HC Deb 06 May 1931 vol 252 cc466-527

Postponed Proceeding resumed on Question, That there shall be charged for the financial year ending the thirty-first day of March, nineteen hundred and thirty-four, and for every subsequent financial year, a tax at the rate of one penny for each pound of the land value of every unit of land in Great Britain."—[Mr. P. Snowden.]

Question again proposed.


I will not go on any further about mortgages. I think I have explained the position quite clearly. I want to remind the Committee that this is not the first Land Tax Bill that has been brought forward. We have had a Land Tax before, in 1798. I have looked it up and I find that there are certain exemptions in it. I think it was put at 4s. in the £. It was an annual tax and it was put on to various counties. Lancashire, for instance, had to pay £20,989 14s. 6½d. during the year. The City of London had to pay £123,399 5s. 5d. The collectors were paid 3d. in the £ for all the money they collected, and the tax was redeemable. One of its provisions was: Provided that nothing in this Act contained shall extend to charge any college or hall in either of the two Universities, Oxford or Cambridge, or the Colleges of Windsor, Eton, Winton, Westminster or the Corporation of the Governors of the Charity for the Relief of the Poor Widows and the Children of the Clergy. I mention that because in the present proposal these college" are not exempted at all, and a very heavy burden indeed will come on to them and on to the Universities. I do not know whether the hon. Gentleman would consider the relief of the children of the clergy, that is, whether he would consider the relief from taxation of the various vicarages and rectories, because the example might well be taken from this old tax.

Hon. Members opposite seem to think this is a popular proposal. I can assure them that it is not nearly as popular, when it is explained, as they imagine. I can tell my constituents that we have been discussing the question whether in three or four years' time we shall or shall not pay a penny tax on land values all over the country, and they will say, "Why do you not talk about unemployment or about the boycott in India? Why do you talk about things like the taxation of land values? How is it going to affect us?" My answer to them is that they will get a lot of forms and that there will be a very large number of civil servants and apprenticed valuers all over the country. They will have to send in returns of all the mills in Lancashire and will have an extra burden put on so as to take away the advantage that the Derating Act gives them. I do not think this is going to be the election cry that the Chancellor of the Exchequer thinks it will be. I feel quite sure that, if the Government go to the country on this Bill, they will not get another mandate. They will be asked why they talk about things like that when the real thing they ought to be talking about is unemployment.


I think the hon. Gentleman was in the House when we discussed the De-rating Act, and I am surprised that he should make the statement he has just made. He spoke of the advantages that have come from it. The late Lord Advocate had to admit that the only advantage of de-rating would go to the landlords. [Interruption.] I challenge hon. Members to deny that that was the statement made by the late Lord Advocate, speaking on behalf of the Government.


It is quite easy to challenge that statement.


I will read the statement.


We are talking about the taxation of land values.


The hon. and gallant Member was talking about the advantages of de-rating. This is what the late Lord Advocate said: I do not want to argue at length the question of whether a benefit like this ultimately goes to the landlord or not. My humble view is that it certainly does."—[OFFICIAL REPORT, 11th March, 1929; col. 909, Vol. 226.]


Was the Lord Advocate referring to the de-rating of agricultural land or to the de-rating of factories?


He was just dealing with de-rating. We have been hearing a lot about the wonderful things that people with land have done to bring benefit to the community. A few minutes ago we heard about flats in London. I admit that there are a lot of flats in London. When I wanted to get a place to live in here, I started to look for a flat, and I discovered some of the great advantages of having a landlord. In the end I was compelled to take three small box rooms at the top of three storeys. When a omnibus passed, the whole place shook. I had to pay £125 rent. The stairs were 3 feet 9 inches wide. These are some of the beautiful advantages that accrue from this far-sighted landowner in the past. Of course, he would not take the risk of putting his money into business. He put it into something that was sure and secure. Let us see what the landlord system has done in recent times for the business community of London. We read in the Press of a building lease for 99 years on a site in Oxford Street at a rental of £20,000 per annum for two years and £30,000 per annum thereafter. That is only for 99 years. When that date arrives, the Duke will come along and make some fresh arrangement, put Gamages out of business and take away the results of their business organisation. The Duke of Westminster, by abstaining from putting his money into business, has succeeded in shoving someone else out of it.

The whole of this proposal is another instance of the ever-growing demand for land. Private ownership is not known to the law. As a technical point of law, land is not subject to absolute ownership but to tenure held directly or indirectly from the Crown. That applies to tenure in the name of the King in Scotland and does not apply to English conditions. The chief holds his stewardship under the King, but the King system in Scotland has been altered by subinfeudation. The means used in these demands brought the need for drastic methods. When they tried drastic methods, they were always beaten by the other fellow with more money who could get a man with a more acute legal mind to deal with what had previously been drafted by a lawyer. The system that developed, in the attempts to get away from the landlord by subinfeudation, resulted in the landlords beginning to realise that the other people were getting away, and they had to pass another law to get the people back into the fold.

What we are discussing to-day relates to present conditions in regard to unemployment. The basis of unemployment is the power to divorce people from land. Whenever you do that, you get unemployment. When you close the land you open the Employment Exchanges. You cannot get away from that fact. We have been paying £1,000,000 a week insurance while trying to get men on to the land. Then you find that the gentlemen in the other place have been destroying the Agricultural Land (Utilisation) Bill. I have noticed that everything remains pretty smooth in our Debates until you touch land. You have only to stand at the Bar in the other place to see the change in character and in mood whenever the question of land is reached. Yet here we are, facing this £1,000,000 per week and trying by Bills to get something done in relation to land, and being met always by this constant barrier of landlords saying that they are owners, while in law they are not. All this has taken place in regard to land in its connection with unemployment. I look upon unemployment payments as a pay-off against revolution, because, if you are not going to have reforms, you are going to have revolution. There are no two ways about it, especially in the state in which this country is at the present time.


I have tried to give the utmost liberty in this Debate, similar to what is given in a Second Beading Debate, but there are obvious limitations to what can be discussed on a Second Reading of a Bill. I must ask the hon. Member to confine his remarks more to the subject of the Motion before the Committee.


I was only relating unemployment to what is being done in regard to the land. If we had not paid the money there would have been revolution. If you take the history of land taxation in this country, you find that it was the land basis in the past that always led to riots. The Parliament Act was the result of all of it. That Act was passed to save the Commons against the landlords. Taxation I believe to be the key to freeing the land at present, in order that we may have a greater access to land, and therefore greater flexibility in moving our industries from time to time.

Scotland has some of the blackest pages in the history of the world, in regard to the treatment of the people on the land. Scotland has twice passed a Valuation Bill, which has each time been killed in the other House. The agitation as to the taxation of land values really began in a serious form in Glasgow. The Glasgow Corporation started the agitation, so far as local authorities are concerned. The 1910 agitation grew out of the Scottish agitation; I do not think there is any doubt about that. It was Sir Henry Campbell Bannerman, a Scotsman, who took up the case of agitation in Glasgow and who used it. Might I just quote an example to show what makes Glasgow so bitter, in regard to its attitude on this question of the taxation of land values? The Glasgow people desired to get good drinking water on one occasion, and the Glasgow citizens had to pay the landlords a sum of £106,820 for the right to use the water for domestic purposes. That was for just the water, not the land.

Last week, when I was at the Bar of the other place—[Interruption]—hon. Members opposite all seem familiar with the other "bar" of the House—I there saw the son of the owner of the land-of whom I am speaking, protesting against those parts of the Agricultural Land (Utilisation) Bill which Would have given people access to the land. The people have always to pay for every little improvement they make in Glasgow. When they make an improvement they are always improving the power of the landlord to increase his drawings. For instance, take the case of the Scottish wholesale co-operative movement, a working-class movement. In 1925, the Scottish Co-operative Wholesale Society issued a report in respect of certain expenditure upon land. It pointed out that when the Scottish Co-operative Wholesale Society bought land in Glasgow, to put up works, in 1887, it paid £500 per acre. In 1914, desiring to extend their premises by one-and-a-half acres, they had to pay, not £500 an acre, but £2,000 per acre. In 1815 another extension became necessary over about three acres, and the Scottish Co-operative Wholesale Society had to pay, not £2,000 per acre, but £5,600 per acre. The landlords were scooping up a bit of the dividend that other people should have had. That is exactly what the principle we are discussing to-day is intended to deal with. The reform must come. The feu duties must not escape the tax.

The "Lloyd George Budget" that has been described to-day was a failure. Only one of its taxes was a land valuation tax, and the whole of his scheme was ruined by concessions made to the Tories. That is the thing that has to be watched from our Front Bench. We have to see that there is no giving away what we are fighting for. When I get up to fight for something, I am going to fight for it to a finish, and take the result. That is a warning to everyone who is in charge of affairs in connection with this Finance Bill. How does this matter affect Scotland? We desire to speed up the valuation. We cannot understand that it has to take all this time to value the land, and we are very apprehensive of the present proposals. In Scotland we have a system of registering all changing of land for a long time back, and we could begin right away by taking that registration as part of the machine that is going to do the work. I do not see why those who are looking at this think as if it were going to be a tremendous lot of trouble, should look to Scotland as giving any trouble at all. Four months should be quite ample to go through all those proofs, and you could start off the moment that that was finished. You would have completed your valuation.

I quite agree with the hon. Member for Burslem (Mr. MacLaren) that we should not have to pay for valuation at all. We ought to do just as we do with regard to Income Tax. We send out a form and ask a man to declare his income, and we should ask him to declare what land he owns. In that way, you can get the thing done in six months. We shall be told that some people would return their land at a penny. That could be prevented by a Clause in the Bill. I object, as a Scotsman, that an arrangement which has already been working for so long should not be used, and I object to Scotland being dragged after England in this matter. There is no need for Scotland to have to wait all this time for its valuation. I am sorry the Lord Advocate is not here, but I hope he is going to see to it that, in so far as this machinery exists, it should be brought in right away in order to speed up things.

We have to get something in the form of a separate instrument to deal with Scotland. If we do not, and if we have to wait until England is through, we may have to take up the English system, which will not work. The land laws of England would not work in Scotland at all. There is so much of the Roman law in Scottish law. Also, it is going to take a different type of surveyor and valuer to deal with the question of valuation in Scotland. I am hoping that the Scottish Office is going to see that we are not left, so far as that is concerned. I am quite sure that the question of the ground-annual will be brought up, and will be mixed with the new duties. I want to make a quotation in regard to the exemption of feu or ground-annual. The ground-annual, or feu, is paid by a vassal by way of a sum of money, as trustee for the King. In regard to the case of Scott v. Edmond, 1850, 12D. 107V, Lord Blackburn said: I think it is established by a long series of authorities, ending with Scott v. Edmond, that the obligation created by a Clause in relief in a feu-charter worded in terms such as these does not apply to burdens or taxes imposed by future or supervening laws. That, I think, makes the position quite clear, so far as the legal point is concerned. I do not think there is anyone in this House who doubts the character and ability of Lord Blackburn, or would care to challenge what he said.

8.0 p.m.

So far as the feu is different from the ground-annual, the practice of feu was described by Professor Bell in his lecture on conveyancing. In that lecture, it is stated that the valuation duties in the Finance Act of 1909–10 laid it down that both duty and ground-annual are included in the expression "feu." So there can be argument in relation to the feu duty, or in relation to the ground-annual. All these things have a real basis in Scottish law. I hope that the Scottish Office will see that the question of registration of feus will be one that will give immediate satisfaction. The position as far as England is concerned, is much more involved. In view of the information which we have in Scotland we should be able inside six months to say that the valuation was finished. In regard to Edinburgh, where those values have been said to operate, I can give the following example: The town council of Edinburgh required land for the erection of gasworks in the neighbourhood of Granton. The land belonged to the Duke of Buccleuch, and comprised 105 acres, partly built on, and rated on an average at £5 10s. per acre. At 30 years' purchase of the assessed value the price would have been £165 per acre, and the total price for the land £17,325. The town council paid the Duke of Buccleuch £124,000 or 214 years' purchase. I can give hundreds of those cases.


Can the hon. Member justify the example?


It was the town council of Edinburgh who purchased the land in order that they could build a gasworks.


This property was developed at great expense by my great grandfather, as a result of which it appreciated in value, and the town council of Edinburgh have since agreed that they made a very good bargain in their favour by purchasing. If the hon. Member wishes any further statement, I have the whole thing here and he can see it afterwards.




The hon. Member has told us that his great grandfather created the ground value. He has not listened to what I read. What I read was, the difference between what you pay and what you get. The land belonged, as I said, to the Duke of Buccleuch and consisted of 105 acres partly built upon and rated at an average of £5 10s an acre. It is generally held that land is acquired on 20 years' purchase. At 30 years' purchase on the assessed value the price would be £165 an acre, and the total price for the land would be £17,000, but the town council had to pay £124,000.

Earl of DALKEITHrose


I think that as the Noble Lord assumes that he has been attacked, it might be better if I called upon him as the next speaker to follow the hon. Member.


He knows that: If every man had his ain coo', There wadna be the Duke o' Buccleuch.


I deny that I am attacking any Member of this Committee. I am attacking the system, and I am showing, from the records of the Edinburgh Corporation, what took place. If the hon. Member has any quarrel with the statement he must see the corporation of Edinburgh. I am not taking the responsibility for it.


I want to make it quite clear that certain references have been made to the Noble Lord, and he claims the right to reply. I think that it is the custom in this House that when a reference is made to an hon. Member the hon. Member concerned is entitled to reply to it.


I am not quarrelling with the Noble Lord but with the system, and I am showing the need for this taxation, and that this particular land would not have reached such a value were it not for the fact that the population of Edinburgh was increasing and the land was desired in connection with the erection of a gasworks to meet the requirements of the population. That is my point. If a piece of land out on the Sahara were owned by any Noble Lord it would remain of the same value until someone began to get round it or to use it. I am not attacking anyone, only the system. It is fortunate that the Edinburgh Corporation have this example on record. I did not realise that the Noble Lord was the person alluded to. There are a great many more instances which I could give. I hope that those in charge of this matter on the Front Bench will see to it, since there is this difference existing in Scotland and since we can facilitate matters as far as actual valuation is concerned, that the feu duties do not escape. We must get right into that question, and perhaps on the later stages of this proposal we may be able to obtain some further details from the Scottish Office.


