§ Order of the Day for the Second Reading read,
§ EARL GRANVILLE
My Lords, I rise to move the second reading of a Bill the object of which is to repeal a tax which has now existed for nearly 150 years. That tax, as stated in the preamble of the first Act, was imposed for the purpose of enabling Her Majesty Queen Anne to carry on the war then raging, and it was to continue until she had secured a lasting peace. Contemporary writers, however, inform us that the real object of the Bill was, in conjunction with other taxes that were levied at the same time, to impose restrictions on the press, which was at that time thought too licentious. It is curious that Swift, the great Tory writer and the friend of the Ministry then in power, complained of this proceeding both in verse and in prose. In verse, in some lines, describing himself, he said,—His works are hawked in every street,But seldom rise above one sheet;Of late, indeed, the paper-stampDid very much his genius cramp.In prose, in his history of the last four years of Queen's Anne's reign, there is a passage, which is too long to read to your Lordships, but which is well worthy of attention, arguing, upon Conservative 1440 grounds, against the expediency of throwing any difficulty in the way of cheap publications of a political character. The tax, however, with some modifications, has continued to our time. In 1832 an agitation was begun against it. In 1835 a Royal Commission, of which Sir Henry Parnell was at the head, was appointed to examine into the effects of this tax among others. They reported in favour of some modifications, and also the reduction of the duty by one-half. That reduction accordingly took place, was followed by an enormously increased consumption, and, what is more remarkable, by a diminution in the price of paper to double the amount of the duty repealed. The Commissioners, in their Report, begged it should not he thought that they approved the tax, and they hoped the time would soon come when Parliament would be able to repeal the tax altogether. Motions were then made in the House of Commons on the subject. Two years ago an abstract Resolution was adopted there; and, although in general abstract Resolutions respecting taxation are not very desirable, it was adopted with the full concurrence of the late Government through their representatives in the House of Commons. Her Majesty's present Ministers decided upon the repeal of the tax this Session. They brought forward a proposal to that effect in the House of Commons; it has in different shapes gone through the ordeal of three divisions in the House; and it now comes here for your Lordships' approval. On any ordinary occasion I should have satisfied myself with the short history I have given of this tax, trusting that your Lordships would be glad to take your share, whatever that may be, in the work of relieving the people from a burden of this character. Considering, however, the Notice which has been given by my noble Friend below me (Lord Monteagle), and the energetic assurance given by the noble Earl opposite (the Earl of Derby) that be would not only Vote for but would use all his endeavours in the support of the noble Baron's Motion, I think it necessary to trouble your Lordships at much greater length than I should otherwise have wished on this subject. I must first briefly refer to the objections which are likely to be brought against this Bill. From a Report that I have read of what took place elsewhere on Saturday I have reason to suppose that the noble Earl does not intend to go much into the merits or demerits of this tax. I was quite pre- 1441 pared for this course, because the noble Earl, no doubt, felt that it was impossible to say anything in favour of a tax of which the leading Members of the late Government had expressed themselves in favour of the repeal. Lord Stanley, whose opinions on any question affecting the social state of the country are so liberal and unprejudiced, has long been known as a warm advocate of the repeal of this tax. Sir Bulwer Lytton, equally distinguished as an able public man and man of letters, has been most eloquent in his denunciations of the tax, and to him the country owe the happy and true definition of this impost as a tax upon knowledge. The late Chancellor of the Exchequer, in opposition voted for the repeal of the tax; when in office he stated that it combined moral as well as physical objections, and, as leader of the House, he agreed to the Resolution to which I have just referred, and which declared that paper was not a fit subject of permanent taxation. With regard to the noble Earl himself I am informed by the report of what took place, as well as by a gentleman who was present, that the noble Earl, in answer to a deputation which waited upon him on a previous occasion, declared that he only repeated his former impressions when he stated that this tax was bad in principle and bad in practice. I am not therefore surprised at his determination to refrain now from entering into the merits of the tax; but, as I do not know what view may be taken by other noble Lords on the subject it will be necessary that I should state as shortly as I can what are some of the principal objections to it. There is a phrase used by Lord Stanley which so well describes the operation of the tax that I should almost wish to take it as the text of the objections which may be advanced to it. He stated that the tax was vexatious in collection, that it impeded improvements in manufacture, that it heightened the price of an article, the demand for which already exceeded the supply, and pressed injuriously on the supply of cheap literature and the diffusion of news. As to its being vexations in collection, I must refer to the Report of the Commissioners of Inland Revenue published on the 1st of March in the present year. I see the noble Baron smile; but I do trust that in this House we shall not hear the insinuations which have been thrown out elsewhere, that this is not the deliberate opinion of the Commissioners, but a Report "got up to order." To prevent 1442 the repetition here of a statement so derogatory to the gentlemen of high character who compose the Board of Inland Revenue I will state what I have ascertained on this point. I went to Somerset House for the purpose of making inquiry on the subject, and what I found to be the case was this:—Very soon after the passing of the Resolution agreed to by the late Government the difficulties in the way of collecting the tax daily became greater. Towards the beginning of this year the Board were beset with applications for exemptions to which they were unable to give any answer whatever; and in this dilemma, not knowing whether the Government meant to repeal the tax or not, they appointed some of their most able and practical officers to examine into the question and see whether they could frame any regulations with regard to its collection which might be draughted into a Bill, and which, if approved by Parliament, might enable them to collect the tax with something like justice. Afterwards, when the Government, acting partly on the opinion of the Board of Inland Revenue, and partly from reasons to which I shall presently advert, came to the determination of repealing the tax, a debate took place in the House of Commons, and Mr. Walpole said that, comparing the former Report of the Board with the statement of the Chancellor of the Exchequer, he did not think these were perfectly consistent. Upon this the Commissioners drew up their Report perfectly spontaneously, and without the slightest communication with the Chancellor of the Exchequer or any other Member of the Government. I shall be confirmed that this is as the opinion of the Commissioners by the noble Earl opposite, as he can tell your Lordships that during the time he was in office, letters were constantly received at the Treasury from the Commissioners bearing exactly on the same point. [The Earl of DERBY intimated doubt.] If the noble Earl does not know it, I can assure him that it is the fact. I will not read the whole of the Report—I will read only a few sentences. The Commissioners say—We beg leave to state that it is our deliberate opinion that the paper duty (to use the words of the Chancellor of the Exchequer) 'is rapidly becoming untenable'; and we hope to satisfy your Lordships that this opinion is not inconsistent with those which we have previously expressed or the subject.Again, they say—In our third Report, however (that of last 1443 year), we were compelled to draw your Lordships' attention to the very great and increasing embarrassments in which we were involved in collecting this tax. We pointed out that this state of things was attributable in a great measure to the condemnation of the duty by a Resolution of the House of Commons, and we might perhaps have added that the evils of which we complained had been accumulating for many years previously under the prevalence of a general impression that the duty on paper would be given up on the very first available opportunity. We endeavoured to show how impossible it was, under these circumstances, to apply to Parliament for power to subject new branches of the trade to excise regulations.They go on to say—And at the same time how unjust it was to allow to one an exemption from this duty and survey, which alone prevented a rival branch from successful competition in the market.The Commissioners proceed to point out the difficulties with which the collection of the duties is beset, and when it comes to this, that those charged with the administration of the laws are unable to discharge their duty without injustice, which cannot be remedied it is time that the tax should be brought to an end. The whole of the Report is well worthy of your Lordships' attention, as showing the excessive injustice and inequality of the tax, and the necessity to which they were driven to exercise an arbitrary decision, there being no definition of "paper" sufficiently clear. The noble Earl opposite in the course of the answer he made to the deputation that waited on him on Saturday last, stated that he had received intimations of a contrary character from publishers, booksellers, and newspaper proprietors, and stated that he was intrusted with petitions from Irish newspaper proprietors on the subject. I can explain this matter to your Lordships, and the petitions of the Irish newspaper proprietors need not have very great effect on your Lordships' minds. The Irish newspapers only pay three farthings tax, and the English newspapers pay 1d. stamp duty; and the Irish newspaper proprietors had been told that if they were relieved from the necessity of buying dear paper, it would be only fair to put them on an equality with the English newspaper proprietors. With respect to the opposition of the manufacturers to the repeal of this tax, we all know what happened on the abolition of the excise duty on glass—how, by the competition that arose, that material was cheapened, and how it increased in quantity and improved in quality; but its immediate effect on the profits of the manufacturers was not favourable, in consequence of the competition which was there 1444 fore encouraged. I know that with regard to the material from which paper may be made, some persons declare that fibre is not applicable to the manufacture of the finer and better sort of paper. Still it is applicable to the manufacture of a paper most useful to the poorer classes of persons. I remember four or five years ago a very interesting discussion being brought on in this House respecting the manufacture of beautiful paper from West Indian fibre; and a complaint was made by the noble Earl (the Earl of Derby) that a charter of limited liability had not been granted to a company for the manufacture of that paper. Now, it appears to me a clumsy proceeding to put a tax on one side, and then to prop it up by some special privilege on the other. There are several very ingenious inventions waiting to come into operation as soon as the excise duty shall be abolished. Pulp may be used for forming models from works of art, some of the finer kinds of which are liable to be hurt by contact with clay or plaster of Paris. This pulp is applicable to any work of art without injury; but it is obliged to be dry before it leaves the paper-maker, and, therefore, until the duty shall be repealed, it would be absolutely impossible to use it for the purpose I have indicated. I have been informed within the last day or two, that a large mill in Lincolnshire, owned by a person named Sharpe, has been built to turn twitch, that most destructive weed to the farmer, into paper; but the tax interferes so much with the process that the owner has been compelled to shut up the mill. If the duty were repealed, the mill would be reopened. And instances of a similar kind are, I am told, very numerous. The duty operates also in a peculiar way in creating a monopoly, owing to the manner in which the payment of the duty is made to press on the mill-owners, in consequence of purchases made from them shortly before the moment when the duty must be paid. When I look abroad and see that in America all the processes of papermaking are infinitely superior to ours, that the paper is made much cheaper, and that the consumption is something like treble of ours per head, then, considering the wealth and enterprise of this country, I think there must be some reason for this. When I advert to France and note the enormous quantities of paper exported from that country, and when I remark that the French paper is superior for printing purposes, the same reflection 1445 forces itself on my mind; and so, when I go in imagination to Japan, or read the interesting book written by Captain Osborn, in reference to that country. Captain Osborn says, in the interesting volume he has recently published:—It was wonderful to see the thousand useful as well as ornamental purposes to which paper was applicable in the hands of these industrious and tasteful people. Our papier-maché manufacturers, as well as the Continental ones, should go to Yedo to learn what can he done with paper. We saw it made into material so closely resembling Russian and Morocco leather and pigskin, that it was very difficult to detect the difference. With the aid of lacker-varnish and skilful painters paper makes excellent trunks, tobacco-bags, cigar-cases, saddles, telescope-cases, the frames of microscopes, and we even saw and used excellent water-proof coats made of simple paper, which did keep out the rain, and were as supple as the best Macintosh. The Japanese use neither silk nor cotton handkerchiefs, towels, or dusters; paper in their hands serves as an excellent substitute. It is soft, thin, tough, of a pale yellow colour, very plentiful and very cheap. The inner walls of many a Japenese apartment are formed of paper, being nothing more than painted screens; their windows are covered with a fine translucent description of the same material; it enters largely into the manufacture of nearly everything in a