HC Deb 25 April 1933 vol 277 cc64-75

Motion made, and Question proposed, That, on and after the twenty-sixth day of April, nineteen hundred and thirty-three— (a) except in the case of beer of any of the descriptions specified in Sub-section (1) of section two of the Finance Act, 1930, there shall be charged in respect of beer brewed in the United Kingdom, in lieu of the duty of excise now chargeable thereon, the following duty of excise:

£ s. d.
For every 36 gallons of worts of a specific gravity of 1,027 degrees or less 1 4 0
For every 36 gallons of worts of a specific gravity exceeding 1,027 degrees—
For the first 1,027 degrees 1 4 0
For every additional degree in excess of 1,027 degrees 0 2 0
and so in proportion for any less number of gallons; (b) no rebate shall be allowed from the duty of excise chargeable under this Resolution; (c) there shall, on the exportation from the United Kingdom as merchandise, or for use as ships' stores, of beer other than beer of the descriptions specified in the said Sub-section, be allowed (in addition to any excise drawback allowable so long as a Customs duty is chargeable on hops but in lieu of any other excise drawback) an excise drawback at the following rates:
£ s. d.
For every 36 gallons of beer of an original gravity of 1,027 degrees or less 1 4 2
For every 36 gallons of beer of an original gravity exceeding 1,027 degrees—
For the first 1,027 degrees 1 4 2
For every additional degree in excess of 1,027 degrees 0 2 0
and so in proportion for any less number of gallons:

Provided that—

  1. (i) as respects beer of an original gravity of less than 1,027 degrees, the amount of drawback allowable shall not exceed by more than two pence for every thirty-six gallons the amount of duty which is shown to the satisfaction of the Commissioners of Customs and Excise to have been paid; and
  2. (ii) the amendments as to drawback effected by this Resolution shall not have effect in relation to any beer as respects which it is shown to the satisfaction of the Commissioners of Customs and Excise that duty was paid at the rates in force before the twenty-sixth day of April, nineteen hundred and thirty-three.
And it is hereby declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1913."—[Mr. Chamberlain.]

5.32 p.m.


I understand that it is usual for a general discussion to take place on the Motion that you have just put from the Chair, Sir Dennis. Before saying anything general, however, I should like, if the right hon. Gentleman the Chancellor of the Exchequer will allow me, to offer him my congratulations upon both the matter and the manner of his Budget speech. I have heard a goad many Budget speeches, and last year I thought that he put the sets of figures before the Committee in very clear and understandable fashion, but I think that to-day he has done even better. I think that to-day he has told us much more clearly and, if I may use the word without any offence, much more honestly, the actual position of the finances of the country. He almost led me to give him a great cheer at the beginning of his speech, because he laid bare, as many of us have tried to lay bare in the country, the futility of any of the methods adopted by his Government for restoring trade and industry. I have never heard a confession quite so candid and adequate as the one the right hon. Gentleman made, and I must say that I appreciated it very much indeed.

I want to ask the right hon. Gentleman one question which perhaps he will answer. In the Resolutions that the Government are asking us to carry tonight and to debate more fully on Report, there are none, I take it, except those that deal with taxes that the right hon. Gentleman desires to come into operation immediately. There are no new ones, as far as I followed the right hon. Gentleman, containing any sort of provision similar to that which was contained in the Import Duties Resolutions last year. I wonder if he is able to tell me if there is any Resolution that he is asking us to pass to-night which has reference to a tax that will not come into operation immediately. Take, for instance, the heavy motors tax. He will not ask us to vote on that to-night, I take it, because I understand it is not to come into operation until January.


We wish to get the Committee stage of that Resolution to night.


But last year there was something that slipped through, and we had to raise it at midnight, on the Report stage, and we were not permitted to debate it at all. I understand that the right hon. Gentleman desires to get certain Resolutions to-night so that the taxes may immediately come into operation. We have no objection to that at all, but we think that he ought not to ask for a formal vote to-night of a new tax which is not to come into operation until January.


I think the right hon. Gentleman may be quite easy in his mind, that there is nothing in these proposals which is comparable with the procedure to which he objected last year. We have not, I think, in any way departed from what is the common and ordinary practice in the Resolutions for which we are asking to-night.


