HC Deb 26 May 1932 vol 266 cc573-621

Before I call upon the hon. and gallant Member for Tiverton (Lieut.-Colonel Acland-Troyte) to move the Amendment standing in his name, I think it would be for the general convenience of the Committee if we took a discussion on the Amendment to cover the points either of the repeal or suspension of the Land Tax, or for the suspension for a longer or a shorter period. That covers the Amendment standing in the names of the hon. Member for Caerphilly (Mr. Morgan Jones) and the hon. Member for Limehouse (Mr. Attlee). The discussion will not predudice the right of the hon. Members to take a Division upon their Amendments if they so desire. The other two Amendments on the Clause, namely, that in the name of the hon. and learned Member for Norwood (Sir W. Greaves-Lord), and that in the name of the hon. Gentleman the Member for Aberdare (Mr. G. Hall) raise slightly different points, and I hope to be able to call them, but I will, first of all, call upon the hon. and gallant Member for Tiverton to move his Amendment.

Lieut.-Colonel ACLAND - TROYTE

I beg to move, in page 15, line 37, to leave out from the word "year," to the word "and," in line 40.

The object of my Amendments is to repeal Part III of the Act of last year. I do not wish to reopen the general controversy of the whole question of the land taxes which was discussed last year. I suppose that every Member of the Committee has already made up his mind about them as to be able to decide whether he thinks they are good or bad. We regard them as thoroughly bad, and the only question which can arise upon my Amendment is whether Part III of the Finance Act of last year shall be completely abolished or only postponed. This part of the Finance Act was brought in by a moribund Government. It was not brought in with any idea of equity or for the benefit of the revenue. It was brought in to try and obtain the support of the Liberal party in order that the Government might continue its miserable existence a few weeks longer. It was also brought in with the idea of hiding the fact that the Budget of last year was an unbalanced and a dishonest Budget. The Chancellor of the Exchequer of that time was completely bereft of any plans to get the Budget properly balanced. He also wished to hide the fact that Free Trade had nothing further to contribute in helping the finances of the country. Everyone knew when it was brought in that the Government was tottering to its fall. Everyone thought that as soon as the election took place and a new Government was returned the Land Tax would immediately be abolished. The Lord President of the Council, speaking on 13th June, said: I can say one thing about it—that if we get back to power, that tax will never see daylight. Speaking on 18th June, he said: I am not alarmed about the Land Value Tax, because I do not believe that tax will ever come into existence. If we come in, it certainly will not. 4.0 p.m.

The present Government, instead of fulfilling expectations we all held, have tried to fob us off by simply postponing the operation of this tax. If they think they can satisfy us with that, I say that we are by no means satisfied, and will not be satisfied until these provisions are removed from the Statute Book. If not successful this year, we shall try again next year, when, I hope, we shall be successful. As long as these taxes remain on the Statute Book, they can be put into force in a very short time and with practically no Debate. They are causing great uncertainty and difficulties with regard to mortgages and things of that sort. In addition, a sum of, I think, £10,000 is thrown away annually under Part III of the Finance Act, and although the Chancellor of the Exchequer does not regard it as a very large sum, yet in these hard times a sum of £10,000 is certainly worth saving.

I could quote a large number of extracts from speeches of Members of the Conservative party who now sit on the Front Bench to show what the Conservative party thought about this Measure when it was brought in last year, and which back benchers still think, but on which some Front Benchers seem to have changed their mind. I will quote one ex- tract from the right hon. Gentleman the Chancellor of the Exchequer, who, I am sure we are all very sorry indeed, is not here to-day. We all sympathise very much with him in his illness. I am particularly sorry that he is not here, because I feel certain, after the speech he made last year against these taxes, we should get his support for their abolition. On 19th May last year, the Chancellor of the Exchequer was talking about the damage done by the tax. He said: No one knows how much that depreciation is going to be, and I am perfectly certain that the doubts, the uncertainties and the anxieties that people will feel about what the effect of these proposals is going to be will have just the same effect upon housing development as the disastrous proposals of the right hon. Member for Carnarvon Boroughs in 1909–10, when the increase in new houses was brought down from an annual average of 119,000 to only a little over 72,000. May I remind the Committee that as long as this Measure remains on the Statute Book, those uncertainties and anxieties, about which the right hon. Gentleman spoke, will remain? Further on, in the same speech, he said: As our discussions go on it becomes more and more apparent that the real object of the right hon. Gentleman and hon. Gentlemen opposite is the nationalisation of the land by confiscation. The only thing is that they have not the courage to say so."—[OFFICIAL REPORT, 19th May, 1931; cols. 1810–14, Vol. 252.] That being so, why have our present Government not the courage to do away with the taxes altogether? It will be remembered that we fought these taxes with all our power, hut under very difficult conditions, because the Government at that time were afraid to face discussion, and put on a very drastic Guillotine. The result was that a large number of most important points were never discussed at all. It is not my idea of fairness or equity to put on special taxation and cause special hardship to one class of taxpayer, and not allow that taxation to be properly considered or properly discussed. I want the Lord President of the Council to realise that we regard this definitely as a matter of principle. We are prepared to put up with a great deal from the present Government in order to support the National Government and keep them in power. If these taxes had anything to do with producing money for revenue this year, we would put up with them, but they will not produce a penny to the Revenue this year. Although we may be prepared to accept taxation which we consider unjust and unfair, in order to balance the Budget, that does not apply in this case.

There has been an agreement in the Cabinet to differ on Import Duties and tariffs: Why should they not agree to differ on this matter? Why should not the Conservative and Liberal Members of the Cabinet who desire to see these taxes abolished insist on their rights? If any Member of the Cabinet refuses to accept the decision and resigns in consequence, let him resign. If one or two resign it will not be very much loss. When we consider the events of the last few months in connection with the Import Duties, I do not think the right hon. Gentleman need be afraid of losing many of his colleagues. I beg the right hon. Gentleman to consider his own reputation. We value his reputation very highly. He knows perfectly well that it would be right to abolish these taxes altogether, and I ask him to do so and accept the Amendment in my name If he feels that he cannot accept it right away, I ask him to leave it to a free vote of the Committee. The late Government very seldom allowed a free vote, and the present Government only allowed it once on the question of Sunday cinemas. Surely a National Government representative of all parties ought to allow a free vote on a matter of this sort. I not only ask it; I demand a free vote. It does not affect the Revenue in any way, or the balancing of the Budget. The only thing it may affect is the pride of the Lord Privy Seal, which is, after all, a matter of small importance when compared with the honour of the Conservative party. If the Government do not accept this Amendment, they will be letting down their supporters very badly. Some people think this is not the first occasion on which they have done this. They may be let down a certain number of times, but if they are let down constantly it is bound to strain their loyalty too far.


There is one observation which fell from my hon. and gallant colleague in the representation of Devonshire (Lieut.-Colonel Acland-Troyte) that I thoroughly endorse. I ask the Government to have a little courage. Their action in this matter fills me with a good deal of despair. [HON. MBMBEKS: "Hear, hear!"] I am not sure that I court those cheers from the other side. I say to the Government that infirmity of purpose is fatal to good government. We know that the Measure in question was the principal Measure of the late Socialist Government. It was, as my hon. and gallant Friend said, guillotined through the House of Commons. There was a good deal of bargaining with the party to which I belong, although I did not take part in it. [Interruption.] I am a Liberal now. I say I did not take any part in that bargaining, because I opposed the Bill root and branch. Well, the Bill was passed, and within six weeks after it was passed the Government floundered in the waters of political bankruptcy. There is no question about that. There was an election, short, sharp and decisive, and hon. Gentlemen know the result. [Interruption.] This is a very serious matter. That decisive condemnation was led by the Prime Minister, the Lord Privy Seal and the Dominions Secretary. [An HON. MEMBER: "And Lord Beaverbrook!"] I did not know that Lord Beaverbrook belonged to the Labour party. Do not let us get things mixed up too much.

I have a, good many years' experience in this House, and I say that this is quite an unprecedented action. I have never known such a thing before as postponing an Act. One understands a good Act or a bad Act. If it is a good Act it can go on, but if it is a bad Act it ought to be repealed. Now the Government, apparently, are putting this Bill in the position of a dormouse. It is to hibernate, and to wake up some time— when, I would like to know. If this is the result of a compromise in the Cabinet, again I would say that a Government cannot exist on compromise. A Government must have a mind of its own. It must have courage in purpose and resolution in action. These land questions have been treated with a good deal of hesitancy and wobbling. We have been told, first, on agricultural questions, that we must wait for Ottawa. But there is no question of waiting for Ottawa here. This is a matter which the House of Commons can deal with at once.

If the Dominions at Ottawa would like to share some of our taxes we should be delighted for them to do so. I appeal to the Government as a friend. I want to support them. I tell hon. Members opposite quite frankly that I do not see anything between this country and anarchy except this Government. Therefore, I do not want the Government to fall between the two stools of suspension or repeal. I have looked up the Debates on this subject. There was a Second Reading Debate on the 19th May, 1931, when an Amendment was moved by the present Chancellor of the Exchequer on behalf of the Conservative party stating in regard to the Bill that it …. introduces a new tax on one particular form of capital, thereby destroying confidence in all transactions in land…. Either that statement is right or it is wrong. I and others voted with the Conservative party in support of that Amendment, which declared that Part III of the Finance Act, 1931, "destroys confidence in all transactions in land." If it destroyed confidence in transactions in land in May, 1931, why does it not destroy confidence in transactions in land in May, 1932? [Interruption.] I am not joking about this matter. It is very serious. The Amendment further stated that the Bill would increase the already overwhelming amount of unemployment in the country."— [OFFICIAL REPORT, 19th May, 1931; col. 1801, Vol. 252.] If it would increase the already overwhelming amount of unemployment in the country in May, 1931, it will do exactly the same in May, 1932. Why, therefore, leave it on the Statute Book? We know full well that if there was a free vote of the House there would be a vote of at least six to one against this Act. It is inconceivable after the verdict of the country that the Government should continue this Act on the Statute Book. I will not go into the pledges of the Conservative leaders, but they did make pledges and we as Liberals acted with them in the last House of Commons in supporting their Amendments against thi3 Act. Therefore, for them to allow it to continue on the Statute Book is not playing the game. The Second Reading took place on the 19th May and the Third Reading on 3rd July, 1931. The present Chancellor of the Exchequer having had six weeks in which to digest the Bill declared on the Third Reading that it was of an injurious and destructive character. Another description of the Bill came from the Foreign Secretary, one of the greatest lawyers in the country. He said that it was clear that the Bill was nothing more than a step to State ownership; a step by way of confiscation and not by way of compensation. Do the Government propose to allow an Act to remain on the Statute Book which is a step to State ownership by way of confiscation? If so, they are trifling with the House of Commons and the country.


What did Lord Snow-den say?


I am not concerned with Lord Snowden's views. I have quoted the views of the Foreign Secretary. My hon. Friend seems to know the mind of the Government better than I do, but I have not noticed that he has been taken much into their confidence. I would ask the supporters of the Government to tell the Government that this sort of thing cannot go on. There has been a good deal of hesitation and wobbling in regard to land questions and to agriculture. The Government made it as plain and explicit as possible to the country that if they were returned to power they would repeal this Act. It is to be suspended. For how long? What is to happen? Is that procedure not unprecedented? It has never been done in my political lifetime. Can the Government give a precedent for hanging up an Act and saying that it shall not come into operation until Parliament otherwise determines? This Act is the law of the land, but it is to be suspended between heaven and earth until Parliament otherwise determines. I do not understand it. [An HON. MEMBER: "What about the Home Rule Act?"] My hon. Friend must know that that was suspended during the War. There is no war now. [Interruption.] Everybody seems to be trying to make my speech for me. It is suggested that because the Home Rule Act was hung up in the early part of the War that can be compared with the suspension of this particular Act. Such a suggestion is playing with the House of Commons. I ask the Government to repeal the Act. Let them do what they were pledged to do at the election.


Who gave the pledge?


I would remind the Committee that we have come to a voluntary arrangement to try to finish the Bill to-night. These interruptions do not assist in carrying out that arrangement.