Japanese household; and we saw what seemed balls of twine, which were nothing but long shreds of tough paper rolled up. If a shopkeeper had a parcel to tie up, he would take a strip of paper, roll it quickly between his hands, and use it for the purpose, and it was quite as strong as the ordinary string used at home. In short, without paper all Japan would come to a deadlock; and, indeed, lest by the arbitrary exercise of his authority a tyrannical husband should stop his wife's paper, the sage Japanese mothers-in-law invariably stipulate, in the marriage settlement, that the bride is to have allowed to her a certain quantity of paper.I think the fact of a great enterprising nation like ours being, in respect to the manufacture of paper, behind the Americans, the French and the Japanese may, without any great stretch of imagination, be attributed to the effect which we know the Excise laws produce in other matters. I will now come to the last branch of the subject—namely, the effect which the repeal of the duty will probably have upon cheap publications. On this subject some people have the most extraordinary notions, thinking that that repeal is merely advocated to give a greater circulation to a particular newspaper, expressing extreme views, not certainly in accordance with those held by the majority of your Lordships. What is the case? In London there are three cheap daily papers,— The Morning Star, a journal of advanced Liberal opinions; The Daily Telegraph, also a Liberal 1446 paper, but not on all questions at one with The Morning Star; and The Standard, a journal of purely Conservative principles. I had the pleasure sonic three days ago of reading an interesting and well-written article in The Standard, attacking the Liberal party in general, and myself in particular. Well, I have here a letter written in 1858 by the manager of The Standard, stating that every day he paid £29 to the Excise, and that if the paper duty were repealed he should have £20 for the better remuneration of literary talent and the purchase of better material to print upon, leaving, of course, a larger profit for the proprietors of his journal. He also points out the heavy charge placed upon newspapers like The Standard in the obligation to have their sheets of certain sizes dried before they left the paper-mill, and damped again in the printing-office, all causing great waste and delay. He adds that if the paper duty were abolished, he has not the slightest doubt that the circulation of The Standard would be doubled in amount. That, surely, is a consummation which noble Lords opposite must earnestly desire to bring about, because it means that with greater literary talent Conservative principles would be spread among double the number of leaders. So with respect to books. The paper duty presses very lightly indeed upon popular novels in three volumes, expensively got up annuals, and works of that sort, and costly works — such as Macaulay's or Mahon's History of England. But, when we come to books and publications intended for circulation among the I poorer classes of the community, we then see the effect of the tax upon paper. Instead of 5 or 10 per cent, as upon the publications purchased by the rich, we have the duty rising to 30, 40, 50, and even 60 per cent upon publications which the working classes desire and ought to obtain. Mr. Black, the eminent publisher of Edinburgh, says that upon one work alone he has paid duty to the amount of £4,000, and he calculates that the tax cost the purchasers of the book at least £8,000—a statement which is, of course, equally applicable to smaller books. Your Lordships know that Mr. Knight has been occupied all his life in endeavouring to spread useful and instructive books at cheap rates among the people. He was the publisher of the Penny Cyclopædia, a work brought out under the patronage of a noble and learned Lord who is at this moment engaged 1447 in the cause of education—a cause which he has served during a long and laborious life—and whose absence I regret to-night, because I know he entertains a strong opinion as to the necessity of the immediate abolition of the paper duty and an equally strong objection to the course which is proposed to be taken by this House to-night. What does Mr. Knight say? He states that in twenty years he spent £80,000 on authorship, and £50,000 on Excise. The Messrs. Chambers say they have been constantly prevented issuing cheap publications of an improving character in consequence of the paper duty. They once published a series of instructive tracts sold at three halfpence per copy. The sale was enormous, but after a certain time they found, on making up their books, that they had paid £5,000 to the Excise without getting a single farthing in the way of profit to themselves, and therefore, in the middle of an immense circulation, they stopped the publication. I could go on thus for ever. Here is a bulky pamphlet full of details, in which Mr. Knight proves to demonstration that, while the tax on paper falls with crushing effect upon cheap publications of an instructive character, it does nothing whatever to stop licentious and obscene books, which are got up for a mere trifle. But let me come to a class of books which greatly interest me—the National School books. The duty upon them is quite enormous, and while these school books, on one side, are paying a heavy tax, I, in my office, on the other, am administering Government grants to counteract that effect. It is impossible to conceive a more ridiculous system. I have been given to understand that the son of the noble Marquess opposite is prepared to advocate a relaxation of the duty as regards school books; but the noble Marquess will agree with me that while we should be glad to see school hooks cheapened, and they have a better right to be exempted from duty, than books in the northern languages, which are now so by law, it would not be advisable to add to the list of exemptions by which the law is already broken down, or to the difficulties of the book last issued by the Privy Council. I am afraid I am wearying your Lordships, but you can hardly imagine the immense mass of materials I have before mo all tending to the same point—the condemnation of this most vexatious and unjust tax. But I shall spare your Lordships, and shall assume that the main objection to the re- 1448 peal of the paper duty is one of a financial character. Some of your Lordships may think that we ought to have reduced the tea and sugar duties instead of repealing the duty on paper. That is a matter of opinion which it is perfectly competent and perfectly fair for any noble Lord to express. All I can say is, that after mature consideration the Government came to the conclusion that the repeal of the paper duty would afford the greatest amount of relief to the trade and industry of the country. I must add that they were peculiarly urged to that conclusion by the Report of the Excise Commissioners, stating that the tax was untenable in its present shape and that it could not be improved. Again, some of your Lordships may be of opinion that we ought to have taken a less income tax and to have retained the paper duty. That question was started in the other House of Parliament, it was discussed there at considerable length, and decided in the negative; therefore I need not trouble your Lordships with any remarks upon it. I am not aware that there can be any other financial objection to our proposal except this, that the Government have been improvident in arranging for the financial necessities of the year; which must mean either that we were improvident at the time our Budget was produced, or that the circumstances which have since occurred have stamped that character upon our propositions. Now, I am not going to make a long financial statement to your Lordships. There has never yet been a case of that kind recorded to have taken place in this House, though from the precedent proposed to be set tonight, I am not sure that it will not become the custom to trouble you with elaborate financial expositions. In that case I trust that a Vice-Chancellor of the Exchequer will be appointed for the purpose of supplying you with that information which must be requisite to enable your Lordships to adjust the balance between income and expenditure. Meanwhile, as that course has not yet been adopted, I feel myself entirely relieved from the obligation of inflicting upon your Lordships the intolerable tedium of a Budget speech from my mouth, and shall content myself with merely stating the general principles upon which the Government have acted in dealing with the finances for the year—a year, be it remembered, so difficult that I believe it was looked forward to by the late Government under the awful designation of "the year 1449 of immortal smash." Well, my Lords, this year of immortal smash presents, at all events, one remarkable peculiarity. Our Naval and Military Estimates are larger than has ever before been known in a time of peace. To provide for that vast outlay the Government were not content to frame a plan which should only just make the two ends meet, but they proposed, while raising an adequate revenue, to continue those commercial reforms and improvements which not only have conferred enormous benefits upon the nation at large, but which have produced a peculiar and extraordinary strength and elasticity in our revenue, especially in our indirect taxation. I do not know what your Lordships can see improvident in our Budget arrangements. The only possible objection to our financial policy in this respect must be connected with the question which has already been put to me this afternoon — the probable expense of the Chinese war. Now, when we made our Budget arrangements, we did not know whether we should have war with China or not. [EARL GREY: Hear, hear!] The noble Lord gives a most insulting cheer upon a matter of fact; but it is a fact that up to ten minutes ago the Government have continued to be—and necessarily so— ignorant whether there was war or peace. We had given orders for the fitting out of an expedition; but we did not know whether that expedition would end in a warlike or an amicable way—a question, indeed, which I could answer ten minutes ago from private information only. The noble Earl's cheer, therefore, was quite uncalled for. No doubt an expedition was ordered to be prepared, and some of your Lordships seem to think that we did not provide for the expense of that expedition. That was not the case. Last year there was taken a Vote of credit for £850,000— a Vote of credit only applicable when all supplies in connection with the ordinary service is exhausted—and this year a similar Vote of £,500,000 was put in the Estimates. In addition to this, the Army Estimates include, for the purposes of the Chinese expedition, a sum of £454,000, and the Navy Estimates a sum of £680,000, forming altogether, as nearly as possible, a sum of £2,500,000, provided for that expedition. Do your Lordships think that it would have been wise to make an enormous provision on that account? We have generally been accustomed to do too much in that direction. What was the case in the 1450 Crimean war? That we so much exceeded what was necessary for the purposes of the war that we ended by paving back £1,600,000 into the Exchequer. If there is any one principle in finance which appears to me to be sound and indisputable, it is that you should either have a war Budget or a peace Budget. If you have a war Budget, everything is exceptional; but if you have a peace Budget, it should be founded upon peace principles, to this extent—if there is any danger, if there is any cloud upon the horizon, it rests with the responsible Government to provide those armaments, those numbers of men on land and at sea, and those stores which may, in their opinion, be necessary to provide against contingencies, and also to provide for the raising of the sums of money required to meet the expenditure occasioned by such preparations; but if you go beyond that, and take large and undefined sums for large and indefinite contingencies, you act contrary to sound principles, and you become liable to this great practical inconvenience — that if, fortunately, you should be disappointed in your fears, you have a sum of one, two, three, or four millions, whichever it may be, which, according to the spirit of the law, should, at the end of the year, be applied to the reduction of the National Debt. Now, I ask your Lordships whether it would have been wise at the beginning of the year, when you were asking for an enormous revenue of an almost unprecedented character, to burden the people with additional taxes, the product of which might possibly be applied merely to the discharge of debt? My Lords, I am aware of no other charge of improvidence which can be made against the original Budget; but it may be said that since its publication circumstances have altered. I know of one circumstance, which I will mention, and which tells against me in this argument; other matters have been referred to as to which we were informed at the time the Budget was framed, and which were amply provided for. There was the question of the national defences. A Commission had been appointed to inquire what was necessary to be done to defend our principal arsenals. We knew of the Report of that Commission when the Budget was framed; we know of it now, and I am happy to say that we have at last got all the collateral information which will enable Her Majesty's Government to come to a decision upon it. Well, one of these things will happen— 1451 either we shall reject that Report, and the finances will be completely untouched, except as regards the large and unusual sum taken for current purposes of fortification; or we shall adopt it in one of two ways. If we adopt it and come upon the current revenue to provide the means necessary for carrying it out, it is clear that it will require a greater provision than the £800,000 included in the Estimates, or than the £1,500,000 which the noble Earl stated to the deputation the other day was the amount of revenue which he was going to save the country—and really when the noble Earl undertakes to teach the Government their duty, infinance it is no light matter to state Estimates at half a million more than their actual amount. If, on the other hand, we determine to adopt the Report, and to borrow money for the purpose of carrying out its recommendations, then the largo Vote for fortifications which is already before the House of Commons is sufficient, at any rate, to pay the proportion which will be required during the present year. Since the month of February the question of the China war has remained in the same position in which it then stood, and until this afternoon we could not tell whether there would be peace or war; nay, we now know nothing more, except that, from the tenor of a private telegram, there is reason to fear that hostilities are likely to take place. We cannot, however, tell whether the war will be short and