I regret that I have been called upon to reply to the charge which has been made with regard to a development in Edinburgh. This attack has been made so frequently in the past few years by Socialist speakers in my own constituency and at General Elections, that I brought the papers in connection with the matter with me today. In order to improve trade and employment, a very long time ago, a capital sum amounting to £520,000 was spent upon the development of this district by an individual. It is true that a portion of that land was sold, as has been indicated, to the Edinburgh Town Council. If the hon. Member for Springburn (Mr. Hardie) has any fault to find, I have the complete information here, or he can obtain it from the Edinburgh Town Council. I feel quite sure, on the evidence which I possess, that he is unjustified in making any charge against the family, or in using that illustration in favour of this particular Bill.


Do I understand the Noble Lord to say that £520,000 was spent on this property which was afterwards sold for £124,000?


That is not exactly what I said.


Then what is the point?


The hon. Member for Springburn tried to assure us that the valuation required for the proposal was very simple in Scotland, and, in fact, was almost ready now. Although there is a valuation and although there may be records of certain sales which have taken place, it cannot be assumed that the valuation would be carried out as easily as he suggested. The difficulties and complications are just as great there as in England, and the cost would also be very great. I suggest that the Government would deserve far greater support for their proposal if it was really designed to deal with, and would succeed in dealing with, certain cases of exploitation in the sale of land, especially the sale of land for the use of the community. It has already been shown that the result will be quite different and that the method will be entirely wrong. Very exaggerated statements have been made from the benches opposite about the difficulty of acquiring land for building, and the high cost of housing schemes being due to the price of land. The Unionist party have taken, or supported, action since the War to make it easier for local authorities to acquire land at a reasonable cost, and it is fair to say that at the present time no difficulty exists where it can be shown that it is for the welfare of the people. Examples have been quoted of very large sums being given for small plots of ground. If further legislation were needed, I am sure that the Chancellor of the Exchequer would receive our assistance if he produced a method of dealing with the matter without causing an injurious and unjust effect in other directions.

I have looked up the figures for the recent housing schemes in the largest town in my constituency. I find that the proportion of weekly rent which is due to the price paid for the land works out in one scheme at a 1½d. out of 7s. 9d., equal to one fifty-eighth part of the weekly rent, and in another scheme it is a fraction over a penny out of 7s. 3½d., which is equal to one-eightieth part of the cost of the weekly rent. In other words less than one-fiftieth and one-eightieth respectively were due to the cost of land. I mention this fact because I think it will dispose of the very general charge made in regard to housing schemes, that out of the total cost, the cost of land is prohibitive, or at any rate comprises a very large proportion of the cost of the houses. This is evidence which shows that there is not the difficulty in acquiring land that has been suggested by hon. Members opposite, and I feel that if they will investigate the different items which go to the total cost they will find, in far more cases than they believe, that the cost of land is much smaller than is understood to be the case.

So many questions have been put to which answers have been withheld, that it is difficult to judge the merits of the proposal. I hope that the Government will not prejudge the wisdom of the course we are pursuing, and that they are not committed too deeply, because I feel that if they will consider the arguments on their merits, rather than the loose statements that are being made in support of their case, they will come to the conclusion that this proposal should be withdrawn. I have only one reason for welcoming the proposal, and that is that we shall have open discussion in the House. I feel confident that the House will feel convinced that the proposal is thoroughly unsound, and that it will be withdrawn for good.

As a member of a family still owning a considerable estate, chiefly agricultural, in Scotland, I feel entitled to challenge and deny the assumption so freely made about landowners, especially dukes, and the use of the land for which they are responsible. I feel justified in taking exception to the attacks upon landowners and the insinuations that their land is habitually used to the disadvantage of the community. When attacks are made upon the larger estates, I may in fairness point out that in the case of typical agricultural estates such as ours, it is largely because of their size that they can be efficiently equipped, maintained and worked for the use of those farming the land, and for other useful purposes. Although the Prime Minister spoke of ignorant landlordism in his May day speech, it can hardly be disputed that landowners in the past have developed their land with advantage to the community. They have done so and provided capital, in addition to paying large taxation to the Exchequer, far more economically than in those cases, so often quoted, where experiments on the land by the State have only resulted in large cost to the community. The charge of ignorance is, therefore, hardly to be laid upon the landowners in preference to Government officials. Recently, higher taxation has brought about a change, and many landowners discouraged by threats of vindictive action by the Socialist party may perhaps have some sense in anticipating the further burden proposed this week.

A number of hon. Members have talked as if this tax of one penny in the £ will be only a tax on land, ignoring the fact that Income Tax and Super-tax may be paid up to an amount of 12s. in the £, with Death Duties in addition. Where the new tax is levied on agricultural land it will amount in Income Tax to 1s. 8d. in the £. That is the policy adopted by the Socialist Government to prevent the maintenance and equipment necessary for this land. The landowner is paying his share and rightly objects to being singled out for unequal and penal taxation. There can be no doubt that some agricultural land will be exempt and some will not. In any case, in Scotland, if a fair deduction was made for owners' improvements, there would be no value left for taxation, but sometimes there would be a minus. Where agricultural land is exempt the difficulties and anomalies of discrimination by the valuer will be enormous, and by its very exemption the principles on which the tax is based are broken. Where it is not exempt, it will rest entirely upon the opinion of the tax gatherer and valuer as to whether the land should or might be built upon, and it will be taxed upon the value that he puts upon it, and will be a further tax upon the production of food.

Apparently, even where agricultural land is exempt, it is not from any wish to help agriculture, but only because it would cost the country even more than we believe the rest of the scheme will do. It is not from any love for the landlords. We are accustomed to much propaganda about land monoply, which is no longer justified, and we are accustomed to much abuse of landlords, despite the evidence that they do take great interest in the proper use of their land. We get no credit for development which is entirely due to individual enterprise. Respect is due to those who invest their capital in the land of this country, which helps employment, where it is heavily taxed, rather than in foreign investments where it only helps foreign employment.

We understand that where a private owner has provided allotments, or cricket grounds, or football grounds, or playing fields at a nominal rent in. the vicinity of towns, this land will in future be liable to heavy taxation, whereas if it belongs to a local authority it will escape. That will surely be a very heavy blow to the allotment holders and those cricket and football clubs and others who just manage to pay their way annually. The tax will have to be passed on to them, or will the Chancellor of the Exchequer show a way in which it can be avoided? I hope the Committee will resist this iniquitous proposal. Will the Government tell us whether their real object is revenue or revenge, and whether the effect is likely to be no improvement whatsoever or confiscation? It is certainly no business proposition.

The Chancellor of the Exchequer has a considerable reputation for business capacity and he must be aware that this is not a business transaction. The hon. Member for Kincardine (Mr. Scott) and other Scottish speakers suggest that the immense revenue from the tax will provide relief in taxation. That is impossible. The Chancellor of the Exchequer himself is doubtful. He does not mind if it fails to produce revenue. There seems no doubt that the whole object of this proceeding is confiscation of the land, or even Socialist control. The Chancellor of the Exchequer, speaking at Paisley in 1925, made his views quite clear and showed that he would destroy private landlordism root and branch. Evidently this is the scheme of taxation by which he hopes to bring that about. If he does intend confiscation, can he not say so direct and can we not have done with this bargaining, and let the Liberal party choose whether they wish to submit to State control? Whenever they are challenged they deny that they support nationalisation of the land, but by their actions they try to make any other system of land tenure impossible.

The object of the tax is political. It is a political bribe to Liberals, to faddists and fanatics. The Chancellor of the Exchequer thinks that the Liberal party will swallow this bait at one gulp and as soon as he has finished with any necessity for their support he will complete nationalisation as soon as he can. Surely at this stage, during these years of difficulty following the War, the Government, if they have any intention of solving the internal troubles of the country and avoiding keeping up internecine strife, will withdraw this proposal, which cannot possibly have any effect in helping the country. I suggest, after all the arguments that have been brought forward by hon. Members on this side, that the time has come when they should withdraw the proposal.


The Noble Lord who has just resumed his seat has suggested that the proposals of the Chancellor of the Exchequer are designed for confiscation purposes. I can assure him that they are designed for no purpose of the kind. They are designed to prevent the confiscation of socially produced values by the landowning section of the community. This Debate has been interesting for a number of reasons. It has been interesting to see the way in which the proposals of the Chancellor have been accepted by the Committee. It would have been impossible a few years ago for proposals for the taxation of land values to have been received by a Committee of the House of Commons with the lack of excitement, almost the lack of interest, which has characterised the Debate during the two days which have been devoted to this topic. When we look at the present atmosphere of the Committee, the hectic days of 1910 are indeed a very long way behind.

I am rather at a loss to understand the attitude of the Conservative party towards these proposals. The right hon. Member for South Croydon (Sir W. Mitchell-Thomson) said that things have changed since 1910. They have indeed changed, and in no respect have they changed more than in the profound change that has come over public opinion on the matter of the taxation of land values. It is possible that that fact has something to do with the attitude of the Opposition, so far as it has been revealed in the Debate of the last two days. Up to the present we have seen very little conviction and no enthusiasm at all on the other side of the Committee, and it may be that hon. Members opposite are reserving their resistance to the proposals to a later stage. If I were to hazard a guess at the tactics of the Opposition, it is that later on their policy will be to do all they can to restrict the scope of this new taxation and enlarge the range of the exemptions and exceptions. If that be the case, as I imagine it will be, I can only express the hope that the Chancellor of the Exchequer will resist to the fullest extent that kind of tactics, as I have no doubt he will.

Another rather interesting feature of the Debate has been the comparative absence of references to speeches made some years ago by the right hon. Member for Epping (Mr. Churchill) the ex-Chancellor of the Exchequer. It has been very noticeable that although the right hon. Gentleman displayed a very considerable interest in the proposals for rating and the taxation of land values a few years ago, he has not graced these Debates by his presence this week. It is true that this afternoon, while the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George) was speaking, his form flitted across the scene for a few brief moments and then disappeared. When I turn to the speeches of the right hon. Gentleman the ex-Chancellor of the Exchequer I find there a good deal not only to interest, but also to instruct and inspire me on this question.

The hon. Member for Burslem (Mr. MacLaren) ventured to give one or two quotations from speeches made by the ex-Chancellor of the Exchequer. I have one here. It is an extract from a speech delivered at Edinburgh in 1910, in which the right hon. Gentleman referred to the enrichment which comes to the landlord as the result of social effort. He spoke about the improvements of various kinds made at the public expense, many of them made at the expense of local authorities, and the right hon. Gentleman said: Everyone of these improvements is effected by the labour and at the cost of other people, many of the most important are effected at the cost of the municipality and the ratepayer. To not one of these improvements does the land monopolist, as a land monopolist, contribute, and yet by everyone of them the value of his land is sensibly enhanced. He renders no service to the community, he contributes nothing even to the process from which his own enrichment is derived.


What is the date of that?


It is the year 1910.


It related to Increment Duty, which is entirely different from the present proposal.


At the time this speech was made, the ex-Chancellor of the Exchequer was a whole-hearted supporter of the full policy of the taxation of land values for local municipal purposes, and while the ex-Chancellor has frequently changed his political views and his political attachments since that time, this statement is just as true to-day as it was in the year 1910 when the speech was made.


It has no relevance to the proposals of the Chancellor of the Exchequer.


There is a quite unanswerable case to be made out for these proposals, and the case is un-answerable, because it is the universal need of man for land which is the sole source of land value. I know of no other factor which contributes to the rising value of land but the universal need of mankind for the use of land, and, after all, private ownership of land itself can confer no sort or kind of advantage on the landlord. Suppose the whole area of these islands were in the possession of one landowner, and that this one landowner was the only inhabitant of these islands. That one landowner might possibly maintain for himself a standard of living very much like that which was maintained on his desert island by Robinson Crusoe—although I am not quite so sure about that, because Robinson Crusoe possessed qualities of initiative and enterprise, foresight and forethought, which are not always present in the modern landowner—but even in such a situation as that the fact that one man possessed the whole area of these islands would mean very little to him.

The fact of the matter is that it is not the ownership of land in itself which confers an advantage. Ownership merely represents a power which the private owners of land possess to levy a continual tribute on social production. The right hon. Member for Tamworth (Sir A. Steel-Maitland) has told the Committee that as far as the Conservative party are concerned they are willing that betterment should be taken, but if we take the betterment which accrues on certain land, it does not really affect the problem with which the Chancellor of the Exchequer is now endeavouring to deal. It is not merely a question of betterment. We are agreed that, where betterment exists, it should be taken for the community and used for the purposes of the community. But what we are most concerned about is to prevent this tribute being exacted from the community by the owners of the soil. I believe that one of the greatest, perhaps the greatest of all social scandals of to-day, is the steady appropriation by landowners of the accumulated resources of human energy and enterprise as expressed in steadily rising land values.

That is the general case in support of these proposals. There is one matter however which ought to be cleared up before these Debates conclude. From a statement made by the Financial Secretary on Monday it would appear that certain classes of agricultural land are to be exempted from the valuation proposals. I did not gather, however, from the statement of the Chancellor of the Exchequer that such was to be the case. I hope that the position which I understood the Chancellor of the Exchequer to take up on Monday, is to be regarded as the correct position as far as the general valuation is concerned. I see no reason for excluding any type of land from the valuation proposals. The nation has a right to know the total value of the national estate. I hope that the valuation will be complete, that it will make public for the first time the value of the national estate, and that it will admit of no exceptions or exemptions whatever. I was also glad to hear the Chancellor of the Exchequer express the hope that when the valuation was complete, it would be made the basis for the purchase of land by local authorities and—what I regard as even more important—for the transference of local rates from houses and improvements.

