§ Motion made, and Question proposed,
- (a) income tax for the year 1929–30 shall be charged at the standard rate of four shillings in the pound, and in the case of an individual whose total income from all sources exceeds two thousand pounds, at the same higher rates in respect of the excess over two thousand pounds as were charged for the year 1928–29;
- (b) all such enactments as had effect with respect to the income tax charged for the year 1928–29 (other than subsection (3) of section twenty-nine and subsection (2) of section thirty-two of the Finance Act, 1926, and section twenty-eight of the Finance Act, 1927), shall have effect with respect to the income tax charged for the year 1929–30;
- (c) the annual value of any property which has been adopted for the purpose of income tax under Schedules A and B for the year 1928–29 shall be taken as the annual value of that property for the same purpose for the year 1929–30:
§ Provided that the foregoing provision relating to annual value shall not apply to lands, tenements and hereditaments in the administrative county of London with respect to which the valuation list under the Valuation (Metropolis) Act, 1869, is by that Act made conclusive for the purposes of income tax.
§ And it is declared that it is expedient in the public interest that this resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1913."—[Mr. Churchill.]
§ Mr. SNOWDEN
I am sure that the Committee is in no mood, after listening to the lengthy, not too lengthy, statement of the Chancellor of the Exchequer, to hear more speeches now. I propose to follow the precedent of previous years and to confine my observations, in the main, to congratulating the Chancellor of the Exchequer upon a speech of a very exceptional character, and not wanting in the least in his accustomed eloquence and scintillating rhetoric. From the 69 statements which have appeared in the newspapers for the last two or three days, we had been led to expect the type of speech that the Chancellor of the Exchequer has delivered. We were told that he was spending 16 hours a day in preparing those scintillating epigrams which afford so much entertainment to Members on the other side of the House. It is a pity for the purpose for which this type of speech has been prepared and delivered that it will not appear quite so entertaining when it is read in the newspapers to-morrow morning.
The right hon. Gentleman was expected to do something to restore the declining fortunes of the Tory party. He was their one remaining asset. It remains to be seen whether his Budget will prove to be of the electoral value which, I have no doubt, the right hon. Gentleman expects it to be. In his concluding observations, the right hon. Gentleman said that he had confined his statement to financial matters, wholly. I have heard something like 20 Budget statements, and I must say, without any disrespect to the right hon. Gentleman, that I have never heard a Budget statement which has travelled to such an extent outside the proper purposes of a Budget speech as that to which we have just listened. Of course, the explanation is quite clear. The right hon. Gentleman could not resist the temptation to forestall the speech which the Prime Minister is expected to make in the country. That has been a characteristic of the speeches of the present Chancellor of the Exchequer.
I have given various descriptions to previous Budgets of the right hon. Gentleman. There is one description of this Budget which I am sure will have occurred to the minds of all hon. Members who sit on this side of the House. It has not been a Budget statement; it has been an election manifesto. The description that will be given of this Budget will be that of a bribery Budget. On more than one occasion the right hon. Gentleman has said that a General Election is a very expensive thing for the Treasury. He has proved that to be true. There are few of the concessions which he is proposing in this Budget which would have been made were it not that the Budget is presented on the eve of a General Election. A more shameless piece of election bribery has never been 70 presented by any political party. We have had the spectacle of the Tory party trying to win the coming General Election by using public funds for party purposes.
I shall have more to say about the details of the proposals at a later stage of our proceedings, but there is one feature of the Budget which is different from the features of all the right hon. Gentleman's preceding Budgets. Under his fascinating rhetoric and engaging personality, the right hon. Gentleman has in previous Budgets managed to convey the temporary impression that his Budget was a good Budget and contained proposals which it would be difficult to oppose. I have even found some of my hon. Friends behind me, at the conclusion of one of the right hon. Gentleman's Budget statements, feeling somewhat depressed for the moment. I have never been depressed; I know the right hon. Gentleman too well. That mood of depression has never lasted long, because as soon as we have had an opportunity to get away from the mesmerism of the right hon. Gentleman the real character of his proposals has been made quite clear.
I have said that it is customary on these occasions to confine one's observations to those of a complimentary character. I am doing the best I can. Perhaps I shall be able to improve upon it to-morrow. At any rate, I can honestly and sincerely say that the right hon. Gentleman's speech has been in his best style. I always like to hear the right hon. Gentleman when he is in the mood in which he was this afternoon. I know no man who enjoys his own rhetoric and his own epigrams so much as the right hon. Gentleman, and he certainly has provided himself, if not others, with an abundant fund of enjoyment this afternoon. Upon that, I do most heartily congratulate him. I have doubts at the moment, doubts which, I think, experience will strengthen, that the purpose of his speech will not be fulfilled. Hon. Members opposite are far better qualified than I am to judge the intelligence of their own supporters, because they know them, but, if the right hon. Gentleman and the Government think that the intelligence Of the country is so low that it cannot see through the purpose of this Budget, they will be mistaken. 71 The right hon. Gentleman has given a good deal more provocation to the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George), who will follow me, than to myself. He is never very severe on me. I never have any reason to complain of the right hon. Gentleman's treatment of myself. He is really a good sportsman. He does not mind being hit hard and he hits back, but I think he always hits above the belt.