successful, and therefore rather a benefit to the finances of next year than otherwise, in consequence of an indemnity to be obtained from China; or whether it will be prolonged over next year, and, therefore, require a Budget for war. I am now going to state a circumstance which I feel tells against me. The estimated surplus amounted to £460,000. Owing to there being an error in the calculations of one of the departments of the revenue amounting to £230,000, and to the abandonment of taxes to the amount of £180,000, that surplus is very nearly gone. [Earl GREY: Hear, hear!] I am glad to hear my noble Friend cheer in a more cheerful manner this time; but has my noble Friend any reason to suppose that it is a perfectly unusual circumstance that during the passage of a Budget through the Houses of Parliament the surplus should disappear? I think that if he will refer to the records of our proceedings he will find a great many instances in which that has occurred without the Govern- 1452 ment thinking it necessary to modify their financial proposals in consequence. I will give an instance. In the year 1853 the estimated surplus, and more than the estimated surplus, utterly disappeared before the financial measures were passed through this House. I remember that two noble Earls opposite in the strongest language the remission of the soap duties. They pointed to the probability of our becoming engaged in war with Russia, and said that under such circumstances they could not allow such a Bill to pass. But they did allow it to pass, and partly upon my representation. I begged them not to alarm the country, not to disturb the trade of the country, but to leave the responsibility where it ought to fall, until you turn out the Ministry, upon Her Majesty's Executive Government. And what was the result? Why, at the end of that very year you had a surplus of £3,500,000. And will any one tell me that when the Russian war did arrive, and two successive Governments had to appeal to the people of this country, they found them less able or less willing to give the lavish supplies which were asked of them, because the year before we had remitted taxes which pressed upon the trade and commerce of the country? My Lords, I do not know whether or not my noble Friend will cheer what I am going to say, but I am authorized by those most competent to form an opinion to state that looking at the principles upon which the estimates of revenue and expenditure for the year have been prepared, looking at the fact that on the 31st of March of this year there was a surplus of £1,250,000 which was not taken into account in the financial statement of February, and looking at the fact that the balances are now £2,000,000 higher than they were at the same period of last year, although at the end of that year there was a surplus of £1,250,000 — taking all these circumstances into consideration, they see no danger of any deficiency in the revenue of the present year. I now come to the question of the prospective deficiency. In very quiet times there is no great objection—although it is a new system, and one which sprung up with the income tax—to making prospective arrangements; but when you have to deal with very uncertain circumstances, the adoption of such a course is utterly impossible. The noble Earl, in that speech to which I have already alluded, said that if Her Majesty's Government could show that there would not be a deficiency of 1453 £2,000,000 next year he would not vote for the Motion of my noble Friend. I am afraid that I have no chance of obtaining his vote, because I utterly decline to make any estimate for next year. There would be no safety in doing so. No doubt if you compare the two years, allowing for the loss of taxation by the expiration of laws, what with the arrears of the malt and hop duty and other fallings off, there will be a deficiency of £2,000,000; but if you take the normal increase of revenue, and add to that the increase which has always arisen upon any large remission of taxation, though I make no estimate of what that may be, yet past experience shows that it is impossible to put it at less than £1,000,000, and when you add to that the £250,000 saved by the falling in of the Long Annuities, your deficiency, without going into any other calculation, instead of being £2,000,000, will be reduced to something like£750,000. I saw it stated in a leading article of the The Times the other day, that my noble Friend the noble Baron (Lord Monteagle) is the pivot upon which the British Constitution turns. I was not aware of the fact before, and I venture to think, for reasons which I will state, that he is not even the pivot upon which this question turns. My noble Friend is well acquainted with financial subjects. Formerly a Chancellor of the Exchequer himself, he has great knowledge and great love of finance, and has been in the habit of bringing his views upon it before your Lordships, as it was natural that he should do; but with regard to the conduct of this House, as a House, my noble Friend is nothing more than any other able and distinguished individual among your Lordships who sometimes takes part in your debates. He has no pretensions to lead a great party; he can only attract those whom his reasoning, his arguments, and his eloquence convince. With respect to the noble Earl opposite (the Earl of Derby) the case is entirely different. I was surprised that, in addressing the deputation to which I have so often referred, he seemed to dwell upon a distinction which he supposed to arise from the Motion for the rejection of this Bill being made, not by himself, but by the noble Baron. Why, surely this is not a question so insignificant that the noble Earl was waiting to see whether or not some independent Member of your Lordships' House took it up. He must have had in his own mind clear views as to whether it was of sufficient importance 1454 for him to undertake it himself, or whether he should leave it entirely loose. Well, my Lords, I have the greatest possible admiration for the ability, the character, and the position of the noble Earl; I am not sure that I have not almost been wanting in good taste in too often alluding to the admiration which I have felt for those qualities; but that feeling is not without exception. I have the greatest respect for his gifts and attainments, but there is one gift which he does not possess. That one gift is the gift of prophecy, which no human being will say he possesses. He has indulged in prophecies with regard to trade, navigation, and always without success, and in every question of finance his predictions have been signally unlucky. I have alluded to the alarm he expressed with respect to the remission of the soap duties. In the same year another question arose. My right hon. Friend (Mr. Gladstone) has been incessantly taunted with the mistake he made as to the amount which the succession duty would produce. He intimated that it would produce more than it has actually done. He has satisfactorily explained the cause of this in the other House this year. My right hon. Friend was not alone in his expectations of a large return from the succession tax, because the noble Earl himself proved by figures and details that that impost would extract from the pockets of the unfortunate landowners a sum of £4,000,000 sterling per annum, or quadruple the amount which it has actually yielded. In his speech on the Customs Duties Bill, on the 22nd of June, 1846, the noble Earl said—I am about to deal with this measure chiefly on the score of revenue; for I beg your Lordships to observe that you have at this moment a calculation of only a very small surplus revenue, even with things as they are, for the service of the current year; and if the calculations respecting the revenue which I have made are accurate (and I have taken every pains they should he so), those who are in office this time twelve months, whoever they may be, will be in great danger of experiencing a deficiency in the revenue. Yet, my Lords, it is under these circumstances that the Government think it wise and politic to introduce a Bill for the purpose of reducing or repealing the duties on numerous most important articles. I am aware that a certain increase in the consumption will make up part of the loss, but that there will be a serious defalcation of revenue arising from the reductions proposed by this Bill will readily be admitted on the part of Government themselves."—[3 Hansard, lxxxvii. 788.]That was spoken by the noble Earl opposite in 1846; and what is the answer to be given to it? On the 22nd of February, 1455 the following year, the then Chancellor of the Exchequer said—The right hon. Gentleman who preceded me in office made his financial statement on the 9th of May last year. He stated that he anticipated a surplus from the ordinary revenue of £76,000, and from extraordinary sources—namely, money from China, of £700,000, making a total of £776,000. By subsequent legislation foreign sugar was made admissible into this country, and in nine months, from April to December, the duty paid on the foreign sugar imported amounted to £304,000. That, of course, is an item which the right hon. Gentleman could not calculate upon when he made his financial statement, but adding the sum derived from the sugar duties to that which the right hon. Gentleman anticipated, it would give a surplus of only about a million of money. If, however, hon. Gentlemen will refer to the balance-sheet of the 5th of January, they will find that the produce of the revenue far exceeds that calculation, for the surplus amounts to £2,846,000. The progress of the revenue since the 5th of January has exceeded again, beyond all expectation, the produce of the corresponding quarter, and I think the probability is that I should be fully justified in stating that when the period comes to which the calculations of the right hon. Gentleman referred his calculations will be still more exceeded, and that the surplus of the 5th of April will be even still more considerable than that which I have stated as the surplus on the 5th of Januarv."— [3 Hansard, xc. 321.]I say, then, that the noble Earl, when he comes forward as the head of the great Conservative party, and proposes to support with all his influence the Motion of the noble Baron, by which this House will in effect take upon itself the financial duties that properly belong to the Executive Government and the House of Commons, surely ought to show that he has some fitness for the task. The same noble Earl, I find, stated to the deputation—We know nothing with regard to the question of any substitute at all. I was not aware that this repeal was taken as a substitute for any tax which was imposed. It is part of the general financial statement made by the Government, but I have never seen in any quarter, and certainly not before the House of Lords, any proposal of an alternative tax.My Lords, it seems perfectly incredible that the noble Earl, taking these duties upon himself, does not appear to have read the debates of the House of Commons upon those matters of finance which we are to correct, and should not even be informed by his political Friends in that House that Motions were made there by Conservative Members and supported by all the Conservative leaders, but which were rejected after long debate by a decisive division. I now come to a more extraordinary statement of the noble Earl. He is reported to have assigned, as a reason for not giving 1456 up the paper duty, that it is not a declining but an increasing tax. I should really like to have an explanation from the noble Earl on this point. Does he not know that every Excise duty which has been repealed of late years was an increasing, not a declining duty? Or does he mean to say that the course we have taken in all these cases, which has, I think, been so fruitful of benefit to the country, was a wrong course, and one that ought not to be followed by any further remissions of the same kind? In his address to the deputation the coble Earl said—But you must allow me to recall to your recollection that when in 1858 or 1859 (I forget which it was), I made use of the expressions to which reference has been made by Mr. Serjeant Parry, and when Mr. Disraeli in the same year, as Chancellor of the Exchequer, assented to a Resolution of the House of Commons, stating that this was, in point of principle, an objectionable tax, we, at the same time, objected to a further Resolution which was proposed to be added to it —namely, that the financial arrangements of the country should be made in such a manner as to enable that tax to be forthwith taken off, or some words similar to those, and that that was a year in which, having considerable means at our disposal, we preferred reducing the income tax, and we preferred reducing the tea and sugar duties. We thought that the reduction of those two taxes was more important than the taking off of the paper duties, and we gave the preference to those two, and under those circumstances declined to take off the paper duties.Now, Hansard is a book often consulted by your Lordships, and we have many copies of it in our library; and if we resort to that authority we shall find that in that year Mr. Disraeli, the Chancellor of the Exchequer of the noble Earl's Government, made a long financial statement, the pith of which was shortly this—that instead of having a large surplus the Government had a deficiency, and a deficiency of how much? Why, of £4,000,000; and instead of reducing the tea and sugar duties, they borrowed a sum of money in order to meet that large deficiency; they repealed certain Acts of Parliament entailing on them the obligation of their repaying the other sums; and they also raised the duties on Irish spirits, on cheques, and stamps; the whole yielding them at the most an estimated surplus not so great as that which the noble Earl thinks so small when it figures in Mr. Gladstone's Budget. After that, I think the noble Earl is really out of court in advising your Lordships to take a safe and prudent step in the financial matters of the country. I believe there are on this side of the House noble Lords emi- 1457 nently fitted to deal with financial questions, and no doubt there are noble Lords opposite who possess the same qualifications, although I am not so well acquainted with them. But there must be others who have come up to-day from the extreme end of the kingdom, and who are too attached to hunting, literature, and other pursuits that are best carried on in the country, to attempt to master the principles or the details of finance; these noble Lords, knowing the vast information and experience of the noble Earl opposite upon all other matters, may think it perfectly safe on this occasion to put their consciences in his hands. But if the noble Earl's prophecies, as nobody will deny, have always failed — if his knowledge of finance is of the most limited description—if, indeed, that subject is so repugnant to his capacious and well-stored mind that he cannot for two consecutive