I will try to keep my part of the bargain. I will conclude by asking the Government, in their own interests, to repeal the Act. If they do not repeal it there will be uncertainty throughout the country. Every owner of land for development will be in a state of difficulty and embarrassment. Therefore, I ask the Government respectfully, friendly and in all sincerity not to proceed with this Clause, but to repeal the Act straight away.


The view of this side of the Committee is well known. In listening to the right hon. Member for South Molton (Mr. Lambert) I have felt that the Liberals have something to be thankful for that he still claims to be a Liberal, but the Liberals behind him did not seem to be very proud of his claim. I suppose the Lord President of the Council was pleased at the demand that he should grant a free vote. I expect he will grant a free vote. Certain hon. Members claim free votes on some questions but they object to free votes on other questions. They want a free vote if it suits their purpose but not a free vote if it does not suit their purpose. I remember a Debate of a similar kind about 12 years ago. I was privileged to listen to that Debate from the Gallery, and I have been struck by the resemblance to the present position. On that occasion a Coalition Government was repealing a Liberal Act of Parliament. On the present occasion we have a Coalition Government repealing a Labour Act of Parliament. Some remarks were made which suited the occasion very well. One hon. Member named Mr. C. White, in opposing the repeal of the Act, used these words: I should have moved to report Progress so that the Prime Minister could have been here himself to have explained his attitude in this matter. Surely it is not respectful to bury the child without the presence of the father. At any rate, an explanation is due to those men and women who, at his bidding, fired by his religious fervour, by his perorations, carefully prepared, but called impromptu perorations—I remember many of them—went out, many of whom could not sing very much, singing 'The land song' with our unmusical voices. There might be a variation of that song. Instead of the words God gave the land to the people it might read God gave the Lamberts to the Liberals. The hon. Member went on to say: The Prime Minister then delighted in being called a robber of hen roosts, but he now stands convicted by his silence of deserving some such a name as that. At any rate, if he does not deserve that he does deserve to be called a man who deceived some of us in the years that are past."— [OFFICIAL REPORT, 14th July, 1920; col. 2515, Vol. 131.] The father of the Act of Parliament which it is now proposed to suspend was not the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George). The father was the present Lord Privy Seal. Hon. Members who have already spoken seem anxious to know where the Lord Privy Seal stands on this question. He is in another place and cannot be here, but if the Lord President of the Council could have arranged this Debate so that the Prime Minister's health would have enabled him to be present, we should have been pleased. He might have told us how he stands on this question. No two men did more to get our party pledged to support the Act which it is now suggested should be repealed.

Our case is very simple. We realise that this is a Conservative Government. The Dominions Secretary, in an article in a publication known as "The News Letter" is at great pains to show that this is not a Conservative Government, but he failed to convince me. Not only is this Finance Bill a piece of legislation which indicates a Conservative Government but the Amendment that has been moved indicates that there are some Conservatives who want a stronger Conservative police than even the Government want. We think that the Act ought not to be repealed but that a date ought to be inserted in it. We have an Amendment on the Order Paper which provides that we should leave out the words: As Parliament may hereafter determine. and to insert the words: Ending the thirty-first day of March, nineteen hundred and thirty-five. 4.30 p.m.

We realise that we cannot expect this Act to operate immediately, but we do think that it is in the interests in the House to see that this Section of the Act does operate at the latest by the end of December, 1935. We realise the advantage of the Act as it stands. There is the advantage of revenue, but that has never been our great claim. Not because it was a revenue producing instrument were we so strongly behind the Act. We supported it because we believed that it would cheapen land and bring land into greater use. For that reason we feel that, in the interests of the country, the Act ought to operate from the date mentioned in our Amendment. The Lord Privy Seal taught us to accept this proposal. Let me quote some words which he used on 27th of April last year when dealing with this matter. The scandal of the private appropriation of land values created by the enterprise and industry of the people and by the expenditure of public money has been tolerated far too long. In asserting the right of the community to a share in what has been created by the community, we are taking a step which will be approved not only by the Labour and the Liberal parties, which have long advocated this reform, but also by a large number of Conservatives, whose sense of justice is outraged by glaring examples of the exploitation of the public by private land monopolists. The present system stands in the way of social and economic progress, inflicts crushing burdens on industry and hinders municipal development. When we have carried this Measure, as I am sure we shall, we shall look back upon the Budget of this year as a landmark on the road of social and economic progress, and as one further stage towards the emancipation of the people from the tyranny and the injustice of private land monopoly."— [OFFICIAL REPORT, 27th April, 1931; col. 1411, Vol. 251.] This Bill, of course, will stand as it is; but I am quite certain that the proposal which is now to be repealed will be re-enacted and will come into operation. Nothing on earth can stop it. The Conservative majority in the Committee can repeal a Labour Act of Parliament, but it cannot prevent the people of this country claiming their fair share in the development of the land of the country.

The LORD PRESIDENT of the COUNCIL (Mr. Baldwin)

The beautiful words which the hon. Member quoted from the Chancellor of the Exchequer in the Labour Government only confirms me once more in my conviction that there is nothing so dangerous as to prophesy, and that is a truth upon which he might ponder in regard to his own concluding words. I am not rising to attempt in any way to curtail the discussion or to argue the more technical details of the Amendments; I want to explain to the Committee as briefly and as clearly as I can why the Government are not prepared to accept Amendments which will repeal the Statute or which will insert a date, such as hon. Members opposite want. Had this been a Tory Government we should have repealed the Statute. Had I been a private Member I should very likely have put my name to the Amendment to which hon. Members from Devonshire have put their names, but I occupy a more responsible position, and I have to remember that, this is a National Government. The right hon. Member for South Molton (Mr. Lambert) asked whether there was any precedent for what we are doing. I do not know; and I do not care. We have to make our precedents, if they do not exist, as we go along. He said that this was a matter of compromise, while the hon. and gallant Member for Tiverton (Lieut.-Colonel Acland-Troyte) said that it was the result of an agreement to differ. In a way that is true, but I would call the attention of the Committee to the difference.

I am not going to give away any Cabinet secrets, but I think I can say enough to enable the Committee to see how a decision of this kind has been arrived at without breaking any confidences, and only using as examples conversations in which I have taken part myself. Let me remind the Committee that the subject of land taxes and land valuation is one of the deepest controversy between parties. I remember very vividly how we were kept up night after night, and all night, on what was then called the Lloyd George Budget. I was a Member of the Coalition Government when the Lloyd George taxes were finally removed from the Statute Book. That was not done in the first Budget after the Coalition was formed. All parents of contentious legislation watch the failing health of their offspring with apprehension, and it was not until the second year of the Coalition that the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George), with a vast shrug of his shoulders, watched the interment of the child of 12 or 13 years before.

With regard to this Act, we all remember what took place in the House of Commons. In the National Government there are five Members who were Members of the Labour Cabinet when this Act became law. The matter has been considered and discussed among us. Members of the National Government, fully conscious of the importance of the cause for which they were returned by the country to serve, are anxious, so far as practicable, without sacrifice of principles, to hold together; to give and take. What is the present effect of this Statute? It is a Statute in coma. For this Parliament there can be no prospect at all of there being a land tax or land valuation, so that apprehension ought to be removed. It is true that the Statute is on the Statute Book, but action is delayed until Parliament so wills. That is the position to-day.

I put this question to private Members, and particularly to those who fought in the Midlands and in the North —not in Devonshire, because it does not matter what the right hon. Gentleman for South Molton stands for in Devonshire he will get in. Would any one of you who had been a member of a National Government, who had gone through the fight we went through last autumn, who had taken part in the discussions on finance on the first construction of the National Government with men who fought during that Election like Lord Snowden, when you had been met, by those who had been opposed to you, by their consenting to eviscerate this Act, and when they expressed to you their reluctance to see the Act finally taken off the Statute Book, do you think that I, going about the country as I did and knowing the force of Lord Snowden's speeches and broadcasts in helping to win seats which we should never have won, was going to say to them, "Oh, no, now we have got a big Tory majority, much bigger than I expected, out you go." Not much. That is why we stand for the Clause as it is in the Bill. We can accept neither a repeal of the Act nor the insertion of the Amendments.


We have had a very interesting statement from the Lord President of the Council as to the number of pieces of silver which have been handed to Lord Snowden. Apparently this is the price which is being paid by the National party for his marvellous speeches over the wireless immediately preceding the last election. It may be satisfactory to the National party, and I am sure that the right hon. Member for South Molton (Mr. Lambert) will now feel perfectly happy that the Bill shall go forward in the form in which it is now. As far as we are concerned it is not a satisfactory solution. This is, of course, quite obviously a compromise. It is a compromise which is intended to produce a state of coma referred to by the Lord President of the Council, and a state of coma generally precedes death. No doubt that is the intention of the right hon. Gentleman's remarks. Perhaps it is a decent way of interment in order that the father may be given that respite of sorrow which he deserves for the champion speeches he put up at the time of the election. It seems to us that this method of dealing with it is just dishonest. Either it is the intention of the Government not to go forward with the Land Tax—and I am bound to say that I sympathise with the right hon. Gentleman for South Molton that it would be just as well to repeal the Act—or else it is their intention when the times become quieter, if ever they do under a National Government, that these Land Taxes shall go forward. The Lord President of the Council has not told us which it is to be. He has not definitely stated that the National Government have made up their mind on either view. Apparently they are postponing the evil day for another year, and for that reason we shall certainly vote against the Clause although we do not propose to call a Division on all the Amendments.


I am very sorry to find myself in disagreement with the Leader of my party, the Lord President of the Council. He has ignored the fact that the land value tax, so long as it remains on the Statute Book, however long the postponement of its operation may be, is a contingent liability in the balance sheet of every single unit of land in the country. What, we ask the Government to do is not to abandon one penny piece of revenue but to remove a contingent liability from the assets of the country at a time when confidence is more needed than ever. How severe that contingent liability is and how important it is to remove it, I will try to explain. Several speakers to-day, and also last year when the Finance Bill of 1931 was before the House, have spoken of this matter as if it were merely a question of raising or depressing land values for the purposes of sale. It is nothing of the kind. What this contingent liability does is to destroy confidence and depress values for the purposes of credit, and in these days no owner of land, be he large or small, can maintain his property and utilize it to the best advantage without credit. So long as there is this contingent liability hanging on to every unit of land, there is a distinct added difficulty in either obtaining credit or retaining it when once you have got it. It is a deterrent to obtaining loans on mortgage, as every one who handles real property of any kind must have found.

Others have spoken of this land values tax as if it were serious only in the case of quite a small proportion of the land of the country. But that is not so, because it is proposed that this tax should apply to every unit of land, which has to be valued according to the Act of last year as if it was the only unit of land available for any particular purpose of development. The example that was taken in the Debate last year given by the hon. and learned Gentleman who was then Solicitor-General was, I think, an urban one. He took the case of the site of the Savoy, and said that that would be valued on the assumption that it was entirely cleared, and as if every other building in the Strand remained in position. That is undoubtedly the correct interpretation of the Act of last year. It would consequently be a heavy burden on every unit of land, and although its operation is postponed it remains a contingent liability. Every one in business knows how the existence of contingent liabilities interferes with the raising of new capital or the obtaining of credit of any kind. It is a terrible drawback to a public company which wants to raise capital.

The Treasury know perfectly well that their contingent liabilities under the Trade Facilities Act and guarantees of that kind have a definite bearing upon their capacity to borrow and the rate at which they can borrow in the City. So it is with every owner of land, whether it is the site of a cottage or farm or a site in the City of London. So long as this contingent liability remains there is a definite hindrance to obtaining the full credit to which the value of that unit of land is entitled. So I do hope that our Front Bench will realise that they are making a very serious decision in pro posing to retain this tax upon the Statute Book. Do not let them think for one moment that the tax is doing no harm so long as it is not put into operation. It is doing a very great and serious harm, and if the Government persist in this course let them realise how much harm they are doing—harm for which they will get the full blame in the country.


