It is proposed to deal with the Amendments to the Third Schedule as a block. The first Amendment in the name of the hon. Member for East Middlesbrough (Mr. Alfred Edwards) will be called and there will be a general discussion upon all the other Amendments to the Third Schedule. After the discussion has taken place, if necessary, Divisions on certain selected Amendments will be taken.
§ Mr. Alfred Edwards (Middlesbrough, East)
I beg to move, in page 61, line 35, at the end to insert:electric washing machines.There is very little to say on this subject except that these machines, more than most domestic machines, remove the drudgery from the housewife's life. Of necessity they are very costly machines. I understand that unless this Amendment is accepted their cost will now make them almost prohibitive for any ordinary purpose—over £100. No one will think that that is a suitable price to pay for a machine which does so much to help the housewives. The purpose for which this tax was imposed was to save electricity, but the amount of electricity saved in this case is infinitesimal. The machine is normally used about once a week, and the saving is hardly noticeable. This is an Amendment to which the Chancellor should give further consideration.
§ Mr. Eccles
I understand that we are now having a general discussion on apparatus which uses electricity. Cooking stoves appear to be the only class of such machines which really deserve to have the tax remitted. I know that a case can be made out for a number of other machines which use electricity, but this is a very special form of taxation proposed by the Chancellor. He is not proposing it for revenue purposes. It is because we are in a fuel crisis and are likely to be for some time. On the other hand, the Committee know all the arguments for the cooking stove. New houses must have these stoves. It is impossible to complete those houses without the stoves, and it is quite wrong if the purpose of the tax is not revenue, but to deal with the consumption of electricity, simply to put up the total cost of houses.
1844 I was sorry that when we discussed this matter on the Report stage of the Budget Resolutions it did not appear from the speeches from the Government Front Bench that the Ministry of Fuel and Power had provided the Ministers who spoke with detailed information of the saving that could be expected from the substitution of new stoves for old stoves.
After all, if the point is to save electricity it is very foolish to make it more expensive to instal apparatus that will cook the dinner at least quite as well as the old apparatus if the new apparatus is going to be more economical in the consumption of fuel. I thought that the raising of the Purchase Tax proposed was something of a panic measure, and that it had been done in view of the great difficulties we experienced in the early part of the year. I hope that when the Government give us their considered reply on all the Amendments that have been put down dealing with these machines which consume electricity, we shall have what I may call "a Fuel and Power reply," and not a "Treasury reply," because it ought not to be beyond the wit of the Treasury to arrange that in all cases where there is a definite saving of fuel the tax might be remitted. I agree that it would be difficult if that were to cover, washing machines, electric irons, etc., but I think the case is absolutely unanswerable in relation to cookers. If the Government would give that, I would be satisfied and I believe that all sides of the Committee would welcome the concession.
§ Mrs. Castle (Blackburn)
I want to appeal to the massive common sense of the Chancellor of the Exchequer on all these questions of fuel consuming appliances and the remission of the Purchase Tax on a number of them. I want particularly to put the argument for the Amendment standing in my name—in page 61, line 36, at end, to insert, "and electric irons." I ask the Chancellor to explain to us just what it is he is trying to do in reimposing this tax on such an essential household commodity as the electric iron. I presume he is not going to tell us that ironing is an anti-social activity like smoking, for example. Presumably he is not going to suggest that it is one of those pleasures we have to cut out because we cannot afford it. It is something which we shall continue to do, and, therefore, the question we have 1845 to decide is what are the best implements with which to do the job. Equally, the Chancellor is presumably not concerned in this matter with raising revenue because he admitted last year that electric irons were not a good subject for the raising of revenue when he exempted them from Purchase Tax. He has, therefore, only the fuel argument in mind.
I want to persuade him that he will, in fact, be indulging in fuel extravagance if he forces the housewife from the most modern form of ironing which is the most economical in fuel, namely, the electric iron. If one does not use an electric iron, one has to use a flat iron—if one is obtainable. It is not irrelevant to this discussion to say that if we are all driven from electric irons as part of this fuel economy campaign we shall be very hard put to it to find the flat irons to take their places. If one uses a flat iron, particularly in the summer, unless one is wasting fuel by having a large coal fire burning, one has to put it on the gas ring. If the Chancellor of the Exchequer has ever done his own ironing, he will know that placing a flat iron on the gas ring is about the most wasteful form of fuel consumption one could possibly have. Therefore, I want to suggest to him that he has imposed this tax again without considering whether or not it will achieve the purpose he has in mind. We realise there has been something of a panic over this fuel question. The whole of the problem as far as electricity is concerned is the peak load, and electric irons are not used at a time when there is the greatest pressure upon generators. Most housewives do not do their ironing during breakfast time; it is not done during the perilous hour between 8 and 9; they wait until their other domestic activities have ceased and then they iron at their leisure. If, however it is suggested that electric ironing has now become something which the fuel resources of this country cannot stand, then we are driven into a situation which cannot be justified by any of the domestic facts.
I ask the Chancellor to realise that the burden of running a home is becoming increasingly difficult. Laundry facilities are not improving to the extent we need if the domestic burden is to be lightened. As laundry charges go up, housewives have to do heavier and heavier laundry work, and an electric iron is an essential if they are to do that without an inordinate 1846 amount of fatigue and labour. The Chancellor will not save fuel by this, he will merely make it more expensive for the ordinary housewife to buy what has become a necessity and, without saving fuel, he will waste instead the valuable labour of the housewife. I urge him, therefore, to consider this as a necessity.