I accept the right hon. Gentleman's assurance, of course, and do not desire to consider that matter any further. There are some observations that I should like to make in a general sense. My hon. Friends will deal faithfully and in detail with the right hon. Gentleman's Budget during the next few days, but the first thing that I would like to say is that, so far as I have been able to follow the right hon. Gentleman, the people who will benefit from his Budget, if there is any benefit at all, are those who drink beer and those who pay Income Tax. The unemployed, to whom the right hon. Gentleman owes the fact that he has balanced his Budget or that he has brought it as near balancing as he could, are to receive no benefit whatsoever. We, on this side, think quite definitely that any money that the right hon. Gentleman had to give away should have been given to the relief of the unemployed. It has been said again and again by the right hon. Gentleman himself, and by many other experts in this House, that if only the Budget were balanced, if only money could be cheap, trade and employment would improve, yet the right hon. Gentleman himself to-day, near the close of his speech, spoke of the stress on all sides, the bad trade, and the terrible unemployment that we are facing to-day.

We think that nothing that he has proposed in his Budget to-day and nothing that was done in last year's Budget has in any way improved trade and industry, and we think that that is due altogether to the fact that neither the Government nor any of their supporters really face the social and economic problems of our times. When I listen to the right hon. Gentleman and other speakers on finance questions in this House, I am always reminded of Carlyle's "French Revolution" and his description of the Finance Ministers of the time immediately preceding that Revolution. Every sort and kind of device was advocated and practised in order to deal with something of which none of the statesmen realised the true cause. The fundamental cause of bad trade, of unemployment, and of poverty is that neither this Government nor this Parliament nor the Parliaments of most countries in the world have faced the fact that production outstrips consumption, and that the only problem to be solved is that of how to bring about an increased consumption of the goods that are produced. No amount of sophistry and no amount of talking will get over that fact. I have listened to the right hon. Gentleman and to many of his predecessors since 1922, and none of them has really got down to that question, and until you do get down to it, all this business of Budget-balancing and so on is beside the point.

I was struck by the right hon. Gentleman's reference to other countries and their terrible conditions. I have been to France occasionally since the War, and I have never been able to accept the theory that the mass of the people in France are worse off, or that that country itself is worse off as a nation, than ourselves. When I am told that the balancing of Budgets is the thing that will restore trade and industry. I cannot accept that at all, and all the evidence up to the present time proves that that has nothing whatever to do with the subject. It proves conclusively that you may have heavy taxation or light taxation, but that in the end, unless you find the means of distributing the goods that are produced, you will have poverty and unemployment. The fact is that people forget the spacious days of Mr. Gladstone. I lived through those days, when you had a very small Budget, when you had strict economy, when public expenditure was extremely limited, and when there was no expenditure by the local authorities. Anyone would think that those were the great days for the workers of this country, but they were exactly the reverse. The condition of the working people in those days was one of a very low level of subsistence indeed. When I hear people talk of the prosperous days of the nineteenth century, I remember the wages paid to the average working people—18s., 19s., and sometimes 17s. a week in London factories.

Therefore, I do not accept this doctrine that the right hon. Gentleman has laid down to-day, that strict economy and the balancing of a Budget are something that will restore or give prosperity to the average man or woman. My constituents under this Budget will remain just as starved as they have been any time since I and other people have represented them. There is nothing here that will restore trade at all, and I will be quite content, whether I am here or not, to be judged next year on what I am saying now. Each successive Chancellor of the Exchequer since 1920 has stood at that Box and told us what the Foreign Secretary once said—Jam yesterday and jam to-morrow, but no jam to-day; that trade will be better to-morrow, that we shall get round the corner to-morrow, and so on. That is altogether an illusion. We are not moving forward one bit, and there is no sign of improvement anywhere.

This Budget will leave the mass of the working people exactly as they are, and in all probability a little worse. Everyone knows that the Budget has not been balanced; the right hon. Gentleman has explained that it is not a balanced Budget at all; but, so far as it is balanced, it has been balanced out of the lifeblood of the masses of the unemployed. We shall be able to demonstrate that during these discussions. An hon. Member spoke from the Liberal benches just before we adjourned of the terrible position in one division of Newcastle. I can match those conditions with conditions in many parts of London. By their economy and cutting down the Government are lowering the standard of life of very large numbers of people. Worst of all, they are not improving trade and industry. If by their policy they were improving conditions or giving any promise of improvement, it might be arguable that the people should go on suffering for a time, but there will be no improvement while the policy of this Budget is continued, because it is based on the fallacy that by economy you can increase consumption, and that by cutting down you can get rid of abundance. That, in our judgment, is absurd.