years remember, but, on the contrary, jumbles and confuses together all the facts and figures of his own department as Prime Minister and First Lord of the Treasury, then I think he places noble Lords on his own side in a difficult and even false position in respect to how they are to vote to-night. My Lords, I believe the Amendment of which notice has been given is not in accordance with the spirit of the constitution; nor do I think it consistent with the dictates either of justice or wisdom. I shall very briefly state the grounds of my opinion why it is not in accordance with the spirit of the constitution. The greatest of our debates since I have had the honour of sitting in this House was one in which a noble and learned Lord (Lord Lyndhurst), whom we all rejoice to see as strong and vigorous now as then, took a leading part in advising your Lordships as to the course you should adopt. That noble and learned Lord then laid down the principles of constitutional law, and those principles were sanctioned by this House. I of course allude to the discussion on the question of life peerages. He told us it was of no use going back to ancient precedents—it was of no use telling us that Coke and Black-stone and other learned authors laid down the law of the subject in the most distinct manner. They were of no authority. We must come to the usage and practice of the Constitution since it has been defined and settled in its best days—namely, from the date of the Revolution downwards. Well, this House adopted that reasoning. It is unnecessary, therefore, now to quote any 1458 learned writers. I myself rather regret this, because the other day I took occasion to read Blackstone, Hatsell, and Hallam, for the law on this subject. I did not find anything that really applied exactly to the case. I found they all admit the real technical power of rejecting a money Bill. I found they go further, and speak of the unreasonable extent to which the jealousy of the House of Commons was carried in respect to small and trifling alterations. This showed more than any rule the usage and custom of the House of Commons. They also give as a reasonable ground of jealousy on the part of the House of Commons that this House could not originate a tax or indirectly charge the people of this country. I myself, not being learned, cannot give an opinion upon these matters; but it seems to me that if your Lordships cannot alter the law so as to make the most trifling charge upon the people, it cannot be said that by rejecting a Bill for the remission of taxation you do not practically charge the people. I know there may be a technical difficulty, but as to the spirit of the thing, I conceive, if you adopt the noble Lord's advice to-night, you will to all intents and purposes impose a burden on the people. The legal technical right of rejecting I do not deny. The very preamble of the Bill shows it. The question being put four times to your Lordships' House shows it. Legally and technically the Crown may reject a Bill passed by the other two branches of the Legislature. That, to a certain degree, is guarded by the responsibility of the Ministers. The Crown undoubtedly has the technical right and prerogative to create 100 Peers to coerce this House; but for the Crown to exercise that right would be a gross and flagrant violation of the Constitution. The House of Commons has, I should also say, by the power of stopping the Supplies, a right to coerce both this House and the Crown; but in all these instances the power is tempered by constitutional usage, it is tempered by prudence. In every one of those instances, not excepting that under consideration, it has been tempered by usage and custom. The noble Baron, I know, will produce certain meagre precedents with regard to the rejection of Bills certainly affecting taxation and trade of one kind or another; but are these at all similar to what he proposes to-day? He proposes now, on mere fiscal grounds, as I understand, to reject a Bill repealing taxation, which Bill formed part of the finan- 1459 cial scheme submitted by the officers of the Crown; and therefore with the consent of the Crown, to the House of Commons, and adopted by that House. I say, I know of no precedent for the rejection by this House of a Bill remitting taxation, or even revising taxation, which formed part of a whole financial scheme so approved and recommended. If the noble Baron can produce such a precedent, I hope he will do so. My Lords, even if I were to grant, for the sake of argument, that the noble Baron is not only technically and legally right, but that in proposing such an unusual course to your Lordships he is within the pale of the Constitution, I ask, is the course he proposes a just one? Is it just to the people of the country when a remission of burdens affecting trade and industry is proposed by the Government and assented to by the House of Commons — is it just to the people after the remission and imposition of taxation have been balanced, that your Lordships should reject one portion of it, so as to saddle them with additional taxation? I think it the most unfortunate course your Lordships could adopt. I had a letter from a very intelligent tradesman of the town of Carmarthen, who stated that the tax on the paper he consumed would more than enable him to pay his income tax. He was well satisfied with the Budget, and hoped by his savings to be able to drink a little cheap French wine, but he was now to be exposed to a double tax. I will tell you another set of individuals to whom the conduct recommended by the noble Earl is unjust—I mean the Board of Inland Revenue. Is it fair to gentlemen whom you clothe not only with administrative but with judicial attributes, and on whom the whole onus of the collection of taxes depends, is it fair to impose on them the administration of a law which they tell you they cannot suggest any means of amending, but which if carried out must be unjust and unequal to a large portion of the taxpayers? I say it is not just. Then, is it wise in your Lordships, of all branches of the Legislature—admitting the constitutional right, is it wise of your Lordships to set the example of stretching your constitutional right to the utmost? Is it wise to take the people by surprise as much as you have taken them? You have taken them by surprise, but—perhaps that comes more under the head of justice than of wisdom—is it fair to persons in every branch of the paper and publishing trade, 1460 who in the usual course of proceeding have embarked in contracts on the faith of this measure having passed the House of Commons, and who will lose not hundreds but thousands by the purchase of steam engines and land on which to extend their factories, as well as in numerous contracts both at home and abroad? My Lords, I think the injustice to these men will be great indeed. Then, with respect to any real public objects proposed by the noble Baron, in the consolidation of the finances for the present or the future, is this a wise proceeding? The principle has always been to limit to the smallest possible space the inconvenience arising from any change in our system of taxation affecting the commercial and industrial world. As soon as the House of Commons have declared their opinion in favour of the remission of any Customs duty it ceases at once; and your Lordships in agreeing with the noble Lord will now be disturbing all confidence in the decisions of the House of Commons, and it will be impossible for the Government to propose the most beneficent improvements in taxation, without our whole merchants, manufacturers, and tradesmen being kept in a state of anxiety and suspense two or three months longer than they might otherwise have been. With regard to revenue, is it perfectly wise to put yourselves in opposition to the House of Commons? I sincerely hope the House of Commons will show the utmost moderation and temper with regard to the interests of everybody in view of any decision to which your Lordships may come to-night; but is it perfectly wise to take an unusual and exceptional course, and to trust entirely to the moderation and temper of the Commons that no evil results shall arise? The House of Commons will be placed in a great difficulty, and to this I would call the special attention of the noble Earl opposite. You by this act tonight certainly take an unusual course; and if there was anything wanted to make this more unpalatable to the House of Commons, I think you have it in the speech of the noble Earl to the deputation upon this subject. The noble Earl talks of permanent taxation, and he says:—When you state that refusing the repeal of a duty is equivalent to the imposition of a new tax, and when, further, I think I caught the expression in the address of a loose practice having prevailed of passing duties for a term of years, definite or indefinite, I must protest, in the first place, against that being termed a loose practice which has been brought in, because it is a practice 1461 which, if it were disregarded, would destroy the very essence of our constitution.["Hear, hear."] That the noble Earl should cheer that observation I can understand, but that any other Member of the House should cheer it utterly takes me by surprise. [A laugh.] This is no laughing matter. The noble Earl goes on to state:—There are certain great departments to be maintained, certain great services to be performed, which it is absolutely essential should not depend upon the annual vote of Parliament, and which the Lords and Commons, feeling together that they ought not so to depend, have placed nut of their own power and have passed permanent Acts for supplying the means of defraying the expenses of those departments, and have also provided that the appropriation to those departments should not be interfered with by annual vote.What does that mean? Does it mean that you are to take away the right of the Commons to stop the supplies. ["No, no."] What else does it mean? If it be the duty of the House of Commons to keep permanent taxation for the purpose of keeping up certain departments? I hope the noble Earl will take the opportunity in his speech to-night of explaining this part of his address, and that there would be a mistake in coupling the rejection of the Bill with such a declaration. There is, my Lords, another view of our position which may very properly be taken in dealing with this great question — I allude to the internal state of the country. The noble Earl and those who act with him, I apprehend, feel no apprehension in reference to the internal state of the country, for never did greater order—never did greater tranquillity prevail throughout the land than at the present moment. At no period, I may add, did a greater degree of soundness manifest itself in its trade, its agriculture, and its manufactures, while it is, as I speak, rich with the glorious promise of future production. The employment of the poorer classes, too, is in a state the most satisfactory, causing the diminution of poverty and crime. What ground for financial alarm is there, I should like to know, to be found in such a position of affairs? None; and I shall not, therefore, mince the matter, but shall take it for granted that many among your Lordships look with some anxiety to foreign countries, and see certain signs in Europe which you think may possibly lead to war, and to complications which may result in dragging England into the contest. You take this view, and you seek to make due provision 1462 against the contingency which you apprehend. Heaven forbid, my Lords, that I should give expression to a single syllable which would tend to encourage such an apprehension in the slightest degree; but if, unhappily, such a consummation as that to which I allude should arrive, what, let me ask, would be the best position in which we could stand to meet its approach? Which would be more desirable, that its advent should find the two Houses of Parliament acting with cordiality together, without a particle of jealous feeling towards one another, under their beloved Sovereign, directing in unison the energies of the wealthiest and the most public-spirited nation on earth; or that it should come upon us at a moment when a series of recriminations between the two branches of the Legislature had sprung up—and nobody can tell how soon they might under a certain state of things break out—affording a scandalous spectacle to the other nations of Europe? Do you suppose, my Lords, that you would in the latter ease find yourselves in a better position either to carry on diplomacy or to prosecute war than you would in the former, even though you had to aid you some few hundred thousands pounds extracted from a tax which no one among us desires to see permanent, and which is now seriously damaged as a source of revenue? There is one other consideration which I would suggest to your Lordships' notice before I sit down. Is it wise for yourselves, or for the interests of this House—which I believe stands as high now in popular favour and esteem as it did at any period of its existence—to take the course which the noble Earl opposite asks you to pursue? One great proof, my Lords, that I am right in saying you do hold such a position in public opinion is to be found in the fact that no writing, speech, or declaration hostile in spirit to this House can be made that the attack does not immediately fall flat to the ground, being devoid of any substantial foundation. Is it prudent, then, for your own sakes to afford what, in accordance with my view, might be construed into a resonable ground of complaint against you, and to do that which in accordance with the view of almost every one among us must appear to be calculated to furnish food for declamation to those who may seek to injure this branch of the Legislature as one of the institutions of the realm? It was, I think, Mr. Burke, who said that one of the most critical and invidious 1463 functions which the House of Commons had to discharge was to originate the whole weight of taxation, inasmuch as its hand was felt and seen in every burden that pressed upon the people. This system has, however, hitherto worked well, connecting as it does taxation with representation. Would it be wise for your Lordships to introduce a new system, and to have your hand, instead of that of the House of Commons, felt in every burden which presses upon the people, thus virtually and practically severing taxation from representation? My Lords, I have done. It remains for me simply to thank you for your unexampled kindness and indulgence, and to assure you that the observations which I have just offered to you have been made with feelings as earnest and sincere as any by which I have at any period of my life been animated, and with a strong hope that your Lordships may see the expediency, independent of all party considerations, of avoiding, by your decision to-night, the occurrence of a state of things the direct or indirect consequences of which it is impossible for any one among us to predict.