I share the right hon. Gentleman's hope. It is a good many years since I was instrumental in getting passed through the Bradford city council, a resolution asking Parliament to give power to local authorities to levy rates on the basis of land values. The matter was urgent at that time. It is even more urgent to-day, because of the recent considerable increase in local rates. I have never taken up the attitude which some people—I think, mistakenly—take, that it does not matter how high local rates are as long as the citizens are getting value for the money which is expended in that way. I think that is a fundamentally unsound position. I know, from experience, that high rates in a city like Bradford or Leeds constitute at the present time a heavy, and in some cases, an almost intolerable burden on large classes of the poorer ratepayers. While that is the case with regard to the poorer section of the community, there is another section which escapes its fair share of contribution to the local expenditure, and that is the landlord class. The landlord benefits most from municipal government, and contributes least towards its cost. In addition, as a result of the operation of the existing system of rating, municipalities are penalised in respect of their purchases of land, and also in respect of the loss in rates which they regularly sustain owing to the operation of the present system.


On a point of Order. Are we entitled on this Resolution to discuss the whole question of raising rates upon land values? In connection with that point, may I call your attention, Mr. Dunnico, to the fact that your predecessor in the Chair ruled that this question was outside the scope of the present Debate.


On that point of Order. May I point out that the Chancellor of the Exchequer in his original speech on Monday, referred to the value which this valuation would have in relation to rating?


May I also call attention to the fact that the Chancellor of the Exchequer only made a passing reference, almost in parenthesis, to the fact that some day he hoped to utilise this valuation for the purpose of raising rates on land values?


I said some time ago that I looked upon this Debate as being in the nature of a Second Reading Debate, and on the Second Reading of a Bill a rather wider latitude is given, as to the discussion of general principles. I am afraid it is now rather too late in the Debate to try to restrict it. The Chancellor of the Exchequer in his opening statement did suggest that one of the underlying reasons for this Resolution was to permit such a thing as has been mentioned to take place, and I cannot prevent any hon. Member from arguing that it is advisable or inadvisable for it to take place. Therefore, I think that the hon. Member for West Leeds (Mr. Stamford) is in order.


I am obliged, Mr. Dunnico, for your ruling. After all, there is no good in having a valuation of land unless it is intended to put it to some use, and I was merely discussing one of the possible uses to which it might be put. I was referring to the difficulties experienced by local authorities in relation to land purchase, and I was about to give an example from my own experience. When I was a member of the Bradford City Council, that body contemplated the purchase of a rather large piece of land. We approached the owner who informed us that the selling price was £18,500. We then went to the local valuation office and inquired as to the value of the land, according to the conclusions of the official valuer. We found that the value placed upon the land by the official valuer was £5,000. We then made inquiries at the office of the city treasurer to ascertain how this piece of land stood in the Tate books of the corporation. The information that I got was the rather startling information that the piece of land for which the owner demanded from the corporation £18,500 stood in the ratebooks of the corporation as if its value were £110 10s. There is only one comment to be made on a case like that. If the land were worth what the owner said it was worth, it should have been paying local rates on the basis of that valuation; if, alternatively, it was worth what it was represented to be worth in the rate books of Bradford Corporation, the local authority ought to have had the power to compel the owner to sell his land to the corporation at that price.

Some little time ago the City Corporation of Sheffield published some figures relating to its recent land transactions, from which it appeared that during the last 24 years Sheffield had acquired 1,010 acres of land for public purposes. The price-which it had to pay was £245,540, and the rates levied upon that land totalled £1,329. With instances like that, which could be multiplied over and over again and which are within the knowledge of every Member of this House who has ever sat on a local authority, the case for some change in the basis of local rating is absolutely complete and overwhelming; and I again express the hope that later on, when the valuation is complete, the local authorities will be empowered to take that valuation as the basis for local rating purposes. I am certain that it would represent the biggest revolution that has ever been made in the history of local government in this country.

Let me turn to what is, I think, the main objection urged from the other side to the proposals of the Chancellor of the Exchequer. An hon. Member on Monday evening put his objection in these words: My great objection to this tax is that it will inevitably be a tax on industry, and a very great tax at that."—[OFFICIAL, REPORT, 4th May, 1931; col. 150, Vol. 252.] The right hon. Gentleman who opened the Debate to-day repeated that objection in rather different words. I am rather at a loss to understand exactly what ground the Conservative party is choosing for its fight on these valuation and taxation proposals. We are told, on the one hand, that their effect will be to increase the cost of production and the cost of commodities; on the other hand, there have been arguments advanced from the other side to the effect that this new tax will be a grievous burden on the landowners of Great Britain. I imagine that it is impossible for the Conservative party to have it both ways. Either this tax rests where it is put, or it does not. If it rests where it is put, on the landowner, it does not increase the cost of production and it does not tend to increase the cost of commodities; if it does pass from the landowner into industry, I cannot understand a part of the argument from the other side or the bitter opposition to these proposals displayed by the Land Union of Great Britain. They, at any rate, are under no illusion with regard to it; they know quite well, as we have been told by economists for very many years past, that one of the virtues of a tax on land values is that it stays where it is put, that it stays on the landowner, and it is impossible that it should be otherwise.

It is very difficult to present the case in a brief and at the same time simple way, but I will try to do so. The price of a commodity is fixed by the relation of supply and demand. If the supply of a commodity is ample and the demand is small, the price will be low; if, on the other hand, the supply of a commodity is limited, either by monopoly or in any other way, and the demand for the commodity is very considerable, then the price will be high. That is why protective tariffs tend to increase the cost of production and the price of the article to the consumer, but that does not apply to a tax on land values. It cannot. A tax on land values cannot be passed on, for the very simple reason that it does nothing to diminish the supply or to increase the demand. The demand for land is fixed. It cannot be altered. It remains precisely what it was before the tax was imposed.

The demand for land is fixed by the size and demand of the population for land, and there is nothing in the imposition of a tax on land values that in any way alters the extent of that demand. On the other hand, what we claim for a tax on land values is that it does tend to increase the available supply of land. If I happened to be a landowner, which, fortunately or otherwise, I am not, I am certain that I should find it much easier to hold land out of its full use in the absence of a tax than if a tax is actually in operation. [HON. MEMBERS: "Hear, hear!"] If it is agreed on the other side, as apparently it is in some quarters, that the effect of a tax on land values is to increase the available supply, and if the tax does nothing to increase the demand, then the effect of the taxation of land values must be lower rents and cheaper land. If there is any flaw in that argument, if it is an unsound argument, I should like one of the hon. Members opposite to tell us plainly and simply where the flaw lies and where the unsoundness of that argument is.

May I now turn to one rather wider consideration? This proposed tax on land values is not, as many Members on the other side appear to imagine, an additional tax. It is an alternative tax. It is a form of taxation which will provide revenue without hampering and hurting industry. [Interruption.] That, at any rate, is the claim that we make for it. The biggest problem, the gravest problem, the most tragic problem with which society is faced at the present moment, without any question at all, is the problem of the unemployment of upwards of 2,000,000 decent working people in this country. It is a problem that up to now has baffled the attempts of every political party to deal with it, and I believe that it will continue to baffle the attempts of all who would wish to settle it until the roots of that problem are found and cut away. At the root of the problem of unemployment, I believe, is to be found the problem of land monopoly. It is the worst of all monopolies, because it is the monopoly of the source of all wealth, of all production and of all life.

Unemployment, the poverty of the people, is part of the price that society has to pay for the denial of common rights to land. I believe those rights can be enforced by the instrument of taxation, and I see in the proposals of the Chancellor of the Exchequer a beginning towards that end. I see in them the beginning of the opening of an attack on the age-long established private land monopoly. I see in them the beginning of the socialisation of economic rent, a necessary first step if the community is to retain the advantage of other forms of socialisation, and I congratulate the Chancellor of the Exchequer on his good fortune in having his name associated with what, I believe, will in future be recognised to be one of the biggest, most important and far-reaching reforms ever submitted to the House of Commons.


The right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George), if I understood his speech aright, teemed to deprecate anyone, save those on our Front Bench, who were his colleagues during the Coalition, attacking that wide and vulnerable front which represents his long Parliamentary career. I do not know whether I come within the category of what he terms "pip-squeaks." Everyone must acknowledge that is a highly reprehensible and discourteous way of referring to any of his colleagues in this House, but I represent a constituency just as much as the right hon. Member for Carnarvon Boroughs, and although his constituency may be a better judge of men, it is obvious that my constituency is a better judge of measures. I claim the same right to criticise him as any occupant of our Front Bench. He pointed out that we cannot expect the Government at this stage to supply us with any details of this tax. We fully appreciate that, but what we want is more elucidation of the principle that is enforced by this Measure. The right hon. Gentleman the Member for Carnarvon Boroughs, in recommending it-to the Committee, reminded me of that historic company promoter who, just before the bursting of the South Sea Bubble, when speculative fever was at its height in the City, invited the public to subscribe to an enterprise, the nature of which he subsequently revealed. It is preposterous that any Member in any part of the House should be asked to go into any particular Lobby to vote on this tax until we know a little more about it.

9.0. p.m.

I want to ask the Solicitor-General how far the principle of this tax fits in or conflicts with principles which are contained in Measures which are on the Statute Book, and in one in particular which is going through the House at the present time. Before I do so, I should like him to give the Committee a definition. We have heard a certain phrase used perpetually from the very start of this campaign for the taxation of site values. It is a phrase which the Chancellor of the Exchequer employed in his opening speech a few days ago, and it is a phrase which even the Solicitor-General, with all his legal acumen, will have considerable difficulty in defining. It is the phrase "The people." We have heard the Chancellor of the Exchequer say that the Creator made the land for the people. According to this Measure, if I have real estate of the value of £119 I am a person, I am one of the people; but if that real estate is worth £121, then I am no longer a person; I have no longer my civic rights. One of the difficulties of this form of legislation is that it penalises—3 use the word "penalises," for it is a crime to own land—one section of the community in order to benefit another section. It is very interesting to read an extract from a speech made by the Chancellor of the Exchequer a long time ago, which was published in a leading article in "The Times" this morning. He was holding up to ridicule the right hon. Gentleman the Member for Carnarvon Boroughs, because he was making the distinction between two sections of the community as to who were the people and who were not. He said that the right hon. Member for Carnarvon Boroughs says: it is wrong for the rich man to take something which is the creation of the community, but it is not wrong for the poor man to do so. What we are going to say now is that it is not wrong for a man to steal from the community, provided his income is not more than £3 a week, but the moment he gets beyond that point he is a thief. What is the moral of all this? That the Chancellor of the Exchequer has found his land taxation to be an utter failure and the machinery set up impracticable. We are in the same difficulty. The hon. Member who spoke last wanted to know exactly the line we were going to take in attacking this Measure, but I should like to have fuller and better particulars. Nothing has emerged from the other side beyond the fact which we knew before, that they have an obsession against landlords. This obsession is disguised under the cloak of what appears to be a laudable ambition to benefit the community. I should be much more convinced if these strong champions of the taxation of site values were going to make sacrifices themselves. I should form a much higher opinion of their public spirit. Their anxiety to tax the landlords is derived more from a morbid obsession than from any charitable impulse.

The hon. and gallant Member for Wells (Major Muirhead) said that the Socialist party were most hopelessly out-of-date and old-fashioned, and I endorse that statement. In this campaign they seem to be completely ignorant of the great changes that have taken place since the right hon. Member for Carnarvon Boroughs first initiated his campaign in favour of the taxation of site values. Hon. Members opposite seem to be under the impression that the same great estates which existed in the original Domesday Book are in the same hands now, that great estates have not been split up, and that they do not change hands frequently at the present time. One hon. Member referred to the fact that he had found a tombstone in his cathedral of a Crusader whose name was exactly the same as that of the family which owned the land of this departed warrior at the present time. Let me assure hon. Members that, if great estates exist, they are now possessed not so much by the descendants of the Crusaders as by the descendants of those whose land aforetime the Crusaders invaded. Hon. Members opposite still think that great landlords are in the same situation as they were in when Dr. Johnson auctioned Barclay and Perkins' brewery. He went about at the auction saying, "I am not auctioning a couple of vats and a chimney stack, I am auctioning potentialities of wealth beyond the dreams of avarice." No landlord is in that position to-day. In the last 20 years Income Tax, Surtax and Estate Duties have appropriated a very large proportion of what hon. Members opposite call "unearned increment."

The hon. Member for Burslem (Mr. MacLaren) evidently ignores the fact that education has advanced, because he thinks the cry, "They are taxing food as opposed to taxing site values,' will go down with the people of the country at the next election. I can assure him that the people of this country are much too well educated to be gulled by such statements as that. Hon. Members opposite also ignore all recent legislation. Apart from such Acts as the Rent Restrictions Act, the Housing Act, 1930, the Land Drainage Act and the Agricultural Holdings Act, there is a town planning Measure which is receiving attention in Committee upstairs. I think at is very important that we should know how far the principle of the taxation of site values which is now before us conflicts with the principle contained in the Bill upstairs, because I believe that the provisions in the latter Bill for preventing the community being exploited by landlords is a much better method of achieving their end than that which is contained in the Measure now before us.

As several hon. Members on the other side of the Committee have instanced their own cases, perhaps I may quote mine. We all know more about our own individual cases, and probably we can make our points clearer in that way. I am the fortunate, or unfortunate, possessor of a small agricultural estate. Though it is small, it has a considerable length of boundary adjoining one of these arterial monstrosities which are defiling the amenities of the countryside. I have no doubt that when the emissaries of the Chancellor of the Exchequer start assessing my property under this scheme, if it is ever placed on the Statute Book, they will say that although it is agricultural land yet, with its frontage to the Oxford high road, it has potentialities of development which are other than agricultural. I would like hon. Members opposite, who have as good an eye for the main chance as I have, to put themselves in my situation. What would be my best course? Obviously it would be to develop that strip of country. But then what would happen under this other Measure which is upstairs? The Solicitor-General knows a great deal about the matter, and if he can convince me that I am wrong, I shall be only too delighted. The local authority, having made a scheme under Clause 5 of that Bill—if it becomes law—will claim that my development scheme does not conform to the provisions of theirs, and then, under Clause 12, they can insist that I shall remove or pull down my buildings, though how one can remove buildings without pulling them down is one of the mysteries known only to the promoters of that Bill. It is quite true that under Clause 17 owners who are in that horrible predicament—


The hon. Member is discussing the Bill upstairs. He is not at liberty to do that.