§ Mr. Douglas Marshall (Bodmin)
In following the hon. Member for Blackburn (Mrs. Castle) may I take this opportunity, because I may not have one again, of saying that I agree with every word she has said. However, I do not want to repeat the arguments which she has used but to return to the question of cooking stoves. Here it seems to me the Committee really cannot but be in universal agreement about asking the Chancellor to remove Purchase Tax from these stoves. I am sorry that the Chancellor is not in his place at the moment because I would have liked him to listen to this argument, but no doubt the Financial Secretary will tell him all about it.
I understood when I listened to the Budget Debate that the Chancellor gave as his reason for imposing Purchase Tax on certain electrical goods the fact of saving fuel. I understood that was the whole basis of his argument—not the question of revenue. If that is the case, what argument will he make now? Will he say that people want two cooking stoves in their home? In fact, the burden which this imposition will place will fall mostly on people who are setting up new houses, people who during the war have had to live in communities with their mothers or fathers as the case may be and now, in spite of the housing shortage, they manage from time to time to find accommodation for themselves. I really cannot see that the argument which the Chancellor used, that this imposition of tax was only to save fuel, can possibly apply to stoves and, if the Committee will have patience with me for a few moments, I will read an extract from a letter I have received, for it is put so well that I cannot improve upon it. It is as follows:For instance, just prior to the Purchase Tax being imposed we had orders for one dozen electrical cookers, and you will appreciate that these orders had to be obtained under priority conditions, which meant our clients had to satisfy the powers-that-be that they were suffering hardship, and which enabled them to claim the priority. The position now is that, after contacting these prospective clients, nine of them have to cancel 1847 their orders because they cannot afford the extra cost. In some of these instances clients have no cooking facilities whatsoever, the reason being that other people have shared the house with them because of the housing shortage whilst in other instances all they have is the open fire.I trust sincerely that the Chancellor will look into this matter again and give it full consideration, because if there is anything that will save fuel—I am not a technician—surely it would be reasonable to suppose that a new apparatus would save fuel more than an old one which is getting out of date. For the life of me I cannot see why any individual wants two stoves in one home; therefore I support the Amendment in my name and that of my hon. Friends and trust the Chancellor will see his way to remove the Purchase Tax in this case.
§ 6.15 p.m.
§ Mr. Gibson (Kennington)
I do not propose to detain the Committee very long, but there is one aspect of this problem to which I want specially to call attention. It was referred to in part by the hon. Member for Bodmin (Mr. D. Marshall) in his reference to cookers. There is, however, heat-using apparatus which must inevitably be in constant use in any house, such as the apparatus for securing hot water. I am particularly concerned because the imposition of the increased Purchase Tax will make a tremendous difference to the cost of municipal housing in this country this year. Hon. Members know that I have an interest in a large local government organisation with a big housing programme. This increased tax on cookers and water heating apparatus, such as water boiler and washing tubs, will cost the London County Council £200,000 extra this year, on top of the existing cost of the building of houses. That is asking rather more than the local authorities, who are busy with their housing programmes, ought to be asked to carry, and I make a special plea to the Chancellor that, when the time comes to reply to this Debate, he will take the tax off cookers and water-heating apparatus, in order that there shall be no tendency to save in the cost of house building by reducing what everybody has now come to agree is an absolutely essential feature in any good housing scheme.
In any case the fuel will be burned, because people must have cooking apparatus, whether it is gas, electricity, or hard 1848 fuel in an old-fashioned stove. We shall not save fuel by imposing a heavy Purchase Tax on these goods. What we may do—and I am sure the Chancellor does not want to do this—is to encourage the putting in of less efficient and more old-fashioned apparatus. It is possible for the whole thing to be controlled, because one cannot get these goods without a priority certificate, and if there is any tendency for the matter to get out of hand, it will be easier to control it by the effective use of the priority symbol. Therefore, I hope that the Chancellor 'will agree to do something to relieve the tax on these items in the interests of good housing in this country, and in the interests of not imposing on the already heavily-burdened local authorities a charge which seems to me to be unreasonable.
§ Mrs. Leah Manning (Epping)
I want to say a word or two about cookers and electric irons. I suppose all of us have pets among these Amendments, and these are my two pets. I do not wish to go beyond them, because I know the Chancellor has not a lot of money with which to be kindly. On the Second Reading of the Bill, we were given to understand that if we did not ask for too much, he would try to give us what we were asking for. I came into the Committee just as my hon. Friend the Member for Blackburn (Mrs. Castle) was discussing irons. It seems to me incredible that anyone should ask a young married women to spend 10s. more than the 30s. which she has to pay for an iron, when she simply must have that iron, and cannot be without it.
When I got married, which was a long time ago, I went to my mother-in-law and asked her to give me what was then called a flat-iron., There are many uses for flat-irons, but there is no use for them today except when one is in a very bad temper, which is the time when one ought not to have a flat-iron in one's hand. It is no good going to a mother-in-law today and asking for a flat-iron, for the very good reason that during the war every one who had a flat-iron gave it to aid the war effort. People gave away every bit of scrap iron they had, and they turned out flat-irons which had been hidden in the cupboard under the stairs. It is no good going to a mother-in-law today, because she has got rid of the flat-iron. So the girl who has just married has to use an electric iron. If 1849 by any chance she did rake out a flat-iron from somewhere, she would have to light the coal stove or the electric stove and put it on the hotplate—and there is no more wasteful method of using heat that I can think of—or she would have to put it on the gas ring. Ironing is very often done at odd times of the day, and not during the time of the peak load. Very often it is done before breakfast, because it is a hot job. My hon. Friend the Member for Blackburn and I iron all our "smalls" at home, because we would have nothing left if we sent them to laundries. They would pull them to pieces in the wash and we would be in a very difficult situation.
§ Mrs. Manning
I certainly will not wander too far. The Debate was a bit dreary, and I thought I would make it more amusing. Many hon. Members wish to speak about cookers, and perhaps my hon. Friend the Member for Kennington (Mr. Gibson), who is chairman of a great housing committee, knows more about that than I do. I am sorry the Chancellor was not present during my speech, but perhaps the Financial Secretary will tell him what has been said, and he will soften his heart to those young wives, whom I am sure he loves.