With reference to the proposal to put a tax on the co-operative societies, I am glad that the right hon. Gentleman has consulted those who can speak for the Co-operative movement. I am sorry that the hon. Baronet the Member for Barnstaple (Sir B. Peto) is not in his place, because I should have liked to remind him that he did not rise to object to the right hon. Gentleman consulting the brewers on the Beer Duty, but he did object to his consultation with the cooperators. I do not accept the view that this is a long-standing controversy and that the traders have any grievance at all. It is a great pity that we have not been able to have the evidence which was put before the Raeburn Committee. Neither the co-operative societies nor any one else except the Committee know what evidence was given on this subject, and we do not know what the traders, through their representatives, said. We con- sider, as we said at the time, that it was not an impartial committee because one of the members was President of the Institute of Accountants, which had already given its views against co-operative societies. One of the other members was in a similar position in regard to trading. I maintain, and I think all my colleagues and all fair-minded Members of the House of Commons will agree, that before any legislation is brought in we ought to have the evidence on which the Committee based its findings. Until that is done the House ought not to pass any legislation.

Until the right hon. Gentleman tables his Resolution we shall not be able finally to judge, but I should like to ask whether the negotiations are continuing and whether it is proposed to try and get an agreed Resolution with the co-operative societies. I understand from the right hon. Gentleman's speech that in any case he is not going to adopt the whole of the proposals of the Raeburn Committee, and that the principle of mutuality is to be left as it is. I should like to hear whether I am right about that. It has been represented in some quarters that the co-operative societies desire to have a privileged position as against other citizens. That is not true at all. We do not want any privilege. We simply want to be treated exactly as other people are treated, and if it can be shown by proper evidence and after proper discussion that there is a just case for dealing in any way with the co-operative societies, I am sure the societies will be only too glad to discuss the matter and to arrive at a settlement. We are not, however, going to allow this thing to be dealt with on the lines of the Raeburn Committee's report. Unless we can get an agreed settlement we shall do our best to fight these proposals, and if we do not succeed here we shall do our best in the country.

I have no doubt that the traders have a, grievance against the co-operative societies. They have a grievance also against the big corporations, such as Boots and the Home and Colonial Stores, which plant their establishments in their midst. They have a complaint against the co-operative movement because we want through that movement to improve the private trader out of existence. We do not, however, want any advantage from the State in doing it. On the other hand, we do not want to be treated unjustly by the State, and we think that the proposals of the Raeburn Committee are unjust. I hope that the right hon. Gentleman will continue his discussions and that when he brings a proposal forward it will be an agreed proposal.

The giving of one penny a pint off beer may apparently be a very popular thing to do, and it may be popular in other quarters to deal with the Income Tax as the right hon. Gentleman has done. But we have reached a. very low point in our national history when we have to be saved by a penny a pint, off beer. It shows that, in spite of the right hon. Gentleman's statement that he does not take much notice of criticism, he has bowed to an agitation which he will find in the long run not very profitable. Although I am a teetotaller, I have never said anything against any one who drinks beer, spirits or wine. I am certain that the younger men and women are not drinking so much as they did in the past, but this Budget will tend to prevent a still further fall in drinking habits. I am sure that it will not succeed, and that the taking of less intoxicating drinks will continue. I do not say that people will become total abstainers altogether, but they are finding their amusement and recreation to-day in a better way than by merely sitting in public-houses or elsewhere and doing nothing but drink. The working people can walk into the country or go to cinemas, and there are one hundred and one ways in which they are spending their leisure differently from the way in which they did it in the past. When the right hon. Gentleman had some money to spare, the first people of whom he thought were not those who are at the bottom of the social scale, the victims of bad trade and of our social system, but the people who can much better look after themselves. We consider that he ought to have used whatever money he had to spare to help the unemployed by giving their children and their women better conditions they they have at the present moment.

5.56 p.m.


The custom has grown up in the House of recent years that on the day of the Budget state- ment the House should adjourn very early and that Members should not engage in any survey of the Chancellor of the Exchequer's proposals, or still less in any general consideration of the state of the nation. That has always seemed to me to be an admirable custom. I shall not therefore follow the right hon. Gentleman, the Leader of the Opposition, in his somewhat elaborate review of both the Budget proposals and the present conditions of the country. If leaders of parties are to examine the Budget proposals and policy in general, then private Members necessarily will think it encumbent on them to do so, and this custom, which has generally been regarded as an admirable custom, will gradually disappear.


The right hon. Gentleman was a member of the Government last year, and if he looks it up he will find that the Prime Minister broke the rule then. I called attention to the fact and said that I intended to do it.