I want to thank the Lord President of the Council for his very fair and frank statement of the position. It is what we expected from him, and is in keeping with the way he has acted all through the last few months. He has tried at any rate, under great difficulties, to keep the national character of the Government. We are not forgetting the political past of the Prime Minister. The Prime Minister was the head of a Government that was responsible for this particular Act of Parliament. He endeavoured to make clear to the country that he had not altered any of his political opinions and that he reserved the right to retain his views. As recently as November last, after the formation of the second National Government, he said at the Guildhall: We are a National Government. The Cabinet and Administration consists of Members of all parties, none of whom has shed his party allegiance. We Liberals—I speak for a good many in the country—attach great importance to retaining the valuation Sections of the Finance Act of last year on the Statute Book. We still believe that they are of great value, and we want to see them in operation at the first opportunity. We realise that the majority in this House is against us, but when the financial position has changed, when so-called national emergencies have disappeared and inter national affairs have become more normal, we claim full right to use all our energies not only to get the valuation into operation but to levy the taxes for which the Act provided.


All of us listened with respect and admiration, as we always do, to the statement of the Lord President of the Council, but I cannot suggest that my right hon. Friend altered in any way my decision to sup port the Amendment so ably moved by my hon. and gallant Friend. The Lord President reminded us that this was a National Government, and in effect he said that this was a part of the price paid to the Lord Privy Seal for his ser vices before the last General Election. We all appreciate the advantages and the disadvantages of a National Government, but I have never heard that among either was the question of minority rule. The retention of this tax on the Statute Book is unquestionably minority rule. If there is one thing more certain than another it is that the vast majority of both Houses want these taxes repealed. Is the retention of a tax on the Statute Book to be treated as a bargaining power between different Members of the Cabinet? I submit that it is not in the highest interests of the country or in accordance with the high traditions which the National Government have so ably kept up, to use taxation or the suspension of taxation as a bargaining power for the adherence or non-adherence of one Member or another.

We believe these taxes to be definitely bad and that they should be repealed. If they were bad in May, 1931, they are bad in May, 1932, and the only thing that has changed in the last 12 months is that the power of repealing them is in this new House of Commons. I suggest that the Government are simply shirking a vital issue which has to be faced. The issue as to whether these taxes are to be pushed forward or repealed has to be faced at some time, and it had better be faced now. Running away from vital issues was the thing that brought down the last Government. If we once start that course it is a thing which it is fatally easy to follow up. I beg the Government to face the issue, to take their courage in one hand, in both hands, or rather to take their courage in one hand and their principles in the other, and to support the Amendment of my hon. and gallant Friend.


I should have been content to have remained in my place except for the fact that, although an arrangement was come to an hour ago, supporters of the Government are breaking the agreement. [Interruption.] It was a friendly arrangement, but quite a dozen supporters of the Government are anxious to talk and they are keeping the Debate going. I am not going to find fault with the decision of the Lord President of the Council. I do not think he could have done differently in common decency. He has had the decency to admit that he and his party would not have been here in their present strength except for the action of the father of the Act under discussion. It was Lord Snowden's action last year that gave to the Conservative party the preponderating power it has in this House. It is quite clear, of course, that the Lord Privy Seal is quite content with the state of coma to which the Lord President has referred. I can see clearly, and I can prophesy, that the coma will gradually pass into absolute extinction; death will take place before this Parliament rises, no matter what arrangements may be come to. The moment that the late members of the Labour party have served fully the purpose of the Conservatives they will be told that they can get out or take the consequences, and then this Bill will go. I would have liked to have seen some. Socialist supporters of the Prime Minister and of Lord Snowden raising their protests against this action on the part of their colleagues in the present Government. I should have thought that this was their opportunity of putting the Socialist point of view.


The hon. Member complained just now that the arrangement made to curtail discussion had been broken, and he is now complaining that other speeches are not being made.


I understood that certain supporters of the present Government were in this House for the purpose of maintaning the Socialist point of view, but in all the Debates that have taken place since the National Government was instituted, the Socialist supporters of the Government have been conspicuous by their silence. I have never heard their voices raised from that point of view. I should have thought that they would have been in friendly contention with their Conservative colleagues in maintaining the authority of the Lord Privy Seal. [Interruption.] If hon. Members who interrupt want to see broken the arrangement that has been come to, we can do it. I want to see this Act retained; I want to see it strengthened and enlarged. I do not want the fight over land values again. Therefore I welcome what has been said. At the same time I want to see Socialist supporters of the Government maintaining Socialist principles. They are where they are as hostages of fortune, and they ought to play their part.

5.0 p.m.


I did not propose to intervene because I understood that some arrangement had been made to curtail discussion. It is only right, however, that in a few sentences I should express a point of view which I share without any reservation with the Lord Privy Seal. I share the view which has long been represented by the Lord Privy Seal but I acknowledge the description of the position given to-day by the Lord President of the Council. The friendly controversy which has arisen is due to the fact that hon. Members opposite have never properly recognised the circumstances which brought this Government into existence. It was because they failed to recognise the circumstances that the country with some indignation rejected them and placed this Government in office; and they still affect not to understand the motives which lead this Government to continue its legislation. As I say, I agree with the general description of the position given by the Lord President of the Council and, if I may be allowed to make a personal reference, I would say that I have been engaged in this controversy since it started in 1909 when the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) incorporated these land taxation proposals in his Budget of that year. I have never desisted from the view which I then held. I am satis- fied that the time will come when, in any assessment of the economic resources of the country, the value of the land will have to be taken into account. I have never changed my view upon that point but in present circumstances I realise the practical difficulties to which the hon. Baronet the Member for Rye (Sir G. Courthope) has alluded and the difficulties of owners of agricultural land at the present time. I also realise the circum stances of this Government and the fact that we have to concentrate on immediate and practical purposes. But in response to the friendly suggestion of my hon. Friend the Member for Merthyr (Mr. Wallhead) it is right to say that there are Members in this House, sup porters of the Prime Minister, who have not abated their attachment to the principles and policies of the previous Government but who are prepared, in the interests of the nation, at this moment to support a general national Administration.


The hon. Baronet the Member for Eye (Sir G. Courthope) showed very clearly to many of us that whatever else may be said on this question the very fact that this provision remains at all must do a certain amount of harm to the welfare of the country. Which course, then, are we going to choose? Are we going to agree that a certain amount of harm should be done to the welfare of the country, or are we going to refuse to bow to the personal predelictions of certain Ministers? That is the crux of the matter. The hon. Member for South-West Bethnal Green (Sir P. Harris) stated the Opposition case very wisely. He of course wants to keep this provision in existence for use at a later date. He says that he is maintaining his identity as a Liberal and, naturally, he desires the opportunity later on of making use of whatever is left of the land values proposals for Liberal purposes.

Are the Conservatives to be the only people who are not to be allowed to maintain their identity? Are we to bow the knee to every compromise? I suggest in all seriousness to the Lord President of the Council that the greatest danger to the national welfare and to the National Government will arise if there is for one moment a breath of suspicion that principle is in any way being com promised for the sake of expediency. We on the Conservative side for years fought the principle of land value taxation, all along the line, as a bad principle. Sup pose that, as has been suggested, it passes into a state of coma now, until the next election; suppose that at the next election you have land tax proposals brought up by hon. Members who are now sitting in Opposition and suppose that they get in, which is quite possible, how are we, then, going to fight the principle in the country if we have allowed that principle to slip for two or three years under this Administration? It must be either right or wrong and, for my part I stand by the Amendment.


I would like to defend the Lord President of the Council from the furious onslaught of the hon. Member for South-East Essex (Mr. Raikes). I think that from his own point of view the right hon. Gentleman adopted a very reasonable attitude. He is suspending the operation of this taxation. He is just waiting until the author of the scheme has worn the robes of nobility for a little while longer, until he has acquired, as he probably will, in a year's time, the usual sentiments of a landed proprietor. It would be cruel to the Noble Lord who is the author of this taxation scheme to kill it at the present moment, because this proposal represents the sum total of the achievement of the Noble Lord's political career. For 36 years he has toiled and worked for these land taxes and last year he had the satisfaction of placing them on the Statute Book. It is true that they are very small. It is true that they have never really enjoyed the breath of life, but they are the one creative thing which he has ever done and if they are repealed now, what will be left to him to show for his whole existence? If they are repealed now there will be nothing left to console him for a hard-working if somewhat acidulous existence but the Opera Subsidy. To repeal them now would be to rob the Noble Lord of that gratitude which ought to be shown to him for the great help he gave to hon. Members opposite during the last election. I think hon. Members ought to be patient. The Noble Lord has not at the present moment any chaplet of laurels pressed down upon his brow. They should leave him this one little withered leaf as the sole momento of a wasted and futile life.


These taxes were brought in as has been said in 1909 but the movement in favour of them started away back about 1903 with a somewhat doubtful Glasgow bailie. He lived off the agitation for many years and ultimately managed to stuff this proposal into the programme of the Liberal party who never understood the matter properly. These taxes have been proved to be exceedingly damaging to land and to landowners. They make the transfer of land dearer and more difficult and not cheaper and easier. Particulars have constantly to be supplied, solicitors have to be employed, and there are any number of "Nosey Parkers" going about in Government Departments looking after these things and it all costs money. The right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) although he was a solicitor never under stood anything about landed estates. His only acquaintance with them was gathered from going about the country districts and seeing the notices about trespassing and about land for sale. When he brought these proposals into his 1909 Budget one of the calamities was that the scheme was not allowed to stand just as it was originally because it would have ruined the Liberal party. As it was the taxes were found to be utterly unworkable in practice. Most of the young men in this House do not know anything about the history of this matter but I was concerned in this business even before the right hon. Gentleman the Member for Carnarvon Boroughs and I know the damage which was done to the building trade, for instance, as a result of this taxation. It is due to those taxes that there is a housing problem to-day because as a result of them nobody could build cottages or houses of any kind for working people.

Another result was that a great many surveyors and architects were put out of their jobs. They were immediately rushed into the Government Valuation Department—a perfect army of them, all living off the taxpayers. When the taxes were found to be unworkable the scheme was scrapped by the Coalition Government. Even their author understood then that they were unworkable though it took a long time to get it into his head. Then these people who had been brought into the Government Valuation Department were kept working away for a year or two winding up but at the end of that time they began to find them selves idle, just as the Employment Ex changes were idle until we invented the unemployment dole to make sure that they would not be unemployed. Then these fellows sat back and said: "All this land tax agitation is forgotten. The litigation about Form IV has disappeared. The masses of the people have been forming fours in the Army and have for gotten all about it, so we will start the business once again, to avoid being scrapped. "Accordingly they stuck the Labour Government in the same way as they had previously stuck the Liberal Government. The taxes which were un workable under the Budget of 1909 are just as unworkable under the Budget of last year, which was said to be such a monument—and so it was, a monument of folly and disingenuousness because it did not disclose the state of the country at all.


The author of it is a Member of your Government.


Yes, he is in the Government and I have a great regard for him and I quite admit that his speeches were very valuable but is the landed interest and all the people who are concerned with the land to be sacrificed, simply to avoid hurting the feelings of any Member of the Government? It is all very well for the Lord President of the Council to say that he looks upon Lord Snowden as his friend, but the interest of the country is the only interest to which the right hon. Gentleman ought to have regard. After all, what did Lord Snowden do at the last Election except to tell his followers that all the nostrums which he had been advocating for years would not work and that ho had led the country "down the drain." To some extent he has led our party "down the drain" because we have been going in for a great many Socialist nostrums which are thoroughly unsound. I do not know whether it is the result of sitting opposite to each other and looking at each other but the Conservative party have been taking a certain tinge from the Socialist party and I think that our own party has been very much to blame in regard to certain measures.

These taxes are of no use. If you want to get at unearned income on land then you ought to empower the Government to buy the land and take the chance of the income. But do not take the money off the poor shivering wretches who are burdened with the ownership of land. It is not the man who owns the land nowadays but the land which owns the man. [Interruption.] Yes, we get it all round about us in the end, and some of us will enrich it more than others. In agricultural language that will depend on our manorial value. To continue these taxes would only be in the interests of those people in the land valuation department who have stuck successive Governments with this proposal in order to keep their jobs. Why not pension them off and enable them to cultivate a bit of land? They will then know something about it. The one problem that we have to solve in this civilisation and in all Anglo-Saxon civilisations is that we are being eaten up by officials. They are clinging on the backs of the working men, and more and more people are continually demanding pensions, and we are having more and more inspectors of this and of that, so that those who produce the wealth of the country have not a chance to live; and unless the Government take in hand enormous cuts and tell all these over developed people—


The hon. and learned Member is now getting very far away from the Clause.