§ Mr. Baxter
We are glad to see the Chancellor back. He is a very courteous Minister, and when he does go away for a few minutes we miss him.
§ Mr. Gallacher (Fife, West)
On a point of Order, Mr. Beaumont, can you tell us which Amendment the Chancellor is now lacing?
§ Mr. Baxter
May I point out, since the hon. Member for West Fife (Mr. Gallacher) who has just intervened is in the habit of making insults at the beginning and end of his speeches, he must allow one of us to pay a compliment to a Minister without being interrupted? I want to say to the Chancellor that in his absence the 1850 Committee was most eloquently addressed by two housewives, who are also Members of Parliament. I trust that because they have been expressing themselves quite strongly this will not be denounced by the Chancellor as impertinent, or as showing that they are inspired by the Tory Party. Those housewives are as innocent of any persuasion by the Tory Party as are the Housewives League; the Tory Party have nothing to do with them.
I wish to deal with the Amendment regarding cookers. Where this tax is so basically unfair is that those of us who have established our homes, and perhaps some position in life, have all these things, but the ex-Service man, faced with the rising cost of houses and everything, has to pay this real imposition. A very important point was made by my hon. Friend the Member for Bodmin (Mr. D. Marshall). Cookers come under a priority system of selection; therefore, once the priority is granted, it is established that they are a necessity to the people who qualify for them. Then what is intended by this tax? The Chancellor said that it was not for revenue. I do not doubt for a moment that the Chancellor will give this matter his consideration. Of all the people in the community who ought to be assisted, young people setting up homes under such difficulties and distress should be considered. This matter goes beyond party divisions. I have had a great many letters on the subject, and I hope the Chancellor will consider the matter.
§ Mr. Asterley Jones (Hitchin)
I wish to support my hon. Friend the Member for Kennington (Mr. Gibson) in regard to apparatus for heating water. It is a mistake to suggest that merely because more geysers and similar apparatus are installed, more gas will be used. Many people are sharing houses, and when one member of the household takes a bath a certain amount of gas has to be used, and for every bath that is taken another lot of gas is used. Therefore, it another geyser is installed, it does not mean there will be twice the amount of gas used. The same amount will be used not only for baths, but for washing clothes, washing up, and for washing floors—not to the same extent, but nearly so. I do not believe there will be a greatly increased amount of gas used for the purpose of heating water if more geysers are installed.
1851 A coal fire or a stove using solid fuel is very much more uneconomical than a gas or electric geyser for the purposes of making a bath, unless it is in winter time. In winter, it is probably more economical to keep the stove going. I am informed that it takes about 5 lbs. of coal to produce the gas necessary to heat the water for an ordinary bath. Clearly, it takes a good deal more coal than that to start up a boiler and provide the bath by that means.
Further, the thermal efficiency of these various methods is very different. The ordinary geyser, whether gas or electric, has a thermal efficiency of about 75 per cent., whereas the figure for boiling a kettle or a pan of water on a gas stove is only 40 per cent.; and, on a coal fire, in the region of 20 per cent.—it may be a good deal less. There is no doubt that the announcement that this increased Purchase Tax is to be imposed has caused a great dimunition in orders for this up-to-date modern apparatus for heating water. I am certain that in the short run, as well as in the long run, this will mean more rather than less waste of fuel, because of the use of these older methods.
Hon. Members have already referred to the fact that the cost of houses will increase. Whether Purchase Tax is imposed or not, this apparatus will be installed, perhaps not to the same extent as before, and it will simply mean that costs will go up. I have here several examples. An ordinary simple single point bath gas geyser, instead of costing £10 17s. 6d. will cost £16 10s. 7d. That is the effect of the tax on the simplest type. On the more elaborate types the increase will be more. Cookers show an increase of £10 on the simpler types, and £15 on the more elaborate ones. There is another point which has not been sufficiently stressed. The Minister of Labour has been appealing to women to go to work in factories. He cannot expect them to do so unless he relieves them of household work at home. If he tells the women who go into new houses today that it is the policy of the Government that they should have to light the fire for the bath and for their hot water generally, instead of switching on a geyser, he will be doing something quite contradictory. If he wants the women 1852 of this country to work in factories to help the country through, he should at the same time see that work in their homes is made as easy as possible, and accordingly encourage the installation of these modern methods of water heating.
§ Sir Arnold Gridley (Stockport)
It may perhaps be thought that I shall very soon have no interest whatever in all that is involved in the maintenance of the electricity supply to domestic and power users in the country. While for an indefinite period I must disclose my interest—I am still a director of such companies—there is only a short time left now before we shall be divested of these undertakings, and they will become national property. Therefore, if I looked at the matter purely from the point of view of what concerns me, I should say that I need no longer worry about it, as the responsibility will soon be transferred to other, and perhaps more capable—or perhaps less capable—hands. We shall see in time.
I have in mind the thousands of new houses which are going up all over the country, as far as this Government can secure their erection. Those who are entering into occupation of those houses will have to be provided with many of these articles. We on this side of the Committee would be failing in our duty if we did not join hands with hon. Members opposite in pleading that the Purchase Tax shall be excluded from these absolutely essential articles which save the time and energy of the harassed housewife today. Speaking from considerable experience as to what amount of current is consumed by various items in this list, I would say that the Minister of Fuel and Power has secured his greatest economy in the sphere of space heating, and the Chancellor of the Exchequer has helped him in it by levying Purchase Tax on space-heating methods—radiators, etc.—which really are the great consumers of current. It is true that the item in the list with the next heaviest consumption is the cooker, but the cooker is absolutely indispensable in every household.
