, J. (West Ham, Silvertown)

    Perry, S. F.

    Williams, Col. P. (Middlesbrough, E.)

    Jones, Morgan (Caerphilly)

    Pethick-Lawrence, F. W.

    Williams, Lt.-Col. T.S.B. (Kenningtn.)

    Jones, Rt. Hon. Leif (Camborne)

    Phillipps, Vivian

    Williams, T. (York, Don Valley)

    Jones, T. I. Mardy (Pontypridd)

    Potts, John S.

    Willison, H.

    Jowitt, W. A. (The Hartlepools)

    Purcell, A. A.

    Wilson, C. H. (Sheffield, Attercliffe)

    Kay, Sir R. Newbald

    Raffety, F. W.

    Wilson, R. J. (Jarrow)

    Kedward, R. M.

    Rathbone, Hugh R.

    Windsor, Walter

    Keens, T.

    Rea, W. Russell

    Wright, W.

    Kirkwood, D.

    Richards, R.

    Young, Andrew (Glasgow, Partick)

    Lansbury, George

    Richardson, R. (Houghton-le-Spring)

    Laverack, F. J.

    Robertson, J. (Lanark, Bothwell)

    TELLERS FOR THE NOES.—

    Law, A.

    Romerils, H. G.

    Mr. Morgan Jones and Mr. Warne.

    FIRST SCHEDULE.
    Mr. SNOWDEN: I beg to move, in page 18, line 5, column 2, at the beginning, to insert the words:
    "In the case of molasses produced in bond an amount equal to the duty paid, and in any other case."
    This is a drafting Amendment. It is necessary, so that a claim for drawback may not be higher than the original duty.
    Amendment agreed to.
    Schedule, as amended, ordered stand part of the Bill.

    SECOND SCHEDULE.
    Mr. HUGHES: I beg to move, in page 21, to leave out lines 10 and 11 and to insert instead thereof:

    Rate of duty.

    exceeds 1s. 1d. and does not exceed 1s. 6d.

    3d.

    exceeds 1s. 6d. and does not exceed 2s.

    4d.

    exceeds 2s. and does not exceed 2s. 6d.

    5d.

    exceeds 2s. 6d. and does not exceed 3s.

    6d.

    2218
    I should like to recall the Chancellor's proposals in his Budget Statement. It will be remembered that they covered the abolition of the taxes up to 6d., and a partial revision of the taxes from 6d. up to 1s. 3d. My Amendment will carry the partial revision from that point up to, and including, 2s. 6d. It may be thought that this will double the amount taken off the tax, but such is by no means the case. We know the sums apportioned to the various stages of the scale vary very greatly. It appears from the basis of our present total tax, that is, £9,500,000 per annum, that the higher you go in the scale the lesser the amount that accrues to the Treasury. The proposals I have to make will not involve a very great loss to the Treasury. It will be observed that there stands in the Schedule a very big jump between the 1s. 3d. and 1s. 6d. A difference of 3d. in the price of admission makes a difference of 2d. in the tax.
    My Amendment has a tax of 3d., 4d., 5d. or 6d., graduated instead of a jump of 3d. and 4d. and then to 6d. If my proposal be adopted that big jump will be

    2219
    avoided. In addition to that, my proposal will admit of a very popular price of admission. Such a price, inclusive of tax, does not exist at the present moment. One has to pay either 2s. 4d. or 2s. 7d. My Amendment will allow the popular price of 2s. 6d. The partial remission of the tax only affects the cheaper houses of entertainment, and leaves the higher priced class of entertainment untouched. This Amendment will do something towards ameliorating that state of affairs. The Chancellor's proposals came into effect on the 2nd June and I realise it is quite impossible to make my proposal retrospective. It might, however, come into force conveniently on the 1st August or September, or at such date as may be convenient. These are the four reasons on which I submit to the Committee and appeal to the Chancellor that the Amendment in my name should be adopted.
    Mr. SNOWDEN: In the Ways and Means stage of the Budget this Entertainments Duty was discussed at some length, and some criticism was made of my proposal on the ground that it left the duty on the higher priced seats untouched. When I made the proposal for the reduction of certain Entertainment Duties I said I was concentrating on a reduction of the low priced seats. The hon. Member who has moved the Amendment said quite truly that the position would be that the Entertainments Duty is to be found in the returns from the lower priced seats. That is my difficulty in dealing with the matter and proposing an all-round reduction. I find it quite impossible to do that without sacrificing practically the whole of the income from this tax. When this question was debated the Financial Secretary expressed his view on the matter, and I do not think I can do better than read what he said:
    "Suggestions have been made that, within the limits of what we propose to concede, there might be some readjustment of the scale. The Chancellor of the Exchequer and I are very anxious that there should be no misunderstanding as to any further consideration or any further concession which he may be able to make. In the first place, we cannot agree to any modification of the complete exemption up to 6d. In the second place, it is quite impossible for my right hon. Friend, with his other commitments, to agree to anything which will cost him more than the £3,400,000, or the £4,000,000 in a full year. Those two points are for us beyond a shadow of doubt. My
    2220
    right hon. Friend is willing to consider whether in practice it would be possible so to delay the introduction of this change as to confer a benefit by way of reduction rather higher up the scale, but he has come to the conclusion that he must adhere to the date suggested, namely, 2nd June, with this proviso on his part—that subject to those considerations, he is willing to consider any modification of the scale which can be suggested, although I, personally, take the view that it wilt be hard to discover a method of dragging out the remission more equitably and generously than that which we have devised."—[OFFICIAL REPORT, 12th May, 1924; col. 1048, Vol. 173.]
    I saw the entertainments people two or three times and said that within the limits of the sacrifice I was prepared to make I was ready to consider any suggestions they might make upon improving the proposed scale. They have done that. What they have proposed is an extension of relief; and to accept the Amendment now before the Committee would involve a further sacrifice of £100,000. It will be remembered that we had an interesting incident in the Committee stage of the Bill last week in connection with exempting certain charitable institutions from the incidence of the tax. That Amendment meant a sacrifice of £100,000 a year. If the House of Commons on Report uphold that decision I should have been compelled to make a larger sacrifice than I intended, and it is quite impossible that I can accept the responsibility for this further addition which would be involved by accepting the Amendment of the hon. Member who has just moved it. I very much regret it.
    Mr. HUGHES: In view of the statement made by the Chancellor of the Exchequer, I have no desire to press the Amendment to a Division.
    Amendment, by leave, withdrawn.
    Second Schedule ordered to stand part of the Bill.