§ Moved, That the Bill be now read 2a.
§ LORD LYNDHURST
My Lords, the noble Earl who has just spoken, has done me the honour to refer to certain opinions which I expressed on a former occasion; but I trust that I shall before I sit clown be able to satisfy your Lordships that the remarks to which he alludes have no bearing upon the present case. I hope, therefore, I may be allowed, even at this early stage of the argument—not proposing to myself to enter into the whole question under discussion, confining myself to the preliminary and most important question of the privileges of this as contrasted with those of the other House of Parliament— to trespass for a short time on that indulgence which you usually exhibit to those who address you on subjects of this nature. There can, my Lords, be no party question —no possible party question—involved in the consideration of the privileges of your Lordships' House. All we have to do in dealing with the subject is to ascertain what those privileges are, and then to act in accordance with the conclusion at which we may arrive. The noble Earl opposite alluded in the course of his speech to some meeting which took place lately, and which was presided over by a great number of the Members of the other House of Parliament. [EARL GRANVILLE intimated dissent.] 1464 My noble Friend then did not allude to the meeting but to the results of the meeting. That meeting was, I repeat, presided over by several Members of the House of Commons; and what, let me ask, were the doctrines which were there laid down? The doctrine, my Lords, that for this House to reject a money Bill which had passed by the other branch of the Legislature was an invasion of the privileges of that House, and an infraction of the rights of the people. Not satisfied with that statement, those who addressed the meeting declared such a proceeding to be an insult to the monarchy. I believe also that at that meeting, or at some other of a similar character, a Member of the House Commons who has great influence with certain classes of the people of this country told his audience that the Amendment of which my noble Friend opposite (Lord Monteagle) has given notice is an insult to the other House of Parliament. Under these circumstances, my Lords, I have felt it to be my duty—I hope not with impropriety, having on more than one occasion presided over your Lordships' deliberations in which position it fell within my province to examine into and to make myself, as far as possible, master of the question of the privileges of this House—to lay before you the conclusions on the subject at which I have arrived. You must not, however, for one moment suppose that I assume to myself any authority in dealing with this important question. I have no intention or desire to dogmatize with respect to it. I shall simply do that which I have done on a former occasion—lay before you, as plainly as I can, the facts, the principles, the authorities, and the precedents with which, in connection with this point, I am acquainted, leaving your Lordships—without any doubt as to the conclusion to which you will come—to form your own opinion upon the matter. Now, it is, in the first place, most desirable in such a discussion to get rid of all those points in regard to which no doubt exists. I do not dispute—nor can it be for a moment disputed—that we have no right whatsoever to amend what is called a Money Bill. We have, moreover, no right whatsoever to originate a Bill of that nature. Formerly, indeed, and for many years, a very sharp controversy took place between the two Houses of Parliament as to the existence of the right to which I refer. From the time of the Restoration to a considerable period after the Revolution there were 1465 cases in which this House exercised the right of amending money Bills brought up from the other House of Parliament with little or no dispute on the point. Controversies, indeed, sometimes took place which were carried on with no small degree of acrimony. All the cases on the subject are to be found collected in the 3rd volume of Mr. Hatsell, who I may fairly represent as being the advocate of the privileges of the House of Commons. I may observe that the result was that this House abandoned the claim. Why? Because they had no power to enforce it. If we amended a Bill which was sent up from the other House of Parliament, the House of Commons had the power of rejecting the Amendment. With them the Bill originated, and it was idle for us, therefore, to insist on a right which could not be enforced. But that principle does not apply to the rejection of money Bills. I take leave to say that there is not an instance to be found in which the House of Commons has controverted our right to reject money Bills. Over and over again, I repeat it, nothing can be found in the Parliamentary Journals or in any history of Parliamentary proceeding to show that our right to reject money Bills has been questioned. There is a curious anecdote to be found in Roger North's Examen, which bears upon the point. A money Bill came up from the other House, in which there was supposed to be something or other informal or improper. There was a payment to be made of some money on account of the past year, and great difficulty existed as to what course should be taken. Roger North, who knew well the privileges of both Houses, states that it put the House of Lords in a dilemma. He says we could not mend the least punctilio in a money Bill; but he admits distinctly in terms that we had a clear right to throw it out altogether, although we did not like to exercise that right on that occasion, because we were afraid that a similar Bill would not come up, and we wore anxious to pass the Bill. They got out of the dilemma in rather a curious way. After two days' discussion, some noble Lord, a little behind the scenes apparently, asked to see the Bill, to have it laid on the table, and when it was produced and examined it was found to be perfectly correct; there was an end of the difficulty, and the House passed it. Still, I do not mean to rely on the authority of Roger North, well acquainted though he was with the privileges of both 1466 Houses; but before going to the authorities which established those privileges I will consider the arguments and authorities of those persons who oppose our privileges. I find there is a Resolution of the House of Commons in 1671, which I will read to your Lordships. On a Bill for an Imposition on Foreign Commodities the Commons resolved,—That in all aids given to the King by the Commons the rate or tax ought not to be altered by the Lords.Your Lordships do not dispute it. That is an authority on which our adversaries rely. Another authority on which they rely is a Resolution of the Commons in 1678, which I will also read to your Lordships. On the 3rd of July in that year they resolved: —That all aids and supplies, and aids to His Majesty in Parliament, are the sole gift of the Commons; and all Bills for the granting of any such aids and supplies ought to begin with the Commons; and that it is the undoubted and sole right of the Commons to direct, limit, and appoint in such Bills the ends, purposes, considerations, conditions, limitations, and qualifications of such grants; which ought not to be changed, or altered by the House of Lords.These are the two authorities which are relied upon by the adversaries of our privileges, and they deduce from them that the Lords have no power to reject money Bills. These authorities say that we have no right to amend a money Bill and that we have no right to originate a money Bill, and, by a curious kind of logic, they conclude that we have, therefore, no right to reject a Bill of that kind. That is a logic peculiar to themselves, which certainly would not meet with the approbation of the great Stagyrite. My inference from these documents would lead to a directly contrary conclusion; but that I pass over. But what I complain of is this,—I complain of the want of fairness, the want of candour,—I will not say of honesty, because that is too strong a word—displayed in quoting these passages, and omitting to quote others which are to be found in the self-same book, and which lead, as far as inference can lead, to directly the opposite conclusion. Is this fair? Is this candid? Can you place any reliance upon persons who adopt this style of argument. In fact, it is destructive to the case which they endeavour to set up. In the very book whence the quotations I have read are drawn you will find what I am now about to read. In 1689—one of the best periods in our history—the Lords amended a 1467 money Bill—a Poll Bill, I believe. The Commons disagreed, and desired a conference, giving their Reasons at that conference. In their Reasons, which are stated with the utmost elaboration, with the utmost minuteness, and with a kind of superabundance of words which seems to show that they meant to sweep everything into their net, they admit in the most unqualified manner, not only the power but the right, the constitutional right, a right equal to that of the House of Commons, to reject money Bills when they think proper, and when they think the interests of the country require it. I defy any person at all acquainted with the law and constitution of this country to entertain a different opinion after having sifted and examined the subject even in a superficial manner. I have some scruple in reading the Reasons stated by the House of Commons, on account of the superabundance of words, but still they will show how earnest the Commons were on the subject—how eager they were to state their own privileges— and then you will see the value of the admissions they make as to the authority of this House. On the 9th of May, 1689, they sent up their Reasons for desiring a conference on the Amendment of the Poll Bill by the Lords. Among them are the following—and this extract, I beg your Lordships to observe, is taken from the same book as those I read before, which are relied on by our adversaries:—All money aids and taxes to be raised or charged upon the subjects in Parliament are the gift and grant of the Commons in Parliament, and are and always have been, and ought to be, by the constitution and ancient course and laws of Parliament, and by the ancient and undoubted rights of the Commons of England, the sole and entire gift, grant, and present of the Commons in Parliament, and to be laid, rated, raised and paid, levied and returned for the public service and use of the Government, as the Commons shall direct, limit, and appoint, and modify the same. And the Lords are not to alter such gift, grant, limitation, appointment, or modification of the Commons in any part or circumstance.Nothing can be more full, nothing more precise, than this phraseology; nothing can show greater anxiety to state what their rights are. So far they are not disputed by your Lordships; and then the extract goes on:—Or otherwise to interpose in such Bills, than to pass or reject the same for the whole, without any alteration or amendment, though in ease of the subjects.Nothing can be more distinct than this admission. They state their own rights 1468 forcibly, and they state the exception in favour of the Lords with equal force and precision, but not with equal abundance of words. But they do not stop there. They go on, and use a kind of simile: —As the Kings and Queens, by the laws and constitutions of Parliament, are to take all, or to leave all, in such gifts, grants, and presents from the Commons, and cannot take part and leave part, so are the Lords to pass all or reject all, without diminution or alteration.This is not an admission of a power, but of a right; an admission by the Commons of a constitutional right of this House. And this does not stand alone. It is to be lamented that those Gentlemen who contend against the privileges of this House, and who have quoted certain passages from this very work, had not the fairness to cite the one I have now read, which is to be found in the very next page to that from