I ask the Chancellor to remember that the household has unfortunately a great deal less to cook in these times than it was accustomed to having before the war, and most of the cooking in the average 1853 house is done on Sundays, when there is no industrial load. Therefore, the cooking does not cause the drain on power which is one of the causes that necessitate economies in consumption which the whole nation is now being called upon to effect. As space heating is ruled out, and cooking requirements are very much limited compared with what they were, these other items on which we are asking that Purchase Tax should not be levied are really the smaller current-consuming apparatus, and there is, therefore, not much risk in the Chancellor according Purchase Tax remission.
There are today a great many people who cannot afford to put down the money to buy cookers, washers and items of that kind, which are much more expensive than they used to be, without Purchase Tax being put upon them. Most of the supply authorities are today continuing their hire-purchase system. This Purchase Tax has to be added, and that will put up the hire-purchase charges, so that the unfortunate householders will be caught in every way, whether they have the money to buy the apparatus outright, or whether they hire it or obtain it on hire purchase. For the reasons I have given, and the arguments I have submitted, which I hope are sound, I would like strongly to reinforce the appeal of hon. Members opposite that the Chancellor should give his friendly consideration to this plea.
§ Mr. Sargood (Bermondsey, West)
I would like to make a plea to the Chancellor of the Exchequer on behalf of the local authority in which my constituency is situated. For a number of years we have been an electrical generating authority, and because we have been very progressive most of our houses in Bermondsey are wired for cooking and heating by electricity. During the war, we were the most heavily bombed district in London, because of our proximity to the docks. The result is that a great deal of replacement and renewal has to take place. We in Bermondsey have no choice; we have to replace electrical cooking and water-heating apparatus. Therefore, the object of discouraging the unnecessary purchase of this electrical equipment does not apply in Bermondsey. It simply means that the extra tax will be paid by people who have already borne more than their fair share of the burden. I ask the 1854 Chancellor to give consideration to the point of view of Bermondsey.
§ Mr. Osborne (Louth)
Two local authorities in my area asked me to support the plea that the tax should be removed from these articles. I do so in answer to their request. My hon. Friend the Member for Chippenham (Mr. Eccles) made a point to which I think the Chancellor should pay heed. He said that the answer to this Debate ought to be made not on a Treasury basis but on a fuel and power basis, because the consideration for imposing this tax is one of fuel and power and not of finance. Therefore, instead of the Chancellor we should have the Minister of Fuel and Power to give us an answer. What astonishes me is that apparently the Government are accepting the fact that we shall be short of fuel and power for a long time to come. They appear to accept the fact that shortages will continue and that—at least not this year and perhaps not next year—nationalisation of fuel and power is not going to produce the results. To me that is a very dismal picture. I am rather surprised that hon. Members opposite who have pinned their faith for a long time to the nationalisation of the mines, should now sit down and accept the dismal picture and agree that the position is not going to improve.
The Chancellor's colleague, the Minister of Labour, has been appealing for women to come back into industry to help with our production drive. When the Chancellor himself was President of the Board of Trade during the war he knew, and he must know today, that in the boot and shoe and the hosiery industries, of which I have some knowledge, we are short of women operatives to the number of tens of thousands. The Government are asking women, especially young married women, to come back into industry. It is grossly wrong to ask these girls to leave their young children in day nurseries and then take them in the evening to a home where they are not able to get the things required as cheaply as they ought to be. Yesterday the President of the Board of Trade made an appeal that the day nurseries which had been closed should be re-opened, in order to encourage young married people to come back to industry to assist the output drive. I hope the Chancellor will bear in mind that very important point.
1855 Unless we have bigger and bigger output, and unless the Government in one way or another are prepared to help us to get that output, these schemes of equalising what we have got will lead us into deeper and deeper poverty. If we are to expect these young girls to help us—and in the boot and shoe and the hosiery industries we cannot do without them—we must do something to help them. Unless they come back to industry, clothes rationing will not end quickly. We should enable these people to buy the labour-saving devices they require at home as cheaply as possible.
§ Mr. Gallacher
I had a discussion recently with the hon. Member for Kirkcaldy (Mr. Hubbard) and representatives of one of the local authorities in my constituency, on the question of the cost of equipment for new houses. The local authorities are facing a very difficult situation. In fact, this particular authority has decided that it will have to increase the rents of the houses because of the high cost. But everyone knows, 20 years ago one could get loans at 5 per cent. to build houses. Now, one can get loans from the Chancellor at 2½ per cent. but the houses cost more than double. Therefore, the value of the cheap rate of interest has gone. Earlier this afternoon we discussed a new Clause and our Debate was directed towards the very important question of experts. Everybody recognises the importance of that. Here, is a question of equal if not greater importance. I refer to the cutting down of prices. That will have a very big effect on the situation in this country. There is no other field where the necessity for cutting prices is as great as it is in connection with houses.
If we accept the suggestion of the Government in this case, instead of cutting prices we shall be increasing them for necessary equipment for houses. I happen to be one who on occasions has used a flat iron—not for lethal purposes. On rare occasions, I have used an electric iron. I know the great advantage to the housewife when she can use an electric iron which saves labour and fuel. I have not been an actual participant, but very often I have watched the operation of an electric or a gas cooker. I know what a very big saving is involved there from the 1856 point of view of the housewife. In the old type of house which I occupied in my earlier days, all the cooking was done on a coal fire. The cooking which is now done on an electric stove or a gas cooker results in a tremendous saving in fuel. Every encouragement should be given to the housewife to make the fullest use of this equipment.