May I put this point? Is it not within my rights to ask how far the principle of another Measure which is being promoted by the Government conflicts with the principle of this Bill?


I heard the hon. Member put that point, but since then he has been referring to the various Clauses of the Bill.


I wanted to elaborate my point. In any case I bow to your Ruling, but I do hope that the Solicitor-General will find himself sufficiently within your Ruling to be able to make the position clear on that point. We claim that the Measure upstairs embodies a principle which may solve the difficulties of hon. Members opposite. As I am not allowed to proceed on that line, I will put one or two other points. In the first place, I cannot conceive how anybody can produce a formula which, under modern circumstances, will define what is agricultural land pure and simple and what is agricultural land which has any potentialities other than agricultural. The factor of rapid transit renders it improbable that there is a square inch of land anywhere in Great Britain which has not potentialities outside agriculture. It is amazing to see how, in a few weeks, arterial roads and consequent developments can spring up in districts which were formerly absolutely rural. Then the right hon. Member for Carnarvon Boroughs twitted the right hon. Member for Croydon (Sir W. Mitchell-Thomson) on the fact that he had forgotten that if we imposed a tariff there must be an enormous increase of staff for the collection of the revenue. Surely the answer to that is that a general tariff, whatever one may think of it, would unquestionably produce an immense revenue, far greater than any which will be raised by this land tax, and in those circumstances we could better afford a larger staff. I will conclude by saying that we on this side of the House regard this as a Measure which is replete with injustices and inequity, and, that being the case, we resent the use of such a phrase as "The Creator gave the land to the people" and object to right hon. Gentlemen opposite sheltering themselves behind it. They only add one more to the long list of offences against the Decalogue by a flagrant breach of the Third Commandment.


I agree with the hon. Member who has just spoken that the Committee are undoubtedly labouring under a substantial disadvantage in not having the full details of the Government's scheme, which will in due time be presented in the Finance Bill. At the same time, I think the issue before the Committee is a very simple one. We are dealing here with a question of principle on which we shall have to record our votes to-night. The principle is whether it is proper to levy a duty which is based upon the value of sites, limited, as I understand, to urban areas. [HON. MEMBERS: "No."] Substantially so. I understand that agricultural land is to be excluded. I should have thought there would have been a much larger measure of agreement in the House, certainly with regard to the principle of valuation, which has been dealt with adequately this afternoon by the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George), and I should be surprised to hear that there is any hon. Member who is not prepared to accept the proposition that it is in the interests of the country to have a basis of valuation on which the revenue officers can estimate taxation for Estate Duty and other purposes.

With regard to the general issues which are raised, I should have thought that hon. Members who sit in the opposition benches would have been prepared to go a very long way on this subject. I have long been associated with the movement for the taxation of land values, and I have discussed this subject with men who hold different political opinions. There are three propositions upon which, I think, there is general agreement. The first is that we should secure for the community the increment values created by the population. That is a proposition which will receive substantial support in all quarters of the House. My second proposition is that land required for public purposes should be acquired at a fair price. I do not think any hon. Member will dispute that proposition, in view of the scandalous cases which can be cited as to what has taken place in the past with regard to the high sums exacted when land has been required for public purposes.


Within the last 10 years?


Yes. There have been many cases where very substantial prices have been paid beyond the actual value of the land taken. In the third place, I think it will be agreed by all sections in this Committee that it is very desirable that something should be done with regard to relieving improvements in the form of buildings, including factory buildings, from rates and taxes through the readjustment of taxation which will bring in a source of revenue which at present escapes altogether. [Interruption.] Apparently the hon. Member who interrupts me has not studied this question or he would know that there are in this country a large number of (municipalities who are not concerned with any political party, who, in the interests of the community they serve, have brought in time and again proposals of this character. I would like to mention the proposals brought in by the great municipality of Glasgow to secure the rating of site values. I agree with the Chancellor of the Exchequer that there are hundreds of municipalities who would be prepared to do the same.

I do not think that this point has been stressed sufficiently, that the principal object of a tax on site values is to secure an equitable readjustment of taxation. I am not prepared to accept the statement that the proposals of the Government involve simply an additional form of taxation. If I thought the intention was to impose a fresh duty or a fresh tax which is going to impose an all-round additional burden, I should oppose it.


The Resolution we are discussing is a proposal to add an additional tax, and there is no proposal as to how the money is to he spent. In those circumstances surely we are considering an additional tax and nothing else.


The proposal of the Government is one which will have to be debated in detail on the Finance Bill, and I am discussing the principle which the Resolution raises. Are you going to impose a tax on site values? I think that depends largely upon the intention of the Government to readjust taxation. I was dealing with the question of the rates, and I am glad that the Ruling of the Chair permits me to deal with that question. It appears to me that the necessity for allowing local authorities to deal with the question of local rating is urgent to-day, and I should prefer to have seen steps taken in that direction in the first instance. The Chancellor of the Exchequer, in referring to the taxation which he proposes by this Resolution, said the intention was to raise revenue for the purpose of meeting the expense of the de-rating proposals, amounting to a sum of £35,000,000. My submission to the Committee is that instead of meeting the expense of de-rating the duty of the Chancellor of the Exchequer is to abolish the de-rating proposals and to readjust taxation in order that every section of the community will benefit. Under the de-rating scheme many wealthy industries are getting advantages for which they never asked, and which they did not deserve, and the ratepayers are called upon to pay an additional charge to those engaged in these trades.

Why should the Chancellor of the Exchequer raise this revenue for the particular purpose of meeting the expense of the de-rating scheme, which is only to benefit certain favoured productive industries? I think the Government are bound to reconsider the whole question of de-rating in relation to the proposals which they are putting forward, and they ought to remove this very unjust burden which has been imposed upon many small ratepayers, including householders and those engaged in distribution trades. Many Bills have been introduced dealing with this question, and I remember the time when we had introduced land valuation Bills which obtained a Second Reading, and some of them passed this House, but were rejected in another place. I think opinion in the country is ripe for a distinct advance being made at the present moment on this question. The experience of other countries which have adopted these proposals is that they have been successful, and if they are passed we shall share the benefits and advantages which have accrued in other countries. I do not share the views of hon. Members who do not believe that these proposals are calculated to meet the needs of great municipalities.

I cannot associate myself with the form in which these proposals have been submitted and introduced by the Chancellor of the Exchequer. I think questions of this character ought to be raised altogether above party considerations, and that no challenge should be made from one side of the House or the other. We are dealing with a problem which vitally affects the whole of the country. Certain statements have been made in support of these proposals to which I cannot agree. I cannot accept the view that this Measure asserts the right of the community to the ownership of land, and that private individuals only possess a nominal claim. I do not agree that that is a fair or a just statement of the case. I would like to see these questions argued without bias on either side, and I would like to see points of difference thoroughly thrashed out. I desire to reserve my right fully to criticise these proposals when they are brought up in detail, and I dissociate myself from some of the statements made by the Chancellor of the Exchequer, which do not seem to me to agree at all with the Liberal standpoint.


The right Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) and certain others have seemed to he in some doubt as to the extent to which these proposals are really going to be opposed by hon. Members on these benches. The right hon. Gentleman, at any rate, ought to be a sufficiently experienced Parliamentary hand to know that the most serious opposition is not that which makes the greatest noise at the start. It may be just possible that with his great Parliamentary experience he may be endeavouring to interfere to some extent with the way in which we propose to conduct our opposition. The Government may be assured that if they intend their proposals to be on the lines of the principles expressed by the Chancellor of the Exchequer in introducing this Resolution, they will meet with an opposition which, if not noisy, will at least have solid argument behind it, and is likely to have a considerable amount of success.

Let me for a moment try to show what arguments have been advanced in support of what has been described as the second Reading principle which we are now discussing. The hon. Gentleman who has just sat down has called attention to what is apparently the argument of the Chancellor himself, which is that he desires the ultimate nationalisation of all land in the country. We on these benches are not very much afraid of that proposal, for we realise, at any rate, that there is not a majority in this House in favour of it. The only other argument which seems to have been advanced to any great extent in introducing these proposals is the alleged wickedness and unfairness of the man who holds a piece of land which increases enormously in value without his doing anything to increase it. It has been pointed out over and over again that we are not discussing now the question of the taxation of unearned increment values. The right hon. Member for Newcastle-under-Lyme (Colonel Wedgwood), the keenest supporter of the taxation of land values in the House, has taken the view, in support of which there has been considerable evidence from past experience, that that is not practicable, and that you cannot do it. Those who are supporting the Resolution on those grounds quoted instances of the extraordinary increase in value of land in certain places, but they did not refer to the other land which is going to be taxed under this principle.

Let me refer just briefly to one unit of land. It is true that we may have more information about this when we come to the details, but, at any rate, here is an example of broad principles which is worth considering when we have this Resolution before us. Generally speaking, I understand this tax on land values, if not to be levied directly upon is at any rate ultimately to be thrown back upon the actual freeholders of the property. It may be levied on the leaseholders if the original lease is for more than 50 years, but he is to have the right of recourse against his lessor. I know perfectly well that it is no use worrying the Chancellor at the present time for exact details as to what those circumstances will be, but let me refer to the particular case I have in mind. Reference has been made to land in the City of Manchester. I will take my example from that city. There is land up there in connection with which there is a form of property commonly known as ground rents. Thrifty persons with savings who want a safe investment have invested in the purchase of these ground rents.

Not many years ago, a good gilt-edged ground rent bought at 25 years' purchase brought in 4 per cent. or a little less, after all expenses were paid. No one will dispute the fact that many of the sites on which these ground rents are secured are worth 7½ times the price which would produce 4 per cent. Under those circumstances, the owner of that £4 a year ground rent, after paying his 4s. 6d. in the £ for Income Tax, is left with £3 2s. a year, the exact amount of the land tax on that unit of land. There may be circumstances which are going to alter that, but if not, it is going to amount to confiscation of a form of property which is not properly described as an interest in land in the sense that the owner can do nothing whatever at present with regard to dealing with the land. He has parted with the control of the land for a very long term of years. I admit at once that that case may be dealt with to some extent by the special circumstances which are to qualify throwing this tax back on the ultimate owner, but, at any rate, unless we can be told that the owners of these freehold ground rents are to be entirely exempt from this taxation, it is enough to show that you are levying a severe tax on a form of property the owner of which has no practical power whatever to interfere with the user of the land for a great number of years.

A very large amount of that sort of interest in land and ownership of site values is subject to mortgages. Again, there is the investment of money by people, very often of no great means, who want a safe investment. If the ground rent is practically confiscated or reduced by 50 per cent. or even 25 per cent., what is to be the fate of that particular mortgagee? Let me take another matter in connection with this, namely, the question of valuation. The hon. Member who has just sat down referred to the need of a basis for valuation of land throughout the country. I do not know what be means by basis of valuation. Everyone who knows anything about land knows perfectly well that it is no use undertaking a complete valuation, even if it were possible, of all land in the country as the value stands to-day, because within one month the value would be different. To say we have no system of valuation is absurd and ridiculous.

The right hon. Gentleman the Member for Carnarvon Boroughs could not find any better reason for supporting the principle of this tax than telling long stories about the wickedness of the man who gets the unearned increment. When he comes to this question of valuation he moans over what he calls the destruction of the Valuation Department system which he set up. What is the actual truth of the case? The Valuation Department has never been abolished. The Inland Revenue Valuation Department remains and is as active and successful as ever it was. What the right hon. Gentleman makes such a song about is the abolition of the necessity of filling up a certain form. I have the reference to the Debate here. It was the case in which the Government at the time took off the Whips and allowed a free vote. It was on the question of the abolition of the Clause in a previous Finance Act requiring that on every transfer of land there should be filled up a certain form, known as the "Particulars delivered" form.


Form IV.


No, it was not Form IV. The hon. and learned Gentleman should have spent a little more time in an office of the lower branch of the profession, if he wants to understand some of the practical considerations which affect this matter.


It was not a serious interjection.


I can quite understand that, but I am dealing at the moment with a rather serious matter, which formed one of the main arguments and one of the main topics of the speech of the right hon. Gentleman the Member for Carnarvon Boroughs. What he complained of was apparently that my right hon. Friend the Member for West Birmingham (Sir A. Chamberlain) had almost been guilty of a breach of faith by getting rid of the necessity for filling up that particular form. One effect of getting rid of it was to save the country £500,000 a year from that time onwards—


Has the hon. Gentleman any idea of the amount that is being lost in Death Duties through the Valuation Department not being kept up to date?


Not one penny, and I will tell the right hon. and gallant Gentleman why. I have some experience of the work of the Valuation Department with regard to Death Duties. It does its work very well indeed at any rate from the point of view of the National Exchequer.


It is handicapped by not being able to get particulars as to the selling price.


The right hon. and gallant Gentleman is wrong again. It is able to get those particulars, and I challenge him to give me proof to the contrary. It is always furnished with the fullest possible information.


The Department was furnished with the fullest possible information for the purposes of the duty which was destroyed when that Clause in that Government Bill was withdrawn by the right hon. Gentleman the Member for West Birmingham.


The right hon. and gallant. Gentleman seems to think that, if he dies to-morrow, and the Inland Revenue Department comes down to value his real estate for the purpose of Death Duties, what it will want to know will not be what has been done With the property within the last 12 months, but what has happened with regard to certain building restrictions, certain building lines, certain leases, timber and fixtures, at the time when the right hon. and gallant Gentleman or his predecessor bought it years ago. What is the use of that? If you ask any business man in the country who knows anything whatever about the valuation of real estate for purposes of Death Duties, he will tell you that the Department is as efficient as ever it was. That is, as I have put it, from the point of view of the National Exchequer. It is far more efficient than it was at the time when that "Particulars delivered form" was abolished.