which their extracts were taken. I have another case of a somewhat earlier date— the year 1671. And it is remarkable that the very document which I have just read, should have been founded on the proceedings to which I am now about to call your Lordships' attention; so that in reading the case which they have quoted, they must have had this very document before them. A Bill for an Imposition on Foreign Commodities came up from the House of Commons, and was amended by the Lords. The Commons rejected the Amendments. A conference was demanded, and the proceedings were continued for several successive days. Now, mark what took place. Your Lordships maintained it to be the greatest security to all the subjects of the kingdom, that the Houses, by their constitution, do not only give assistance, but are mutual checks upon each other. What was the answer of the Commons? "So they are still," they said, "for your Lordships have a negative to the whole." There is a marked admission on the part of the other House. Another part of the argument was, "If the Lords may deny the whole, why not a part? Else the Commons may at last pretend to bar a negative voice." The reply of the Commons bears on the present question: "The King must deny the whole of every Bill, or pass it; yet this takes not away his negative voice; why should it take away yours?" My noble Friend (the Earl of Derby) on Saturday received a deputation, which at great length, and with marvellous audacity, endeavoured to dissuade him from opposing this Bill. But they took nothing by their motion. And when, as they were about to retire, one 1469 more pugnacious than the rest took a long and lingering look behind, and endeavoured to draw my noble Friend into a conflict, the noble Earl wisely and prudently refused to be entrapped into any admission. My noble Friend put the question very clearly when he asked—"What is the use of our discussing Money Bills when they come up to this House, if we have no right to reject, as we admit we have no right, to alter them?" Noble Lords will recollect when the Succession Duty Bill was sent up from the other House, it was very warmly discussed and debated by your Lordships. My noble Friend Lord Aberdeen—whose absence on the present occasion I greatly deplore—was then at the head of the Government; a man of high talent, and, if possible, of still higher character, and of great reputation, not alone in this country, but throughout Europe and the world. That noble Lord has been a Member of your Lordships' House for sixty years, and from his station, character, and acquirements, no one can be more conversant with our privileges. What was the language held by Lord Aberdeen in 1853? —Now your Lordships cannot alter a tittle of this Bill; not a particle. You may—and this you have a full right to do—throw it out on the second reading. That is perfectly within your Lordships' competence to do."—[3 Hansard, cxxvii. 671.]It is for your Lordships to consider, in this particular case, whether it will be prudent and proper, having regard to the interests of this country, that you should adopt such a course. My Lords, my noble Friend opposite (Earl Granville) has done me the honour to cite my authority. What was the nature of the circumstances which led to the decision he has referred to? It was stated that 400 years ago the Sovereign had created a life peerage, but no instance had occurred since that time. The argument I made use of, which was supported by many noble Lords, was that everything in this country depends on long usage and prescription; when, therefore, no such right has been exercised for 400 years, and no claim has been put forward during that period, it ought not to be acted on, and cannot be considered as part of the law and constitution of the country—particularly after the many changes, including a revolution and a restoration, which have since taken place. That was my argument; but does it apply to the present case? My Lords, I shall be able to show that within a recent period this right which we claim has been acted on without dis- 1470 pute, not in one, two, or three cases merely, but in numerous instances. I bold a list of these cases in my hand, and I have selected the more modern. In 1807, a Bill came up to this House for continuing and granting certain duties on malt. It was rejected. I am not prepared to say whether the Bill was rejected in form, or whether, according to the usual course, the Motion was that it be read a second time, or committed, that day three months. Again, in 1789, a Bill was passed through the House of Commons, and came up to your Lordships, for imposing a duty on cocoa-nuts. It was rejected on the 6th of August in that year. A similar Bill was brought up in 1790, and again rejected. So that not only are there admissions of our right by the House of Commons over and over again, in the most distinct terms —not only has there been no instance in which they have disputed that right—but cases have occurred in which it has been directly affirmed and exercised by this House without any complaint on the part of the Commons. But a distinction is drawn by my noble Friend opposite, who says that those were Bills for imposing taxes; whereas this is a Bill to relieve from taxation; and my noble Friend alleges that a wide distinction is thereby created. That is certainly a novel doctrine; I never heard it broached before; there is no precedent for it; no authority can be cited in its favour; no dictum even is given. But how is the practice? I hold in my band a list of certain Bills for relief from duties, which were rejected by your Lordships' House. I select a few. In the year 1790, a Bill was passed through the Commons to relieve the coasting trade of Great Britain from stamps on certain documents, and abolishing bonds respecting the Isle of Man. This Bill, which I believe had reference to smuggling, was rejected by your Lordships; and there was not a murmur of complaint that I can find even a trace of. What becomes, then, of my noble Friend's distinction? What becomes of his 400 years' prescriptive right which he cited against myself? But I should be sorry that the case rested even here. In 1805, a Bill was sent to this House for abolishing certain fees payable to Custom House officers in England; that was a Bill for relief from taxation, and it was rejected by your Lordships without complaint. In 1807, a similar step was taken with respect to a Bill which proposed to abolish payments to I Custom House officers in Ireland, and no 1471 complaint followed. In 1808, a measure was carried through the Commons to repeal duties on coals carried coastwise in Wales, and grant others in lieu thereof. Here was a Bill to remove and to impose taxation, embracing consequently both alternatives, and it likewise was rejected by your Lordships. So much for the authority and antiquity of the claim which is said to be obsolete! Then, my Lords, in 1811, there was a Bill passed by the other House to suspend for one year the duties on corn-wash for distillation of spirits in England, and to permit the distillation of spirits from sugar. That was a Bill for the relief of duties, and the amount of those duties was considerable. That Bill was discussed in the House of Commons at great length. All the agricultural interest took part in the discussion, and when it came down to this House it was again discussed at great length. Lord Liverpool was then Minister. He took part in the discussion, as did also Lord Bathurst, the Minister for the Colonies. After a long debate the Bill was thrown out. Did Lord Liverpool—the Minister of the day under whose authority the Bill was introduced— did he make any complaint? Did the House of Commons make any complaint? Not a single syllable was uttered on the subject. So far from that, when a few days afterwards the Chancellor of the Exchequer brought in a Bill to make amends for the loss of duties, he merely said, "I introduce this Bill in consequence of the rejection of a Bill by the other House." Never was a subject more fully discussed than that was, and no complaint whatever was made by the Lower House. But, my Lords, this ease is still stronger. It is a case of a tax in progress. The moment a Bill has passed this and the other House, and received the Royal Assent, it becomes the law of the land. All individual authority on the part of the House of Commons is at an end—has terminated, and the House of Commons has no more authority over it than your Lordships have. It is law, and, like any other law, can only he revoked by the joint action of the two Houses of Parliament and with the consent of the Crown. I was surprised to hear my noble Friend the other day admit, as I understood it, that the whole permanent revenue of the country can be touched by the House of Commons without the consent of this House. However, I think I have gone sufficiently, if not too much, into this matter; but the question is of im- 1472 mense importance, not only to the Constitution, or to this or the other House, but to the country, and that I must plead as my excuse. I have stated distinctly what rights we claim and what rights we have exercised. We exercise those rights not for ourselves, but for the people. I hear it said that the House of Commons may order their officers not to levy a tax of excise. The House of Commons may annihilate that or any other law, and leave the responsibility upon their unhappy agents who are the instruments of their caprices. But that is not a subject for discussion here. It would be indecent in me —it would not be respectful to the House of Commons nor to your Lordships —it would not be respectful to the Sovereign—it would not be respectful towards myself, were I to enter upon such a consideration. I hear it said, too, that a discussion took place respecting a substitution of a penny of income tax for these duties, and that the substitution was agreed to. Whether a penny of the income tax was or was not meant as a substitute for these duties I have no means of knowing; but this I do know, that we could not strike out that penny. We had no right to amend that Bill, and if we had attempted to amend it we should have been told at once it was an invasion of the privileges of the House of Commons. This is the answer I give to the charge of "sharp practice" which I believe an hon. Member who has considerable influence over some classes in this country, to whom I have before referred, has endeavoured to fix upon your Lordships. I may be told that there will be more money than we want—that there is a surplus. That is a perilous matter into which I do not choose to enter. It forms no part of the programme which I have marked out for myself. I leave that to my noble Friend opposite (Lord Monteagle), who I have no doubt will sufficiently clear up that portion of the subject. The question comes to this:—If your Lordships are satisfied, as you must be, that you have not only the power but the constitutional right to reject this Bill, and if you are satisfied that there is an actual deficiency, that next year there must be a most enormous deficiency, and that the present state of Europe is such as to create continual anxiety, then I ask your Lordships will you consent to give up, not for the present year only, but permanently, a sum of nearly a million and a half? That is the proposition I put to your Lordships, 1473 and I am satisfied what your answer will be. My Lords, as I said I would confine myself to this question of privilege, I will only further observe that the illusions, perhaps I may say the delusions, created by the introduction of the Budget seem to have passed away, and we have learnt that, although brilliant eloquence has charms, yet, like other seductions, it is not without its dangers. The same schemes may bear the impress of genius, of imprudence, of rashness. Satis eloquentiœ, sapientiœ parum is not an irreconcilable combination. If my noble Friend should move the Amendment of which he has given notice, I shall give him, fur the reasons I have stated, my cordial support.