Any local authority building new houses puts in an electric or a gas cooker and provides many other gadgets in order to make the work of the housewife as light and as effective as possible. In view of the urgent necessity for bringing down the cost of houses, I ask the Chancellor to consider this matter seriously. In my own area a considerable increase in rents is taking place, and other local authorities throughout Scotland may follow the lead. I ask the Chancellor when replying to this Debate to bear in mind the necessity for doing something to reduce the very high cost of houses with a view to preventing the rents going up to such an extent that the people who occupy the houses have to sacrifice the necessities of life in order to pay the rents.
§ Mr. Bramall (Bexley)
I would not have spoken at all in view of the eloquence with which the arguments on this point have already been advanced, did I not claim a sort of parenthood for this Amendment. I was the first hon. Member to raise this question during Report stage of the Budget Resolutions and I also put down an Amendment which had the certain advantage that it was an all-party Amendment, having been signed by a number of hon. Members including the hon. Member for South Aberdeen (Lady Grant). The arguments have already been quoted at some considerable length. I wish to apply myself to one point made by my, right hon. Friend the Financial Secretary in the Debate on the Report stage of the Budget Resolutions. He laid stress on the necessity for economy and on the need not to overload the generating plant more strongly than on the need for saving fuel. I suggest that rules out any suggestion that a tax should be raised on gas stoves. It is ludricrous to say that because we want to save electricity generating plant we should tax gas stoves.
Even accepting the point that we must save the generating plant—and everybody agrees upon the need for a Purchase Tax on space heaters—I would confine my 1857 claims to the claims of the cookers for the simple reason that the demand for gas and electric cookers is, in economic jargon, a completely inelastic demand. Everybody must have one cooker. Virtually nobody has more than one cooker. People do not buy a cooker to stand it in a corner of the room as an ornament. They buy it because they have nothing else with which they can cook. Since a new home must have a cooker, everyone who is entering a new house must buy one. The hon. Member for Bodmin (Mr. D. Marshall) mentioned that nine of the dozen customers of the authority which had written to him had withdrawn their orders. I was surprised at that statement and I was rather sorry that he gave that point to the Chancellor. His constituency, I imagine, is mainly rural, where a good many of the cottages will have the same old-fashioned type of cooking apparatus.
Speaking for my constituency, and also, I imagine for the constituency of the hon. Member for West Bermondsey (Mr. Sargood), which are 95 per cent. urban, there can be no question but that the people will have to pay, however much the prices go up. The houses there are either wired for electricity or supplied with gas, and, normally, there is no choice of transferring from the one to the other, even if the Chancellor decided that it was desirable to have gas rather than electricity. They are fitted with one type or the other, and the people concerned have to have what goes with the house.
The numerous letters which I have had all lead to the same conclusion—that the person who is already hard hit, the person who has been bombed out, and the people married during the war and those people at present living with their parents or relatives, are placed in a position of having to pay extra taxation when there is the possibility of having a home of their own. At the present time that is something which, from the social point of view, we must all consider extremely undesirable. I think the Chancellor will get a very poor economic return because he will not get a reduction in demand, since it is an inelastic demand. It is merely placing a heavy additional tax upon the building of houses, and I would like to associate myself with the words of the hon. Member for West Fife (Mr. Gallacher) when he said that one of the 1858 most important sectors in which we have to bring down prices is in that of house building. I add my voice to the pleas which have been made in asking the Chancellor to reconsider the position.
§ Captain Crookshank (Gainsborough)
May I appeal to the Chancellor to intervene early in the Debate as he is obviously going to make a concession? I deduce that fact because word has obviously gone round to many hon. Members opposite who are usually so superb in their observation of the ordinance of silence on the Finance Bill, but who are now getting up all over the place and making speeches obviously to impress their constituents that it was they and only they who secured the concession. I think they are right, because no case has been made out by the Chancellor for cookers at all. Hon. Members on both sides of the House made that absolutely clear, and, indeed, if the suggestion is not going to be adopted, I hope that the Chancellor will give us some estimate of how much electric current will be saved. It is rather like the case of the Tobacco Duty. If, at any rate, the Chancellor does not get the saving in currency, he will get the money out of the Purchase Tax, and similarly if he does not save currency on the imports of tobacco, he will get it out of the duty. It is a new technique, and I do not think it is a good technique. I think that, as it is quite clear that the Chancellor is going to make a concession, it would make us all very much happier if he would do it now instead of waiting another half-hour.
§ Mr. Dalton
It is not often that the Opposition appeal to me to curtail the Debate. I thought they were well set for a long Sitting, but I am always willing to respond to any suggestion. Let us not forget why these taxes were originally imposed. They were put on because we were assured that too much electricity and gas was being consumed, and having regard to what was called the fuel crisis, but which was, perhaps, more accurately described as the temporary interruption of electricity supplies, it would be desirable to impose a brake, which hitherto had not been imposed, on the increasing acquisition of these electricity-using and, to a less extent, gas-using, implements. That was the broad ground for putting on these various articles a new Purchase Tax of 66⅔ per cent. It was, as I explained in 1859 my Budget speech, a quite deliberate reversal of a policy which I had recommended and which the House had unanimously accepted earlier on, exempting these articles wholly from the Purchase Tax. We must still be mindful of the need not to waste electricity. We must not get into the habit of saying that, because of the good weather and the fact that, for the moment, everybody is being supplied that there is no longer any need to save. That would be very improvident. At the same time, after the comprehensive character of the Schedule had been apprehended, there did, of course, begin to emerge various doubts and hesitations, some on one point and some on another, and the local authorities got busy, and they have many admirable spokesmen in this House.