Perhaps I had better delay until to-morrow saying farewell to the right hon. Gentleman. His speech this afternoon was of the nature of a swan song. I think the result of the General Election will be that the right hon. Gentleman will be relieved from the onerous responsibilities which have borne so heavily upon him during the last five years, and he will be able to find greater leisure for the exercise of a craft in which I believe he has become highly efficient. I see on the hoardings bills which state that the Conservatives have built something like 800,000 houses during the last five years. We have heard what an expert bricklayer the right hon. Gentleman has become, but it is surprising that the activities of the Conservatives in that enterprise have been so extensive. The right hon. Gentleman will have abundant leisure to engage more fully in that craft, and we may expect to see the housing output of the Conservative party considerably increased. I am sure that the right hon. Gentleman is highly pleased with himself at the moment, but I doubt whether he will be quite so pleased with himself when he reads the newspaper comments upon his speech, even the newspapers which generally support his party. I assure hon. Members opposite that I make no complaint about the nature of the Budget. It is just the kind that I expected, but if hon. Members opposite think it is going to be of advantage to them in the election upon which we are about to enter, they are seriously underrating the intelligence of the electors of the country.
§ Mr. LLOYD GEORGE
I do not propose to speak for more than a few minutes, and I shall confine myself to the usual conventional intervention on these occasions. At the same time, my 72 agreement with the right hon. Gentleman the Member for Colne Valley (Mr. Snowden) as to the quality of the speech to which we have just listened is certainly not conventional. We have been led to expect a very fine rhetorical performance, and the right hon. Gentleman has lived up to the expectations of his friends and those who appreciate his brilliant qualities. From that point of view, it was certainly one of his greatest performances. I do not propose to follow him in the criticisms which he passed upon certain proposals that I have made to the country—the Budget will be examined on behalf of my friends by the right hon. Member for West Swansea (Mr. Runciman) who will take part in the Debate to-morrow—but there are just a few observations which I must make. I do not complain that the right hon. Gentleman the Chancellor of the Exchequer has made an electioneering speech. It would be more than ordinary human nature, and certainly his human nature, to resist the temptation, seeing that we are within a few weeks of a General Election. That is a perfectly legitimate purpose, but what I object to is the sort of high moral line which he took about everybody else who had any electioneering ideas in their minds. He talked about their low mentality—I believe he said their moral mentality—but there is nothing in this Budget which we have not been led to expect by intelligent anticipations which have appeared in the newspapers, and I can well understand, having heard it, that these prognostications will provoke a good deal of anticipatory disappointment in the minds of some of his best friends. That disappointment will grow from day to day and from week to week.
I do not think the right hon. Gentleman has risen to the great opportunity which opened to a Chancellor of the Exchequer when dealing with the country in its present emergency. He was severe on me for making certain suggestions with regard to borrowing for public works upon the basis of a fund which would liquidate both interest and capital in the course of a few years, but at the same time he made the boast that, whereas I was going to borrow £200,000,000, he had actually raised £400,000,000 for kindred purposes. If the £200,000,000 is such an outrage on high finance, if it is such a withdrawal of money from ordinary in- 73 dustry that no sound financier would contemplate it at all, why should it be right for him to withdraw £400,000,000 and spend it in such a way, according to his own statement, that industry got little out of it? His statement is that £400,000,000 has been spent and that practically nothing substantial has been provided by the expenditure. It shows how badly the money has been spent.
Let me say a word with regard to the railways. The right hon. Gentleman referred to the Cunningham Scheme and deprecated the action of our forefathers in raising £64,000,000 in one year and £74,000,000 in another year for the purpose of constructing railways. In the first place, the right hon. Gentleman knows that £64,000,000 and £74,000,000 in those years would be equivalent to something like £400,000,000 to-day, and that the withdrawal of £64,000,000 and £74,000,000 from the surplus available for investment at that time would be a much more serious thing than the withdrawal of £100,000,000 to-day. May I put this to him? What is his argument? Is it that railways ought to be built out of current revenue? Does he suggest that no money should be borrowed for the purpose of constructing railways? The sum of £64,000,000 or £74,000,000 may have been too high a figure in proportion to the savings of the country at that time, but nobody is proposing to borrow the same proportion to-day. The right hon. Gentleman has apparently confined his study of Cunningham to the particular quotation. Has he ever read the whole story of how the construction of railways solved the problem of unemployment? Before that period, there was dire unemployment and suffering in the country, and the unemployment was increased by the perfection of industry. It was the railways which enabled the people of this country to bridge over the gap between the time when the perfection of machinery increased the wealth of the country and the opportunities for employment. The whole question is, as the Chancellor of the Exchequer has pointed out, whether they were necessary.