The fact of the matter is that on this occasion a proposal is brought forward which is supported by the Chancellor of the Exchequer on grounds which he knows perfectly well would never get it through this House, is supported on totally different grounds by the right hon. Gentleman the Member for Carnarvon Boroughs, and is supported by certain of the Chancellor's own back-bench Members because they think it will assist those of them who are definitely in favour of class war. They think that it is a form of class war. We all know, however, and it is more or less openly stated, that the real thing here is an arrangement whereby the Government hope to secure themselves in office for a certain time longer by acquiring the support, I Will not say of the Liberal party, because that would not be correct, but of what we may call the "L.G. Liberals." That expression, of course, has no reference to the right hon. Gentleman the Member for Carnarvon Boroughs; the expression "L.G. Liberals" merely means "Labour Government Liberals," who are determined to keep in office a Labour Government as long as they can in order to hold their own seats.


No; that is not true.


It may not be true with regard to the hon. Gentleman, but it is at least true, or I am entitled to suppose that it is true, in regard to the Liberal Members who have been so largely proclaiming their intention, for whatever reason—for the good of the country as they believe—to keep this Parliament in existence and this Government in office as long as they can, and to prevent the country from having the opportunity of putting the party on these benches into office.


To fulfil its mandate.


When the hon. Member speaks of carrying out its mandate, he will know that mandates are sometimes differently interpreted by different people, and I am quite satisfied that certain of those whom I have called "L.G. Liberals" regard their mandate as being what I have described, namely, to keep the present Government in office as long as they can, and, incidentally, to hold their own seats as well. [Interruption.] Hon. Gentlemen need not be so touchy. I do not want for one moment to do otherwise than let them take credit for all the virtues that they claim. Largely their claim is that they are absolutely independent, and it was for that reason, among others, that I refrained from interpreting the expression "L.G. Liberals" as having anything to do with the right hon. Gentleman the Member for Carnarvon Boroughs. They refuse to admit for one moment that they are bound by him in any way; they are absolutely independent. That may be to some extent a matter of opinion, but, on the particular question with which we are dealing here, I think we are justified in calling attention to the very different grounds on which this proposal is supported by the Chancellor of the Exchequer himself and by his allies, whoever they may be or whatever their reasons may be, who sit upon the benches below the Gangway. They claim certain virtues, and I do not wish to dispute their possession of them, but with regard to independence some of us could say that that was about the last virtue that they possessed. We know that the claiming of a virtue which is conspicuously absent is one of the principal signs of senile decay.


My hon. Friend has certainly succeeded in arousing the Members of the party below the Gangway. Considering how loyally they co-operate with the Government in this matter and other matters, it is a little remarkable how tender they are when attention is called to the unholy alliance. A matter of more importance even than the co-operation of the Liberal party with the Government is the interesting and difficult question which we have been discussing for two days. The Solicitor-General has been vouched by the Chancellor of the Exchequer as willing and competent to answer all or every question that may be asked of him in connection with, this scheme and, if I thought at this very late stage in the Debate it would serve any very useful purpose to put some questions to him upon matters which are exceedingly obscure, I should do so, and I am sure the hon. and learned Gentleman would do his best to give me the information, provided he has it. I should like, for instance, to have asked him what the Chancellor of the Exchequer meant by his exceedingly obscure observations upon the question as to the incidence of the tax. What are the circumstances, for instance, to use the Chancellor's expression, which will allow the lessee to pass on the tax to his landlord? I should like to have asked the Solicitor-General what effect the operation of the Rent Restrictions Act has upon the value of land, or to ask the Solicitor-General to tell us how these proposals are likely to affect the Housing and Town Planning Bill.

To tell the truth, I think it is too late in this Debate to raise those questions. If we had had a proper exposition of the matter from the Chancellor, they could have been discussed at an earlier stage and the Solicitor-General could have cleared up any lingering doubts that remained after the Chancellor had done his best to elucidate his scheme. But, instead of an exposure of the proposal, we have had a discursive address by him upon a variety of subjects, beginning with the rapacity of landlords and the designs of the Creator, about which he seemed to be very well-informed. We have had a curious symposium of Lord Rothermere and other textbook writers as to the equity of land taxes. We had hints, which were not developed, as to some ulterior purpose in the Land Taxes that are now proposed. Taken in conjunction with the autobiographical details to which the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) treated us, we seem to have had everything from the two great authorities on the question except accurate and detailed information about the scheme itself.

The right hon. Gentleman the Member for Carnarvon Boroughs occupied the greater part of his speech in treating us to his observations about his own taxes. The Chancellor warned us all that if we enlarged upon that topic we should not only be indulging in irrelevant, but in foolish observations. That did not prevent the right hon. Gentleman the Member for Carnarvon Boroughs telling us what were the reasons which led him to design the taxes in the way he did, and the reasons that led him to assent to their abolition. I should like to make one observation about one defence that the right hon. Gentleman made of the failure of his proposals. He told us their defeat was the result of a long drawn out conflict, which was of old standing, between the politicians and the judges. He told us that, if the judges had had their way with the Income Tax Acts, the revenue would have been scarcely more than a tenth of that which is received to-day. The right hon. Gentleman looks at this matter of taxation from the point of view of the taxer. I think the general public will rejoice that the judges do stand between the taxing politicians and themselves, and perhaps when the right hon. Gentleman expressed great regret, which he obviously felt, at the fact that the Law Courts had stood between him and the operation of his complex and, as I think, nefarious taxes, most Members in the House, and I am sure the public outside, rejoice to think that there is still one bulwark between them and the ingenuity of those people who design fresh taxation for the public.

The Chancellor of the Exchequer thought those old taxes failed owing to their complexity. I gather that the right hon. Gentleman did not agree with him in that respect, but I think the same fate that awaited those taxes will inevitably await the Chancellor of the Exchquer when his scheme comes to be elaborated. The acidity with which he introduced his proposals seemed to me to promise ill for their success. Here he was approaching the Committee in the guise of a philanthropist propounding a scheme which he described as beneficial. If everything was so admirable in his proposals, why was he so reluctant to expose the engaging features of his scheme to the House? Why was he so impatient with the right hon. Gentleman the Member for West Birmingham (Sir A. Chamberlain) who asked a few innocent questions? I can understand his reticence and his impatience if doubts assailed him as to whether his scheme was really all that he claimed it was. Our inquiries were not welcome. I agree with the Leader of the Opposition that perhaps it is just as well that we should wait for the Bill as we were refused any information at the earliest possible moment in this Debate.

After all, I think this discussion has lost a great part of its value, because we have not had the proper details to enable us to give what the right hon. Gentleman below the Gangway called a Second Reading to the principle. It is all very well to speak of a principle. What is the principle? I suppose the principle is intended to be the question of the taxation of land values. Before you can judge of the principle and apply your mind to it, you must know something about the particular form of the tax. If it is to be a repetition of the right hon. Gentleman's faxes, we should all, I suppose, resist it—even the Chancellor of the Exchequer. If it is some new tax, we want to know what sort of tax. What operation will it have? What effect will it produce? What will be its fruits? We have had none of that information, and, for that reason, the Debate seems to me to be likely to be less useful than it otherwise might have been. We are told one thing, however. We are told it is going to be a simple scheme. The Chancellor says he has devised it with the determination to apply strict logic and abstract theory to its form and its operation. So says the Resolution. It seems to be a simple one. It provides for a tax at the rate of one penny for each £ of the land value of every unit of land in Great Britain. But we had not proceeded very far in the Debate before the right hon. Gentleman explained that "every unit "does not mean what it says. It means some units. And what units? Why has the right hon. Gentleman departed from the strict logic and abstract theory of this universal tax upon every unit of land? What "overwhelming reasons," to use his own expression, has driven him to this course?

I think we appreciated the overwhelming reasons when he, with obvious relish, told us that the working classes would be exempted from this taxation. Then we understood that it was not logic, but expediency, which governed him. Indeed he seems to have adopted deliberately the methods of the unjust steward. The right hon. Gentleman told his friends to "take their bill, and sit down quickly and write 50," and he hopes to make friends for himself in the day of Providence. I am not sure that it will work. I am not sure that his design can be carried out to exempt the working classes. Let us take two different cases of members of the working classes, as I understand the expression, who are owners of a small house. "A" lives outside the town, or on the outskirts of the town, and the site of his house is worth £100. He escapes. "B" lives in the city. He does not enjoy the amenities of his friend. The site of his house, as is the case in many towns and cities, is worth at least £200, if you are to consider its site value for other purposes than that of a working class house. "B" is taxed. "A" escapes. I venture to think that in every city in this country there will be hundreds of thousands of members of the working class who will be caught by the right hon. Gentleman's proposal.

But what of the scheme, when it matures, as the right hon. Gentleman for Carnarvon Boroughs expects? He tells us that the foundation of these proposals is to make up the deficiencies which local authorities are experiencing in the yield from the rates. When the taxation becomes 2d. instead of a 1d., even the man who at present occupies a house upon a site worth only £60 in capital value, will have to pay the tax. The Chancellor of the Exchequer deliberately intends to relieve from the consequences of this tax, large portions of the electorate to whom he looks for support. Disaster will overtake him, and he will find that a great many members of the working classes are more aware of the operation of this tax than he is at the present moment. What is the meaning exactly of the phrase "working classes," when the right hon. Gentleman uses it with that obvious reference to one particular portion of the community? Are those who work at agriculture not members of the working classes? How is the Chancellor of the Exchequer going to treat the question of agriculture? I hope the Committee noticed the Chancellor of the Exchequer's careful qualification of this reference to agriculture. He said: I do not propose that the tax should apply to agricultural land as long as it has no higher value than its value for agricultural purposes."—[OFFICIAL REPORT, 4th May. 1931; col. 52, Vol. 252.] Did the Chancellor of the Exchequer mean that agricultural land will be taxed as to 100 per cent. of its capital value, provided that it has a value in excess of that agricultural purpose; or does he mean only that it will be taxed on the excess? Perhaps the learned Solicitor-General will tell us. Then I should like to ask this question: Suppose that the agricultural value of the land goes down, and the land has some value for building purposes. Will the tax then be paid upon the increased amount of the total value of the land? There is not a piece of land in this country whose value for agricultural purposes is not going down. Does that mean that the owner of a smallholding, or of a farm, who is ill capable of supporting even the present burdens that rest upon him, because the industry is languishing and because it is difficult to make money out of it, will not only see the value of his agricultural holding diminished, but will have to face increased taxation, because the building value will be greater?

10.0 p.m.

Agriculture illustrates, perhaps better than anything else, the fantastics and arbitrary character of the Chancellor of the Exchequer's proposal. Let us take two typical pieces of agricultural land in this country, the rich lands of Lincolnshire, and the cold lakelands of Essex. The owner of the land in Lincolnshire presumably is the owner of land that is only agricultural land. He will escape. The rich, prosperous and fortunate owner of that land will escape the tax. What about the owner of the poor low-rented land in Essex, that is adjoining this great Metropolis and has a building value far in excess of its agricultural value? That farmer is to have placed upon him a crushing burden. [Interruption.] Hon. Gentlemen opposite with their limited experience—[Interruption]—with their limited experience of urban life, think that everybody who farms land in this country pays rent to a wicked and extravagant landlord.


Hear, hear!


Hon. Members opposite, if they will make a few inquiries, will find that in the course of the last 20 years there have arisen a large number of farmer occupiers, who now own their land. Some of them labour under burdens in the shape of mortgages, the security for which will be greatly affected by the right hon. Gentleman's proposals. If I may take the two cases I have mentioned: What is the justice of letting the man who can best afford to bear the tax escape, and why should the man who is so unfortunate as to own a piece of agricultural land near London have to bear the tax that the Chancellor of the Exchequer proposes?

Let me take the case of market gardeners. Everybody who has travelled on the London and North Eastern Railway out of London, is aware of the great tract of country which is covered by market gardens, many of them bearing glasshouses. Are those glasshouses to be regarded as structures which are to be stripped from the land, before the land is valued, or are they to be included in the agricultural value of the land which will escape taxation? But contrast the case of the market garden with the pastures or the orchards in the Home counties. Presumably, the market gardener in that part of Essex to which I have referred will escape, because his land, that low-lying, unhealthy land, has practically no other value than that for agricultural purposes. It is not likely that people will build there to a great extent for any considerable class of the community. But what about those pastures in the Home counties, those delightful spots where anybody might covet a residence at a high price for the land on which to erect it? The owners of these pieces of land will be forced to pay tax on them, although they use the land and retain it solely for agricultural purposes. Perhaps the right hon. Gentleman the Chancellor of the Exchequer has thought out those problems, and has considered the extent to which different pieces of agricultural land will have to bear this tax, but we have not been vouchsafed the information this afternoon in the course of this Debate, and we must do the best we can with such material as we have.

Let me make this further observation. If there is one thing the farmers and the farming community abhor, it is the growing burden of forms, schedules and returns which they have to fill up for every Government Department. I do not know how they will relish the new burden which will rest upon them when they have to engage in fanciful estimates and elaborate calculations which will be necessary to define agricultural value as distinct from building value. There are innumerable cases in which, in spite of the intentions of the Chancellor of the Exchequer as I understand them, the owners and occupiers of agricultural land will be involved in taxation which will be the last straw that will crush the life out of them in an industry, which, we all agree, is suffering from the burdens which at present rest upon it. So much was this felt by the hon. Member for Stoke-on-Trent (Mr. MacLaren) that he actually proposed that this new tax should be merged into Schedule A, if I understood him aright. The right hon. Gentleman the Chancellor of the Exchequer expressed no such intention. His intention is not to merge this new tax into Schedule A, but to impose it upon Schedule A as an additional burden.

Let us take a very ordinary and simple case of a man who owns 100 acres of which the value for agricultural purposes is, say, £20 and the value for other purposes £30. The owner of that land will pay, as I understand it, an additional 2s. 6d. in the pound over and above the 4s. 6d. which he pays upon Schedule A. What is the justice of a proposal of that sort? What is the sense of it when we are all anxious to make it possible for agriculture in its present distress to become a success?