I must make quite clear that we cannot agree to any discrimination in the Purchase Tax. We cannot have the Purchase Tax on an article varied in accordance with whether it is placed in a local authority house, or with the way in which it is to be used by one consumer or another. We have to tax the thing itself, not the way in which it may be used. Our control is at the wholesale stage, higher up the stream, and that is a long way from the level of the retail purchaser. I must point out that it is administratively impossible to accept any Amendment to the Purchase Tax which seeks to differentiate according to the use to which such articles are put. We cannot do it in that way. The question, therefore, is how far can we go in reducing the wide field of this tax now that it has served a propagandist and educational purpose, and in what way we can make some concessions for which a strong case has been put by many hon. Members—that would not lead to waste of gas or electricity in the wider use of these articles. There are certain things which I think are very clear at either end of the scale and there are other things which are intermediate. It is essential to retain the Purchase Tax on space heaters—gas and electricity fires and so on—because it is here that most waste occurs, and where people are most improvident. All of us have done it, and we can all say that we have sinned over this. If we are to prevent the waste of electricity and gas—and I do not want to distinguish between them, as we must hold the balance quite level—I think there 1860 is a very clear case for making no concession here, but for retaining this tax where it stands.
I am very doubtful, in the case of water heaters, which was put by the hon. Member for Hitchin (Mr. Asterley Jones), whether we ought not to retain the tax there also. After space heaters, I think they are the most wasteful of all these articles. My mind is wholly against making a concession on water heaters, but I will naturally listen to any further arguments which may be advanced. On the other hand, cookers, and cooking apparatus in general, are cases in which there should be a remission. I accept the argument which has been put forward by a number of hon. Members on both sides of the Committee that, after all, one must cook and that in many of the new local authority houses and, in fact, in all new houses, it is much more civilised, practical and sensible to cook with either electricity or gas. Therefore, I agree that cookers shall be exempted altogether from the tax.
As for further possible exemptions, the hon. Member for Stockport (Sir A. Gridley) has always been a great protagonist of the exemption of the electric kettle. It is an extremely useful implement; we have argued about this before, and I think we can exempt it.
§ Mr. Dalton
Yes, but even if it is supplied separately I think it could be exempted. There are ancillary articles which I am taking in my stride, so to speak, such as boiling rings, grillers, hot plates, etc., I am prepared to take all those out of the field of tax. Then we come to certain other matters. I think the case is made out for wash boilers. It is desirable that we should encourage householders to have effective laundry facilities and, therefore, I am inclined to exempt wash boilers. Then there are various electric washing machines. I would like to consider them to see where the line of definition comes. I think there is a case for doing something about electric washing machines and electric irons, too.
We then come to some more debatable articles, the cost of which is rather high and of which it cannot be, therefore, argued 1861 that they are necessities in the same degree as some of the articles to which I have been referring. There I definitely ask for a period of reflection. I shall be prepared to listen to anything further which may be said between now and the Report stage, and that applies also to refrigerators and vacuum cleaners. I am not quite sure about them. Everybody would like them to be exempted from tax. They do not consume a great deal of current on the one hand—that is a point in favour of exempting them—but, on the other hand, I do not wish to carry the process of exemption too far. I think the Committee will agree that I have already gone a certain distance in that respect, and, therefore, I would like to suspend judgment on refrigerators, vacuum cleaners and one or two kindred objects. There are one or two other cases which I will not elaborate, on which I would like to think again.
Therefore, if I may summarise, we have retained space heaters and probably water heaters under the full tax; I am not convinced that those should be exempted.
§ Mr. Dalton
There I must seek technical advice, perhaps from the hon. and gallant Member. No water heater that I have ever known heated instantaneously to the temperature required. It always took a certain amount of time and fuel. Retaining those and giving exemption to the group of articles to which I have referred, headed by gas cookers, and suspending judgment on a few intermediate cases like refrigerators and vacuum cleaners, I should be giving away by way of revenue—which is a factor, though not a predominant one, which I took into account when I made the proposal—something of the order of £8 million this year, which is substantial, and about £12 million in a full year. Any relief we give here should be made retrospective to Budget day, otherwise people would be unfairly treated. I think anybody who, between Budget day and now, has purchased any of the articles now to be exempted, and has paid the high Purchase Tax on them, should be entitled to a refund. I am advised that can be done. There will not be a very large number of such persons, because the desire and effect of this tax was to stop purchases 1862 of those articles. I am advised that refunds can be arranged and I will make suitable arrangements accordingly. I must ask that the Clauses shall be left to the Government to draft, because there are difficult questions of definition and so forth, but I will give the undertaking on the lines which I have indicated. I hope that the hon. Member will be prepared to withdraw his Amendment, and that the other Amendments which we have been discussing will not be pressed, and on Report stage I will bring forward proposals on the lines which I have indicated.
§ Captain Crookshank
Could the right hon. Gentleman say how the refund will work? Obviously, a great deal of satisfaction will be obtained from it, but, after all, the tax, as we have always understood it, has been levied at the wholesale stage. How, therefore, will it be possible to get the refund into the right hands? Perhaps the Chancellor would prefer not to say anything about it, but it seems to me to be a very novel idea, always having heard the argument that it takes place at the wholesale stage. How can Mr. A. or Mrs. B get the refund?
§ Mr. Dalton
May I take advantage of the right hon. and gallant Gentleman's suggestion, and make a detailed explanation at a later stage? I am advised that it can be done and, therefore, I am of opinion that it should be done I would prefer to defer my explanation. I do not pretend yet to have a cut and dried scheme. I am merely advised that it can he done and if, on further consideration, I am sitisfied that that is so, I will take the necessary measures.
§ Mrs. Castle
Would my right hon. Friend make quite clear in which category he has placed electric irons. Are they certain, or are they among the doubtfuls?
