§ The MARQUESS of LANSDOWNE
rose, in pursuance of notice, to move the Second 1345 Reading of the Bill to continue for three years the duties on property, professions, trades and offices. In making this proposition to their Lordships, he certainly did not labour under the difficulty of having any new proposition to make, or of explaining a matter with which they were not already well acquainted, both as to its principles and its details: but still this subject, familiar as it was to their Lordships, was one so important that he could not ask their consent to the second reading of the Bill without laying before them the grounds on which Government had felt it to be indispensable that the measure should be renewed, and the motives that had induced them on the present occasion to take that course. In doing so he would very briefly state what was the financial condition of the country, what were the expenses for payment of which they had to provide, and what was the present state as well as the future prospects of the revenue; from a consideration of all which the House of Commons had determined on the present measure, and which their Lordships were now asked to sanction. He would, however, in the first instance, call their attention to the fact, that by far the largest proportion of the expenditure of the country arose from obligations which they were bound to meet, if they desired to maintain the public faith; and that it was on a comparatively small amount of the public expenditure that they could attempt to effect any reduction, or to exercise economy. The first head was the interest of the Funded Debt, for which they were bound to provide 27,778,000l. To that was to be added, for interest of Unfunded Debt, 752,600l. That was after allowing for the deduction, which he was happy to say his right hon. Friend the Chancellor of the Exchequer had already provided for; making, under those two heads, a total of 28,530,600l. To that sum was to be added the charges on the Consolidated Fund, which comprised the fixed salaries of the public service, 2,750,000l., raising the total to 31,280,600l. There remained different heads which were provided for from time to time by the concurrence of both Houses of Parliament. One amongst them was the vote for the Navy and Army. The expense of the Navy was 7,726,610l.; for the Army, 7,162,926l.; to which was to be added, for the Ordnance Department, 2,924,835l. He did not feel called upon to use any argument with their Lordships to induce them to give their 1346 concurrence to those estimates. They exceeded in only two particulars the estimates of last year; and he was not prepared, until he should hear it from some noble Lord, to believe that he would be met with any expression in that House to the effect that there ought to be a reduction in our military strength. For although there might be no immediate apprehension of war—although there might be no quarter from which hostility was reasonably to be apprehended—yet the present was not the moment at which to make any considerable reduction in the naval and military expenditure of the country. It was not a time, in the present circumstances of the world, at which we should leave ourselves less provided than before in means of military defence; or in the means of maintaining that security which was so necessary for our trading and commercial prosperity. He was sure that the amount of the estimates essential for the maintenance of the honour of the country would receive the sanction of that as well as the other House of Parliament. In addition to the Army, Navy, and Ordnance Estimates, there were the Miscellaneous Estimates, amounting to about 4,000,000l., making together 53,100,000l. to be provided for. Now as to the revenue, the amount of Customs Duties was estimated at 19,750,000l., and the Excise at 13,000,000l. These made together 32,750,000l. The Stamps were estimated to produce 7,200,000l.; the Assessed Taxes 4,340,000l.; the Post Office 900,000l.; and from the Crown Lands, and the various resources classed under the head "Miscellaneous," 360,000l. The revenue expected to be derived from the Post Office was an amount of produce which must be most satisfactory, and to which it was well worthy of calling the attention of the public, as it entirely justified the change in the system of the Post Office, which had afforded so much accommodation to the public. No one was more adverse than himself to direct, in contradistinction to indirect, taxation. On the contrary, so long as indirect taxation could be carried out without producing injurious reaction, he had always thought it desirable that it should be adopted as the great foundation of the revenue. There was, however, a limit beyond which they could not carry indirect taxation, without encouraging frauds or smuggling. He was, however, favourable to indirect taxation as a foundation of the revenue. There was no small advantage in that the public were 1347 more easily satisfied with indirect taxation, as they considered they were to a considerable degree at liberty to limit or extend the consumption of taxed articles. These taxes, however, could be carried no further, without running the risk of affecting the public revenue, as it was shown when the extent of the tax was carried too far a revulsion took place, and they got a smaller amount. Under these circumstances it was proposed by Her Majesty's Government to reimpose the property and income-tax, which was estimated at 5,200,000l. This, with the sums he had already stated, would make up the amount of revenue to 51,250,000l. Having stated this, he was prepared for the question which would be naturally asked him—Would this amount be equal to the proposed expenditure? His reply was, it would not: and therefore it was that it had been the opinion of Her Majesty's Government that it was most desirable to provide for the excess of the expenditure by a small addition to the income-tax. Circumstances, however, had prevented them carrying out their intentions. A strong opinion had been expressed in the other House of Parliament against any increase of the property-tax; and other circumstances had occurred which had also induced them not to persist in their proposal. It appeared that there was a charge of 240,000l. for excess of naval expenditure for last year, which would not again occur. Further than this, in consequence, it had fortunately happened, from the great