    THIRD SCHEDULE.
    Mr. S. ROBERTS: I beg to move, in page 23, line 45, at the end, to insert:
    "1 and 2 Geo. 5. c. 2.—The Revenue Act, 1911—Sub-section (1) of Section eight."
    This Amendment is consequential on the long Amendment which I previously moved.
    Amendment agreed to.
    Mr. SNOWDEN: I beg to move, in page 24, line 6, to leave out the word "first," and to insert instead thereof the word "second."

    2221
    There was a mistake made with regard to the date upon which the new import duties should cease.
    Amendment agreed to.
    Further Amendments made: In page 24, lines 9 and 10, leave out "Sections eight, twelve, and thirteen," and insert instead thereof the words
    "Sub-section (1) of Section twelve, and Section thirteen, except Sub-section (1) and the last paragraph of Sub-section (4)."
    In page 24, line 39, column 3, leave out the word "six."—[Mr. Snowden.]
    Third Schedule, as amended, ordered to stand part of the Bill.
    Bill, reported; as amended, to be considered upon Monday next, and to be printed. [Bill 196.]

ELECTRICITY SUPPLY ACTS.
Resolved,
"That the Special Order made by the Electricity Commissioners under the Electricity (Supply) Acts, 1882 to 1922, and confirmed by the Minister of Transport under The Electricity (Supply) Act, 1919, in respect of the urban district of Brownhills and the parishes of Hammerwich and Ogley Hay Rural, and part of the parish of Burntwood Edial and Woodhouses, in the rural district of Lichfield, all in the county of Stafford, which was presented on the 12th day of May, 1924, be approved."
Resolved,
"That the Special Order made by the Electricity Commissioners under the Electricity (Supply) Acts, 1882 to 1922, and confirmed by the Minister of Transport under The Electricity (Supply) Act, 1919, in respect of the borough of Tenterden and the rural district of Tenterden (except certain detached portions), in the country of Kent, which was presented on the 12th day of May, 1924, be approved."
Resolved,
"That the Special Order made by the Electricity Commissioners under the Elec-
2222
tricity (Supply) Acts, 1882 to 1922, and confirmed by the Minister of Transport under The Electricity (Supply) Act, 1919, in respect of the borough of that part of the city of Wakefield which was formerly part of the township of Lupset, in the West Riding of the county of York, which was presented on the 12th day of May, 1924, be approved."
Resolved,
"That the Special Order made by the Electricity Commissioners under the Electricity Commissioners under the Electricity Commissioners under the Electricity (Supply) Acts, 1882 to 1922 and confirmed by the Minister of Transport under The Electricity (Supply) Act, 1919, in respect of the urban district of Buress Hill, parts of the parishes of Wivelsfield and Ditchling in the rural district of Chailey, and parts of the parishes of Cuckfield Rural, Koymer, Clayton, and Hurstpierpoint, in the rural district of Cuckfield, all in the administrative county of East Sussex, which was presented on the 21st day of May, 1924, be approved."
Resolved,
"That the Special Order made by the Electricity Commissioners under the Electricity (Supply) Acts, 1882 to 1922, and confirmed by the Minister of Transport under The Electricity (Supply) Act, 1919, in respect of the urban districts of Letchworth and Baldock, the parish of Willian and part of the parish of Radwell, in the rural district of Hitchin, in the country of Hertford, and the parish of stotfold, in the rural district of Bigleswade, in the county of Bedford, which was presented on the 28th day of May, 1924, be approved."—[Mr. Gosling.]
The remaining Orders were read, and postponed.
It being after half-past Eleven of the Clock, upon Tuesday evening, Mr. DEPUTY-SPEAKER adjourned the House, without Question put, pursuant to the Standing Order.
Adjourned at Two Minutes before Six o'Clock a.m., Wednesday, 9th July.