HC Deb 30 June 1938 vol 337 cc2237-66

Section one of the Finance (New Duties) Act, 1916, and Section one of the Finance Act, 1935 (which relate to entertainments duty), shall cease to have effect on the thirty-first day of March, nineteen hundred and thirty-nine.—[Mr. A. Herbert.]

Brought up, and read the First time.

8.59 P.m.

Mr. Alan Herbert

I beg to move, "That the Clause be read a Second time."

After the interesting, important but rather varied entertainment which we have had to-day perhaps I might, without apology, ask hon. Members to turn their minds to the legitimate drama. Some Members of the Committee would like to thank the Chancellor of the Exchequer and the Patronage Secretary for making it possible for us to discuss the very important question of the Entertainments Duty, which is of national, not sectional, interest, and to do so with rather more leisure than was possible the other night. So many bricks—or half-bricks—have been thrown about to-day that a few roses might not be out of place: and perhaps I might congratulate the right hon. Gentleman and his lieutenant on the very distinguished and good-humoured manner in which they have piloted their first Finance Bill through this rightly vigilant Committee.

The Clause which I am moving does not go nearly so far as the suggestion which was made last year, and I think again this year, in the memorial signed by more than half the number of Members in this House, that the Entertainments Duty should be removed entirely from the living theatre and concerts. That suggestion would, if adopted, reduce the revenue in the present year by about £1,000,000, and hon. Members might justly recoil from that suggestion with horror and dismay. This new Clause does not affect the revenue in the current year by a single penny. What it says is that the tax shall come to an end at the end of the present financial year. If the date suggested is not correct, that could be altered. The tax could end in May, temporarily, if necessary for a second or two; that is to say, my right hon. Friend could reimpose the duty in his next Budget exactly as it is to-day. But in preparing the next Budget the right hon. Gentleman and the Treasury would be forced to face the question: Are we to reimpose this tax in this or any form and, if so, upon what entertainments, with what exemptions? and so forth.

This duty is not, like the income-tax, imposed anew every year. It was not mentioned in the Budget speech, although the right, hon. Gentleman has been bombarded with correspondence in the "Times" and with constant memorials and deputations, and although he went out of his way to refer to taxes on beer, whisky and other important commodities. Then, in the Budget debate, though the hon. Member for Brixton (Mr. Colman) made a substantial and sensible speech on the question, the right hon. Gentleman did not find time to mention it in his Budget reply. I know that he was somewhat pressed for time. So, year after year, the only opportunity of questioning this tax is for some humble private Member to put down a new Clause which may or may not be called. Quite apart from the merits of this tax there is a very strong feeling that if it is not to be taken out of the present system of things the decision, if it comes back in any form whatever, ought to be deliberately made and justified by the Chancellor of the Exchequer in his next Budget speech.

We all know that this tax was originally intended to be temporary, to meet war purposes. I have many quotations with which I will not weary the Committee; but the suggestion was that it was somehow unpatriotic to be amused during wartime. Further, many people were earning far more money, for example, as munition workers, during wartime than they had been doing in peace, and this duty seemed a good way of getting some of it out of them. Those conditions have all gone. I would remind the Cornmittee that in the Finance (New Duties) Bill, in which this duty was first imposed, taxes were proposed on matches, cider, perry, and soda-water syphons, and there was another tax which was very interesting indeed. A tax of this nature was proposed upon certain railway fares, but that tax was not successful in reaching the Statute Book in the Finance (New Duties) Act, and I think hon. Members will not be surprised to hear that information. Certainly it is not difficult to imagine what would happen now if it were suggested to those very patriotic hon. Members of the House who rightly guard the interests of the railways that a tax of, shall we say, 10 per cent. should be placed upon railway tickets, without reference to profits or losses.

The tax on the theatre did go through, and here it is. My right hon. Friend may reply that the particular crisis which this tax was framed to meet still survives, owing to the foreign policy of foreign governments, and that would be a perfectly good reply. But, however grave that crisis was, it was not intended, and the Financial Secretary of those days, Mr. Montagu, carefully said so, to do anything either to cripple or injure, much less kill, the theatre; and if it can be shown, as I think it can, that the theatre, although I do not think it will ever entirely die, is being gravely injured, and to some extent other entertainments also, I think there is some justification for reexamining the tax.

May I attempt to give the Committee a few figures? In this I ask for their indulgence, because I am not very good at figures. I think it may not be a waste of time if I mention once again the rates of this tax. The basic rate, of course, is 20 per cent., that is to say, 20 per cent. on the original price of admission—1d. on 5d. That rate does not cover the whole range, because there are various gradations, but it was the original basic rate, and, in the cinema at any rate, it goes a long way. In the theatre, taking the 12s. 6d. stall, that figure consists of ios. 6d. plus 2s. duty, so that the duty amounts to 19 per cent. The price of a lower stall, say ios. 6d., is made up of 8s. 10d., plus 1s. 8d. duty, or 18.8 per cent. for duty. On an 8s. 9d. seat the tax is 19.3 per cent., on a 5s. seat, 17.6 per cent., on a 3s. 6d. seat, 16.6 per cent.; while in the case of a 2s. seat the tax goes down to 14.2 per cent. In the case of the cinema, owing to the small but much appreciated concessions made in 1935 to the living theatre, which I think were quite deserved, the figures are a bit harsher. On a 9d. seat the tax is 20 per cent., on a 10d. seat, 25 per cent., on a 1s. seat, 20 per cent., on a 1s. 3d. seat, 20 per cent., on a 1s. 6d. seat, 20 per cent., and on a 1s. 10d. seat, 22[...] per cent. I do not guarantee the arithmetic of this last figure. I ask the Committee to speculate what would be the response of any other industry in this country if it were proposed that a tax of 20, or 19, or even 15 per cent. should be placed upon its receipts without reference to profit or loss, and if, when the industry complained, it was told airily that it could pass on the tax to the consumer, and all would be well.

After those figures, I do not think the Committee will be astonished to hear the next set of figures that I propose to give. They are the figures of actual losses, and in some few cases profits, on some recently acted productions. I am in some difficulty about these figures, because many of the managers who at my request gave them to me asked that the names of the plays and theatres should be regarded as confidential. The reasons for that are, I think, obvious, and I hope that my right hon. Friend will not insist that I should disclose the sources of my information, still less that I should attend at the Treasury in cap and bells. I propose, first of all, to refer to two of that great man Mr. C. B. Cochran's productions. Many people say that Mr. Cochran is very extravagant and lavish, that he spends too much money, and they wonder how he can ever expect to earn any profit. But these two productions (two interesting and elevated plays, one by one of our greatest dramatists) were by no means lavishly expensive. The total losses amounted to £3,400, and the total paid in Entertainments Duty was £4,200. In this case, as in so many others, the loss is less than the tax, which means that, if only some proportion of the tax had been left in the hands of the manager, it might have been possible to carry the run along.