I agree with you, Captain Bourne. I was getting over developed. But I say that here is an opportunity to do something to get quit of a Government Department, and if we can get quit of a Government Department, it is a great step towards prosperity for the country. After all, the acceptance of this Amendment would not hinder our hon. Friends opposite, if the country should be disgusted with the present Government for not being a really National Government and for not acting and doing what the country believed they would do, and should put a Socialist Government back into power. It would be a very simple matter to bring in these proposals again, and they would have valuers and lawyers and other officials all jumping to 'attention at once. But let us take these taxes off the Statute Book now as quickly as possible. There is no use having a sword of Damocles hanging over your head all the time. Such a tax is damaging, and it is wrong to keep it on the Statute Book, and very unhealthy to have it there. Therefore, I wish the Government would take their courage in their hands and remember that a National Government is a Government that does the best for the population, not for the susceptibilities of particular members of any section of the population.


I have listened to the appeals made here to-day on behalf of the poor landlord of this country, and I feel that a word should be put in for those who are suffering from the effects of landlordism. The proposal put for ward by certain Members of the Conservative and Liberal parties is that these Land Taxes should be repealed instead of being merely suspended. I can under stand their anxiety lest at any time the Land Taxes should come into full working order, as they were liable to have done in the event of the continuation of the late Administration. At the same time, I think they can take consolation from the words of the Lord President of the Council, when he assured them that during 'at least the four or five years of this Government there is no danger of these taxes operating. He was quite honest when he stated that if he were a private Member, he would probably have associated himself with the demand for the repeal of the taxes. That being the ease, I hope that those who have put down this Amendment will do as he claimed that he would have done, and go into the Lobby in favour of it.

I am rather inclined to think that we should have no need of a time-table in this House in connection with any of these Clauses if we had more common honesty and decency among the people who are putting down Amendments. They should either put down Amendments in order to get concessions from the Government, or, if no concessions are granted, they should carry their Amendments into the Division Lobby to test the feeling of Members on all sides of the House. But we get them on every other Clause leading their army up to the top of the hill, making all sorts of threats to the Government as to what they intend to do, and then retreating, like a cowardly, bedraggled army, when they are expected to take the plunge and oppose the Government of the day. I had not a tremendous amount of faith in the effect of these taxes passed by the last Administration, but I do say that it brings the Government of this country to a farce when you spend, as we spent, almost the whole of the spring and summer months, night after night, in an endless amount of talk in favour of or in opposition to Land Taxes, and then, with a simple turning of the tide and manipulation of the electoral machinery, you attempt to turn your machine against the decisions of a previous Government.

I say quite frankly that if this question of the land of the country was presented to the electors—either the question of a Land Tax or the question of the ownership of land—the electors would enthusiastically and by a very large majority endorse the previous proposals and would go a great deal farther. The only fault that I find with this tax is that it does not go far enough, and I am hoping that the lessons of this Land Tax, with a danger of the fall of the Government because of a matter of one-sixteenth of a penny, may result, if a Socialist Government is again in office —if the system does not completely collapse earlier, and I anticipate that the whole system will collapse before we can get another Government in this country— in that Government tackling the question in a very different manner. I am engaged now in reading up and studying how the Russian State acquired the land of Russia, and I hope that if a future Ad ministration of a Socialist nature should be in operation in this country, I shall be able to contribute to the discussion and suggest radical methods of obtaining the land of this country by a more modern machine than by the method of one-eighth of a penny at a time.

A plea has been put up that the land lords of this country, owing to the in decision of the Government, are not able to get that confidence in their business affairs that one might expect, but they are surely able to make up their minds on the promise made by the Lord President of the Council that there is no danger of the tax operating for five years at least, and I believe that before the end of that time the Members of the Government will have made up their minds to the extent of annulling and completely wiping out this tax. The Lord President of the Council has been honest in his statement that the only reason for keeping the tax on the Statute Book was to give a certain ease to the conscience of Lord Snowden and the present Prime Minister of this country. He says that he could not honourably wipe out these taxes now, because it would be an affront to those who are in the National Government, and I was glad to hear the hon. Member opposite putting his point of view from the National Socialist party.

I may be wrong, but I do not think I heard his voice, or the so-called National Socialist party raising their voice, in any way in protest when these taxes were going to be suspended, and if they believe in the operation of the tax, I suggest that even in a state of national emergency there was the greater need for the country adopting such a tax and getting it into full working order in order to collect the ultimate revenue obtainable from it. Therefore, I am glad to see that the hon. Member opposite gave us his point of view to-day, although he was largely dragged to his feet by a Member of our group. The honest opinion of the overwhelming number of the Members of the Tory party is that this tax is a bad tax, which should be wiped out. If that is their point of view, why do they not have the courage to go into the Lobby to-night for this Amendment? They are all very confident and courageous when there is no fight on. As a matter of fact, we saw all that game in the last Administration. I had not much knowledge of it, but we always found out that there were plenty of rebels until the numbers in the Division Lobby were called out, and then it was found that there were very few, and it all came to excuses for their not being there.

Whether I agree with a man's point of view or not, I admire him if he has the courage to carry his convictions into the Division Lobby, no matter what his Front Bench may say. I believe that if that Front Bench put up a point of view that is not the point of view of the individual, or the party, or the interests that an hon. Member represents in the country, he ought to manifest that point of view by carrying his voice into the Lobby, because otherwise it reduces discussion in this House to a farce. What is the use of endless Amendments on the Order Paper and a person getting up, for the sake of getting his voice across to the country and showing to those who have asked him to demand a repeal that he is prepared to voice that demand in the House, and then saying, "I did not carry my protest into the Division Lobby. The promise of the right hon. Gentleman has been so satisfactory; I thank him for nothing, and I withdraw the Amendment in my name"?

That is an absurdity, and I cannot understand it. I would rather leave this House entirely than adopt a policy of that description. It is hypocrisy and make-belief of the worst description. Just as I disagree with the Labour party carrying out this Tory policy, I would object if I were a Tory to see my party carrying out a Liberal policy, and there fore I hope the hon. Members who have put their names to this Amendment will have a little courage and will go into the Division Lobby, thus showing us that public decency and duty have not passed out of this arena. There is nothing that brings this House of Commons into the contempt of the people outside more than this sham and make-belief. I invite hon. Members to go into the Lobby on this question, and I will give them an opportunity, by raising my voice when the Question is put, to carry it to a Division.

5.30 p.m.


Every hon. Member who listened to the Lord President of the Council will agree that the late Chancellor of the Exchequer has a very loyal colleague indeed. I do not think I have ever heard, in the course of many years in this House, a greater case of loyalty to a colleague—who has not, I believe, voted for the Government so very strongly himself all the time—than was given to us this afternoon. I wonder which of the two private Members below the Gangway opposite who have spoken this afternoon has been the loyalest and the firmest and the best supporter of the National Government—the right hon. Member for South Molton (Mr. Lambert) or the hon. Member for South-West Bethnal Green (Sir P. Harris)? These are not members of my party, and we Tories owe a debt to those Liberals who are loyal to us in the constituency in the same way as our loyalty entitles us to their loyalty. The ordinary private Member might occasionally have ex tended to him the loyalty which he shows in such profusion to Members of the Cabinet. It has been agreed that because of very bitter feeling in the Cabinet the Members of the Government should be free to vote as they like. Why should you not extend that freedom to the private Members? Some of us have been tried very hard both here and in the country by the attacks which are going on behind our backs from Members who are supposed to be supporters of this Government. That sort of attack does not entitle those who carry it on to loyalty on the Floor of the House of Commons. I happen to be in a fairly independent position, and I shall vote to-day as I have always voted, exactly as I choose.

I would like to remind the Committee what this battle is being fought about. It is all over some Sections of an Act which was passed last year and which the Lord President of the Council said was in a state of coma. It is more than that. This Clause is really nothing but a tombstone, and a rather expensive tombstone at that, erected to something that was passed in a previous Parliament and that ought to be abolished, something which is costing a great deal to many thousands of small people who are in anxiety about what is to happen in regard to the Land Tax. If the Government are really genuine in their desire to restore confidence, why cannot they make a big move and allow Members to vote with the same freedom that is allowed to Members of the Cabinet on certain questions such as tariffs. In view of the attacks which have been made against us by some Members of the Cabinet behind the scenes, it is wrong that those who sit on the Government Benches should not have absolute freedom to vote in a way that they think is right.


I would not like to give a silent vote in favour of this Amendment. We all respect the speech which we have heard from our Leader, the Lord President of the Council; we would not have expected any other speech from him. He said that had he not been a Member of the Administraiton, and had he been a back bencher, he might have taken another line. We respect and honour him for the line that he has taken, and we know that he will not object to us back benchers doing what we think is right and honourable. Many of us have felt-very sorely the action which Lord Snowden in another place and certain Members of the Government have taken in making light of and in holding up to obloquy things which we value very highly and which we think are essential in the intersts of the country. Nobody should complain if we back benchers also want to have the freedom of our con-

victions, and on this occasion to vote against the retention on the Statute Book of something which we believe is deleterious to the country and especially to the land, which is suffering so severely. I hope that Members who have put down this Amendment will carry it to the Division Lobby, and that others will have the same freedom of supporting it as Members of the Government reserve to themselves in dealing with other matters.

Question put, "That the words proposed to be left out, to the word 'such', in line 39, stand part of the Clause."

The Committee divided: Ayes, 298; Noes, 71.