§ Sir John Barlow (Eddisbury)
There seems to be a certain amount of doubt in the mind of the Chancellor as to the advisability of not increasing the Purchase Tax on electrical cleaners. We all know what difficult times housewives have had throughout the war. That position has-not been alleviated by queues and so forth. The Government are trying to get women, back into industry, and it is most important that they should do so. The use 1863 of an electrical cleaner saves a great deal of time in the house. I expect most hon. Members on both sides of the Committee have used an electrical cleaner at one time or another, and I think they will agree that it saves a great deal of time We know the Chancellor wishes to save electric current, and that is the basis of all these increases in Purchase Tax.
I should like to point out, however, that I am informed that the amount of coal used in making the electricity to run cleaners is estimated to be under 1,000 tons a year, which is not much compared with the vast quantities of coal used for industrial and domestic purposes. The Chancellor of the Exchequer said he was not going to increase the tax on electric irons, yet they consume 23,000 tons of coal a year—or are estimated to do so by the trade; and electric clocks use some 15,000 tons. These are figures given by the trade, and I have no doubt the Chancellor can check them very easily if he wishes to do so. Against those large amounts of coal consumption by the use of electric clocks and irons, what is 1,000 tons for cleaners? Yet cleaners do mean a good deal of saving of time in so many homes in the country. I hope the Chancellor of the Exchequer will think again, and do his best to make this a happier and a cleaner world.
§ Mr. James Hudson (Ealing, West)
I should like to say how warmly many of us on these benches appreciate the concessions—the considerable concessions—that the Chancellor of the Exchequer has made. They certainly go beyond anything I had expected. I know what his difficulties are. I am sure my hon. Friends will for the most part agree with me that what he has proposed will go a long way to meet the requests we have put to him in our speeches tonight. It does not take away one iota from what I have said, to say that I am disappointed at the way the Chancellor seems to be looking at the question of electric water heaters.
I agree with him that these can be very useful instruments. I saw what he meant when, in commenting on what the hon. and gallant Member for North Blackpool (Brigadier Low) said about instantaneous water heaters, my right hon. Friend said he did not know of any "instantaneous" water heaters. The heater in my flat takes a long time to heat the water. I think that 1864 one reason is that the hiring authority does not service its water heater frequently enough to keep them in good condition. That means a waste of fuel. I do not want to pay for it; but the nation has to pay for it, in the sense that good fuel is wasted because the water is not heated quickly.
Against that, I think the Chancellor must take into account that, in the newer world in which we are living, the old fireside has gone, with its grate and the boiler behind the grate and the oven at one side. There is such a thing in my flat. We are in an old flat. But we are very glad to leave the old grate as a memento of the past; and to turn to our electric water heater and cooker. It really will effect a very great disservice to many homes, and a very great loss in fuel, if the Chancellor takes too stringent an attitude with regard to the water heaters. People will turn back to the old firesides and the old grates and the old heating arrangements.
I have this further point to make about the matter, which has been touched on in the Debate, although the Chancellor does not seem to have allowed it much weight, namely, that the water heaters, for the most part, in such houses and flats as I know, are paid for on the hire system and the money paid for their hire goes into the rent. The rent of my own water heater, ineffective as it sometimes is—I have looked the matter up—costs me res. a quarter. If the Chancellor puts the higher tax on water heaters, people will be charged twice as much. That is a very heavy imposition to put on the tenants of the new houses. It is a definite increase in the rent of the houses. That is not a good policy. I submit very earnestly to the Chancellor, now that the Labour Government are doing so well in providing the houses. [Interruption.] I do not agree with the hon. Member for Stockport (Sir A. Gridley) who began his speech by suggesting that the houses were not being delivered by the Labour Government. At least he looked as though he would like to have said that, but knew that he would have destroyed his case if he had. But the houses are being built and are going to be delivered as houses to rent. [HON. MEMBERS: "When?"] Now Many people are getting houses as a result of this Government's policy, but it would be a pity if, on top of the rents 1865 that are now being charged—charged as a result of considerable subsidies to make the rents low—the Chancellor were to put on this tax and so destroy part of the aid he is giving, and make the rents heavier through the prices of these articles. He has indicated that he has not finished his consideration of the matter, and I hope that before the Report stage he will not rule out water heaters. I am quite sure this in some way can be dealt with. I think that if the Ministry of Fuel and Power brought to bear more pressure upon the hire authorities to service their water heaters, a good deal more fuel could be saved than by any tax the Chancellor could put on these articles to raise the price of them.
I hope, too, he will give further thought to the vacuum cleaners. I have in my constituency the most famous of the firms of electric cleaner manufacturers, and I have it on good authority that the hon. Member for Eddisbury (Sir J. Barlow) made a reasonable computation in saying that only about 1,000 tons of coal are used per annum in the manufacture of sufficient electricity to run all the vacuum cleaners in the country. But the amount of toil and moil and difficulty in the home that the masses of women in the country are saved by electric cleaners is immense. This affects many working women and I am assured by the company to which I have referred that their vacuum cleaners go to homes 80 per cent. of which are run by the women of the houses who have not got maids and who themselves use the vacuum cleaners. To make these more expensive would add very considerably to the work these women are doing. I leave those two points with the Chancellor of the Exchequer for his further consideration. I sit down with another very warm word of commendation for what he has done.
§ Brigadier Low
When I interrupted the Chancellor of the Exchequer a few moments ago I used the term "instantaneous" gas water heater, and I rather gathered that not only did the Chancellor of the Exchequer not think any water heater was instantaneous, but that he did not see the distinction between the kind of water heater to which I was referring and the water heater described by another epithet. I would ask him to remember—and I am quite sure he knows this—that 1866 by "instantaneous" water heater I mean the modern equivalent of the geyser. It really does save fuel. That kind of water heater really does save fuel, because it is only alight during the time that the water is being drawn off. If the Chancellor's object is to save fuel, there is a very good case for exempting that type of heater from Purchase Tax.