I will now take two of Mr. Cochran's big productions—expensive revues—with one of which I had the honour to be concerned, and with the other of which I was not concerned. The first of these, I am delighted to say, showed a profit—it was a pleasant surprise to me—of £7,000. I might add that on a show of that kind the production costs would be at least £10,000, and, of course, the running expenses are tremendous, so that a profit of £7,000 after a run of about five months is not very excessive. On that production, which showed a profit of £7,000, the tax amounted to £16,000. On the other show, hich was similar in character, there was a loss of £2,000, but let the Committee observe the astonishing fact that in this case also the tax was precisely the same, namely, £16,000. Therefore, on these two shows the total profit was £5,000, and the total tax £32,000 (apart, of course, from income-tax). I have here a total of 12 productions which showed as a whole a loss of £5,000 but in the case of which £28,000 was paid in tax. Again, Mr. Anmer Hall wrote in a letter to the "Times": "During this past winter I produced Mr. O'Neill's play "Mourning Becomes Electra," and at the conclusion of a run of eight and a half weeks, and with the aid of my bars, which functioned more effectually than ever before in the history of the theatre, I closed with a balance of profit of £130. But the Customs and Inland Revenue Department were more fortunate, for during the same period I paid them £940."

Mr. Walter Payne, the President of the Society of West End Managers, told me that of 53 productions in the last two years, (these figures, I believe, were taken at random from two or three auditors) 43 lost £214,000, and To made £50,000. I have not the figures of tax for them. I can quote numerous examples of this character, and so can anybody else. Mark you, although I am taking no highbrow line, in order to justify myself to the front Bench I took the trouble to find out a few of the more cultivated and elevated plays. That is to say, these are not the kind of vulgar or corrupting productions that upset the Bishops.

This is not a question of enriching the managers. It is a question of keeping in being, and healthy being, a socially valuable enterprise. I have so often seen in my own experience how little money may be necessary just to turn the corner. I have seen numbers of times how at the beginning of a run, managers, authors, designers and musicians spend, rightly, many months preparing the show; it starts well: the critics are kind; all looks well. The actors are drawing pretty good wages and salaries, and paying Income Tax, and rightly; the authors drawing good royalties, and paying Income Tax, and rightly; all those golden girls, not paying Income Tax perhaps, but sending presents to their mothers; and all is doing splendidly. But the manager, who is taking the risks, is not receiving a penny of profit; he is still paying off his production account. It is very often six weeks, or it may be more, before he begins to receive any profit; and all that time the State is putting its hands into the till and grabbing 15 to 20 per cent. on the basic prices.

Is there a single industry in the world where the same thing would be done or suffered? But that is not the end of the story. Two months go by; perhaps a little bit of profit begins to appear; then there is a heat wave, or a Coronation—[Interruption.] Oh, yes there is nothing worse for the theatre than public festivals—or a strike, or somebody takes up the street outside the theatre, or there is one of those mysterious and fatal waves of antagonism to the theatre, and people cease to come. Now every week brings a loss. The manager keeps on saying, "Another week or two"; and then there begin those tragic conferences when it is decided whether or not the notices are to be put up. Only a few hundred pounds might turn the corner. Far more than those few hundred pounds has been taken by the State, and will never come back. The show finishes. The golden girls go clattering up the stairs for the last time: they may or may not get another job. The actors pack up their grease paint: they may or may not get another job. The stage-hands shake their heads and go home: they may or may not get another job. But all that hive of industry is dead. And a play is not like a soap-factory: the whole process of manufacture must begin again.

That kind of picture, sad though it is, can be reproduced, I know, in many another industry; but there is one kind of picture that I will wager cannot be reproduced in any other—the picture of the Monday when the manager who has taken the risk of this precarious and difficult enterprise goes to his backer or his banker, or perhaps the bankruptcy court, and has to say: "We have all worked hard and done our best for five or six months; nobody has been greedy; for five months we have entertained and even uplifted the public; and the result is that I have lost you several thousand pounds, and the State has taken £16,000." Yet people say, "Why do not you improve the accommodation at your theatres? Why do you not pay your actors and actresses more? Why is Leicester Square, that old haunt of the theatre, given over to the cinema?" Well, what do you expect with a tax like that?

I think I ought to face frankly the question which is always asked, which has been asked by many Members in private discussions on this question, "What would the managers do if the tax were remitted; would they pass the remission on to the public?" I am not here in any representative capacity. I have never been a manager—I hope I never shall be. I cannot answer for them; but I would say first, if this Clause is accepted, as of course it will be by the right hon. Gentleman, its great beauty is that the right hon. Gentleman may put that question to the managers when he is preparing his next Budget. Let him say to them, as he says to the brewers and other people when he is proposing to review a duty, "What will you do; will you pass it back to the public?" That does give him a hold on them. He may become not only a collector of revenue, but a reformer as well. He may say, "What about paying more money for rehearsals?" But I think it is fair to say that the public will get some, if not all, of the benefit of the remission of tax. To pass on the whole benefit would be a rather generous line to take. It should be remembered that during the time that has elapsed since this tax was imposed, though the costs of production have increased, I am told, between 100 and 150 per cent., the basic price of tickets has not increased at all.

Here is a letter to the "Times" from Mr. Payne. He says that if no per cent. of the takings were retained at the box office, managers would then be able (a) to deal with prices of admission to the public, (b) to produce more and better plays, (c) to increase the minimum rates of lower-paid artistes and other theatrical workers, and (d) to avoid the at present crippling losses. I do not think that you can say fairer than that. As I say, I am not giving any undertaking or guarantee, because I have no right to do so. Once more, it is not a question of taking money away from the State and giving it to greedy managers; it is simply one of enabling the money paid by the public to entertainment houses to be used to keep the business going in a proper manner.

I apologise if I have been too long; but it is time this question was considered thoroughly. Last year, when I moved the same Amendment, the right hon. Gentleman in a very courteous and friendly speech said that if I devoted my ingenious mind to producing sound proposals for classifying entertainments for the purpose of this tax, I might do a great service. I might reply that I am not, after all, the Chancellor of the Exchequer. I thank God every day that I am not the Chancellor of the Exchequer—I do not mean anything personal. Therefore, I might say that it is not really for me to frame the taxes. If the Chancellor decides, as I am sure he long ago decided in his heart of hearts, that this is a thoroughly bad tax, it is for him to give his mind to the invention of another. But I seldom refuse a challenge and I will do what I can. The first broad distinction that I would make, as I have already indicated, is between entertainments—vicious, virtuous, good or bad—which are profitable and those which are not, though it may be that it is not practicable to make that distinction. Secondly, there is a classification already on the Statute Book, because in the Act of 1935, where it was decided quite rightly to reduce the tax upon what is called the living theatre, you have these admirable words: The said duty shall be charged at the reduced rate where all the performers whose words or actions constitute the entertainment are actually present and performing and the entertainment consists solely of one or more of the following items, a stage play, ballet, whether a stage play or not, the performance of music, whether vocal or instrumental, a lecture, a recitation, a music hall or other variety entertainment, a circus, or a traveling show. With that on the Statute Book it is not necessary to seek any other classification. The real objection to this sales tax, profit or loss not considered, upon the theatre, and indeed, to be logical, upon the cinema, is that it is a tax upon the things of the mind, and no civilised State puts taxes upon the things of the mind. We should not think of putting a tax upon newspapers, though in the days when my right hon. Friend the Member for Carnarvon Boroughs (Mr. Lloyd George) was young they did. It was only about 1850 or 1860 that there ceased to be taxes on newspapers. [Interruption.] I warned the Committee before he came in that my arithmetic was not very good. I should hesitate to use the word "art" but for the fact that in the original Act the dangerous word "art" is several times used. The Oxford English Dictionary defines it as "the application of skill to subjects of taste, as poetry, music, dancing, the drama, oratory, literary composition and the like". That corresponds closely with what we already have in the Act of 1935, and what many of my hon. Friends would do if they had the power would be quite simply to take the tax off all entertainments which are the products of musical or dramatic art, and performed by living people, according to that definition. After all, exhibitions of painting and sculpture are already exempt, because they are educational, even when they are miserably attempting to get a profit. What is the distinction between them and musical and dramatic art I do not know.