Division No. 199.] AYES. [5.36 p.m.
Adams, D. M. (Poplar, South) Cruddas, Lieut.-Colonel Bernard Hamilton, Sir R.W.(Orkney & Zetl'nd)
Adams, Samuel Vyvyan T. (Leeds, W.) Culverwell, Cyril Tom Hammersley, Samuel S.
Agnew, Lieut.-Com. P. G. Daggar, George Hanley, Dennis A.
Albery, Irving James Davidson, Rt. Hon. J. C. C. Hannon, Patrick Joseph Henry
Allen, Lt.-Col. J. Sandeman (B'k'nhd.) Davies, Maj. Geo. F.(Somerset, Yeovil) Harbord, Arthur
Allen, Lt.-Col. Sir William (Armagh) Davies, Rhys John (Westhoughton) Harris, Sir Percy
Aske, Sir Robert William Denman. Hon. R. D. Hartland, George A.
Astbury, Lieut.-Com. Frederick Wolfe Denville, Alfred Harvey, George (Lambeth, Kenningt'n)
Attlee, Clement Richard Dickie, John P. Harvey, Major S. E. (Devon, Totnes)
Bailey, Eric Alfred George Doran, Edward Haslam, Sir John (Bolton)
Baldwin, Rt. Hon. Stanley Dugdale, Captain Thomas Lionel Headlam, Lieut.-Col. Cuthbert M.
Balniel, Lord Duggan, Hubert John Heilgers, Captain F. F. A.
Barton, Capt. Basil Kelsey Duncan, Charles (Derby, Claycross) Heneage, Lieut.-Colonel Arthur P.
Batey, Joseph Dunglass, Lord Hicks, Ernest George
Beaumont, Hon. R.E.B. (Portsm'th, C) Eastwood, John Francis Hills, Major Rt. Hon. John Waller
Betterton, Rt. Hon. Sir Henry B. Edmondson, Major A. J. Hirst, George Henry
Bevan, Aneurin (Ebbw Vale) Edwards, Charles Holdsworth, Herbert
Bevan, Stuart James (Holborn) Elliot, Major Rt. Hon. Walter E. Hope, Sydney (Chester, Stalybridge)
Bird, Ernest Roy (York., Skipton) Ellis, Robert Geoffrey Hore-Belisha, Leslie
Bird, Sir Robert B.(Wolverh'pton W.) Elliston, Captain George Sampson Hornby, Frank
Borodale, Viscount Elmley, Viscount Howard, Tom Forrest
Bossom, A. C. Emrys-Evans, P. V. Hudson, Capt. A. U. M. (Hackney, N.)
Boulton, W. W. Entwistle, Cyril Fullard Hudson, Robert Spear (Southport)
Bowyer, Capt. Sir George E. W. Essenhigh, Reginald Clare Hume, Sir George Hopwood
Boyce, H. Leslie Falle, Sir Bertram G. Hunter, Dr. Joseph (Dumfries)
Briant, Frank Fielden, Edward Brocklehurst Inskip, Rt. Hon. Sir Thomas W. H.
Briscoe, Capt. Richard George Foot, Dingle (Dundee) Jackson, Sir Henry (Wandsworth, C.)
Brockiebank, C. E. R. Fuller, Captain A. G. Jackson, J. C. (Heywood & Radcliffe)
Brown, C. W. E. (Notts., Mansfield) Galbraith, James Francis Wallace Jamieson, Douglas
Brown, Ernest (Leith) Ganzoni, Sir John Jenkins, Sir William
Buchan, John Gibson, Charles Granville Jennings, Roland
Burnett, John George Gillett, Sir George Master man Jesson, Major Thomas E.
Butt, Sir Alfred Gilmour, Lt.-Col. Rt. Hon. Sir John Johnston, J. W. (Clackmannan)
Campbell, Edward Taswell (Bromley) Gluckstein, Louis Halle Jones, J. J. (West Ham, Silvertown)
Campbell, Rear-Admiral G. (Burnley) Goff, Sir Park Jones, Lewis (Swansea, West)
Campbell-Johnston, Malcolm Goldie, Noel B. Jones, Morgan (Caerphilly)
Cape, Thomas Goodman, Colonel Albert W. Ker, J. Campbell
Caporn, Arthur Cecil Gower, Sir Robert Kerr, Hamilton W.
Cazalet, Thelma (Islington, E.) Graham, Fergus (Cumberland, N.) Knatchbull, Captain Hon. M. H. R.
Chapman, Col. R.(Houghton-le-Spring) Grattan-Doyle, Sir Nicholas Knebworth, Viscount
Chotzner, Alfred James Graves, Marjorie Knight, Holford
Clarry, Reginald George Greaves-Lord, Sir Walter Lansbury, Rt. Hon. George
Clayton, Dr. George C. Greenwood, Rt. Hon. Arthur Law, Sir Alfred
Cobb, Sir Cyril Grenfell, David Rees (Glamorgan) Lawson, John James
Cochrane, Commander Hon. A. D. Griffith, F. Kingsley (Middlesbro', W.) Leckie, J. A.
Colman, N. C. D. Griffiths, T. (Monmouth, Pontypool) Leech, Dr. J. W.
Colville, John Grimston, R. V. Lees-Jones, John
Cooke, Douglas Grundy, Thomas W. Leonard, William
Cooper, A. Duff Guest, Capt. Rt. Hon. F. E. Lewis, Oswald
Copeland, Ida Guinness, Thomas L. E. B. Liddall, Walter S.
Cove, William G. Gunston, Captain D. W. Lister, Rt. Hon. Sir Philip Cunliffe-
Cowan, D. M. Guy, J. C. Morrison Lloyd, Geoffrey
Creddock, Sir Reginald Henry Hales, Harold K. Locker-Lampson. Rt. Hn. G. (Wd. Gr'n)
Cripps, Sir Stafford Hall, F. (York, W.R., Normanton) Lovat-Fraser, James Alexander
Croft, Brigadier-General Sir H. Hall, George H. (Merthyr Tydvil) Lumley, Captain Lawrence R.
Crooke, J. Smedley Hall, Capt. W. D'Arcy (Brecon) Lunn, William
Crookshank, Capt. H. C. (Gainsb'ro) Hamilton, Sir George (Ilford) Lyons, Abraham Montagu
MacAndrew, Lieut. Col. C. G. (Partick) Peto, Geoffrey K. (W'verh'pt'n, Bliston) Stanley, Hon. O. F. G. (Westmorland)
Macdonald, Gordon (Ince) Pickering, Ernest H. Stevenson, James
McEntee, Valentine L. Pickford, Hon. Mary Ada Stones, James
McEwen, Captain J. H. F Potter, John Strauss, Edward A.
McKie, John Hamilton Powell, Lieut.-Col. Evelyn G. H. Strickland, Captain W. F.
Maclay, Hon. Joseph Paton Pownall, Sir Assheton Stuart, Hon. J. (Moray and Nairn)
Maclean, Rt. Hn. Sir D. (Corn'll, N.) Price, Gabriel Sueter, Rear-Admiral Murray F.
McLean, Dr. W. H. (Tradeston) Procter, Major Henry Adam Sugden, Sir Wilfrid Hart
Macmillan, Maurice Harold Pybus, Percy John Tate, Mavis Constance
Maitland, Adam Ramsay, Alexander (W. Bromwich) Templeton, William P.
Makins, Brigadier-General Ernest Ramsden, E. Thomas, Rt. Hon. J. H. (Derby)
Mallalieu, Edward Lancelot Rankin, Robert Thomas, James P. L. (Hereford)
Mander, Geoffrey le M. Ratcliffe, Arthur Thompson, Luke
Manningham-Buller, Lt.-Col. Sir M. Rea, Walter Russell Thomson, Sir Frederick Charles
Margesson, Capt. Henry David R. Reid, William Allan (Derby) Thorne, William James
Martin, Thomas B. Rentoul, Sir Gervais S. Tinker, John Joseph
Mason, Col. Glyn K. (Croydon, N.) Reynolds, Col. Sir James Philip Titchfield, Major the Marquess of
Mayhew, Lieut.-Colonel John Roberts, Aled (Wrexham) Todd, Capt. A. J. K. (B'wick-on-T.)
Millar, Sir James Duncan Robinson, John Roland Turton, Robert Hugh
Mills, Sir Frederick (Leyton, E.) Rosbotham, S. T. Wallace, Captain D. E. (Hornsey)
Mills, Major J. D. (New Forest) Ross Taylor, Walter (Woodbridge) Wallace, John (Dunfermline)
Milne, Charles Rothschild, James A. de Ward, Lt.-Col. Sir A. L. (Hull)
Milne, John Sydney Wardlaw- Runciman, Rt. Hon. Walter Ward, Irene Mary Bewick (Wallsend)
Mitchell, Harold P.(Br'tf'd & Chisw'k) Russell, Albert (Kirkcaldy) Ward, Sarah Adelaide (Cannock)
Mitchell, Sir W. Lane (Streatham) Russell, Alexander West (Tynemouth) Warrender, Sir Victor A. G.
Mitcheson, G. G. Russell, Hamer Field (Sheffield, B'tside) Watt, Captain George Steven H.
Morris, Owen Temple (Cardiff, E.) Russell, Richard John (Eddisbury) Wedgwood, Rt. Hon. Josiah
Morris-Jones, Dr. J. H. (Denbigh) Rutherford, Sir John Hugo White, Henry Graham
Muirhead, Major A. J. Salmon, Major Isldore Whiteside, Borras Noel H.
Munro, Patrick Salt, Edward W. Williams, David (Swansea, East)
Nathan, Major H. L. Samuel, Sir Arthur Michael (F'nham) Williams. Edward John (Ogmore)
Nation, Brigadier-General J. J. H. Samuel, Rt. Hon. Sir H. (Darwen) Williams, Herbert G. (Croydon, S.)
Nicholson, Godfrey (Morpeth) Shakespeare, Geoffrey H. Williams, Dr. John H. (Lianelly)
North, Captain Edward T. Shaw, Helen B. (Lanark, Bothwell) Williams, Thomas (York, Don Valley)
Nunn, William Shaw, Captain William T. (Forfar) Wills, Wilfrid D.
O'Connor, Terence James Simmonds, Oliver Edwin Wilson, Clyde T. (West Toxteth)
O'Neill, Rt. Hon. Sir Hugh Skelton, Archibald Noel Withers, Sir John James
Palmer, Francis Noel Smiles, Lieut.-Col. Sir Waiter D. Wood, Rt. Hon. Sir H. Kingsley
Parkinson, John Allen Smithers, Waldron Worthington, Dr. John V.
Patrick. Colin M. Southby, Commander Archibald R. J. Young, Rt. Hon. Sir Hilton (S'v'noaks)
Pearson, William G. Spencer, Captain Richard A. Young, Ernest J. (Middlesbrough, E.)
Peters, Dr. Sidney John Spender-Clay, Rt. Hon. Herbert H.
Petherick, M. Stanley, Lord (Lancaster, Fylde) TELLERS FOR THE AYES.—
Sir George Penny and Lord Erskine.
Allen, William (Stoke-on-Trent) Donner, P. W. Macquisten, Frederick Alexander
Amery, Rt. Hon. Leopold C. M. S. Dower, Captain A. V. G. Nicholson, Rt. Hn. W. G. (Petersf'ld)
Applin, Lieut.-Col. Reginald V. K. Duckworth, George A. V. Peto, Sir Basil E. (Devon, Barnstaple)
Apsley, Lord Duncan, James A. L. (Kensington, N.) Raikes, Henry V. A. M.
Baillie, Sir Adrian W. M. Emmott, Charles E. G. C. Ramsay, Capt. A. H. M. (Midlothian)
Balfour, Capt. Harold (I. of Thanet) Fermoy, Lord Rawson, Sir Cooper
Beauchamp, Sir Brograve Campbell Fox, Sir Gifford Renwick, Major Gustav A.
Belt, Sir Alfred L. Gault, Lieut.-Col. A. Hamilton Scone, Lord
Blaker, Sir Reginald Gritten, W. G. Howard Smith, Sir Jonah W. (Barrow-in-F.)
Boothby, Robert John Graham Groves, Thomas E. Smith-Carington, Neville W.
Bower, Lieut.-Com. Robert Tatton Henderson, Sir Vivian L. (Cheimsford) Somerville, Annesley A. (Windsor)
Bracken, Brendan Hepworth, Joseph Sotheron-Estcourt, Captain T. E.
Braithwaite, Maj. A. N. (Yorks, E.R.) Horobin, Ian M. Stourton, Hon. John J.
Braithwaite, J. G. (Hillsborough) Hunter, Capt. M. J. (Brigg) Taylor, Vice-Admiral E. A.(Pd'gt'n, S.)
Brown, Brig.-Gen. H. C.(Berks., Newb'y) Hurst, Sir Gerald B. Touche, Gordon Cosmo
Burton, Colonel Henry Walter Hutchison, W. D. (Essex, Romf'd) Train, John
Cayzer, Sir Charles (Chester, City) Joel, Dudley J. Barnato Wayland, Sir William A.
Conant, R. J. E. Lamb, Sir Joseph Quinton Wells, Sydney Richard
Cook, Thomas A. Lambert, Rt. Hon. George Williams, Charles (Devon, Torquay)
Courtauld, Major John Sewell Latham, Sir Herbert Paul Windsor-Clive, Lieut.-Colonel George
Courthope, Colonel Sir George L. Leigh, Sir John Wragg, Herbert
Craven-Ellis, William Leighton, Major B. E. P.
Dalkeith, Earl of Lennox-Boyd, A. T. TELLERS FOR THE NOES.—
Davison, Sir William Henry Levy, Thomas Lieut.-Colonel Acland-Troyte and
Dixey, Arthur C. N. Lymington, Viscount Mr. Michael Beaumont.