The question of allotments has been mentioned. I venture to think that when any hon. Members opposite go down to their constituencies if they happen to be in a town or near a town and tell their constituents that the allotments which a private landlord has allowed them to occupy at a rent far below their real value will have to pay this taxation, they will find that the allotment holders, who represent some of the best members of the community in our towns, will resent the additional taxation. What is the value and the advantage to the community of compelling the owner of allotments to sell his property, to turn out the allotment holders and to erect buildings upon these oases, as they are in many of our cities?

Take another consideration. Why does the right hon. Gentleman prefer cemeteries to playing fields unless he has some kinship with those who occupy the first and very little kinship with those who use the second. I cannot understand why it should be more admirable to exempt cemeteries from this tax than to help playing fields. Which is more important, if you put sentiment aside, the respect that we desire to give to the places where the dead lie, or the ground where the health and happiness of the youth of our nation is involved? Great efforts have been made during the last few years to increase the number of playing fields in our towns and in the country. This proposal, if it ever matures, is the death-knell of any attempt to extend playing fields on a large scale for our great cities.

My right hon. Friend the Member for West Birmingham (Sir A. Chamberlain) asked another question which has scarcely been answered. He asked whether schools and colleges were to be exempted. We have had no answer to that question. The right hon. Gentleman below the Gangway, I understand, asked why should schools and colleges be exempted? Why should schools and colleges be taxed if the principle upon which we are taxing land is that God gave the land for the purposes of the community? I understand that hon. Members opposite regard education as one of the greatest advantages which can possibly be conferred upon the community. If that is so, every school or college that is properly conducted is an advantage to the community, but, apparently, the fact that God gave the land to the community for the community's enjoyment makes it necessary to tax the land when it is applied to a purpose so beneficial as that.

Let me take a case which, I am sure, will appeal to every hon. Member in the Committee—the great school of St. Paul's which was moved some years ago to Hammersmith. That school depends for its endowment upon a property in the East End, and the revenues from that property are devoted to maintaining, not merely the school generally, but to maintaining and educating absolutely free of cost 153 scholars out of 650. There is only one alternative when the right hon. Gentleman's tax has come into operation. You will either affect the upkeep of property in the East End of London or you will affect the upkeep of this great valuable institution for the education of our youth. Is it really seriously intended by hon. Gentlemen opposite to tax the schools and colleges and the sites and the playing fields connected with them? Hon. Gentlemen opposite have done a great deal of lip-service to the cause of education, but they will forgive me for saying that I shall decline to believe that they have any interest except partisan interests.

Let us consider these proposals as affecting industry. We were told by some hon. Members opposite that the only alternative to imposing this tax upon land at the present time is to increase the indirect taxes, that at the present time the yield of direct taxation has reached its maximum and the Chancellor of the Exchequer cannot impose any new tax with any hope of obtaining an increased yield, and that this is the only field open to him. There is but one inevitable consequence of placing a tax upon the sites occupied by the factories which are essential to every industry in the country, and that is to increase the overhead expenses. You cannot get away from that fact. The next fact which follows, as surely as night follows day, is that if you are going to increase the overhead expenses, you either increase the cost of production or you must reduce the wages of the workers. Which will hon. Members opposite prefer? If they tell us, as I suppose they will, that they will never consent to a reduction of wages, they must consent to an increase of the cost of the articles produced. [An HON. MEMBER: "Why? "] Hon. Members opposite will appreciate that an increase of overhead expenses means an increase in the cost of the article, and from that consequence there flows this result, they are by this means merely imposing an additional piece of indirect taxation upon the very community they claim to represent.

The right hon. Member for Carnarvon Boroughs expressed a little doubt regarding the Conservative attitude on this question. I can make plain to him what is the attitude of my friends and myself towards this taxation. If there is one class in the community, whatever jibes may emanate from hon. Members opposite, that has borne heavy taxation where a proper case was made for it, it is the class which hon. Members particularly love to assail. Say what you like, broadly speaking, the richer class in this country, whether it was in the War or whether it has been since the War, have borne with uncomplaining cheerfulness heavy taxation because they were satisfied with the purpose to which the yield of the taxation would be put. The same class, and I know that hon. Members opposite, in their folly, refuse to look at facts like these fairly and squarely in the face, are always prepared, whatever grumbles they may express, to bear taxation that will result to the advantage of the classes that are sometimes described as the working classes and sometimes described as the poorer classes.

But we cannot trust this Government to use any new taxation for the benefit of the persons in whom they profess to be chiefly interested. They misuse the taxation which is already committed to their care. They refuse to look at the consequences of placing burdens upon one class of the community which will most surely and inevitably be passed on to another section of the community. It is certain that a tax of this sort, if it were imposed as the Chancellor of the Exchequer intends, would in due course fall upon the shoulders least able to bear it and would greatly increase the handicap under which many portions of the community are already suffering in the race of life. When the right hon. Member asks us what is our attitude towards this taxation, he may believe me or not, hon. Members opposite may believe me or not, we oppose this taxation not because we resent increased taxation if it is properly used and applied, but we resent it because it is the gambler's throw of the Government.

The Financial Secretary to the Treasury said that he was confident the proposals would secure the assent of a majority of the Committee. He will get his majority right enough. He knows that the right hon. Member for Carnarvon Boroughs and his followers can be depended upon to support this proposal and any other proposal that emanates from the Government. Fortunately, the alliance that exists between the two parties is not the last court of appeal in this matter or in any other matter. These proposals will serve their purpose in filling up the time which the Government are afraid to devote to questions upon which they have not the courage to frame a policy. Sooner or later both the Government and the nation will have to face facts more menacing than any that this generation has previously experienced, and when the nation is driven, as it will be driven, to face facts which can no longer be avoided, we believe that the nation will show its unmistakable opinion about this crazy tax of the Chancellor of the Exchequer.

The SOLICITOR-GENERAL (Sir Stafford Cripps)

Those who sit behind me will not hesitate to meet in that court of appeal the right hon. Gentleman and his friends, and when the time comes for judgment to be given by that court of appeal we shall have little doubt as to the verdict. The arguments put forward by the hon. and learned Member are somewhat familiar to those who have practised in the courts. They largely consist of a failure to meet the points which have been put forward and in irrelevant and somewhat discursive journeys into the realms of speculation. The curiosity of hon. Members opposite will be largely satisfied when they have the Finance Bill in their hands. The hon. and learned Member for Fareham (Sir T. Inskip) said that the Chancellor of the Exchequer has not given any details of this tax, indeed, that he has not stated what sort of a tax it is or what the incidence of the tax will be. I can only recommend the hon. and learned Member to read again the speech of the Chancellor of the Exchequer. He will there find, as in the Resolution, a clear statement of the sort of tax that is proposed. [Interruption.] I am sorry that hon. Members opposite are unable to appreciate the words of the Resolution so far as they define the sort of tax it is proposed to impose. It is perfectly clear that the tax to be imposed is 1d. in the £ on the site value annually, subject to the exemptions which have been stated by the Chancellor of the Exchequer.


And no others?


I have no doubt that hon. Members will desire to put forward suggestions as to other exemption" when the Committee stage of the Finance Bill is reached, but those which the Chancellor of the Exchequer mentioned will appear in the Bill. The hon. and learned Member has said that the strict logic of this tax has been departed from by the exemptions; but this was stated by the Chancellor of the Exchequer himself in introducing this Resolution and, moreover, the reason was given. There are cases of very small values, where it would be a waste of time and money to enter into a valuation and taxation of the subject. [Interruption.] Hon. Members opposite laugh. I wonder what they would have said had there been a proposal to value and collect a tax of 2d. or 4d. per year throughout the country. They would have been the first to say, what a monstrous waste of money to set up this machinery to collect these few pennies, and they should be the first to appreciate the measure of economy in not entering into wasteful valuations which will not yield any result.

Let me turn to the forcible arguments put forward by the right hon. Member for South Croydon (Sir W. Mitchell-Thomson) which, as the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George) has said, contain all that there is to be said against this system of taxation. There were one or two points in his observations which I would like to answer. The somewhat elaborate structure of his argument could fitly be compared, perhaps, with the buildings of some of those speculative builders for whom he showed such a fondness—pleasant and attractive at first sight, but, on closer examination, full of holes and leaks and not very habitable, and, moreover, liable to collapse when met with the earthquake of the argument of the right hon. Gentleman the Member for Carnarvon Boroughs. The first complaint which he made was that there would be no immediate yield of taxation. That is a matter upon which, I imagine, some hon. Gentlemen behind him are congratulating themselves, but he surely must realise that it is essential to carry through the valuation as a first step, before starting to try to collect the tax. I think it is generally acknowledged that one of the reasons why the 1909 attempt was a failure, was because it was then attempted to carry through both processes at once. I think that the right hon. Gentleman admitted that there was wide and general support in the country for some form of the taxation of land values, but apparently he thinks that that support would only be forthcoming for some system which taxes the increment value of land and not land values as a whole.

There were two matters which, he said, he agreed needed some treatment. First, there was the unearned benefit accruing to landowners from the expenditure of public money, and secondly, there was the holding up of suburban land. Both these matters he suggested had been cured, to some extent, by legislation, and I wish to deal with that legislation which the right hon. Gentleman suggested had been to some degree a cure. As regards the first matter he pointed to the right of the Road Board to acquire land on either side of a road, and also to the provision for the payment of some portion of the betterment by the landowner, or its deduction from compensation. I think it is generally known that that provision as to the Road Board has never been used for this reason—that the Road Board in view of the state of its funds cannot lock up money in a quarter mile width of land throughout the country, when it needs the money urgently for other matters. That has consequently made that provision a dead letter. Then as regards betterment, if the right hon. Gentleman has ever been before an arbitrator, as I have been on many occasions, trying to get something for betterment, he will know that that provision also is substantially, a dead letter.

Before coming to the second point may I deal with a little illustration which the right hon. Gentleman gave of some land acquired by the Grocers' Company, as he made, I am sure unwittingly, a somewhat false point in that connection. He said that in 1599 they had invested £150, but he forgot all the rents accruing to them ever since 1599, and, moreover, he forgot that in 1868 they had realised £24,000 and that ever since then, by virtue of an investment of £150, they had been drawing interest on £24,000. It is not, therefore, justifiable to say that you can take the £150 and add to it interest as if it had never been actually drawn, and find that at the present time it would have accumulated at compound interest a sum infinitely greater than the £24,000, as the right hon. Gentleman has omitted to remember that the interest has been pocketed by the Grocers' Company since 1599.

Now let me turn to the second point, the holding up of suburban land. The right hon. Gentleman seemed to think that the Acquisition of Land Act of 1919 gave some powers to local authorities to acquire land. I assure him that it did nothing of the sort. The only thing that it did was to attempt to cut down the admittedly exorbitant prices that were paid under the Lands Clauses Act and to substitute, as a measure of compensation for the value to the owner, the market price. That has had no effect as regards the reduction of market prices, nor has it had any effect in the reduction of the amount that the local authorities have to pay, except the 10 per cent. which was allowed under the Lands Clauses Act; and I can assure the right hon. Gentleman, from my own experience in arbitrations all around London, that consistently the prices paid by the London County Council, for instance, for land for their housing sites have been exorbitant. [Interruption.]

The right hon. Gentleman does not appreciate my point, I am sorry to say. Market value is created by the amount of land in the market. If speculators and others hold it up and do not allow it to go on the market, the price rises rapidly, and a very small sale at a very high price is the only test of market value. May I point out to the right hon. Gentleman another matter in that respect, which is of supreme importance, and that is that if there is a published valuation when these arbitrations take place, the position of the owner will be a very different one. He will no longer be able merely to take as the test of the market value one or two isolated sales at high prices, but he will also have to face cross-examination on the published valuation of his own land.

Now may I deal with another point which was raised by the right hon. Gentleman? He said that, in his opinion, this tax would restrain development, as people would retain the land as agricultural land in order to avoid the tax.


indicated dissent.


Those were the words which I took down, perhaps inaccurately. If the right hon. Gentleman denies the words, of course I accept his denial and will not deal with the argument, because obviously he has seen how perfectly futile it is.


I am sorry to interrupt, but I have refrained under great provocation. So far as I remember what I said, it was to point out that, so long as the land was largely agricultural and largely had an agricultural value, it would either escape or largely escape taxation and valuation, but that so soon as the owner started to develop it for building purposes, so soon as he made the first road to develop it for building, it then acquired a value, and he was then taxed on his own improvements.


The right hon. Gentleman must have said that in another passage. Perhaps I had better deal with the large number of questions which hon. and right hon. Members opposite have asked as regards the agricultural valuation. My right hon. Friend the Chancellor of the Exchequer stated that there would be no valuation of agricultural land where it had no higher value than its agricultural value.


No valuation or no taxation?


No taxation. The provision will be that there will be no taxation, and that where there are exemptions from taxation, it will not be necessary to value it, exactly as at present, where Income Tax is not chargeable, no assessment is made. That is a matter which, of course, is to be left to someone to determine. The Act lays down who shall be taxed and who shall not be taxed, and some authority has to determine who comes as an individual within those provisions and who comes without those provisions.


If that analogy is to be pressed, is it not a fact that under the Income Tax Acts everybody has to make a return, whether he is assessed or not?


My hon. and learned Friend is right under the Act, but not under the practice which has existed since 1842. Since then, I understand, the practice has been not to assess people where obviously they have an income far below the limit. The same principle will be applied here. People will not have their land valued where obviously they do not come within the category to be taxed. That, in my submission, is a perfectly sound and proper way of approaching the matter. Everybody knows that up and down the country there are large tracts of land which obviously have no value other than agricultural. On the other hand, there are large tracts of land which may or may not have some value apart from agricultural land. This, of course, will all have to be valued, and if it is found by the valuer that they have a land value above their agricultural value, the difference between the two values will be liable to taxation. That, of course, will be for the first valuation and for the first quinquennium, and when the next valuation comes at the end of five years, it will be perfectly competent to bring in or to leave out any of that land if the character has altered, or if it has become improved or developed, or the other way round.


We understood the Chancellor to say that we were to get the complete valuation, of the land, and that that valuation was to be sap plied to the local authorities Do I understand the hon. and learned Gentleman correctly now in saying that the valuation will not be complete, and that the local authorities will not have that valuation.