Last year the right hon. Gentleman said something about the difficulty of distinguishing between good artists and bad. I do not think that is necessary. I am now trying to help him to take a rather highbrow line and say, "I may not want to help the managers and I will not bother about the authors, but I will do something on cultural lines because it is a bad thing to tax art." On these principles, there are few entertainments so low in the scale that a man will not take away from them some kind of mental enrichment, some flash of beauty, some enlightenment or understanding of the problems of life, something that makes it wrong and barbarous to tax musical or dramatic art as if it was a bottle of whisky or a packet of cigarettes.

The right hon. Gentleman last year said there were many other things. "Some Members might think it more important to enlarge the Income Tax relief of married persons, and there may be other suggestions. We cannot very well in advance declare that this is the one instrument in the whole collection of instruments of torture which will be here and now abolished." I do not ask him to do that. I would ask hon. Members again to vote for the Amendment because they will not reduce the revenue by a penny. All they will be doing is to say that in the next Budget my right hon. Friend, whom we all admire and love, is to consider the entertainment tax anew and decide whether it shall be reimposed in its present form or be placed only on the cinema or the theatre, or whatever he likes. I ask hon. Members to put out of their minds the suggestion that, at such a time, when there are so many poor people who want bread and boots, we cannot consider letting the theatre off a tax of even £1,000,000. That is a wrong way of looking at it. The poor are more interested in organised entertainment than the rich, and I think we can defend some remission in the tax on the ground that we are going to do something for a valuable national institution.

At all events, let us consider the tax upon its merits, without reference to or comparison with other taxes or other causes. But if anyone is going to wander about in that way I too shall be tempted to stray; for I have an alternative tax in my mind. I will undertake to raise £20,000,000 by a tax on betting if I am permitted to alter the law in the proper way. So I am not entirely destructive. I know the right hon. Gentleman conceives himself as being hemmed in by the thin ends of innumerable wedges, and therefore he is tempted always to say to A, "If I do anything for you I cannot do anything for B." But if that argu- ment is to prevail it will be idle for any of us to put down amendments. Let us consider the tax on its merits and decided that it is, as I am perfectly convinced it has been for many years, a bad tax in essence, in character, in rates and in incidence. I think that no State can properly be described as civilised if it declines for one reason or another to put a tax upon the great activity of betting but for twenty-two years maintains a "temporary" tax of nearly 20 per cent. on the plays of Shakespeare, the music of Handel and Beethoven and the healthy laughter of the people.

9.36 p.m.

Mr. Mabane

I am sure that the Committee will agree that my hon. Friend the senior Member for Oxford University (Mr. A. Herbert) has presented a very powerful case in favour of his Clause, and again I would emphasise the nature of the Clause. It is ingenious in its character. My hon. Friend is not asking that the entertainment tax should be abolished or reduced this year, but is merely asking the Committee to agree that this tax should come to an end at the end of the present fiinancial year and that there should be placed upon the Chancellor of the Exchequer an obligation to introduce the tax in a remodelled form when he introduces his next Budget. It is because the Amendment proposes such a remodelling of the entertainment tax that I, personally, find myself able to support it, and I hope that many Members of this Committee will also be able to find themselves in a position to support it also. [An HON. MEMBER: "In the Lobby?"] Wait and see. After all, this year is a very difficult year in which to argue any reduction of taxation, unless it is possible to argue that reduction is the only way to maintain the tax in its highest possible yield. I am not at all certain that, in connection with the entertainment tax, that argument can fairly be used. I am certain that, if we were merely to confine our attention to those forms of entertainment to which my hon. Friend has referred in which the living performer takes part, it would be very easily possible to argue that unless there is reduction in the tax the yield from these forms of entertainment is likely to be reduced.

It may be argued, on the other hand, even if the tax obtained from entertain- ments provided by living performers is reduced, nevertheless there will be an increase in the amount of tax obtained from the cinema. That may be true. If it is true, it is not an argument which impresses me or one which I like. I firmly believe that in these days the best national interests are served when at last we are paying attention to the manner in which our people get their leisure by the maintenance of those forms of entertainment which may most properly be described as active, those forms of entertainment provided by living performers. I do not support this Amendment as one who is very much concerned to reduce the tax on the cinema. There may be Members of the Committee who desire to argue that the tax on the cinema ought to be reduced also, but for my part I am concerned primarily with a reduction of the tax on what is called the living theatre. It is for one or two very definite reasons, which I wish to offer to the Committee, in addition to those which were presented by my hon. Friend. In the first place, I am satisfied that the living theatre, both in London and in the provinces, is an essential part of English culture and reflects the English spirit in a way that the cinema never can do. The cinema reflects a cosmopolitaa habit of mind, and even in this country the cinema has never endeavoured seriously to represent English culture.

I suggest as my second reason for this Clause having my support that in the living theatre the audiences assist in the truest sense of the word actively, and that a vigorous theatre in this country induces many people not professionally interested in the theatre to occupy themselves in those forms of theatrical effort which are perhaps the essential condition of the development of a real community spirit. The third reason is that the entertainment tax is in fact killing the living theatre in this country. My hon. Friend gave some very interesting figures of profits and losses on productions in London and of the taxes that have been paid on particular plays. I have in mind at the present time two plays which have recently been produced in London which by common consent were plays of the highest quality but which resulted in ultimate losses for the producers, which contributed considerable sums to the Exchequer, and which would have had their run continued for at least double the length of time had the entertainment tax not been imposed upon them. It is really a very practical matter. The incidence of the entertainment tax has made the London theatre, and by reflection the theatrical enterprises in the provinces, something of a racket, if I may use an American term in this rather appropriate connection. It has become of a very precarious nature.

There are very few regular theatrical managements left in this country. There are few if any managements comparable with the old managements of Alexander, Tree and Irving. There certainly are one or two theatrical managements which endeavour to put on continuously plays of good quality in London, and subsequently to send them round the provinces, but, on the whole, plays in London are now produced by introducing one or two people who imagine themselves to be interested in the theatre to put up £1,000, £1,500 or £2,000 for no reason but the reason that they believe the living theatre should be well supported. That £1,500 or £2,000 is perhaps exhausted after a three or four weeks' run with empty houses, and the play comes off. The consequence of that, as my hon. Friend has said, is that actors and actresses are thrown out of work, the theatres are dark, there is no play and the general tone of the London theatre tends to fall. I am quite satisfied that, if this tax were modified to the advantage of the living theatre, we should see a revival of that kind of theatrical management that we knew in the past and that made the London theatre to be regarded with the greatest respect throughout the world.