I beg to move, in page 16, line 5, at the end, to add the words: and Section twenty-eight of the said Act relating to the production of instruments transferring land shall cease to have effect until such date as Parliament shall hereafter determine, and shall be deemed not to have had effect until such date. The effect of this Amendment is to bring Section 28 of the Act of 1931 into line with the Government's action on Section 10 of that Act. Section 10 is the operative Section dealing with the tax, and Section 28 is a part of the machinery by which that tax is calculated and ultimately put into operation, and it does seem rather ridiculous to suspend the tax and at the same time continue a piece of machinery which is merely a source of irritation, a clog upon transfers of land, and a means of putting money into the pockets of solicitors with no advantage to the revenue at all. It is interesting, as a matter of fact, to know that it is the solicitors who want this Amendment made. [Interruption.] An hon. Member opposite wants to know what is behind it. There is one very definite thing behind it. The country should take no step which prevents or clogs the free transfer of land, and there can be nothing more calculated to do so than the operation of Section 28. What that Section demands is this, that upon every transfer and sale of the fee simple of land, or the grant of any lease of land for a term of seven or more years, or any transfer or sale of such a lease, the instrument by means of which the transfer is effected or the lease granted shall be produced to the Commissioners of Inland Revenue within 30 days. If it is not produced within 30 days there is a penalty of £10 for non-production. There is a further provision that the Commissioners shall put a stamp upon it —not a monetary stamp, but a stamp de noting that the document has been pro duced—and unless it can be shown that the document bears that stamp, which is not a revenue stamp at all, it is to be taken as not complying with the pro visions of the Stamp Act regarding the revenue, although the full duty has been paid upon the transfer.

Upon every transfer of land, grant of a lease or transfer of a lease, the solicitors acting for the parties have to take the document to this office, accompanied by a form with a whole heap of particulars, which are quite as iniquitous as was the old Form IV, they have to deposit those particulars and they have to charge their clients for preparing the particulars. In that way we add to the cost of conveyance and clog conveyance, and the only persons who derive any satisfaction out of it are the solicitors who get costs for doing it. In addition, of course, we have to have a certain number of officials to keep the register and the particulars which are handed in. So far from its being a revenue-producing Section, it is an expenditure provision which causes expense but brings in no revenue. If we are to complete the thing properly it is necessary to make this provision retrospective, for this reason: documents have had to be produced ever since the Finance Act was passed, and if we do not make it retrospective then,, even though we suspend the operation of this Section alongside the suspension of Section 10, in every transfer in the future solicitors will have to make search on behalf of their clients to see whether, during the last 12 months, documents had been produced in that way, and unless they could find that documents had been so produced there might be a rather serious flaw with regard to documents which would appear to be otherwise unstamped.

So long as the Land Tax Sections are suspended, and so long, as the Lord President of the Council said, as valuation is also suspended, there is no purpose in keeping Section 28, except that the Land Tax provisions are kept by Clause 24 of the present Finance Bill. In these circumstances I suggest that it is in the interests of the freer transfer of land that this pure machinery provision should be suspended at the same time. It is purely an irritation, purely a clog, purely a. means of charging the clients of solicitors for expenses which the solicitors do not want to incur but which they have to charge if they Save to do the work. It is in the interests of the community and in the interests of economy, which is vital at the present time, that Section 28 should be suspended as well as Section 10.


Because my hon. and learned Friend has expressed so clearly the reasons for bringing forward this Amendment, because I feel that the reasonableness of the request must appeal to the Government, and because we are behind time, I will content myself with formally seconding the Amendment.

Captain DOWER

I will occupy the Committee only a minute or two in sup porting the Amendment. The point at issue is that although the valuation has been suspended this Department is still functioning, and costing the country several thousand pounds a year. The object, as we have heard, is to register sales of land and the grant of leases of seven years or over. This is the register upon which valuations are to be made for a future imposition of a tax upon land, and if it is the intention, as I understood from the Lord President of the Council, that such a tax will probably not be imposed during the present Parliament, then the work of and the expenditure upon this Department will be entirely wasted. During the short time I have had the honour and privilege of being a Member of this House I have understood that one of the vital necessities of the time is to secure every possible economy in national expenditure. Many of us have to go to our constituents and say, "We recognise the great burdens, the tremendous taxes, which you have to bear, but we have no alternative"; and if we make statements of that kind, at any rate we should put our own house in order by effecting every possible economy. I have been told that the only use of this Department, except for the future taxation of land, is in those cases where the Government re quire to buy a piece of land for their own purposes. Do not tell me that every transaction in land throughout the length and breadth of the country must be registered in order that in the one case in 100,000 where the Government require to buy land the register should be at their disposal!

There is another point, which is rather a grave one, in my opinion, because I do not mind admitting that I should like, at the proper time, to see the land tax proposals wiped out. Hon. Members on the Opposition benches frequently say that a Labour Government will be in power in a few years time, and if this Department is continued there is no question that such a Government would be in a very powerful position as regards imposing a land tax. They would say, "A National Government, with a vast majority, has been in power; it could have done anything it liked; admittedly it postponed the valuation on the grounds of economy, but it continued the Registration Department although it cost money, and by so doing it has admitted that to all intents and purposes it is approving of this future tax which is to be put on land." My hon. and learned Friend has already referred to the legal fees attached to these registrations, but, in addition, elaborate plans have to be prepared in certain cases, and all these requirements are a clog in the wheel as regards the transfer of land, with no purpose whatever. If only on the ground of the dire necessity of setting an example in public economy I hope that my right hon. Friend will put an end to a process involving an expenditure which, though small, is wasteful and extravagant.


I wish to support the Amendment. To-day land is passing into many hands and requirements of this kind add to the difficulty of transferring it. We have here an opportunity to make the transfer of land less costly.

6.0 p.m.


My hon. and learned Friend the Member for Norwood (Sir W. Greaves-Lord) has argued this Amendment with great legal knowledge as one would expect, and one is grateful not only to him for so clearly putting his ease, but also to those hon. Gentlemen who have supported him for the brevity with which they have done so. This Clause which my hon. Friend wishes to suspend is on a different footing from Section 10 of the Finance Act of 1931, which Section has never come into operation. No Land Value Tax has ever been exacted under Sec tion10, but this particular Section has been in operation since 1st September, 1931. The second respect in which it may be contrasted with Clause 10 is that it has no necessarily practical relation with a Land Value Tax at all, and it simply raises the principle as to whether certain particulars concerning transactions in land should be furnished to the Commissioners of Inland Revenue. My hon. and learned Friend the Member for Norwood called attention to the trouble which he said was caused to those engaged in these transactions in land by having to supply the particulars in question to the Inland Revenue. But the hon. and learned Member did not read the whole operative part of the Section from which he quoted, no did he refer to the Schedule which depends on the Section. Perhaps the Committee will allow me to read the relevant passages in order to show the amount of care which has been taken to avoid the trouble of which the hon. and learned Member for Norwood speaks. The words of the Section are: On the occasion of any transfer on sale of the fee simple of land or the grant of any lease of land for a term of seven or more years or any transfer on sale of any such lease, the instrument already in existence, has to be produced to the Commissioners of Inland Revenue. There can be no trouble about that. It can be sent either to Somerset House direct or through any local post office. In addition to the instrument., all that the person concerned has to provide is either an abstract of the instrument or a copy of the instrument or neither of those things, merely holding himself ready to give information during a period of six months about the instrument if he is called upon to do so. When my hon. and learned Friend the Member for Norwood says that there has necessarily been additional expense thrown upon the person concerned to file the detailed information of which he spoke he must have been under some misapprehension because the Schedule clearly refrains from laying down such a requirement. All that the person has to do is to wait until he is asked a question during the period of six months.


Certainly, there are other particulars which he must supply. There is something even more dangerous because he has to furnish on demand such information as the Com missioners require him to furnish.


My hon. and learned Friend surely is stretching a point, because if he looks at paragraph (c) he will see that if he exercises the option mentioned he has—it is true —to hold himself open to give any information that may be required, but that relates only to the information which is in the instrument, and which is intended to enable the Commissioners to trace the property, and the person cannot be called upon to give any information outside that transaction.


If the Parliamentary Secretary will refer to paragraph (vii) of the Second Schedule of the Finance Act, 1931, he will find that the person concerned may be called upon to furnish with the instrument particulars of any minerals, mineral rights, sporting rights, timber or easements reserved, and of any restrictions, covenants or conditions affecting the value of the estate or interest transferred or granted.


With great respect, I submit that the hon. and learned Gentleman has read particulars contained in paragraph (a) and I have already stated that that was an optional paragraph. The hon. and learned Member then proceeded to say that I am under a misapprehension, and he read out all that paragraph again. The person concerned may either furnish those particulars which my hon. and learned Friend the Member for Norwood characterised as Form IV, or he may in the alternative hold himself ready to answer any questions which may be addressed to him. In those circum stances, what becomes of the argument of my hon. and learned Friend that a solicitor has to be consulted in every case? Can my hon. and learned Friend produce any single case in which someone has been called upon to provide such particulars and who has been placed in any difficulty on that account? No serious complaints have been made at all, and the letter of the Law Society was written under a complete misapprehension, because they must realise that the provision of the particulars in Paragraph (a) is optional.


Is the Parliamentary Secretary not aware that "optional" means at the option of the Commissioners, and that the unfortunate man who has to provide the return has no chance?


It is necessary for the solicitor in each instance to produce the instrument so that a stamp may be placed, upon it. It is not a question of the particulars, but the production of the deed, and this has to be produced by the solicitor in each of these cases.


I think the Committee will realise that I am being asked two separate questions at the same time. I began my remarks by saying that in the first place the person concerned had to provide the instrument and that cannot impose upon him any additional expense, because the document is in existence. It is then argued that this procedure is at the option of the Commissioners.


That is so in practice.


My hon. and learned Friend the Member for Argyll- shire (Mr. Macquisten) is skilled in these matters, but perhaps he will forgive me if I ask him to look at the second Schedule of the Act, which says: Any person … may, at his option. That is at the option of the person. I can quite understand that hon. and learned Members of this House are very anxious to spare their clients expense, and I think this discussion will have made it plain to the public that anyone who thinks that a great deal of unnecessary inquisition is likely to be indulged in under this procedure is under a complete misapprehension. Already the Clause has served a useful purpose. It is in operation and it is not costing the taxpayer any money, but on the contrary it is saving the taxpayers money. This Clause is quite different from the one we have just disposed of, and I hope that in these circumstances my hon. and learned Friend the Member for Norwood, having drawn attention to this matter very forcibly—I admit it is of great public interest—will consent to withdraw his Amendment.

Captain DOWER

The Parliamentary Secretary has told us that this Clause has nothing to do with the Land Value Tax. If that is so, how is it that at Somerset House there is written in large letters over the office the words "Land Value Tax"?

Question, "That those words be there added," put, and negatived.


I beg to move, in page 16, line 5, at the end, to add the words: (2) The Commissioners of Inland Revenue shall be hereby freed, discharged, and indemnified from all penalities and disabilities whatsoever incurred by them by reason of their failure to observe and carry out the duties imposed on them under the provisions of Part III of the said Act. I am glad to have this opportunity of raising a first-class constitutional issue. The Act of Parliament imposing these duties is still in existence, and this tax will be in existence provisionally until the Bill with which we are now dealing has passed through all its stages in both Houses of Parliament. The Chancellor of the Exchequer not very long ago stated that the Act of Parliament which is actually on the Statute Book was to be set aside, and in setting aside an Act of Parliament he was doing something very serious so far as the Commissioners of Inland Revenue are concerned. In suspending statutory provisions which call upon State Departments and servants of the Crown to do certain things, should not provision be made in the present Bill for indemnifying them against declining to carry out the law? We are not willing to trust the present Government on this issue. They may decide to set aside the provisions of the law and then hold the Commissioners of Inland Revenue responsible for not carrying out that same law. That is a very important constitutional issue. It is passing strange that in this Parliament nearly every constitutional issue of first-class importance is left to the Labour party to maintain. I feel sure that what I have said will have convinced the Government Front Bench that they ought to accept this Amendment in order to make their own position clear for the future.