He talked about roads as mere racing tracks. It shows that the right hon. Gentleman has not studied the elements of the problem. Each year you have 500,000 commercial vehicles running along the roads. They are increasing year by 74 year. If he had studied his own revenue, he would have realised the extent to which this has grown. The chars-a-banc are not there for racing purposes. They have enabled the population of the towns for the first time to get out into the open country, and it is no use talking about a serious problem of this kind—which is here as a fact and which will have to be dealt with—as if it were merely a matter of providing tracks for luxury motors. The roads are used more and more for the purpose of distributing goods from door to door. At the same time the railways must form part of the transport system of the country, and I shall support the right hon. Gentleman's proposal for taking off the Railway Passenger Traffic Duty. When I was at the Board of Trade I did my best to induce the railways to deal with this question. Does the Chancellor of the Exchequer forget that last year the railways themselves realised the importance of motor traffic, and came to the House of Commons to secure powers to enable them to utilise the roads for the purpose of carrying goods from the warehouses right to the doors? It is no use talking about this problem as if it were merely a question of roads versus railways. The two must work together.
The right hon. Gentleman has said that the roads of this country are perfect. They are; and they are perfect because of a fund which was raised by the Government of which he and I were Members for the purpose of improving the quality of the roads. But no new roads or tracks of any kind, as far as I can recall, have been initiated by the present Government. He has a Committee sitting in London at the moment, upon which some of his own supporters are represented, and they have condemned the Government because schemes of which they have approved were not put into operation. It is no use treating a serious problem of this kind as if it were merely a matter of roads against railways. The question of the preparation and initiation of greater facilities for the purpose of carrying this great motor traffic cannot be treated as if it were a mere matter of providing racing tracks for motors.
I do not think it is unreasonable for the right hon. Gentleman to propose that the Budget should be divided into two 75 parts. He is quite justified in that proposal. It would be quite impossible in the time available between now and the General Election to have a thorough examination of the suggestions for amendments of the law which crop up every year, and I think the Chancellor of the Exchequer is perfectly right in confining the part of the Budget which he is to carry through before the General Election to the taxing part, the part essential for the collection of revenue and also his proposals with regard to agriculture.
There is, however, one part of the right hon. Gentleman's scheme of finance which I think is a novelty. He is the first Chancellor of the Exchequer who has ever budgeted for a great deficit for his successor. He has accumulated something which he calls a Suspensory Fund which will carry the Exchequer through this year, next year, and half the following year, but the time will come when the country will have to finance a burden of £36,000,000 with something like £20,000,000 or £22,000,000. Someone will have to find that £14,000,000. The right hon. Gentleman has taken away some indirect taxes. To that extent, he will cripple his successor. On these benches, we have always voted for the abolition of the Tea Duty, and that is a matter on which we cannot quarrel with the right hon. Gentleman. But somebody sitting in his place will have to deal with this problem at a later date; and I understand from the newspapers that, if the present Government have a majority at the next election, the right hon. Gentleman does not contemplate continuing his financial responsibilities. Therefore, someone will have to find this money, and I cannot recall a single case in which the Finance Minister of this country has made arrangements for expenditure which left a deficit to be provided for by his successor. At least, £14,000,000 will have to be found. The right hon. Gentleman says there is the natural growth of the revenue, but the natural growth of the revenue has never been hypothecated two or three years in advance, and it is quite possible to have a reduction in the amount of the Income Tax without having a real reduction in revenue. If, for instance, you have a fall in prices, if in the next few years you get the same 76 basis of prices as before the War, you might have a smaller Income Tax, while at the same time the country was enjoying greater prosperity. The Chancellor of the Exchequer has not taken any of these things into account. He has budgeted for a deficit to be met two or three years hence by his successor. I know it is not usual on these occasions to enter into any criticisms, and I would not have done so if the right hon. Gentleman had not made special reference to two or three matters for which I am responsible. I enjoyed his jokes very much. I think they were worth three weeks' preparation. I am, however, in complete agreement with those who, knowing what is in the Budget, hold the opinion that from the point of view of dealing with a very grave situation in the country it is extremely disappointing.
§ Question put, and agreed to.