I would suggest one other reason. A play is put on with a modest but adequate amount of capital sufficient to enable the play to continue, if things go really badly for three weeks. At the end of two weeks may be the management see that it is not going very well and notices have to go out and the play finishes. Often it has been observed that a good play may begin with small audiences, and after three weeks it may begin to look like being a success, and at the end of six weeks the corner may be turned and a loss converted into a profit. The very fact that the tax takes such a substantial proportion of the receipts of the theatre often prevents a play being continued in its run for a sufficient length of time to enable the loss to be turned into a profit. It may be that the Treasury prefers the cinema and has no compunction in taking action that may damage the living theatre, but I do not think that can be true of the Chancellor of the Exchequer. I think we can look to him as a man who, above all, would be likely to desire to see the living theatre continue.

We are asking for very little in this Amendment, we are asking for a very small crumb of comfort from the lips of the Chancellor of the Exchequer when he replies. Perhaps we cannot expect him to accept the whole of the Amendment, but we should be very gratified, and it would be very heartening to many of those who are engaged in this profession in London and the country, if he would undertake to observe during the course of the coming year exactly how the theatre is going along, to consider seriously whether its present position and prospects are damaged in the way that we suggest by the Entertainments Duty, and to assure the Committee that if his examination convinces him that the living theatre is being damaged in the way we suggest, then before he presents his next Budget he will take into consideration the arguments that we have advanced to-night and, on cultural if not on financial grounds, consider the Amendment of this tax, so that the living theatre may have a better chance.

Unless the House is prepared to consider a little more seriously than it has done in recent years the effects of the entertainments tax on the living theatre, Parliament may find, perhaps too late, that it has taken upon itself the responsibility for killing one of our most characteristic and traditional institutions, the living theatre.

9.48 p.m.

Mr. Poole

I was interested in the way in which the Mover of the Amendment stated the case. The way in which he led us through the history of the industry was very interesting and has shown those of us who are not actively identified with the industry something of the difficulties with which it now has to contend. But I am not satisfied that he has told us the whole of the story, because while he told us of the very serious losses that have occurred on various productions he omitted to speak of the very excellent returns which have been forthcoming on other productions.

I have risen primarily to say what I can in support of the Amendment as far as the living theatre is concerned. I have been concerned with the very serious position which is becoming apparent in the provincial towns. I live in the town of Walsall, which has a population of 106,000 people, and it may surprise the House to hear that there is in that town not one single living theatre. The last theatre which made provision for productions of that type has now been demolished and there is going up in its place an architectural monstrosity which will in the near future be showing moving pictures. That will be the only form of entertainment in the town, not because we in Walsall do not love art, but simply because it has not been possible, I presume, for the industry to put on in Walsall a theatre production of a scale which would justify a sufficient attendance to merit the production continuing in the town.

In my innocence, when I first read the Amendment I must confess that I did not approach it from the line on which the hon. Member for Oxford University (Mr. Herbert) has presented it. Immediately I saw the Amendment I thought that it was an attempt to remove the tax from the theatre-goer, because I understood that the major portion of the tax was borne by the patrons. I imagined that the object would naturally be to hand over the relief in the amount which the theatre-goers would pay for their entertainment. Be that as it may, I should like to refer to one very common occurrence which I find in the cinema industry, and which ought to be discouraged. I hope the Home Secretary will at some early date direct his attention to it. I have noticed it particularly prevalent in the City of London, where cinemas which have seats at varying prices, 1s. 6d., 2S. 6d., 3s. 6d. and up to 8s. 6d., are in the habit of announcing that there is seating accommodation only in the higher priced seats and that there is no accommodation available in the lower priced seats. But if one is bold enough to go inside one finds an abundance of seats at the lower prices. In that very unfair way some of the cinema managers are filling their higher priced seats, because they know that people are not prepared to stand.

I hope that the Chancellor of the Exchequer will consider the Amendment and accept it, because I understand that it will involve him in no financial responsibility so far as the current year is concerned. This gives the Chancellor of the Exchequer 12 months opportunity to consider whether he will or will not continue this taxation in the next financial year. If relief is given from this taxation so far as the living theatre is concerned, I hope that it will be applied in a certain ordered way and that it will not be swallowed up in the industry by giving increased profits to those who are engaged in the ownership and the production. I hope that if relief is given it will, first of all, go to the poorer paid performers. The condition of many of the people engaged in this industry, especially in provincial productions, is an extremely grave one. I have on many occasions during my previous employment come up against the position of companies many of them composed of numbers of young girls who have been visiting provincial theatres where they have had a bad run and have not had the necessary finances to get them to the next town in the circuit. They have had the distasteful task of having to wire to the advance managers asking them to guarantee the expenses of the company on to the next point. In some cases the managers have not been prepared to give that guarantee, and consequently young girls have been stranded in provincial towns without friends and without means. If the relief in regard to this taxation will only go in some small way to meet a position such as that, it will accomplish something.

Secondly, if this relief is granted the public are entitled to some consideration, inasmuch as they are mulcted of the tax. They have at least the second claim to any relief which is given. In the third place, some of the relief should go to improve the standard of production and to enable the provinces to get a better type of show. The money would serve a useful purpose in that direction. It is a tragedy in our national life that we see springing up—I have nothing against the cinema industry—particularly on large housing estates, adjacent to cities and towns, no other forms of entertainment than the moving pictures. There is nothing which makes an appeal to the dramatic and artistic nature of our people, and as a consequence our young people are growing up knowing nothing better than Americanised ideas of art, which cannot but have a harmful effect on them. I am concerned with the American influence of the cinema upon the lives of our young people, and I hope that the Chancellor of the Exchequer will accept the Amendment so far as the living theatre is concerned and by so doing help to improve the artistic and dramatic standards of this country.

9.58 p.m.

Mr. Assheton

I should like to add my plea to the very formidable case which has been put by the hon. Member for Oxford University (Mr. A. Herbert) and other hon. Members, that at least the tax on the living theatre should be remitted. I do not know what other hon. Members feel but I take the view that a tax on plays is every bit as bad as a tax on books. Hon. Members of this House do not have the same opportunities of going to plays as other people and have to get their entertainment from books and in other ways, and I imagine that they would be very annoyed if the books they have to buy were the subject of a tax. A tax on plays is as uncivilised as a tax on books. Last year when this matter was raised the Chancellor of the Exchequer was new at the Treasury and, since then, he has had a year in which to consider this matter. I hope he can make a concession on this occasion. We are fortunate in having a Chancellor of the Exchequer who is a man of culture, a man of learning and intellect and devoted to the arts, and if such a man continues to tax the theatre and does not tax betting, I confess that I shall find it difficult to understand the workings of his mind.