§ LORD MONTEAGLE
My Lords, I have heard with equal gratification and conviction the arguments and the authorities cited by my noble and learned Friend. They set at rest conclusively the objections raised against my Motion, at least that objection which has been relied on most strenuously out of doors, a denial of the strict Parliamentary right of the House of Lords, as proved by law and usage, to reject this Bill. This is rashly stated to be unconstitutional on the part of the House of Lords. As such it is denounced to be an usurpation of the privileges of the Commons, and is described as constituting the "head and front of our offending." This assertion constitutes the main stay and prop of the adverse argument. But after my noble and learned Friend's speech I do not think any one will be disposed again to question the full and unqualified right of the House, admitted by high authorities and sanctioned by uncontradicted practice, to deal with any Money Bill, as a whole, either by accepting or rejecting it. If the arguments you have heard have carried conviction, as they must have done, not only to your Lordships' minds, but conviction to the public mind also, there is an end put at once and for ever to those charges that have been so loosely and, I will say, unpardonably brought against this House. It is but a small matter that one of the humblest Members of this House, like myself, should have been made a special object of animadversion for the course I am about to take. But charges against your Lordships' House as a branch of the Legislature cannot he so lightly passed over. Before going further allow me to say that the responsibility for this Motion rests with myself alone. Permit me to say that, however gratified 1474 and honoured I may feel by finding that on this question my opinion is supported by the earnest approval of the noble Earl opposite (the Earl of Derby), still I make this Motion as a matter of duty to myself and I may add to the country, without concert with him. In doing so I disclaim any possible attempt, by association, combination, or confederacy of any kind, to deal with this question either in an uncandid or an unparliamentary manner. The resolution I formed and announced of inviting your Lordships to reject this Bill was exclusively my own. The noble Earl, I believe, was as ignorant of my intention to give my Notice as I was unprepared for the unqualified cordial declaration of opinion on the part of the noble Earl by which my Notice was honoured. If it be true that what I claim is our right and privilege; if it can be proved that it does not rest upon our own assertion of the right, but on the admissions of the Commons themselves, there is at least an end of all the charges of seeking to interfere with the privileges of the House of Commons. I must say for myself, and though it may be presumptuous in me to use the expression, I assert for others as boldly that the Members of this House are as little minded to violate or undervalue the privileges of the House of Commons as they are unwilling to abandon their own. I believe such a privilege to be as useful to the other House of Parliament as to ourselves. In respect to both Houses I believe that the privileges of Parliament form an essential part of the Constitution of the country; they had not been the work of accident, nor the creation of a moment. They bad been carefully elaborated, and, at length, happily fixed. Like the rest of the Constitution, those privileges have grown up by degrees; and I agree with the noble Earl the President of the Council that it is to comparatively recent times, after our Constitution had passed through the throes of civil war and revolution, that we must really refer for guidance upon this question, rather than to times long antecedent. It was not till the seventeenth century that the Constitutional privileges of the two Houses were matured and consolidated, though debated and asserted long before. Even those who are but slightly acquainted with the Parliamentary history of England must know that in earlier times the Lords exercised a distinct and separate power with respect to Money Bills and taxation. 1475Distinct grants (observes Mr. Hallam) were made by the Lords and by the Commons; of these the latest was in the reign of Edward III. The language used in the reign of Richard II. was, 'We the Commons grant with assent of the Lords.'And Mr. May, our latest authority, admits further (p. 324) that—The Lords were not originally precluded from amending Bills of Supply; for there are numerous cases on the Journals in which the Lords' amendments to such Bills were agreed to.But, as I have said, it is unnecessary to go back to remote history. We may more safely refer to the period when our Constitution was matured, and if we do so we shall find that in this essential question, of the authority to reject a Money Bill, though neither to originate or to amend one, the right of the House of Lords has never yet been brought into doubt. This part of the argument has been so conclusively dealt with by my noble and learned Friend that it would be unbecoming as well as unnecessary in me to advert to it at any length. I do not therefore intend to refer to that part of the question in detail, except to point out in addition to what has fallen from him and in re-assertion of the main principle—not in corroboration of it, because no corroboration of mine is needed—some instances in which this matter has not been left in doubt, but has been decided after solemn deliberation. In the great case of 1671, for example, when on conference the Lords resolved—That by a new maxim of the Commons a hard and ignoble choice is left to the Lords, either to refuse the Crown Supplies when most necessary, or to consent to ways and proportions of aid which neither their own judgment nor the good of the people can admit.The reply of the Commons was—Your Lordships' first reason is from the happiness of the Constitution that the two Houses are mutual checks on each other. Our answer is, So they are still, for your Lordship have a negative to the whole.In 1689, when on the Poll Bill amended by the Lord3 the Commons asserted their own privileges with legal precision, they also concede to the Lords the whole privilege claimed by the present vote—The Lords cannot alter the grant proposed, or otherwise interpose in such Bills than to pass or reject the same without alteration or amendment, though in ease of the subject—.I repeat these solemn and indisputable judgments pronounced by the Commons themselves as laying the foundation for the mote recent precedents to which it is ne- 1476 cessary to refer. But before doing so I may allude to the confirmation of the same principle by Blackstone, vol. 1, p. 170—It would be extremely dangerous (he observes) to give the Lords any power of framing new taxes for the subject, it is sufficient that they should have a power of rejecting, if they think the Commons too lavish or improvident in their grants.Many of the later instances occurred during the existence of strong Governments, exercising, especially in this House, a powerful influence. On several of these occasions the question was decided after the Lords had been summoned to consider the question at issue; the House then pronounced a unanimous decision on the subject; the decision was communicated to the House of Commons; the House of Commons acquiesced; and from that time to the present, there is no instance of cavil, of dispute, or of protest on the part of the House of Commons against such a proceeding. One of these instances occurred in 1758, upon a Bill to discontinue for a limited time the duties payable on tallow imported from Ireland, brought up to this House from the Commons. A Motion was made in the House of Lords for the postponement of the measure for two months, thus practically rejecting the Bill. This Motion was carried, and the Bill was lost. Your Lordships will see that the same principle was involved as on the present occasion, whether the suspension was for two months or for any other period of time. The Bill was thrown out by this House, and no objection was raised by the Commons. I have heard a distinction suggested between the privileges of the Lords in respect to duties of Excise and of Customs. The distinction, if it existed, would be futile. The real point in question was the money Vote, and not the branch of revenue voted and appropriated. But such as the objection is, I can meet and disprove it. I refer your Lordships to a Bill passed by the Commons in 1816, in the case of an Excise Bill. In 1816 a Bill was sent to the Lords "to repeal the duties of Excise on stone bottles, and to impose other duties in lieu thereof." A Motion that it should be read a second time that day six months was made in this House and carried; and the House of Commons made no comment or complaint. I have omitted to notice the Silk Duty Bill of 1765 for laying additional duties on silk imported. This Bill was read a second time in the House of Lords, but the Motion to commit the Bill was negatived and the Bill 1477 lost. In 1783 a Bill to repeal certain Acts and to lay an additional duty on brass exported, was lost in the Lords by a Motion of postponement for two months. The third reading of a Bill for repealing duties on coals, culm, and cinders, carried coast-ways from South Wales, and granting other duties in lieu thereof, reached its third reading in the Lords. In this case the Lords were summoned to consider the Bill. A Motion was carried to postpone the Bill for three months, and the Bill was lost. In 1811, during the Government of Mr. Spencer Percival, (which in this House was most powerful), a Bill for suspending the duties on corn-wash used in distillation in England, and on sugar for distillation in Scotland, and charging duties according to the prices of materials, was brought before this House the Lords being summoned. The Bill was ordered to be read that day six months, and thus rejected. I have thus laid before you a succession of precedents, to which other might have been added, all illustrating and confirming the great principles laid down in 1671 and 1689. Those who maintain the opposite doctrine cannot pretend to point out one single conflicting judgment, or Resolution, during the last two centuries. As an officer of the other House—I mean Mr. May —is reported to have expressed an opinion to the contrary of that which I am now advancing, I wish to read a passage from his very able text-book on the Law and Practice of Parliament. After alluding to the sole and indisputable right of the House of Commons to originate taxation in these terms:—The legal right of the Commons to originate grants of money cannot be more distinctly recognized than by these various proceedings, and to this right alone their claim appears to have been confined for nearly 300 years. The Lords were not originally precluded from amending Bills of Supply; for there are numerous cases in the Journals in which Lords' Amendments to such Bills were agreed to. But in 1671 the Commons advanced their claim somewhat further by resolving nem. con. 'That in all aids given to the King by the Commons, the rate or tax ought not to be altered—;'He proceeds to quote the Resolution to which my noble and learned Friend adverted, and which I have subsequently quoted, which, while it affirms the right of the Commons to originate Money Bills and send them here, clearly reserves to the House of Lords the fullest power of rejecting as well as of accepting them. Mr. May concludes as follows:— 1478The functions of the House of Lords in matters of supply and taxation are thus reduced to a simple assent or negativeAnd again,—Thus the Crown demands money, the Commons grant it, and the Lords assent to the grant.But I wish your Lordships to consider further, that, by law and Parliamentary usage, the rights of the House of Commons are not merely limited to the origination, the framing, and the passing of Money Bills: another and an equally important right which they exclusively possess is the appropriation of the sums so raised. This right is uncontested. Your Lordships have nothing to say to the passing the Votes of Supply and to the framing of the Appropriation Act; we cannot alter a single grant which appears in anyone of those Acts of Parliament; but with regard to one and all of them we have full and entire power to deal with them as a whole, and to adopt or reject them. This power of appropriation is not affected by my Motion. God forbid it were interfered with by your Lordships. I only wish it were more vigilantly superintended by the Commons, and that the memorable Appropriation clause of Lord Somers were more rigidly enforced. Now, when it is said, "If you reject this Bill, you create a surplus of £1,400,000 in addition to the Supplies which have been already voted, and how is it to be expended," I wish to point out that not one farthing of this surplus can be issued or applied to the public service, except upon a legislative authority derived from the House of Commons — originating with them, one which it is peculiarly their function to frame, to which our assent is essential, but in which we are not entitled to make the slightest alteration. I said just now that a sum of £1,400,000 was affected by this Bill. But that does not sufficiently express the real fact. In truth, the amount on which you are called upon to decide by your vote to-night, is not £1,400,000 for one year, but £1,400,000 for an undefined term of years—it is a perpetual annuity to that amount. If you adopt the suggestion of the House of Commons and pass the Bill repealing this tax you will practically part with a sum of £36,000,000 sterling, that being the capitalized value of the annuity which you are now invited by the other House to repeal. The success of my Motion will preserve this sum for the Consolidated Fund, where it must come under the power of the House of Commons itself. For let me 1479 again remind your Lordships that nothing can be paid out of the Consolidated Fund except by virtue of an Act of Parliament; and when we are accused of wishing to diminish the power of the House of Commons, it should be recollected that not one single farthing of the tax which I propose to preserve can be appropriated except by a statute originating with the House of Commons. This enormous sacrifice of revenue becomes a very serious question when it is remembered—as has already been hinted at in debate—that a desire has been expressed on the part of some persons to diminish the security now afforded for the payment of charges placed on the Consolidated Fund, and that it has been suggested, in a quarter that certainly may not add to its authority with your Lordships, that