skill and ability displayed by both the late Governor of the Cape of Good Hope, and by the gallant and eminent officer who had succeeded him—he meant Sir Henry Pottenger, and Sir Harry Smith—a source of great expense and a matter of great difficulty had been put an end to—he alluded to the Kafir war. From what had there taken place, they had reason to hope that no further danger would occur in that quarter. The amount of saving from the termination of the Kafir war would be 1,100,000l. This, then, with the saving of 245,000l. from excess of naval expenditure, being deducted from the gross deficiency, there would be an actual deficiency of 1,800,000l. There was a strong expression of feeling, both in and out of Parliament, that it was consistent with safety, if not with expediency, that they might provide for such a deficiency by the balances in the Exchequer. These balances sometimes amounted to 6,000,000l., and at other times to 1348 5,000,000l. or 5,500,000l. From this source means might be obtained of meeting a temporary difficulty; but these advances must be repaid, when the debt became due, by deficiency bills, and what was called the Ways and Means. It no doubt was most desirable to have the public finances in such a condition as to be independent of the Bank, and this had been the case for some years past; but under the circumstances of the present moment it was deemed expedient to take this 1,800,000l., or such portion as might be required, from this source. At the same time he did not abandon the hope—and but for what had recently occurred on the continent of Europe he should have felt most assured—that the revenue would soon be in such a buoyant state as to equal the expenditure, and that there would be a great increase in the expected receipts from the Customs and Excise. By these means it was hoped that the necessary expenses of the country might be provided for in such a way as to ensure for the defence of the country; for though they had no reason to expect aggression against this country, yet in the events which were occurring in other parts of the world, something might unfortunately arise affecting this country. Out of the resources of the country they must obtain a sufficient amount of taxation for the necessary expenditure. Their first and most sacred duty, before all others, was to provide means to pay the public creditor, and it was also a bounden duty, and, above all, at the present moment it was a bounden duty, that the safety of the country should be provided for, by keeping up an adequate naval and military force, so as to enable this country to maintain her station in the world and to vindicate her honour. On these grounds he proposed the second reading of this Bill; and he felt assured that, under the circumstances, it would receive the support of the House.
said, that he hardly felt it necessary to enter into details after the statement of the noble Marquess, or to follow him into the amount of proposed expenditure, or as to the means of providing resources to meet that expenditure, for, in common with other Members of the House, he entirely concurred in the concluding observations of the noble Marquess, that it was necessary to make provision for the public creditor to the fullest extent, and to maintain the country in such a position of national defence, that while we repudiated all idea of aggression on the rights 1349 of others, we should be enabled to maintain our station, and prevent any attack on our honour. With these paramount objects in view, he was sure that no noble Lord was prepared to refuse—however unpalatable it might be—his assent to the reimposition of this tax for the period proposed. With regard to the latter part of the noble Marquess's speech, it showed that Her Majesty's Government were fully justified, nay, were bound to yield to the universal feeling of the country, as represented in the other House, as well as out of doors, against any augmentation of direct taxation for the purpose of meeting a temporary purpose. He believed that the determination on the part of the House of Commons and the country was founded on the apprehension of the danger of giving to the Government a too great facility in increasing a tax already existing, although the proposed increase might be of a small and temporary nature, and by this facility giving a temptation to undue expenditure. He was glad to hear from the noble Marquess that the jealousy of the House of Commons and the country had not been unnecessarily exercised. He concurred with the noble Marquess as to the inconvenience of drawing on the balance in the Exchequer; but still it was satisfactory to be enabled to believe, from the statement of the noble Marquess, that within a very slight limit the revenue arising from existing resources was likely to be sufficient. There was one topic to which the noble Marquess referred—and he confessed he heard him with some regret—namely, as to the cessation of the expenditure for the Kaffir war. It appeared to him that the amount was overrated. The noble Marquess said that there would be a saving effected of 1,100,000l.; but this, as he (Lord Stanley) understood the matter, was the expenditure which had spread over two years; it, therefore, could not be taken as a charge for one year. While giving every credit to the exertions of the present and last Governor of the Cape Colony, he hoped the noble Marquess did not mean to say that under the predecessor of Sir Henry Pottinger the war was not carried on with success. He confessed he had heard of the recall of the gallant officer with great pain. He hoped there was no intention on the part of the Government to reflect on the character or conduct of Sir Peregrine Maitland either as regarded the finances or the war in that colony. He (Lord Stanley) had been instrumental in 1350 appointing that gallant officer to the office of Governor General of the Cape; and since the return of that officer he had seen all the correspondence between him and the Government, and it did not appear to him that Sir Peregrine Maitland was not fully adequate to the military governorship of that colony, or that his financial arrangements were not sufficiently good. The noble Marquess did not advert to another part of expenditure, which was not likely to occur again at present, namely, the advance of 1,200,000l. for Ireland. After making these observations with respect to the part of the