10.0 p.m.

Miss Wilkinson

I rise to put three points to the Chancellor of the Exchequer. The first is that as far as I know the British Government is the only Government in Europe that taxes the theatre instead of subsidising it. In Germany, before the Nazi flood wiped out much of what civilisation there was in that country, almost every small provincial town considered the theatre as part and parcel of its civic life. In Norway, Sweden, Denmark, Iceland and Poland, and of course in Russia, enormous subsidies are given, and in many of the small towns on the Continent the whole civic pride is settled around the opera house and the theatre. Here, in what I suppose is one of the richest countries in the world which does not really need this revenue, we have this vexatious tax which everybody connected with the theatre says is doing a very good deal of harm. In the second place, there was growing up in this country a number of repertory theatres and companies. Anyone who has ever had any connection with the repertory movement from the heroic days—they were really heroes and heroines who attempted to do this task in the early days—knows that wherever you get a repertory theatre it invariably becomes a school for dramatic art. Wherever you get a repertory company you get a small group of dramatists writing for that theatre, but it is very difficult for them to keep on their feet when they have the millstone of this tax around their necks.

There is not only the question of the repertory theatre but also the amateur theatre. There seems to be some highly placed official who is using his misplaced ingenuity in finding out where any small body of people are going to act a small play or something written for their company, and then he comes down upon them for this entertainment tax. I know a case in the North of England where the mere fact of having to pay this tax limited the performance to one show, and in some cases the proposal had to be abandoned. In these days we are all concerned about our young people; we want to take them off the streets and give them something to do. We also want to find something for the unemployed, but if a show is given by the unemployed they have to pay this entertainment tax if a charge for admission is made. There is another point which I think we are forgetting. Our provincial theatres it is true are practically nonexistent now and we do not want the Americanisation of the artistic life of our country. It is not only a question of the theatres; where is the reservoir of talent to come from if the living theatre is closed down? It means that the reservoir of talent for our films will be dried up.

I have had a previous experience of appealing to the Prime Minister to help certain employers of labour in this country who were unfortunately engaged in making profits, and it has been made perfectly clear that anybody who makes a profit in this country can be protected, except on the high seas. Here we are asking for a concession on behalf of people who are not making profits except on certain occasions, but at least let us penalise those people who are making profits. If we want to have a tax surely it should be on the profits that are made and not on the gross takings, whatever the profits may be. In this country we have subsidised everything from sugar beet to tramp shipping. I do not know anything about betting but I know something on the question of cosmetics, and I guarantee that the Chancellor of the Exchequer by putting a small tax on face powder and face cream would get ten times as much as he does by this tax on theatrical art. I see the hon. Member for Frome (Mrs. Tate) looking at me with great regret, but I am only proposing to tax an alternative form of art. I was told by a woman in a salon this afternoon that the alluring contents of one of these mysterious bottles actually costs 6d. to produce, but is being eagerly bought by my gullible sisters for 12s. 6d. I suggest to the Chancellor that in those circumstances there is a field of profit which would stagger even Mr. Cochran, with his large ideas. There is the possibility for him to recoup himself in that direction. I plead with the Chancellor to accept this Amendment which would give him an opportunity of forcing his officials to look into the whole question again before the Budget next year.

10.6 p.m.

Mr. Higgs

Probably I attend the theatre less frequently than any other hon. Member, but I consider this to be a thoroughly bad tax, and I support the remarks of other hon. Members who have spoken against it. I consider that it is particularly bad in regard to performances in person. I would remind the Chancellor that the removal of this tax would not interfere with the National Defence Contribution. I would also like to draw attention to a point which has not yet been made in this interesting Debate. On several occasions it has been suggested that the acceptance of an Amendment of this nature would involve a loss to the Exchequer of £1,000,000, but that is not so. If this tax were removed, the profits of the theatres would be greater, and the Chancellor would recoup himself to a very great extent by an increased revenue from Income Tax. It is possible that at an early date the amount received in Income Tax on the profits of the theatres would be greater than the deficit of £1,000,000.

Hon. Members have already emphasised the importance of the question of the competition of mechanical entertainment with performances in person. I think the hon. Member for Jarrow (Miss Wilkinson) made a very interesting point when she said that if this tax were not removed, we should lose even the source of supply of artistes for mechanical production. The theatres in the West End are at the present time receiving no more per seat than they received in 1914. I cannot think of any other business organisation to-day which is getting no more revenue per unit than it did in 1914. This tax is equivalent to a turnover tax, and I am convinced that hon. Members would not for one moment permit such a tax to be imposed upon industry. That is the standpoint from which I think this matter should be viewed. There are alternative sources from which the tax could be obtained, particularly football pools, and so forth. This Amendment is unique in that it would not come into force immediately, and thus the Chancellor would have plenty of time in which to consider alternative forms of tax if they proved to be necessary, which I very much doubt. Let me say in conclusion that the repertory theatre in Birmingham is exempt from this tax, for some reason or other, and were it not so, that theatre would not exist to-day. I believe that many more theatres would be in existence at the present time were it not for this abominable tax.

10.10 p.m.

Mr. W. Astor

I hope that my right hon. Friend the Chancellor of the Exchequer will consider sympathetically the substance of this Debate, even though he may not be able immediately to accept the Amendment. The sincerity with which different speakers have stated their views may be proved by the fact that, whereas in the past I remember my right hon. Friend's predecessor complaining that people who proposed taxes proposed that they should be imposed on habits in which they did not indulge, in this case my hon. Friend the Member for Oxford University (Mr. Herbert) has suggested a tax on betting and the hon. Lady the Member for Jarrow (Miss Wilkinson) has suggested one on cosmetics, both of which they would have to pay. I hope that my hon. Friend the Member for Oxford University puts on his bets with the same judicious moderation and skill as the hon. Lady puts on her cosmetics. But seriously, since the War we have had a period almost of cultural renaissance. Never have we had a more creative period in the arts, in writing, in poetry, and in the drama, than we have had in England during the last 20 years. That is the opinion of no less a critic than the late Colonel Lawrence. We are in a way charged with the preservation of the cultural inheritance of Europe. At a time when culture is being debased for propaganda purposes, in England we have the chance of keeping it free. Moreover, we have had the benefit of the immigration into this country of artists from abroad. One need only mention the Ballets Jooss, which have come to found an artistic home in England. As has been pointed out, this is no mere perquisite of the rich, for at the "Old Vic" and the "Sadler's Wells" the highest forms of art have been appreciated by all classes.