I hope that these reprisals will not continue indefinitely, but that an armistice will be agreed and that in future years the more peaceful methods that previously prevailed will be repeated and the old custom re-established that on Budget day the Chancellor's speech should be in effect the only speech to be made. There is, however, one thing which the Committee does desire to do, and that is to congratulate the Chancellor of the Exchequer on the accomplishment of his heavy task and the fulfilment of what must be to every Chancellor a most onerous responsibility. I have heard, I think, about 20 Budget statements in this House, but I do not think that I have heard one which excels that of to-day in lucidity and conciseness. Those are great virtues in a Minister, and they are the greatest courtesy that a Chancellor can show to his audience. Those qualities have been very evident to-day. The Budget statement has been crystal clear, and, considering the magnitude and complexity of the financial matters with which the right hon. Gentleman had necessarily to deal, it was remarkably compact. If it did not evoke any marked enthusiasm in the Committee, that was because neither the conditions of the time nor the proposals that were made were calculated to evoke any great degree of enthusiasm. I do not suppose that the country will think that the Budget shows any remarkable degree of resourcefulness. It is rather a, pedestrian Budget, but the conditions of the time do not provoke any flights of Pegasus.

One point was omitted from the Chancellor's statement, and if any Minister is going to reply to this very brief discussion perhaps he will refer to it. A few days ago there was a Debate in the House, in which great interest was taken, on the burden of the cost of the able-bodied unemployed, and the Government gave an undertaking that within a short space of time a readjustment would be made as between local and national finance with a view to this charge being transferred from the localities to the Exchequer. The Chancellor did not mention that matter to-day, and as the whole question is really one of finance, because the reality of the relief to the local authorities can be measured only by the amount of the transfer to the Exchequer, perhaps the Financial Secretary to the Treasury, if he answers, will be able to tell us what is the amount of money which will be involved and which somehow or other must be included in the Estimates of this year. But, as I say, we do not propose to go into either the merits or the demerits of this Budget on this occasion. Other opportunities will be given for that, and to-day I will content myself with congratulating the Chancellor of the Exchequer on the clarity and the completeness of his statement.

6.2 p.m.


There is just one question I wish to ask the Chancellor of the Exchequer, on a point which I do not think he mentioned in his Budget speech. It is to ask whether he proposes to repeal the Land Tax imposed in the Budget of 1931? Perhaps he will kindly give me an answer, yes or no.

6.3 p.m.


I think it is the well-known procedure that on this occasion there are no speeches on details of the Budget, but I do think one voice ought to be raised in complete and entire appreciation of the speech to which we have listened this afternoon. If I may say so, it was an extremely cheerful speech. One listens to Budgets in which the facts are not fully faced, and I remember in the first Budget of 1931 the sense of depression with which that partial facing of facts affected not only myself but other listeners who had certain knowledge. I can assure the Chancellor of the Exchequer that his speech to-day will strike a chord of cheerfulness in those who feel that finance is being properly dealt with and the facts are being fully faced. I especially congratulate the Chancellor on his courage in facing up to that demand for speculative and imaginative finance which was so insistent in earlier stages this year that a good many of us became filled with alarm. He has justified our confidence in him by declining to be led away into those very sinister and doubtful paths. May I also deal with one detail which the Leader of the Opposition has referred to, and congratulate him on his method of dealing with the taxation of co-operative societies? I have regretted the methods the cooperative societies have adopted in endeavouring to defeat any attempt at taxation which should be applied to them. I am sure that it is in their own interests that this question should be settled by agreement. They are not in a privileged position, precisely, but in a different position.

Some of us who were through all the controversies in regard to co-operative societies when Excess Profits Duties were imposed know that special schemes had to be devised to meet their special case. Similarly, with regard to Income Tax, I hope it will be possible to devise some special scheme that will suit the real needs of the case. Admittedly, ordinary Income Tax law does not apply appropriately to co-operative societies. On the other hand, they are corporations created and sustained by law, artificial, receiving all the benefits of a stable State to which they make a relatively small contribution. The demand on the co-operative societies is that because they receive the benefits of a civilised State they should make a larger contribution than they do, and I feel sure that if they and the Chancellor would combine to devise means they could discover some special methods by which this could be done. May I say in conclusion that the claim from the Opposition that any surplus there was should have gone to adding to the "dole" really shows an extraordinary limitation of financial imagination on their part. As if that were really the best way of dealing with unemploy- ment! We all know that three elements are required in any policy which is to restore prosperity in this country. The first is international agreement on economic disarmament—there is no dispute about that; the second is the skill, competence and energy of our industrial and mercantile populations, whether they be managers or workpeople; and the third is sound finance, and I most heartily congratulate the Chancellor of the Exchequer on having provided the third of these three elements.

Question put, and agreed to.