§ Major Cecil Poole (Lichfield)
I should like to say a few words with regard to the plea of my hon. Friend the Member for West Ealing (Mr. J. Hudson). When the Chancellor is considering water heaters, I hope he will consider something else, too. I am very sorry that the Minister of Fuel and Power was not here tonight to hear the plea of my hon. Friend, because if he had been here I am sure he would have been appalled at that suggestion. The water heater is one of the heaviest consumers of electricity, and for people to plead for water heaters to be installed in houses when we are face to face with the situation which will arise next winter is, to me, to show a complete disregard of our position. Anyone would think that there had been no fuel crisis last winter, when an hon. Member advocates the removal of restrictions on purchases of that sort. There is no connection between the supply of water heaters and the supply of new houses for the people, and my hon. Friend is quite out of touch if he thinks the working class heats its water with water heaters. They are the most wasteful form of heating, and have no relation to the housing problem, and the building of a house will not be held up because it has not a water heater.
I think there is a stronger case to be made for exempting vacuum cleaners than some of the other commodities, in regard to which the Chancellor has conceded the point, and dismissed the tax with a wave of his hand. I am with those who say that this is a most valuable adjunct of the housewife, and it is unfair today to penalise her in her cleaning tasks. The vacuum cleaner ought to be one of the first things to be exempted, because domestic servants are largely non-existent in many households today. I say the vacuum cleaner ought to be exempt from the tax, but the water heater, no. I am reminded of information given to me last year when electric tires were freed from Purchase Tax. Then, had the electric fires sold in the area served by the Ironbridge Power Station all been on during the whole of 1867 the 24 hours they would have absorbed the total output capacity of that power station. That was the situation last year when electric fires were freed. Take the tax off water heaters and allow an abundance of them to be used, and the fuel crisis which is still looming will be a very stark reality to all of us.
§ Viscount Hinchingbrooke (Dorset, Southern)
I should have thought it was for the Government to say that the expected fuel crisis—and I am perfectly certain we shall have one as a result of the Government's policy—bore directly upon coal, and not upon the electricity stations. I understand from what the Chancellor has said that he is making no differentiation between gas and electricity in regard to water heaters. I take it from that, that he thinks the electricity stations cannot stand it. If that is the case, there is then a further point to be considered in the argument put forward by the hon. Member for West Ealing (Mr. J. Hudson). The Chancellor said that water heaters were wasteful. They are not wasteful thermally, as I understand it. An element is inserted into an existing tank, it is encased in material to make it heat proof, and it conserves its heat, except, of course when the water is drawn off. If the hon. Member for West Ealing suffers nom his particular installation it must be because it has been inefficiently installed, and has not been properly protected. The water heater is not wasteful in that sense. A certain number of units of electricity are put through the element, and the water is heated a certain number of degrees. It may be expensive in the consumption of electricity, as the hon. and gallant Member for Lichfield (Major Poole) has just said it is; but, as I understand it, the Chancellor is not basing his argument on the expense of the electricity. I hope he will consider seriously taking further technical advice on this matter in order to see whether he cannot give way in this direction.
§ Mrs. Manning
Has the noble Lord ever compared his electric meter on which is indicated the amount of electricity used for the water heater—and I hope he reads the electric meter—with that on which the other consumption of electricity in his house is indicated? If so, he will find that the amount used for the water heater is abnormal.
§ Several Hon. Members rose—
§ The Chairman
We have had a very full discussion, and I hope the Committee will agree to come to a decision now.
§ Mrs. Castle
I will not detain the Committee long, but the Chancellor did ask us to consider the very important point he raised, whether or not he should extend his concession to vacuum cleaners and refrigerators, and he invited our comments on it. That is why I now intervene. If—albeit to the surprise of some of us—he is prepared to concede the point in regard to washing machines, I would suggest that it is extremely difficult for him to refuse to exempt such a widely socially valuable domestic instrument as the vacuum cleaner If he feels he cannot give too much, I ask him to give way at least on the vacuum cleaner, if necessary at the expense of the refrigerator; not because the refrigerators are things we do not think the working class deserves, but for the simple reason that at the moment they are not widely available. The shortage of steel makes it difficult to manufacture sufficient to instal them in the working class homes, where we hope to put them. The vacuum cleaner, however, is available to a much larger extent. While thanking the Chancellor for his concession on my Amendment in regard to electric irons, I would point out that if we had thought we would get concessions on little more than a very narrow range, we would have rushed to put down vacuum cleaners as well, because they come in very much the same category. Therefore, I ask the Chancellor, if he can, to include vacuum cleaners, although we are prepared to wait for the refrigerators.
§ Mr. Henderson Stewart (Fife, East)
I should like to ask the Chancellor to consider one class of user of the water heater who has not yet been mentioned. I refer to the doctor, who needs to heat water in his own house, and who requires to have it immediately available when he needs it. I know that many doctors find that their ordinary old-fashioned water heating system is not efficient, or they cannot get the necessary fuel to be able to use it. I know many doctors who, in the past few months, and some in the past few weeks, have been compelled, by force of circumstances, to purchase and instal water heaters. Even if the Chancellor condemns 1869 the use of the water heater in other quarters, would he not consider an exemption in the peculiar case of the doctor.
§ Mr. Osborne
Would the Chancellor be good enough to give a specific answer to these two points? The tax was imposed in order to save fuel, as I understand it. He has now made concessions. The first question is: Has he any data from the Ministry of Fuel and Power about how the concession will affect the fuel position? Secondly: Can he give us any hope from the Ministry of Fuel and Power that in 12 months' time the position will have improved so much that the concessions to be made will not affect the position?
§ Mr. A. Edwards
In view of the favourable reception which the Chancellor has accorded to our various appeals, I beg to ask leave to withdraw the Amendment.
§ Amendment, by leave, withdrawn.
§ Schedule agreed to.
§ Fourth Schedule agreed to.