I know from contacts which I have had with people connected with the theatre how very often the Entertainment Tax makes a difference between profit and loss. Surely, as a capitalist Government, we should encourage the making of profits and then tax them afterwards. Let us not put a tax on raw materials, on turnover, on the processing. If a similar tax were put on some exporting industry, there would rightly be protests, for hon. Members watch very carefully the Import Duties Orders which they think may affect an industry both as regards profits and employment. If it be true that we want people to make profits, and if either the actor receives a large salary or the impressario a large profit, then the myrmidons of my right hon. Friend the Chancellor will be after him, with all their usual vigilance, for Income Tax or for Super-tax. If his profits are moderate, he will be taxed when he indulges in a glass of beer and a cigarette, and if they are larger, when he indulges in his bottle of champagne and a cigar; and if he buys a house, they will get him for rates as w ell. Surely, it would be much better to allow the profits to be made and then to tax the profits, and thus make employment and allow the cultural life of this country to be enriched. At a time when we are considering the better use of leisure, I hope my right hon. Friend, with his long tradition of sympathy for all that is best in the intellectual and artistic life of this country, will consider sympathetically the substance of this Debate, even though he may not be able to accept the Amendment this year.

10.15 p.m.

Mr. Pethick-Lawrence

We have had a very interesting Debate and I think it is an excellent thing that this subject should have come up for discussion at this time and not in the small hours of the morning. Speaking also for those who sit on these benches, I wish to say that we intend to support the hon. Member for Oxford University (Mr. Herbert) in his proposal. We do so the more confidently because it would not alter the balance of the Budget for the present year. The hon. Gentleman tried, I do not think quite successfully—as the Chancellor of the Exchequer no doubt will agree—to put forward a case for bringing the duty to an end on 31st March next year so that its application could be reconsidered in the following year. I think it would have been better if he had made the date 30th June instead of 31st March, and I think that if the Chancellor of the Exchequer were prepared to accept the hon. Member's proposal that very small alteration could be made.

This tax is, in my opinion, and in the opinion of a great number of other people, a bad tax. It is bad in form, and bad in substance. It is bad in form because it is entirely unsatisfactory in its working. It seeks to tax, not profit, but the attempt to make profit, thereby rendering the profit in many cases unmade and unmakeable. It is bad in substance because it is wrong to tax the things of the mind. I do not think it is a sound plan to tax a form of activity because it is regarded as entertainment. It is not right that on that account it should come under the ban of the Chancellor and become subject to a special form of taxation. It is a tax which affects not merely the lighter forms of amusement but some of the most serious forms of dramatic and other art and in our view it is deleterious not only to the managers and others concerned in these enterprises, but also the public who are entitled to use their leisure in the way which they consider best for themselves. Actors and actresses set out in their very precarious profession to benefit the public and they ought not to be subject to this special and peculiar burden. We thoroughly support most of the proposals in the new Clause and we shall vote for it if it should prove to be the case that the right hon. Gentleman has hardened his heart and finds himself unable to meet us.

10.19 p.m.

Sir J. Simon

I agree entirely with what the right hon. Gentleman has said—[HON. MEMBERS: "Hear, hear."]—to the effect that we have had a very interesting Debate.[HON. MEMBERS: "Oh!"] Indeed, my hon. Friend the Member for Oxford University (Mr. Herbert)—my representative—made so entertaining a speech that I shall have to consult with the authorities on whether he does not come within the scope of the Entertainments Duty. I should like to make clear to the Committee one or two points about this tax which have not, I think, been made entirely plain in the very interesting speeches we have heard. We must get our facts right before we can consider how we can improve the situation.

The hon. Lady opposite referred to the repertory theatre, and I rather think my hon. Friend the Member for West Birmingham (Mr. Higgs) did also. I may remind the Committee that whatever may be said about the tax, it is provided in the present law that it shall not be applied to entertainments like the Old Vic, the Shakespeare Memorial Theatre, and most of the repertory theatres, because of the provision which exempts from duty entertainments provided by a society, institution, or committee not conducted or established for profit and provided for partly educational purposes. A generous construction has, very rightly, been put on that provision, and I am glad to think that in fact, generally speaking, the repertory theatres and theatres like the Old Vic, are exempted.

Miss Wilkinson

That does not apply to the ordinary provincial commercial companies.

Sir J. Simon

On the other hand, of course, you have to bear in mind that this duty covers a very much wider range of things than we have been speaking about to-night. It covers horseracing, "the dogs," football, and, for the purposes of the duty, even cricket is reckoned as an entertainment. I can understand it being said with a good deal of reason that in point of fact this tax known by the name of Entertainments Duty does gather within its net things of many very different kinds. I am sure I sympathise very much with the hon. Member for Oxford University when he says that he feels particularly distressed when he finds a duty taxing what he called "the things of the mind," and I remember that last year, when he made another very entertaining and instructive speech, he sought to suggest that the best line to take would be to draw a distinction in substance between good entertainment and bad entertainment. He pointed out that it did not seem right to put the same burden on all the very finest dramatic productions as on shoddy and inferior productions, not of the sort which ought to be encouraged.

I pointed out at the time that it was a very difficult distinction to draw in a taxing Statute, and I invited my hon. Friend to apply his ingenious mind—and he is a very ingenious and a very successful legislator—to the subject of how really we could improve the present position of the tax. Though I am making no complaint, the fact is that from the time he made his speech last year until to-night I have had, so far as I know, no contribution from him on the subject; and all the opportunity that I have had of considering it—and I have done my best—has been at my own motion in the Treasury, with many people whom I have consulted, subject always to a deputation which I received from those representing stage interests, and I must say that I find the problem extremely difficult.

There are one or two other observations that I should like to make. One is as to the history of the tax. It has existed for a good many years now. I heard the right hon. Gentleman who has just sat down join in denunciation of this tax as a monstrous form of imposition, but I will not do more than say in reply that in fact it has survived two Labour Governments. Some relief was given in 1935 by my predecessor when he recognised that it was necessary to try and draw some distinction between the living theatre and the mechanical theatre. The result is that the tax does not operate in the same way or so severely in what is called the living theatre. When thinking about this matter I have been concerned as to whether or not the suggestion which has been made in several quarters for the removal of the tax from the living theatre would operate to restore it to a position such as it used to enjoy. The hon. Member for Lichfield (Mr. Poole) told us that in the great town of Walsall there is not any theatre showing at all now, and we find the same thing in other places. We have, however, to consider that the cinema is now offering entertainment of a very high order with scenery of unexampled magnificence and splendour. It is offering it in the small towns and, indeed, villages, just as in the great capitals, several times a day, and being a great and prosperous industry, it is offering it in big newly built premises.

My concern is whether the old historic living drama is really suffering simply because of this tax. It is a serious consideration how far it can be revived by such means as the removal of the tax. We have tried to give it assistance by making the rate of duty in the case of the living theatre smaller than that in the case of the cinema. That has been of some assistance, but it remains true that this preference has not produced all the results that were hoped for it. There may be good reasons for that, but the fact of the matter is that when the tax was put on, the immediate result was that the prices of the seats went up. When the partial remission was made in 1935 the price of the seats did not go down, so that it is not really the case that the removal of this tax would necessarily encourage greater attendance of the public because it would be calculated to make the seats in the theatre cheaper. It may have the result of lengthening the run of some pieces and relieving those who have to pay the tax, and in that way of course it would be of assistance to dramatic artists.