I acknowledge the spirit in which this Amendment has been moved. My hon. Friend says that this matter is one of great constitutional importance, and, of course, it would be a matter of great constitutional importance if all the Commissioners of Inland Revenue were liable to be put, as he fears, in gaol for not carrying out the valuation under the Act. I listened in vain, however, for any reason why they should become liable to these dire penalties. A valuation under the Act of 1931 had to take place within a reasonable time after the valuation date, and in the year 1933–34 the tax had to be levied on the basis of that valuation. The time has not yet come when the tax could be levied. In the meantime, my right hon. Friend the Chancellor of the Exchequer announced that he was suspending all work upon the valuation, and, indeed, in a Supplementary Estimate of the 2nd of February this year a sum which had been voted in the first Budget of last year for the expenses of the officials who were to carry out this valuation was diverted. Finally, we hope this afternoon to have the seal of the House of Commons, and subsequently of the whole machinery of the Constitution, upon our proposals. In these circumstances, to suggest that anyone can bring an action against the Commissioners is, I think, a little far-fetched. However, we have had the advantage of hearing the case presented. We are advised on the highest authority that the case is not a sound one, and, therefore I hope that the Amendment will not be pressed.


The party to which I have the honour to belong raised this issue not long ago on the Motion for the Adjournment of the House. An announcement was made by the Chancellor of the Exchequer, in reply to questions put in the House, that it was his intention to discontinue the land valuation which had been started, and to dismiss the persons who had been employed by the Department. We should have liked to see the Attorney-General on the bench this afternoon, so that we might have had from him a full explanation of the constitutional issues involved. I do not expect the Parliamentary Secretary to the Board of Trade or the Financial Secretary to the Treasury to be able to give us a complete account of the law involved in the matter, and I am not going to presume that I can raise all the legal issues which undoubtedly underlie this case, but I think the Committee ought to be in possession of the facts. The facts are that, after a very important Debate in the House on the first Finance Bill of the year 1930–31, the House decided to impose a tax of 1d. in the £ upon land value. The tax of 1d. was included in the Finance Bill in order to secure the passage of the Bill into law without the veto of the Lords being exercised against it. The purpose of the tax was to secure the valuation of the land. If the valuation had been included in the Finance Bill without a tax, it could not, so I am informed, have become law without the consent of the other Chamber, and we are well aware that the landed interest represented in the other House was so strong that it would never have passed.

In consequence of that fact, the valuation of land was not included in the first Finance Bill of 1931 as an administrative part of the Land Value Tax, but was an obligation imposed upon the Government by the Act itself. That is the crux of the whole matter. If the House had passed the tax and had left the valuation of land as an administrative matter in the hands of the Government, the Government would have been perfectly en- titled, without asking the House at all, to stop the valuation of land, and the only criticism that could have been exercised would have been to indict the appropriate Department. The valuation of land was, however, a legal obligation imposed by Statute upon the Government. The appropriate Section reads as follows: Subject to the provisions of this Section, the Commissioners of Inland Revenue…. shall, as soon as may be after every valuation date"— and the valuation date is the 1st January of this year— cause to be ascertained, as at that date, the land value of every land unit. The excuse may be advanced that the words as soon as may be give the Government the right to postpone indefinitely the commencement of the valuation. But the Commissioners of Inland Revenue had already interpreted the elasticity of these words, because they had started the valuation, so that the Government are now estopped from advancing that as a reason for not going on with the Act. The Commissioners had already started the valuation and had employed a large body of persons upon it, so that the words as soon as may be now disappear as a means of defence for the Government. It may be argued that the funds provided by Parliament for this purpose had been exhausted, that the Government could refuse to provide further funds, and that consequently we should have no redress until the House had again voted money for this purpose. I am informed, however, that the moneys voted by Parliament for this purpose have not yet been fully expended, and that some money still remains.

We are not raising this issue because we think that the House is in favour of land valuation. The present House of Commons is undoubtedly against land valuation and against land taxes. But it is the duty of the Government of the day to repeal an. Act of Parliament by a legislative instrument brought before the House of Commons, and not to assume that the House, because it is against an Act of Parliament, exempts the Government from the need for repealing it in the ordinary way. If the Government are to say, "We think the House of Commons is not in favour of this piece of legislation—or is in favour of it—and we will act accordingly"—if that is the way in which our legislation is to be carried on, why not dissolve the House of Commons entirely, and let the Government for the next five years interpret what they consider to be the will of the House? If the Government did not desire to proceed with the valuation of the land—a valuation which was imposed as a legal obligation upon the Government by Statute—they ought to have brought a Bill before the House, which could have been debated. Why was that not done?

The CHAIRMAN (Sir Dennis Herbert)

I must remind the hon. Member that the Amendment does not deal with any point for which Members of the Government are responsible.


I beg pardon; it is the Inland Revenue Commissioners. I was simply using for the moment a wrong term, but obviously the Government is involved.


What I want the hon. Member to bear in mind is that the action of the Government is not a matter with which we are concerned here. We are concerned here with the question whether there is a legal liability or not on certain servants of the Government.

6.30 p.m.


We are discussing an Amendment to indemnify the Inland Revenue Commissioners from failing to carry out the law, and, as we understand it, the Inland Revenue Commissioners proceeded, upon instructions from the Treasury, not to carry out the law. We were told by the Chancellor of the Exchequer that the Inland Revenue Commissioners did not stop the valuation of land because they woke up one day and said, "We do not think we will go on with this any more. We have had enough." They stopped, on the instructions of the Chancellor of the Exchequer. The Chancellor and the Inland Revenue Commissioners have connived at the violation of an Act of Parliament, and the purpose of the Amendment is to indemnify them against the pressure brought to bear by the Chancellor of the Exchequer. The reason why this was done is not because the law allows the Inland Revenue Com- missioners to cease the valuation, but because at that time relations were very strained inside the Government.


I must ask the hon. Member to pay attention to the Rulings which I have been trying to give. I want him to understand that on this Amendment he cannot discuss the question of the conduct of the Government. Whether the Commissioners have acted on instructions from the Government or whether the Government, in any instructions they have given, have done what he thinks they ought not to have done is not part of the Question that is before the Committee.


I submit that the reason that actuated the Commissioners of Inland Revenue in doing this is a very material matter. In certain circumstances it might well be argued that, if they did it on the instructions of the Government, there should be no penalty but, if they did it of their own volition contrary to the instructions of the Government, there might be penalties and pains due as the result of their action. Therefore, it is material to ascertain why the Commissioners of Inland Revenue ceased to carry out this valuation before one can determine whether or not it is necessary to oppose the Clause indemnifying them.


If the hon. Member had been arguing on those lines, I should not have called him to order. It would have been relevant. But it is not relevant to discuss whether the action the Government took was praiseworthy or not.


Are we to understand that one is not allowed, when mentioning the action of the Government, to criticise it?


Certainly not, and the hon. and learned Gentleman knows it.


I must ask for a Ruling on this point, because what my hon. Friend was doing was pointing out that the Government had given to the Commissioners of Inland Revenue certain instructions in the matter, as has been admitted by the Chancellor of the Exchequer. He was then commenting upon the action of the Government in giving those instructions, and I submit that he is perfectly entitled to do so.


As to the first part, I quite agree that the hon. Member was entitled, but in my opinion he was straying beyond the limits.


May I submit that the Debate has shown that the whole Amendment is out of order in this place? The Clause that it seeks to amend is for the suspension of the Land Tax and the postponement of certain provisions of Part II, and the Amendment does something entirely different. It seeks to permit the Commissioners of Inland Revenue to fail to observe and to carry out duties under Part III in general without any penalties. Surely that is so widely different from the subject matter of the Clause that it is out of order in this place.


Is it in order, when you, Sir Dennis, have called an Amendment, for an hon. Member to rise and say it is not in order to call it?


It is undoubtedly quite in order for any hon. Member in the course of the discussion to raise a point of Order. On the point raised by the hon. Member, it is quite possible that it might have been more convenient to move this as a new Clause, but I do not think it is necessary to shut it out here, and I think I must allow the discussion to proceed.


Is not the short answer that that which would be relevant—


I have disposed of that.


If, as the Parliamentary Secretary has contended, the Inland Revenue Commissioners have not been guilty of an illegal act in ceasing valuation, there is no need to indemnify them. If, on the other hand, they have been guilty of an illegal act, this indemnification is necessary, and I was addressing myself to the case that the Inland Revenue Commissioners have been guilty of an illegal act- and that the Government, in giving them instructions, have connived at the illegality. One of the reasons that obviously led the Government to take this action was that inside the Government there are Members who strongly favour land valuation, and it would be a source of great political embarrassment if a Bill were brought in repealing that portion of the Finance Act, 1931, in which land valuation occurs. The House of Commons ought to be jealous of its powers in this regard. I do not mind right hon. Gentlemen opposite disagreeing with me and carrying legislation to which I am strongly opposed, tout I think I am right in taking exception, and anyone who has the interests of the House at heart should take exception to an Act of Parliament being placed upon the Statute Book which imposes certain unpleasant obligations on the Government and to the Chancellor of the Exchequer going behind the back of Parliament, defying its will and setting aside an important Statute.


It is of extraordinary importance that the Committee should realise the reason why we have brought forward this Amendment. A great many things that were formerly considered unconstitutional have been done by the present Government. We have pointed them out from time to time, and we have pointed out that they will make useful precedents. This is one more useful precedent. Let me illustrate the sort of way in which a precedent of this kind might be used. A Tariff Commission has been set up to do certain things. Another Government comes in. It does not like tariffs and disbands the Tariff Commission without asking Parliament. It says, "We are sure we shall have a majority against tariffs." That is precisely what has happened in this case. The National Government, with a vast majority, can do it, but the National Government and people in the country should realise exactly what it is that has been done. A Minister of the Crown, without authority from Parliament, the matter never having been discussed in Parliament, has disbanded one of the Departments that was created by Parliament to do a particular job. That is another precedent which this Government has set up which may well be followed in the future if there is a change of Government. Any piece of work that has been set up by this Parliament may be brushed completely aside, and something else substituted for it.

Amendment negatived.

Question put, "That the Clause stand part of the Bill."

The Committee divided: Ayes, 343; Noes, 46.