At the first valuation there will only be valuation of those units which are to be taxed. If they are exempt from taxation, they will not be valued. The reason for that is of course obvious to the Committee. It is that it is desired to carry through the valuation as rapidly and as efficiently as possible, and it is desired to get the tax as soon as possible. Anything that will aid cheapness in the valuation or the collection of the tax will naturally be used.

I turn to deal with another point which has been stressed by a number of hon. and right hon. Members, and that is the cost of the valuation, because it is right that an accurate figure should be given rather than the grossly inaccurate figure of £5,000,000 which has so far been discussed as though it had been established. The actual facts of the case, as I appreciate them, are these: In the year 1919 Sir Edgar Harper, as mentioned by the right hon. Gentleman, gave evidence before a Select Committee and then stated that the expenditure up to September, 1915, was £3,000,000, of which £2,000,000 alone was for the first valuation. Subsequently to September, 1915, as the right hon. Gentleman said to-day, no further money was expended on that valuation, which was entirely shut down—[Interruption]. Subsequently to September, 1915, the valuation under the 1909–10 Act was completely shut down, there was no further expenditure on the valuation, and up to that date it had been £2,000,000. Therefore, the total expenditure on the 1909–10 valuation was £2,000,000 and not £5,000,000. [Interruption.] The right hon. Member for West Birmingham (Sir A. Chamberlain) will appreciate that he is falling into an error, because a great deal of the cost of the Department, in fact, practically the total cost of the Department from 1915 to 1919 was, as he stated himself, in the passage read by the right hon. Member for Carnarvon Boroughs, due to war work—the acquisition of land and valuation for war purposes, and the other £1,000,000 which was spent was spent not on the valuation but on the assessment of Estate Duty and service for other Government Departments by the Valuation Department. So the sole sum which was expended on the valuation was £2,000,000.

I ask the Committee to remember one more factor as regards the differentiation between the present proposals and the scheme of 1909–10, and that is that under that scheme there were four different values to be ascertained in order to get the site value. There was the gross value, the total value, the assessable site value and the gross site value. In order to ascertain them 20 figures on each valuation form had to be calculated and filled in; and, as the right hon. Member for Croydon (Sir W. Mitchell-Thomson) will no doubt recollect from the forms which he must often have seen, a mass of particulars had also to be supplied. If that cost only £2,000,000, it would seem that the Chancellor of the Exchequer's estimate for a single valuation of a single figure is a very liberal one indeed. [Interruption.] A single figure except in the case of agricultural land; but, as the right hon. Gentleman will realise, the units of urban and town land will be many more in number than the agricultural units.

Another question I was asked was, what the effect of this tax would be upon the development of land outside towns. It was suggested in a figure given, I think, by the hon. and learned Gentleman the Member for Altrincham (Mr. Atkinson), that the tax would be far greater upon built-up sites in cities than upon the undeveloped land, and that this would lead to a tendency not to develop. The Committee will realise, of course, that that is the complete reverse of the fact, for the reason that when one is dealing with developed land one has a house which costs money, or a building which costs money as well as the land, and one gets a rent for the two together, and the proportion of the tax on that rent is obviously less than the proportion on the rent where there is no building on the land. Therefore the proportion of the tax to the rent will be reduced by development, and that will tend to encourage and not to discourage the development of land.

Several points have been raised by right hon. and hon. Gentlemen opposite as to the Town Planning Act and the Town and Country Planning Bill which is at present before a Standing Committee, and it was suggested by several hon. Members that the result of this tax would be to lead to ribbon development, which was undesirable in view of the town planning ideal which everybody upholds. That again is a misunderstanding which will, no doubt, be cleared up when the Bill is before the Committee. If land is restricted by such a thing as the town planning provisions, that is one of the matters that a valuer must take into account. Let me here mention that the same thing will apply to many colleges and schools. Those colleges and schools which have been well advised have entered into arrangements by which their lands are included in plans. I know that to be so in regard, I think, to almost all the Oxford colleges, and certainly with regard to one public school, Winchester, and if they have accepted, as I know has been accepted in that case, a complete sterilisation of their land for any other purpose except for the purpose of playing fields for the school, and they are not able to build on it except for a school extension, the amount of value in that would be extraordinarily small, because there is no conceivable purchaser unless he buys the whole school.

Certainly in instances of that sort the Committee will see that it is quite easy, if anyone is prepared perpetually to dedicate land to the particular purpose to which they desire to dedicate it, and arrange to have it included in the town plan restricted for ever to that use, they can preserve their playing fields substantially without taxation. That does not, of course, include the playing fields belonging to local authorities, which will be exempted, as my right hon. Friend has already said, under the provision applying to all the land of local authorities.

There are many other points which I have been asked to answer, and there is only a very short time in which to deal with any of them. Perhaps I may deal with one or two of the other exemptions as to which questions have been asked, and also with regard to the question whether we were not taxing the wrong man. I think it was stated by the right hon. Gentleman the Member for Tam-worth (Sir A. Steel-Maitland) that there was no justification for taxing the man who paid the figure—the high figure—and not the man who received the high figure. That argument might be applicable if we were dealing with an increment duty, which we are not. [Interruption.] I am so glad that right hon. Gentlemen and hon. Gentlemen opposite have appreciated that point.

The reason for the putting of the tax on the land value at the moment, in whosever hands it may be, is that it is held that the community have an interest in all the land. That is an interest they have because it is by reason of the existence of the community, the expenditure and organisation of the community, that the land has grown to that value. It is by reason of the continued expenditure of the community that that value is preserved to the owner from day to day, and it is by reason of the future expenditure that that land is expected to increase in value. It is for these reasons that the tax is a fair tax; it is a mere acknowledgment by the owner of the land, a gift by him, in exchange for a very great benefit which he is hourly receiving from the community.

One other point I may deal with. That is the question of passing back the tax, about which several hon. Members have asked questions. The method to be adopted is a method somewhat analogous to the Schedule A method. I think I can best illustrate it by giving a precise example. Let me assume that a person holds under a long lease, subject to a ground rent, a plot of land of which the annual value of the ground rent is £100, and the capital value of the plot is £5,000, equivalent to an annual value of £250 at 5 per cent., on 20 years' purcase. There the tax on the £5,000 at one penny in the £ would be £20 16s. 8d. Of that two-fifths could be passed on, because the proportion between the annual value of £250 and the ground rent of £100 is two-fifths. Therefore, the lessee could pass back £8 6s. 8d., which would fall as a tax on the £100 ground rent. The remainder, £12 10s., would be paid by the lessee himself. I think that will show hon. Members opposite the sort of method which is to be adopted in passing back the tax.

I have attempted in the time at my disposal to deal with the rather large number of questions which have been addressed to me, and I hope that the answers I have given will enable hon. Gentlemen opposite to appreciate both the soundness and wisdom of the tax. The general concensus of opinion among hon. Members opposite as to the necessity for curbing speculation in land and for securing to the community its due share of the profits accruing from land and its due opportunity of obtaining land upon fair and reasonable terms will, I am sure, be welcomed by everybody, and possibly by some with a little surprise. Having taken this great step forward since 1909–1910, when the Act of that year was passed, I am sure, when they have had an opportunity of studying the full details of these proposals in the Finance Bill, they will be prepared to welcome them with open arms. The imposition of this tax, coupled with the valuation which must necessarily precede it, is one of the measures Which have been long and consistently advocated by those on this side of the House—not as a measure of reprisal or attack upon any class of the community, but as a just means of securing to the community as a whole some part of the wealth which that community has created, and at the same time rendering more free and equitable the sales of land, especially in those cases where the land is required for the use of the community. Vast sums have been spent by the community in the past in improving the facilities and services connected with the land in this country, and great works are now being carried through at enormous expense, and will in the future be carried through probably upon an ever-increasing scale. It is the expenditure of these moneys in the past by the community which has developed the land throughout the country, and has given it the value which it now has in the hands of the owners. It is the continual expenditure of this money from day to day that upholds and maintains those values for the owners, and it is only common justice that those who own the land which is so benefited, and will be further "benefited in the future by the expenditure of the resources of the community, should pay some acknowledgment to the community for those benefits. It is for that reason that I support this Resolution.

Lieut.-Colonel FREMANTLErose




There is still time before Eleven o'Clock.

Lieut.-Colonel FREMANTLE

I want, in the two minutes that remain, to ask

the attention of the Committee to a statement made by the Chancellor of the Exchequer with regard to Becontree. As I was Chairman of the London County Council Housing Committee— [Interruption].


I would appeal to hon. Members to allow the hon. and gallant Gentleman to proceed.


On a point of Order. Is it not a proper Parliamentary interjection to Bay "Divide"?


It is Parliamentary to call for a Division provided that the calling is not prolonged.

Lieut.-Colonel FREMANTLE

The Chancellor of the Exchequer stated, with regard to the purchase of the Becontree Estate, that, according to the assessment for local rating, it was valued at £7,000, but that it was bought for £295,000. That is a misstatement, because the £7,000 represents the annual value. The purchase price was £295,000, and the rateable value went up to a very much larger sum, namely, £9,000, owing to the action of the committee. The two things are not comparable.

The PARLIAMENTARY SECRETARY to the TREASURY (Mr. T. Kennedy) rose in his place, and claimed to move, " That the Question be now put."

Question put accordingly, That there shall he charged for the financial year ending the thirty-first day of March, nineteen hundred and thirty-four, and for every subsequent financial year, a tax at the rate of one penny for each pound of the land value of every unit of land in Great Britain.

The Committee divided: Ayes, 289; Noes, 230.