Having considered the difficulties in which the living theatre finds itself to-day—and we must all recall famous names of which theatrical history has furnished so many examples—I still am of the opinion that its present position cannot be explained by reason of the incidence of this tax. At the same time I would say frankly that while a great many taxes are open to objection—I doubt whether it is possible to find any good tax—I do share a great deal of the feeling against this particular form of tax. As something has been said about the duties of the Chancellor of the Exchequer—and I see opposite a right hon. Gentleman who was Chancellor of the Exchequer in the days when I was one of his junior colleagues—I would remark that in the course of the year he surveys all the taxation which is in being as well as considering the possibilities of new taxes, and it is not the case that a Chancellor of the Exchequer merely lets 12 months go by and then says, "Let us turn round the handle again and out it will all come just as before." I have spent some time with some of my advisers on this subject during the present year, and I should very much appreciate suggestions from my hon. Friend or anybody else as to the possible or desirable way to proceed in this matter.

It is natural for people who feel that this particular tax is a bad one to say simply: "Get rid of it," but something else must be found. I am grateful to the hon. Lady opposite for a suggestion she has made, and on some occasion it may be discussed, and I know also that my hon. Friend the Member for Oxford University has views upon the taxation of betting, but I would remind him that that was attempted by a previous Chancellor of the Exchequer with not very successful results. The position is, however, that we cannot proceed on the basis that we can get rid of this tax in the first instance and then look round for something else to replace it. The hon. Member's proposal merely states that the tax shall be one which will terminate on 31st March. It has been pointed out that by selecting that date we should leave a gap, and I thought perhaps the hon. Member had selected it for fun, just for the purpose of making the Chancellor of the Exchequer an "April Fool" the next morning. In any case there would not be time to get any new money by a new tax so early in the year as that.

To come, however, to a broader point, what he is suggesting about this one particular tax is something which is quite exceptional. If we were to accept it we should be saying, in effect, that while the tax on tea is to continue unless somebody alters it and the tax on petrol is to continue unless somebody alters it, this Entertainment Duty is to be marked out as something which we are prepared now to bring to an end, leaving necessarily a gap which would have to be filled, thinking in that way to force Parliament and the Chancellor of the Exchequer to consider what can be put in its place. I do not think that we can proceed in that way. I am bound to follow the course of preserving the sources of taxation which we are authorising this year, leaving them to flow, in order that we may see as the year advances what they produce and what our needs are—and our needs are likely to be very great. We must preserve this tax, along with some other imposts which in their way are, no doubt, also objectionable, so that in due course they may be surveyed and that whoever is responsible for the Budget next April may then make his proposals about them. I have told the Committee quite frankly what are my own reactions on this matter, and I would assure them they are quite genuine and are not felt for the first time to-night. I offer to the Committee and to my hon. Friend this assurance: I am willing to make it my business, with the help of my right hon. and gallant Friend the Financial Secretary, to examine the working of these taxes, and I will offer the assurance that I will during the year have them studied from every point of view, recognising, as I do, that there is great force in this argument, especially as applied to the living theatre.

I am not of opinion that we should treat this particular tax, whatever else may be said about it, in a wholly exceptional way, by condemning it to death on a date about a year ahead without making provision as to how the gap is to be filled. I am certain that the proper way in which this should be done is not that way at all, but to call upon those who are responsible to review during the year, with all the help they can get, the working of this impost, in order that it should not be renewed next year automatically and without further consideration. I offer that assurance in all sincerity, not because I have found the best way to deal with this matter but because I share the feeling expressed by a good many Members in all parts of the Committee that, really and truly in this country, this ancient home of culture, art and literature, this tax ought not to be allowed automatically to continue without very serious examination.

Mr. A. Herbert

I would thank the Chancellor of the Exchequer very much for the kind way in which he has received this new Clause and, in view of what he said, and if the Committee will permit me, I would now beg to ask leave to withdraw the Motion.

Hon. Members

No.

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

The Committee divided: Ayes, 115; Noes, 191.