Division No. 200.] AYES. [6.41 p.m.
Acland-Troyte, Lieut.-Colonel Denville, Alfred Inskip, Rt. Hon. Sir Thomas W. H.
Adams, Samuel Vyvyan T. (Leeds. W.) Despencer-Robertson, Major J. A. F. Jackson, Sir Henry (Wandsworth, C.)
Agnew Lieut.-Com. P. G. Dickie, John P. Jackson, J. C. (Heywood & Radcliffe)
Albery, Irving James Donner, P. W. Jamieson, Douglas
Allen, Lt.-Col. J. Sandeman (B'k'nh'd.) Doran, Edward Janner, Barnett
Allen, William (Stoke-on-Trent) Dower, Captain A. V. G. Jennings, Roland
Allen, Lt.-Col. Sir William (Armagh) Drewe, Cedric Jesson, Major Thomas E.
Applin, Lieut.-Col. Reginald V. K. Duckworth, George A. V. Joel, Dudley J. Barnato
Apsley Lord Dugdale, Captain Thomas Lionel Johnston, J. W. (Clackmannan)
Aske, Sir Robert William Duggan, Hubert John Jones, Sir G. W. H. (Stoke New'gton)
Astbury Lieut.-Com. Frederick Wolfe Duncan, James A. L. (Kensington, N.) Jones, Lawis (Swansea, West)
Astor, Maj. Hn. John J, (Kent, Dover) Dunglass, Lord Kerr, Hamilton W.
Atholl Duchess of Eastwood, John Francis Kirkpatrick, William M.
Atkinson Cyril Edmondson, Major A. J. Knatchbull, Captain Hon. M. H. R.
Bailey, Eric Alfred George Elliot, Major Rt. Hon Walter E. Knebworth, Viscount
Baldwin, Rt. Hon. Stanley Ellis, Robert Geoffrey Lamb, Sir Joseph Quinton
Balfour, George (Hampstead) Elliston, Captain George Sampson Latham, Sir Herbert Paul
Balniel, Lord Elmley, Viscount Law, Sir Alfred
Banks, Sir Reginald Mitchell Emmott, Charles E. G. C. Leckie, J. A.
Barclay-Harvey, C. M. Emrys-Evans, P. V. Leech, Dr. J. W.
Barton, Capt. Basil Kelsey Entwistle, Cyril Fullard Lees-Jones, John
Beauchamp, Sir Brograve Campbell Erskine, Lord (Weston-super-Mare) Leighton, Major B. E. P.
Beaumont, M. W. (Bucks., Aylesbury) Essenhigh, Reginald Clare Lennox-Boyd, A. T.
Beaumont, Hon. R.E.B. (Portsm'th.C.) Falle, Sir Bertram G. Levy, Thomas
Belt, Sir Alfred L. Fermoy, Lord Lewis, Oswald
Benn, sir Arthur Shirley Fielden, Edward Brocklehurst Liddall, Walter S.
Betterton, Rt. Hon. Sir Henry B. Foot, Dingle (Dundee) Lister, Rt. Hon. Sir Philip Cunliffe-
Bevan, Stuart James (Holborn) Foot, Isaac (Cornwall, Bodmin) Little, Graham-, Sir Ernest
Bird, Ernest Roy (Yorks., Skipton) Ford, Sir Patrick J. Llewellyn-Jones, Frederick
Blaker, Sir Reginald Fox, Sir Gifford Lloyd, Geoffrey
Blinded, James Fremantle. Lieut. Colonel Francis E. Lovat-Fraser, James Alexander
Borodale, Viscount Fuller, Captain A. G. Lumley, Captain Lawrence R.
Bossom, A. C. Ganzoni, Sir John Lyons, Abraham Montagu
Boulton, W. W. Gault, Lieut.-Col. A. Hamilton MacAndrew, Lieut.-Col. C. G.(Partlck)
Boyce, H. Leslie Gibson, Charles Granville McCorquodale, M. S.
Bralthwaite, J. G. (Hillsborough) Gillett, Sir George Masterman Macdonald, Capt. P. D. (I. of W.)
Brlant, Frank Gilmour, Lt.-Col. Rt. Hon. Sir John McEwen, Captain J. H. F.
Briscoe, Capt. Richard George Gluckstein, Louis Halle McKeag, William
Brackiebank, C. E. R. Goff, Sir Park McKie, John Hamilton
Brown, Ernest (Leith) Gower, Sir Robert McLean, Dr. W. H. (Tradeston)
Brown, Brig.-Gen. H. C.(Berks., Nawb'y) Grattan-Doyle, Sir Nicholas Macmillan, Maurice Harold
Browne Captain A. C. Greaves-Lord, Sir Walter Magnay, Thomas
Buchan, John Grenfell, E. C. (City of London) Maitland, Adam
Burghley, Lord Gretton, Colonel Rt. Hon. John Makins, Brigadier-General Ernest
Burnett, John George Grimston, R. V. Mander, Geoffrey le M.
Burton Colonel Henry Walter Gritten, W. G. Howard Manningham-Buller, Lt.-Col. Sir M.
Campbell, Edward Taswell (Bromley) Guest, Capt. Rt. Hon. F. E. Margetson, Capt. Henry David R.
Campbell, Rear-Adml. G. (Burnley) Gunston, Captain D. W. Martin, Thomas B.
Campbell-Johnston, Malcolm Guy, J. C. Morrison Mason, David M. (Edinburgh, E.)
Caporn, Arthur Cecil Hales, Harold K. Mason, Col. Glyn K. (Croydon, N.)
Cassels, James Dale Hall, Capt. W. D.'Arcy (Brecon) Mayhew, Lieut.-Colonel John
Cautley, Sir Henry S. Hamilton, Sir George (Ilford) Millar, Sir James Duncan
Cayzer, Sir Charles (Chester, City) Hamilton, Sir R. W.(Orkney & Ztl'nd) Mills, Sir Frederick (Leyton, E.)
Cayzer, Maj. Sir H. R. (Prtsmth., S.) Hammersley, Samuel S. Mills, Major J. D. (New Forest)
Cazalet, Thelma (Islington, E.) Hanley, Dennis A. Milne, Charles
Cazalet Capt. V. A. (Chippenham) Hannon, Patrick Joseph Henry Milne, John Sydney Wardlaw-
Chalmers, John Rutherford Harbord, Arthur Mitchell, Harold P. (Br'tf'd & Chisw'k)
Chapman, Col. R.(Houghton-le-Spring) Hartland, George A. Mitcheson, G. G.
Chapman, Sir Samuel (Edinburgh, S.) Harvey, George (Lambeth, Kenn'gt'n) Moreing, Adrian C.
Chorlton, Alan Ernest Leofric Harvey, Major S. E. (Devon, Totnes) Morris, Owen Temple (Cardiff, E.)
Christie, James Archibald Haslam, Sir John (Bolton) Morrison, William Shepherd
Clarry Reginald George Headlam, Lieut.-Col. Cuthbert M. Muirhead. Major A. J.
Clayton, Dr. George C. Hellgers, Captain F. F. A. Munro, Patrick
Cobb, Sir Cyril Henderson, Sir Vivian L. (Chelmsford) Nation, Brigadier-General J. J. H.
Cochrane, Commander Hon. A. D. Heneage, Lieut.-Colonel Arthur P. Newton, Sir Douglas George C.
Colman, N. C. D. Hepworth, Joseph North, Captain Edward T.
Colville, John Hills, Major Rt. Hon. John Waller Nunn, William
Conant, R. J. E. Hope, Capt. Arthur O. J. (Aston) O'Connor, Terence James
Cook, Thomas A. Hope, Sydney (Chester, Staiybridge) O'Neill, Rt. Hon. Sir Hugh
Cooke, Douglas Hore-Belisha, Leslie Palmer, Francis Noel
Copeland, Ida Hornby, Frank Patrick, Colin M.
Courthope, Colonel Sir George L. Home, Rt. Hon. Sir Robert S. Pearson, William G.
Craddock, Sir Reginald Henry Horobin, Ian M. Penny, Sir George
Craven-Ellis, William Horsbrugh, Florence Percy, Lord Eustace
Crooke, J. Smedley Howard, Tom Forrest Peters, Dr. Sidney John
Crookshank, Capt. H. C. (Galnsb'ro) Hudson, Capt. A. U. M. (Hackney, N.) Petherick, M.
Cruddas, Lieut.-Colonel Bernard Hudson, Robert Spear (Southport) Peto, Sir Basil E. (Devon, Barnstaple)
Culverwell, Cyril Tom Hume, Sir George Hopwood Peto, Geoffrey K.(W'verh'pt'n, Bilst'n)
Dalkeith, Earl of Hunter, Dr. Joseph (Dumfries) Potter, John
Davidson, Rt. Hon. J. C. C. Hunter, Capt. M. J. (Brigg) Powell, Lieut.-Col. Evelyn G. H.
Davies, Maj. Geo. F.(Somerset, Yeovil) Hurst, Sir Gerald B. Pownall, Sir Assheton
Davison, Sir William Henry Hutchison, Maj.-Gen. Sir R.(M'tclae) Procter, Major Henry Adam
Denman, Hon. R. D. Hutchison, W. D. (Essex, Romford) Pybus, Percy John
Raikes, Henry V. A. M. Shakespeare, Geoffrey H. Thompson, Luke
Ramsay, Alexander (W. Bromwich) Shaw, Helen B. (Lanark, Bothwell) Thomson, Sir Frederick Charles
Ramsay, Capt. A. H. M. (Midlothian) Shaw, Captain William T. (Fortar) Thorp, Linton Theodore
Ramsden, E. Shepperson, Sir Ernest W. Titchfield, Major the Marquess of
Rankin, Robert Simmonds, Oliver Edwin Todd, Capt. A. J. K. (B' wick-on-T.)
Ratcliffe, Arthur Slater, John Todd, A. L. S. (Kingswinford)
Rawson, Sir Cooper Smiles, Lieut.-Col. Sir Walter D. Touche, Gordon Cosmo
Ray, Sir William Smith, Sir Jonah W. (Barrow-in-F.) Train, John
Rea, Walter Russell Smith, Louis W. (Sheffield, Hallam) Turton, Robert Hugh
Reed, Arthur C. (Exeter) Smith, R. W. (Aberd'n & Kinc'dine, C.) Wallace, John (Dunfermilne)
Reid. David D. (County Down) Smith-Carington, Neville W. Ward, Lt.-Col. Sir A. L. (Hull)
Reid, William Allan (Derby) Smithers, Waldron Ward, Irene Mary Bewick (Wailsend)
Rentoul, Sir Gervais S. Somerville, Annesley A (Windsor) Ward, Sarah Adelaide (Cannock)
Renwick, Major Gustav A. Somerville, D. G. (Willesden, East) Wells, Sydney Richard
Reynolds, Col. Sir James Philip Sotheron-Estcourt, Captain T. E. Weymouth, Viscount
Rhys, Hon. Charles Arthur U. Southby, Commander Archibald R. J. Whiteside, Borras Noel H.
Roberts, Aled (Wrexham) Spears, Brigadier-General Edward L. Williams, Herbert G. (Croydon, S.)
Roberts, Sir Samuel (Ecclesall) Spencer, Captain Richard A. Wills, Wilfrid D.
Robinson, John Roland Spender-Clay, Rt. Hon. Herbert H. Wilson, Clyde T. (West Toxteth)
Rosbotham, S. T. Stanley, Hon. O. F. G. (Westmorland) Windsor-Clive, Lieut.-Colonel George
Runge, Norah Cecil Stones, James Winterton, Rt. Hon. Earl
Russell, Alexander West (Tynemouth) Stourton, Hon. John J. Wise, Alfred R.
Russell, Hamer Field (Sheffield, B'tside) Strauss, Edward A. Withers, Sir John James
Russell, Richard John (Eddisbury) Strickland, Captain W. F. Wood, Rt. Hon. Sir H. Kingsley
Rutherford, Sir John Hugo Stuart, Hon. J. (Moray and Nairn) Wood, Sir Murdoch McKenzie (Banff)
Salmon, Major Isidore Sueter, Rear-Admiral Murray F. Worthington, Dr. John V.
Salt, Edward W. Sugden, Sir Wilfrid Hart Young, Rt. Hon. Sir Hilton (S'v'noaks)
Samuel, Sir Arthur Michael (F'nham) Sutcliffe, Harold Young, Ernest J. (Middlesbrough, E.)
Samuel, Rt. Hon. Sir H. (Darwen) Tate, Mavis Constance
Samuel, Samuel (W'dsworth, Putney) Taylor, Vice-Admiral E.A.(P'dd'gt'n, S.) TELLERS FOR THE AYES.-
Sandeman, Sir A. N. Stewart Templeton, William P. Captain Sir George Bowyer and
Savery, Samuel Servington Thomas, James P. L. (Hereford) Sir Victor Warrender.
Scone, Lord Thomas, Major L. B. (King's Norton)
Adams, D. M. (Poplar, South) Griffiths, T. (Monmouth, Pontypool) Milner, Major James
Attlee, Clement Richard Grundy, Thomas W. Nathan, Major H. L.
Bevan, Aneurin (Ebbw Vale) Hall, F. (York, W.R., Normanton) Parkinson, John Allen
Brown, C. W. E. (Notts., Mansfield) Hall, George H. (Merthyr Tydvil) Pickering, Ernest H.
Buchanan, George Harris, Sir Percy Price, Gabriel
Cape, Thomas Hicks, Ernest George Salter, Dr. Alfred
Cocks, Frederick Seymour Hirst, George Henry Tinker, John Joseph
Cove, William G. Holdsworth, Herbert Wallhead, Richard C.
Cowan, D. M. Jenkins, Sir William Williams, David (Swansea, East)
Cripps, Sir Stafford Jones, Morgan (Caerphilly) Williams, Edward John (Ogmore)
Daggar, George Kirkwood, David Williams, Dr. John H. (Llanelly)
Davies, Rhys John (Westhoughton) Lansbury, Rt. Hon. George Williams, Thomas (York, Don Valley)
Duncan, Charles (Derby, Claycross) Leonard, William
Edwards, Charles Lunn, William TELLERS FOR THE NOSE—
Graham, D. M. (Lanark, Hamilton) McEntee, Valentine L. Mr. Groves and Mr. Cordon
Greenwood, Rt. Hon. Arthur Mallalieu, Edward Lancelot Macdonald
Grenfell, David Rees (Glamorgan) Maxton, James

Question, "That the Clause be read a Second time," put, and agreed to.