Division No. 233.] AYES. [10.59 p.m.
Adamson, Rt. Hon. W. (File, West) Bennett, Sir E. N. (Cardiff, Central) Burgess, F. G.
Adamson, W. M. (Staff., Cannock) Bennett, William (Battersea, South) Burgin, Dr. E. L.
Addison, Rt. Hon. Dr. Christopher Benson, G. Buxton, C. R. (Yorks. W. R Elland)
Aitchison, Rt. Hon. Craigle M. Bevan, Aneurin (Ebbw Vale) Caine, Hall-, Derwent
Alexander, Rt. Hon. A. V. (Hillsbro') Birkett, W. Norman Cameron, A. G.
Allen, W. E. D. (Belfast, W.) Blindell, James Cape, Thomas
Alpass, J. H. Bondfield, Rt. Hon. Margaret Carter, W. (St. Pancras, S. W.)
Angell, Sir Norman Bowerman, Rt. Hon. Charles W. Chater, Daniel
Arnott, John Broad, Francis Alfred Church, Major A. G.
Aske, Sir Robert Brockway, A. Fenner Clarke, J. S.
Attlee, Clement Richard Bromfield, William Cluse, W. S.
Ayles, Walter Bromley, J. Clynes, Rt. Hon. John R.
Baker, John (Wolverhampton, Bilston) Brooke, W. Cocks, Frederick Seymour.
Baldwin, Oliver (Dudley) Brothers, M. Collins, Sir Godfrey (Greenock)
Barnes, Alfred John Brown, C. W. E. (Notts. Mansfield) Compton, Joseph
Barr, James Brown, Ernest (Leith) Cove, William G.
Batey, Joseph Brown, Rt. Hon. J. (South Ayrshire) Cripps, Sir Stafford
Benn, Rt. Hon. Wedgwood Buchanan, G. Daggar, George
Dallas, George Law, A. (Rossendale) Richardson, R. (Houghton-le-Spring)
Dalton, Hugh Lawrence, Susan Riley, Ben (Dewsbury)
Davies, D. L. (Pontypridd) Lawrie, Hugh Hartley (Stalybridge) Riley, F. F. (Stockton-on-Tees)
Davies, E. C. (Montgomery) Lawson, John James Ritson, J.
Davies, Rhys John (Westhoughton) Lawther, W. (Barnard Cattle) Romeril, H. G.
Day, Harry Leach, W. Rosbotham, D. S. T.
Denman, Hon. R. D. Lee, Frank (Derby, N. E.) Rowson, Guy
Dudgeon, Major C. R. Lee, Jennie (Lanark, Northern) Salter, Dr. Alfred
Dukes, C. Lees, J. Samuel Rt. Hon. Sir H. (Darwen)
Duncan, Charles Lewis, T. (Southampton) Sanders, W. S.
Ede, James Chuter Lindley, Fred W. Sandham, E.
Edge, Sir William Lloyd. C. Elite Sawyer, G. F.
Edmunds, J. E. Logan, David Gilbert Scott, James
Edwards, E. (Morpeth) Longbottom, A. W. Scurr, John
Freeman, Peter Longden, F. Sexton, Sir James
Gardner, B. W. (West Ham, Upton) Lovat-Fraser, J. A. Shaw, Rt. Hon. Thomas (Preston)
Gardner, J. P. (Hammersmith, N.) Lunn, William Shepherd, Arthur Lewis
George, Rt. Hon. D. Lloyd (Car'vn) Macdonald, Gordon (Ince) Sherwood, G. H.
George, Major G. Lloyd (Pembroke) MacDonald, Rt. Hon. J. R. (Seaham) Shield, George William
George, Megan Lloyd (Anglesea) MacDonald, Malcolm (Bassetlaw) Shiels. Dr. Drummond
Gibbins, Joseph McElwee, A. Shillaker, J. F.
Gibson, H. M. (Lancs, Mossley) McEntee, V. L. Shinwell, E.
Gill, T. H. McKinlay, A. Short, Alfred (Wednesbury)
Gillett, George M. MacLaren, Andrew Simmons, C. J.
Glassey, A. E. Maclean, Sir Donald (Cornwall, N.) Simon, E. D. (Manch'ter, Withington)
Gossling, A. G. Maclean, Nell (Glasgow, Govan) Sinclair, Sir A. (Caithness)
Gould, F. MacNeill-Welr, L. Sinkinson, George
Graham, D. M. (Lanark. Hamilton) Macpherson, Rt. Hon. James I. Sitch, Charles H.
Graham, Rt. Hon. Wm. (Edin., Cent.) McShane, John James Smith, Ben (Bermondsey, Rotherhithe)
Gray, Milner M alone, C. L' Estrange (N'thampton) Smith, Frank (Nuneaton)
Greenwood, Rt. Hon. A. (Colne). Mander, Geoffrey le M. Smith, Lees-, H. B.
Griffith, F. Kingsley (Middlesbro' W.) Mansfield, W. Smith, Rennie (Penistone)
Griffiths, T. (Monmouth, Pontypool) March, s. Smith, Tom (Pontefract)
Groves, Thomas E. Marcus, M. Smith, W. R. (Norwich)
Grundy, Thomas W. Markham, S. F. Sorensen, R.
Hall, G. H. (Merthyr Tydvil) Marley, J. Stamford, Thomas W.
Hall, J. H. (Whitechapel) Marshall, Fred Stephen, Campbell
Hall, Capt. W. G. (Portsmouth, C.) Mathers, George Strauss, G. R.
Hamilton, Mary Agnes (Blackburn) Matters, L. W. Sullivan, J.
Hamilton, Sir R. (Orkney & Zetland) Maxton, James Sutton, J. E.
Hardie, George D. Messer, Fred Taylor, R. A. (Lincoln)
Harris, Percy A. Middleton, G. Taylor, W. B. (Norfolk, S. W.)
Hastings, Dr. Somerville Millar, J. D. Thomas, Rt. Hon. J. H. (Derby)
Haycock, A. W. Milner, Major J. Thorne, W. (West Ham, Plaistow)
Hayday, Arthur Montague, Prederick Thurtle, Ernest
Hayes, John Henry Morley, Ralph Tillett, Ben
Henderson, Right Hon. A. (Burnley) Morris, Rhys Hopkins Tinker, John Joseph
Henderson, Arthur, Junr. (Cardiff, S.) Morris-Jones, Dr. J. H. (Denbigh) Toole, Joseph
Henderson. Thomas (Glasgow) Morrison, Rt. Hon. H. (Hackney, S.) Tout, W. J.
Henderson, W. W. (Middx., Enfield) Morrison, Robert C. (Tottenham. N.) Townend, A. E.
Herriotts, J. Mort, D. L. Trevelyan, Rt. Hon. Sir Charles.
Hicks, Ernest George Muff, G. Vaughan, David
Hirst, G. H. (York W. R. Wentworth) Muggeridge, H. T. Viant, S. P.
Hoffman, P. C. Murnin, Hugh Walkden, A. G.
Hopkin, Daniel Nathan, Major H. L. Walker, J.
Horrabin, J. F. Naylor, T. E. Watkins. F. C.
Hudson, James H. (Huddersfield) Newman, Sir R. H. S. D. L. (Exeter) Watson, W. M. (Dunfermline)
Hunter, Dr. Joseph Noel Baker, P. J. Watts-Morgan, Lt.-Col. D. (Rhondda)
Isaacs, George Noel-Buxton, Baroness (Norfolk, N.) Wedgwood, Rt. Hon. Josiah
Jenkins, Sir William Oldfield. J. R. Wellock, Wilfred
John, William (Rhondda, West) Oliver, George Harold (Ilkeston) West, F. R.
Johnston, Rt. Hon. Thomas Oliver, P. M. (Man., Blackley) Westwood, Joseph
Jones, Llewellyn-, F. Owen, Major G. (Carnarvon) White, H. G.
Jones, Henry Haydn (Merioneth) Owen. H. F. (Hereford) Whiteley, Wilfrid (Birm., Ladywood)
Jones, J. J. (West Ham, Silvertown) Palin, John Henry. Whiteley, William (Blaydon)
Jones, Rt. Hon. Lell (Camborne) Paling, Wilfrid Wilkinson, Ellen C.
Jones, Morgan (Caerphilly) Palmer, E. T. Williams, Dr. J. H. (Llanelly)
Jowett, Rt. Hon. F. W. Parkinson, John Allen (Wigan) Williams, T. (York, Don Valley)
Jowitt, Sir W. A. (Preston) Pethick-Lawrence, F. W. Wilson C. H. (Sheffield, Attercliffe)
Kedward, R. M. (Kent, Ashford) Phillips, Dr. Marion Wilson, J. (Oldham)
Kelly, W. T. Picton-Turbervill, Edith Wilson, R. J. (Jarrow)
Kennedy. Rt. Hon. Thomas Pole. Major D. G. Winterton. G. E. (Leicester, Loughb'gh)
Kenworthy, Lt.-Com. Hon. Joseph M. Potts, John S. Wise, E. F.
Kinley, J. Price, M. P. Wood, Major McKenzie (Banff)
Kirkwood, D. Pybus, Percy John Young, R. S. (Islington, North)
Knight, Holford Quibell. D. J. K.
Lang, Gordon Ramsay, T. B. Wilson TELLERS FOR THE AYES.—
Lansbury, Rt. Hon. George Rathbone, Eleanor Mr. Charles Edwards and Mr. Charleton.
Lathan, G. Raynes, W. R.
Law, Albert (Bolton) Richards, R.
Acland-Troyte. Lieut.-Colonel Alexander, Sir Wm. (Glasgow, Cent'l) Astor, Maj. Hon. John J.(Kent, Dover)
Ainsworth, Lieut.-Col. Charles Allen, Sir J. Sandeman (Liverp'l., W.) Astor, Viscountess
Albery, Irving James Amery, Rt. Hon. Leopold C. M. S. Atholl, Duchess of
Atkinson, C. Everard, W. Lindsay Oman, Sir Charles William C.
Baillie-Hamilton, Hon. Charles W. Falle, Sir Bertram G. O'Neill, Sir H.
Baldwin, Rt. Hon. Stanley (Bewdley) Ferguson, Sir John Ormsby-Gore, Rt. Hon. William
Balfour, George (Hampstead) Fermoy, Lord Peake, Captain Osbert
Balfour, Captain H. H. (I. of Thanet) Fielden E. B. Penny, Sir George
Balniel, Lord Fison, F. G. Clavering Percy, Lord Eustace (Hastings)
Beamish, Rear-Admiral T. P. H. Forestier-Walker. Sir L. Peto, Sir Basil E. (Devon, Barnstaple)
Beaumont, M. W. Fremantle, Lieut.-Colonel Francis E. Pilditch, Sir Philip
Bellairs, Commander Carlyon Galbraith. J. F. W. Power, Sir John Cecil
Berry, Sir George Ganzoni, Sir John Pownall, Sir Assheton
Betterton, Sir Henry B. Gault, Lieut.-Col. A. Hamilton Purbrick, R.
Bevan, S. J. (Holborn) Gibson, C. G. (Pudsey & Otley) Ramsbotham, H.
Birchall, Major Sir John Dearman Gilmour, Lt.-Col. Rt. Hon. Sir John Rawson, Sir Cooper
Bird, Ernest Roy Glyn, Major R. G. C. Reid, David D. (County Down)
Boothby, R. J. G. Grace, John Remer, John R.
Bourne, Captain Robert Croft Graham, Fergus (Cumberland, N.) Rentoul, Sir Gervals S.
Bowater, Col. Sir T. Vansittart Greene, W. P. Crawford Reynolds, Col. Sir James
Bowyer, Captain Sir George E. W. Grenfell, Edward C. (City of London) Richardson, Sir P. W. (Sur'y, Ch'ts'y)
Boyce, Leslie Gretton, Colonel Rt. Hon. John Roberts, Sir Samuel (Ecclesall)
Bracken, B. Guinness, Rt. Hon. Walter E. Rodd, Rt. Hon. Sir James Rennell
Brass, Captain Sir William Gunston, Captain D. W. Ross, Ronald D.
Briscoe, Richard George Hacking, Rt. Hon. Douglas H. Ruggles-Brise, Colonel E.
Broadbent, Colonel J. Hall, Lieut.-Col. Sir F. (Dulwich) Russell, Alexander West (Tynemouth)
Brown, Col. D. C. (N'th'l'd., Hexham) Hamilton, Sir George (Ilford) Salmon, Major I.
Brown, Brig.-Gen. H. C. (Berks, Newb'y) Hammersley, S. S. Samuel, A. M. (Surrey, Farnham)
Buchan-Hepburn, P. G. T. Hanbury, C. Sandeman, Sir N. Stewart
Buchan, John Hannon, Patrick Joseph Henry Sassoon, Rt. Hon. Sir Philip A. G. D.
Bullock, Captain Malcolm Hartington, Marquess of Shepperson, Sir Ernest Whittome
Burton, Colonel H. W. Harvey, Major S. E. (Devon. Totnes) Skelton, A. N.
Butler. R. A. Henderson, Capt. R. R. (Oxf'd, Henley) Smith, Louis W. (Sheffield, Hallam)
Butt, Sir Alfred Heneage, Lieut.-Colonel Arthur P. Smith, R. W. (Aberd'n & Kinc'dine, C.)
Cadogan, Major Hon. Edward Herbert, Sir Dennis (Hertford) Smith-Carington, Neville W.
Campbell, E. T. Hills, Major Rt. Hon. John Waller Smithers, Waldron
Carver, Major W. H. Hoare, Lt.-Col. Rt. Hon. Sir S. J. G. Somerset, Thomas
Castle Stewart, Earl of Hope, Sir Harry (Forfar) Somerville, A. A. (Windsor)
Cautley, Sir Henry S. Horne, Rt. Hon. Sir Robert S. Somerville, D. G. (Willesden, East)
Cayzer, Sir C. (Chester, City) Howard-Bury, Colonel C. K. Southby, Commander A. R. J.
Cayzer, Maj. Sir Herbt. R. (Prtsmth, S.) Hudson, Capt. A. U. M. (Hackney, N.) Spender-Clay, Colonel H.
Cazalet, Captain Victor A. Hunter-Weston, Lt.-Gen. Sir Aylmer Stanley, Lord (Fylde)
Cecil, Rt. Hon. Lord H. (Ox. Univ.) Hurd, Percy A. Stanley, Hon. O. (Westmorland)
Chamberlain, Rt. Hn. Sir J. A. (Birm., W.) Hurst, Sir Gerald B. Steel-Maitland, Rt. Hon. Sir Arthur
Chamberlain, Rt. Hon. N. (Edgbaston) Inskip, Sir Thomas Stewart, W. J. (Belfast, South)
Chapman, Sir S. Iveagh, Countess of Stuart, Hon. J. (Moray and Nairn)
Christie, J. A. Jones, Sir G. W. H. (Stoke New'gton) Sueter, Rear-Admiral M. F.
Churchill, Rt. Hon. Winston Spencer Kindersley, Major G. M. Taylor, Vice-Admiral E. A.
Clydesdale, Marquess of Knox, Sir Alfred Thomas, Major L. B. (King's Norton)
Cobb, Sir Cyril Lamb, Sir J. Q. Thompson, Luke
Cockerill, Brig.-General Sir George Lane Fox, Col. Rt. Hon. George R. Thomson, Sir F.
Cohen, Major J. Brunel Law, Sir Alfred (Derby, High Peak) Thomson, Mitchell-, Rt. Hon. Sir W.
Colfox, Major William Philip Leigh, Sir John (Clapham) Tinne, J. A.
Colman, N. C. O. Leighton, Major B. E. P. Titchfield. Major the Marquess of
Colville, Major D. J. Lewis, Oswald (Colchester) Todd, Capt. A. J.
Conway, Sir W. Martin Little, Graham-, Sir Ernest Train, J.
Courtauld, Major J. S. Llewellin. Major J. J. Tryon, Rt. Hon. George Clement
Courthope, Colonel Sir G. L. Locker-Lampson, Rt. Hon. Godfrey Turton, Robert Hugh
Cranborne, Viscount Locker-Lampson, Com. O.(Handsw'th) Vaughan-Morgan, Sir Kenyon
Crichton-Stuart, Lord C. Long, Major Hon. Eric Wallace, Capt. D. E. (Hornsey)
Croft, Brigadier-General Sir H. Lymington, Viscount Ward, Lieut.-Col. Sir A. Lambert
Crookshank, Capt. H. C. McConnell. Sir Joseph Warrender, Sir Victor
Croom-Johnson, R. P. Macdonald, Capt. P. D. (I. of W.) Waterhouse, Captain Charles
Culverwell. C. T. (Bristol, West) Macquisten, F. A. Wells. Sydney R.
Cunliffe-Lister, Rt. Hon. Sir Philip Maitland. A. (Kent, Faversham) Williams, Charles (Devon, Torquay)
Dalkeith, Earl of Makins, Brigadier-General E. Wilson, G. H. A. (Cambridge U.)
Dairymple-White, Lt.-Col. Sir Godfrey Margesson, Captain H D. Windsor-Clive, Lieut.-Colonel George
Davidson, Rt. Hon. J. (Hertford) Marjoribanks, Edward Winterton, Rt. Hon. Earl
Davies, Dr. Vernon Mason, Colonel Glyn K. Withers, Sir John James
Davies, Maj. Geo. F.(Somerset, Yeovil) Meller, R. J. Wolmer, Rt. Hon. Viscount
Davison. Sir W. H. (Kensington. S.) Womersley, W. J.
Despencer-Robertson, Major J. A. F. Merriman, Sir F. Boyd Wood, Rt. Hon. Sir Kingsley
Dixey, A. C. Milne, Wardlaw-, J. S. Wright, Brig.-Gen. W. D. (Tavist'k)
Duckworth, G. A. V. Moore, Lieut.-Colonel T. C. R. (Ayr)
Dugdale, Capt. T. L. Muirhead, A. J. TELLERS FOR THE NOES.—
Eden, Captain Anthony Newton, Sir D. G. C. (Cambridge) Commander Sir Bolton Eyres
Edmondson, Major A. J. Nicholson, O. (Westminster) Monsell and Major Sir George
Elliot. Major Walter E. Nicholson, Col. Rt. Hn. W. G.(Ptrsf'ld) Hennessy.
Erskine, Lord (Somerset. Weston-s-M.) O'Connor, T. J.

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

Resolution to be reported To-morrow;

Committee to sit again To-morrow.

The remaining Orders were read, and postponed.

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