Division No. 264.] AYES. 10.37 p.m.
Adams, D. (Consett) Evans, D. O. (Cardigan) Kelly, W. T.
Adams, D. M. (Poplar, S.) Gallacher, W. Kennedy, Rt. Hon. T.
Anderson, F. (Whitehaven) Gardner, B. W. Kirby, B. V.
Attlee, Rt. Hon. C. R. George, Rt. Hon. D. Lloyd (Carn'v'n) Lansbury, Rt. Hon. G.
Banfield, J. W. George, Major G. Lloyd (Pembroke) Lathan, G.
Bellenger, F. J. George, Megan Lloyd (Anglesey) Lawson, J. J.
Benn, Rt. Hon. W. W. Gibson, R. (Greenock) Leach, W.
Benson, G. Green, W. H. (Deptford) Leslie, J. R.
Bevan, A. Greenwood. Rt. Hon. A. Lunn, W.
Broad, F. A. Grenfell, D. R. McGhee, H. G.
Bromfield, W. Griffith, F. Kingsley (M'ddl'sbro, W.) McGovern, J.
Brown, C. (Mansfield) Griffiths, G. A. (Hemsworth) MacLaren, A.
Buchanan, G. Griffiths, J. (Llanelly) Maclean, N.
Burke, W. A. Groves, T. E. MacNeill Weir, L.
Charleton, H. C. Guest, Dr. L. H. (Islington, N.) Marshall, F.
Cluse, W. S. Hall, G. H. (Aberdare) Maxton, J.
Cocks, F. S. Hall, J. H. (Whitechapel) Morrison, Rt. Hon. H. (Hackney, S.)
Collindridge, F. Harvey, T. E. (Eng. Univ's.) Nathan, Colonel H. L.
Cove, W. G. Hayday, A. Noel-Baker, P. J.
Daggar, G. Henderson, A. (Kingswinford) Oliver, G. H.
Dalton, H. Henderson, J. (Ardwick) Owen, Major G.
Davidson, J. J. (Maryhill) Henderson, T. (Tradeston) Paling, W.
Davies, S. O. (Merthyr) Holdsworth, H. Parker, J.
Day, H. Jenkins, A. (Pontypool) Pearson, A.
Debbie, W. Jenkins, Sir W. (Neath) Pethick-Lawrenee, Rt. Hon. F. W.
Dunn, E. (Bother Valley) John, W. Poole, C. C.
Ede, J. C. Jones, A. C. (Shipley) Price, M. P.
Edwards, Sir C. (Bedwellty) Jones, Morgan (Caerphilly) Pritt, D. N.
Ridley, G. Sorensen, R. W. Westwood, J.
Riley, B. Stephen, G. Whiteley, W. (Blaydon)
Ritson, J. Stewart, W. J. (H'ght'n-le-Sp'eg) Wilkinson, Ellen
Robinson, W. A. (St. Helens) Stokes, R. R. Williams, E. J. (Ogmore)
Salter, Dr. A. (Bermondsey) Summerskill, Dr. Edith Williams, T. (Don Valley)
Seely, Sir H. M. Taylor, R. J. (Morpeth) Windsor, W. (Hull, C.)
Sexton. T. M. Thurtle, E. Woods, G. S. (Finsbury)
Simpson, F. B. Tinker, J. J. Young, Sir R. (Newton)
Sinclair, Rt. Hon. Sir A. (C'thn's) Tomlinson, G.
Smith, Ben (Rotherhithe) Viant, S. P. TELLERS FOR THE AYES.—
Smith, E. (Stoke) Watkins, F. C. Mr. Mothers and Mr. Adamson.
Smith, T. (Normanton)
NOES.
Adams, S. V. T. (Leeds, W.) Gibson, Sir C. G. (Pudsey and Otley) Piokthorn, K. W. M.
Agnew, Lieut.-Comdr. P. G. Gledhill, G. PilkIngton, R.
Amery, Rt. Hon. L. C. M. S. Goldie, N. B. Power, Sir J. C.
Anderson, Sir A. Garrett (C. of Ldn.) Gower, Sir R. V. Pownall, Lt.-Col. Sir Assheton
Anstruther-Gray, W. J. Greene, W. P. C. (Worcester) Procter, Major H. A.
Apsley, Lord Gridley, Sir A. B. Radford, E. A.
Asko, Sir R. W. Grimston, R. V. Ramsay, Captain A. H. M.
Assheton, R. Gritten, W. G. Howard Ramsden, Sir E.
Astor, Major Hon. J. J. (Dover) Guest, Lieut.-Colonel H. (Darke) Rathbone, J. R. (Bodmin)
Astor, Hon. W. W. (Fulham, E.) Gunston, Capt. Sir D. W. Reed, A. C. (Exeter)
Baillie, Sir A. W. M. Hannah, I. C. Reed, Sir H. S. (Aylesbury)
Baldwin-Webb, Col. J. Haslam, Henry (Horncastle) Reid, Sir D. D. (Down)
Balfour, Capt. H. H. (Isle of Thanet) Haslam, Sir J. (Bolton) Reid, W. Allan (Derby)
Balniel, Lord Heilgers, Captain F. F. A. Remer, J. R.
Barclay-Harvey, Sir C. M. Hely-Hutchinson, M. R. Robinson, J. R. (Blackpool)
Barrie, Sir C. C. Hepworth, J. Ropner, Colonel L.
Baxter, A. Beverley Herbert, Capt, Sir S (Abbey) Ross Taylor, W. (Woodbridge)
Beamish, Rear-Admiral T. P. H. Higgs, W. F. Royds, Admiral Sir P. M. R.
Beauthamp, Sir B. C. Hopkinson, A. Russell, Sir Alexander
Bernays, R. H. Hudson, Capt. A. U. M. (Hack., N.) Russell, S. H. M. (Darwen)
Bossom, A. C. Hulbert, N. J. Salmon, Sir I.
Bower, Comdr. R. T. Hunloke, H. P. Salt, E. W.
Braithwaite, Major A. N. Hunter, T. Samuel, M. R. A.
Broadbridge, Sir G. T. Hutchinson, G. C. Sanderson, Sir F. B.
Brown, col. D. C. (Hexham) Inskip, Rt. Hon. Sir T. W. H. Sassoon, Rt. Hon. Sir P.
Browne, A. C (Belfast, W.) Jones, Sir G. W. H. (S'It N'w'gt'n) Soott, Lord William
Bull, B. B. Keeling, E. H. Shaw, Major P. S. (Wavertree)
Burghley, Lord Kerr, H. W. (Oldham) Shaw, Captain W. T. (Fortar)
Butcher, H. W. Kerr, J. Graham (Scottish Unitis.) Simon, Rt. Hon. Sir J. A.
Campbell, Sir E. T. Kimball, L. Sinclair, Col. T. (Queen's U. B'if'st)
Carvor, Major W. H. Lamb, Sir J. Q. Smiles, Lieut.-Colonel Sir W. D.
Cary, R. A. Law, R. K. (Hull, S.W.) Smith, Bracewell (Dulwich)
Channon, H. Leas-Jones, J. Smith, Sir Louis (Hallam)
Chapman, A. (Rutherglen) Leighton, Major B. E. P. Smith, Sir R. W. (Aberdeen)
Clarke, Colonel R. S. (E. Grinstead) Lennox-Boyd, A. T. L. Somerset, T.
Cobb, Captain E. C. (Preston) Liddell, W. S. Spans, W. P.
Crooke, Sir J. Smedley Lipson, D. L. Stanley, Rt. Hon. Lord (Fylde)
Croom-Johnson, R. P. Loftus, P. C. Stourton, Major Hon. J. J.
Cross, R. H. Lyons, A. M. Strauss, E. A. (Southwark, N.)
Crossley, A. C. Mebane, W. (Huddersfield) Stuart, Hon. J. (Moray and Nairn)
Cruddas, Col. B. MacDonald, Sir Murdoch (Inverness) Tacker, Sir R. I.
Culverwell, C. T. Macdonald, Capt. P. (Isle of Wight) Tate, Mavis C.
Davidson, Viscountes McKie, J. H. Taylor, Vice-Adm. E. A. (Padd., S.)
Davies, C. (Montgomery) Maclay, Hon. J. P. Thorneycroft, G. E. P.
Davies, Major Sir G. F. (Yeovil) Maitland, A. Tufnell, Lieut.-Commander R. L.
De la Bère, R. Makins, Brigadier-General Sir Ernest Turton, R. H.
Denman, Hon. R. D. Manningham-Buller, Sir M Wallace, Capt. Rt. Hon. Euan
Doland, G. F. Margesson, Capt. Rt. Hon. H. D. R. Ward, Lieut.-Col. Sir A. L. (Hull)
Dorman-Smith, Major Sir R. H. Maxwell, Hon. S. A. Walt, Major G. S. Harvie
Drewe, C. Mayhew, Lt.-Col. J. Wedderburn, H. J. S.
Duckworth, W. R. (Moss Side) Mellor, Sir J. S. P. (Tamworth) Wells, Sir Sydney
Dugdale, Captain T. L. Mills, Major J. D. (New Forest) Whiteley, Major J. P. (Buckingham)
Duncan, J. A. L. Moreing, A. C. Wickham, Lt.-Col. E. T. R.
Dunglass, Lord Morrison, G. A. (Scottish Univ's.) Williams, H. G. (Croydon, S.)
Eastwood, J. F. Morrison, Rt. Hon. W. S. (Cirencester) Wilson, Lt.-Col. Sir A. T. (Hitchln)
Eckersley, P. T. Muirhead, Lt.-Col. A. J. Windsor-Clive, Lieut.-Colonel G.
Edmondson, Major Sir J. Munro, P. Wise, A. R.
Emmott, C. E. G. C. Nall, Sir J. Womersley, Sir W. J.
Errington, E. Nicholson, G. (Farnham) Wragg, H.
Erskine-Hill, A. G. Nicolson, Hon. H. G. Wright, Wing-Commander J. A. C.
Everard, W. L. O'Neill, Rt. Hon. Sir Hugh
Fox, Sir G. W. G. Patrick, C. M. TELLERS FOR THE NOES.—
Fremantle, Sir F. E. Peat, C. U. Captain Hope and Captain
Furness, S. N. Perkins, W. R. D. Waterhouse.
Fyfe, D. P. M. Petherick, M.

Bill read the Third time, and passed.