speech which went to vindicate the House of Commons for refusing—and he must be excused for saying refractorily refusing—to give Government any increase of the property-tax, the noble Marquess proceeded to state that he hoped the revenue of next year would be fully equal to the expenditure; but it must be recollected that, in the present state of affairs, the amount over which the House of Commons could exercise any control bore a very small proportion to the gross revenue of the country. The only part with which it could deal was the Miscellaneous Estimates. He excepted the Navy and Army Estimates; for he was sure the House would agree with the noble Marquess that this was not the time to cut them down; and while he stated the hopes of the Government that peace would be maintained, he showed the determination the Government had formed not to be drawn into a war by anything but the extreme necessity of defending the national possessions or maintaining the national honour. Setting aside, then, the Army, Navy, and Ordnance expenditure, the only item out of which any saving could be effected, by the most vigilant supervision and control, was a sum of about 4,000,000l. included under the head of Miscellaneous Estimates. Although he did not mean to say that some reductions might not be made under this head, yet they could hardly expect to save any very large amount. He did not believe that it would be possible to make such reductions, or that there would be such an increase in the other departments of revenue that they could dispense with the reimposition, for a limited period, of a tax which brought, 5,00,000l. into the Exchequer. He hoped, however, that the House of Commons would not only watch with vigilant attention the conduct of the Government with respect to the expenditure, but also 1351 the course they might take with respect to other taxes. He trusted that if the revenue should so far improve as to show a surplus, the House of Commons would exercise their vigilance so as to prevent Her Majesty's Government from hastily and inconsiderately reducing other taxes; for if this caution was exercised, they would find, at the end of the period for which the property-tax was proposed to be continued, that Parliament might he justified in getting rid of this most objectionable tax. If the House of Commons was not determined to keep up the revenue beyond the expenditure, and consented, on the first appearance of a surplus, to take off other taxes, it would be idle and useless to say this was a temporary tax; for the country would find, in the absence of a surplus, that it would be permanently saddled with that which he felt to be a most dangerous thing to the public interests, namely, a permanent amount of direct taxation. It was not because he saw nothing objectionable in the principle of this measure that he assented to it, but because he thought that under no other circumstances could the country be placed in a position of national security, and because there were no other means by which the national credit could be maintained. He gave, therefore, his unhesitating support to the proposal of Her Majesty's Government for the renewal of this tax; but, at the same time, he felt it his duty to enter his protest against any permanent system of direct taxation, which ought to be reserved for occasions of extreme necessity. He felt very confident that the time was not far distant when we should find that we had advanced too far and too rapidly in the course of a reduction of those taxes which, while they largely contributed to the revenue of the country, were not materially felt by those who paid them, because they were spread over a large mass of the population. His belief was, that without oppressing commerce, or injuriously affecting the country, a sufficient amount of revenue might be raised by retracing some of those steps which he thought had been injudiciously taken, so that, by resorting again to indirect taxation, we might, at the expiration of three years, be enabled to dispense with this tax, which, though he admitted it to be necessary at the present moment, he considered as objectionable in principle as it was obnoxious to the public.
§ EARL GREY
observed, that his noble 1352 Friend the President of the Council had made no imputation upon any Governor of the colony of the Cape of Good Hope. His noble Friend had only stated that a very large expenditure had been occasioned by the Caffre war; but he did not express, one way or the other, any opinion on the conduct of Sir P. Maitland. After what had fallen from his noble Friend opposite, he felt bound, however, to say that it was his painful duty to advise Her Majesty to relieve Sir P. Maitland of the command of the colony, because, with the highest respect for the character of Sir P. Maitland, both as a soldier and a civil servant of the Crown, he could not conceal from himself, information having reached him to that effect from various quarters, that Sir P. Maitland was not fully equal to the extraordinary difficulties which occurred in the earlier part of the Caffre war. He was not speaking of the military operations which Sir P. Maitland directed; but it seemed to him that, with regard to the expenditure connected with those military operations. Sir P. Maitland did not exercise that control which he ought to have exercised. He was aware of the extreme difficulties in which Sir P. Maitland was placed, and particularly of the great difficulty there was, owing to the nature of the country, in moving troops and stores; but, at the same time, as he was pressed on the subject, he was bound to say that he did not think that full control had been exercised in those matters. His original view of the case was confirmed by information which had been since received; and he could have no doubt that, contrary as he believed to Sir P. Maitland's wishes and orders, there had been abuses committed at the Cape which required to be met with a vigorous hand and determined measures.
§ LORD LYTTELTON
felt bound to say, that during the time he was connected with the Colonial Department, though many transactions happened in the colony of the Cape of Good Hope, yet, neither with regard to those transactions, nor with regard to the war which broke out in that colony, had there been the least reason to entertain any but the most favourable opinion of the conduct of Sir P. Maitland.
§ Bill read 2ª.—House adjourned.