the same course should be taken with regard to the expenditure for the Army and Navy—indeed, it has been suggested that it should be so contrived to make the taxation of the country distasteful to the whole community, thus rendering the payment of taxes hateful to the people, that they in their turn may insist upon cutting down the public civil and military establishment as the only means of ridding themselves of taxation. Your Lordships, I have no doubt, are fully aware of the perils of such a course. Every step taken towards diminishing the security now existing for the payment of charges on the Consolidated Fund strikes essentially at the credit of this country. That security is the foundation on which our public credit rests; that gives to our public securities the value they now so deservedly possess; and every step by which the national credit is struck at, or even by which a disposition is manifested, a desire shown, or an intention avowed of that character, lessens to a corresponding extent the security of the public creditor. In the security of the public creditor public and private interests are inseparably bound up. With respect to the allegation that it is your Lordships who are about to reimpose the paper duty which it is said will be levied and applied by authority of this House, I would observe that it is not your Lordships' vote that re-imposes that duty, supposing you should reject the present Bill; that annual revenue of £1,400,000 will still rest, not on your act, but on the statute law of the land, on the right of the Queen, Lords, and Commons to grant the sum; and on the legal appropriation of that sum by 1480 law, which cannot be changed by your Lordships or otherwise than by the sanction of Parliament. But in this matter— and I am not at all surprised that my noble and learned Friend should have called attention to the argument—we have been charged with what has been described somewhat discourteously as "sharp practice"—if we should re-impose this tax after having passed the additional million of income tax proposed as a substitute for it. I have already shown that this tax would not derive its power from us, but from the authority of the pre-existing law. Now, I request the noble Earl who has charge of this Bill to remember what took place in this House with regard to the Income Tax Bill. When the Income Tax Bill was passing through its third reading in this House, I desired some further delay; but on the declaration of the noble Duke (the Duke of Newcastle) who had charge of the Bill, that public inconvenience would result from the postponement of the measure, I abstained from pressing for its postponement, receiving an assurance that we should not thereby be prejudiced in the discussion of the Paper Duty Bill, which I then announced as impending. I think, therefore, that in candour my noble Friends on the Treasury Bench will admit that no obstacle should be raised to impede the fullest discussion on this Bill. We have, on the contrary, as free right to discuss it as if the income tax had not been already passed. Then it is said, what will become of the million produced by the additional penny laid on the income tax if this Bill be rejected? That is not your Lordships' business to determine. It is fully open to discussion elsewhere. It is competent to the House of Commons, if they can spare the million, to take a penny in the pound from the income tax—it is competent to them either to diminish the income tax by one million, or to apply the million to the diminution of the remaining war duties raised on tea and sugar. All these courses are still open to them; and I wish your Lordships to understand that your rejection of the Bill not only does not bind the future course of the House of Commons, but, on the contrary, that it gives them full power to apply that one million or £1,400,000, the produce of the paper duties, in any way that in their judgment may be deemed most conducive to the public service. But I now proceed to call your Lordships' attention to another part of the question that seems to me of 1481 the utmost importance. I wish to call your attention to a further effect that the repeal of the paper duty will, under our present circumstances, produce on the public credit. I ask those most conversant with mercantile affairs, whether it would be thought creditable (I might say decent) for a private individual to place himself in the position in which this Bill, if carried, would place the country. You have incurred a debt which you have promised to pay on a fixed day. In the month of November you are bound by law to pay to the owners of certain Exchequer bonds the sum of one million sterling. But what was the statement of the Chancellor of the Exchequer on this subject, made in his place in Parliament? He stated, at the very time that he was voluntarily diminishing the annual revenue by £1,400,000 a year, that "he was not in a position to make provision for the payment of the outstanding bonds." The fairer statement would have been that he was putting himself, and wilfully putting himself, into a position where he made it impossible for him to discharge this debt. Neither is this the first time you have postponed the payment of a debt of this kind, nor will it be the last, if you persevere in the proposed reckless sacrifice of productive and improving revenue. There are already outstanding two further sums of £1,000,000 each, which, in place of being paid off in the terms of the original contract, have been carried on and made charges on the income of 1862 and 1863. For those you will also have to provide. Parliament is thus establishing a precedent on which a private merchant could not venture to act without forfeiting his credit and seeing his name in The Gazette. Would such a trader obtain a certificate if made a Bankrupt? It is nothing less than this—you have a debt of three millions to meet, yet you are throwing away gratuitously an income equivalent to a capital sum of £36,000,000 which would much more than enable you to pay every shilling as it falls due. In the case of the private trader would not such conduct amount to a criminal misappropriation of assets. Let me add another observation on the condition in which we stand. It has been said elsewhere that the great object of the present provisional arrangements is to leave everything, as far as possible, free and open for the decision of the Parliament which will assemble next year. In that master-piece of oratory, the Budget speech, the Chancellor of the Exchequer declared that he wished to re- 1482 serve for Parliament the fullest and freest discretion. How is this consistent with the proposed sacrifice of £1,400,000 of paper duties? You are now pressed to take a step which prejudges the whole case to be decided in 1861, and commits you to two propositions—one being a reckless substitution of direct taxation falling on property, for indirect taxation imposed upon articles of general consumption. Such a step can not be taken perseveringly, and on a system, without the greatest peril. I am unfortunately old enough to remember, and Lord Brougham, were he present, could give your Lordships some striking reminiscences, of what took place in 1816 in reference to the property tax. That tax had been imposed by Mr. Pitt expressly as a war tax. In 1816, Lord Liverpool's Government proposed to continue the tax for one year after the peace in order to pay outstanding engagements which it was argued had been incurred for the war. Lord Liverpool's Government was a strong Government, yet not only was he unable to carry his proposition, but the detestation of this tax, in time of peace, was so strong and general that on its rejection a Motion was made in the House of Commons by Mr. Brougham that all the documents relating to the hateful impost should be burnt, in order to give a security to the country against its future re-enactment. We have had further experience in still later times. Have your Lordships forgotten the memorable Resolutions which were moved in your House in March 1842, and which state, in powerful language, the dangers and objections to an income tax in time of peace? Again, when my right hon. Friend, now Secretary for India (Sir Charles Wood), was Chancellor of the Exchequer he proposed a renewal of the income tax for three years. But he was unable to succeed in inducing the House of Commons to agree to his proposal. That House interposed, a Committee was appointed to inquire into the case, and before that Committee had made its Report, the proposed increase of the income tax was swept away; it disappeared as rapidly as Mr. Pitt's tax had done. But the case as it stands this year is worse than on former occasions, because the tax is passed for a portion of the year only. Now, I maintain that it is bad in principle to impose a tax like this for one single year, still less for a fraction of the year. Sir Charles Wood was compelled, as the price of his grant, to propose to Parliament that inquiry 1483 which led to no practical benefit. He consented to that which was only a delusion— namely, an inquiry before a Committee into the tax with all its inconveniences and injustice. Paradoxical as it may appear, in one important respect a perpetual property tax is less unequal than one for a short term of years. Compare with this curtailed property tax one unlimited in duration. The latter falls on the owners of property whether possessed for one year, five years, one hundred years, or for ever, in the exact proportion of the duration of their estates, and is so far just. But a property tax imposed for a single year only compels the owners of incomes for one year to pay equally with an owner for 5,100 years, or for ever. The recommendation which is now urged is to substitute a property and direct taxes for carefully selected and well apportioned taxes on consumption. This is founded on a specious and dangerous fallacy. The people are called on to adopt it with a view of throwing the bulk of taxation on the rich, and exempting the poor. This rests on an unsound foundation. It is in truth to me a most fatal mistake. It assumes that the rich and the poor, the capitalists and the labouring men, constitute two separate classes with adverse interests. No doctrine can be more dangerous and untrue than this. What would become of the working classes were it not for capitalists, as givers of employment; and how is capital to be made productive, except by providing employment for the labouring classes in a way eventually to increase wages? Now, I pray your Lordships to observe how this system of taxation will act if the Customs on foreign paper is repealed, whilst the impost of the raw material is prohibited or highly taxed. You are making fiscal arrangements by which inducements are afforded to English capitalists to transport their capital to France, where the means of manufacturing paper will exist in greater abundance; and though we have been warned against venturing to indulge in prophecy, yet I will take this opportunity of saying that if these alterations on the paper duties are made, they must lead to the transfer of the capital and industry engaged in the paper manufacture from England to foreign countries. Great complaints have been made against my Motion on behalf of gentlemen who are said to have purchased steam machines for the extension of their manufacture if the Excise duty on paper is re- 1484 pealed; but I believe that if this tax is repealed, as well as the duty on foreign paper; we shall see paper mills sot up in Normandy and Picardy instead of in England. The repeal of the duty on foreign paper imported, so long as a prohibition or a prohibitory duty on foreign rags is maintained is not free trade, but a bounty on the foreign manufacture. I return to the question which has been already put. I am asked what are we to do with this £1,400,000, supposing we have any money to spare? I say, if we have such surplus, no very probable hypothesis I fear, and if it is not thought expedient to reduce either the income tax or the war taxes on tea and sugar, let us dispose of it in a truly English way—let us pay our bond debts, and discharge honestly the engagements we have undertaken. But in place of this act of common honesty, we are asked to postpone the payment of our debts in a way which a private individual could not venture to do without a total loss of credit. But, after all, ought we not to ask whether we have the money to spend which we are invited to sacrifice by the Bill before us? We have been told, it is true, that by the falling in of certain Annuities the large sum of £2,000,000 is this year placed at our disposal, and that we are bound and justified in applying that money to the relief of trade and commerce. The supposition of such a surplus is but a fond imagination. There are no facts to support it. That saving was anticipated before the Annuities fell in; it has been exhausted already by the repeal of other taxes prior to or contemporaneously with the expiration of the Annuities; and, therefore, not a single sixpence of that £2,000,000 now remains available. The Budget of this year involves a still greater loss of revenue. It may be said that we have other means at our disposal. The contrary is the case. Your Ways and Means will be shown to be largely deficient before the close of this year. Even if it were not so, I would call your Lordships' attention to the fact that we are bound to look beyond 1860, for we are dealing with the affairs of a great country and its abiding interests. We should consider the future as well as the present, and it will not be enough to show that we have done our duty if we have only provided for the necessities of 1860, without also considering the demands that will be made upon us for 1861 and succeeding years. We have taken a contrary course. By the most ingenious 1485 evasions an attempt has been made to show that there is a favourable balance between the income and expenditure of the present year; and no attempt has been made to explain the condition in which we shall stand in the year that is to come. Even if we limited our consideration to the present year, there is nothing to justify us in repealing this tax. The balance upon an estimated income of £70,000,000 is at best calculated at £474,000. Such a surplus, if it existed, cannot inspire much confidence in our financial position; but have we really got this assured? No such thing. Even during the short interval which has elapsed between the opening of the Budget on the 10th February, and the present time, that £474,000 has disappeared in the same manner with the £2,000,000 of Annuities—it has vanished into thin air. Nor is that all. How, let me ask, was this insufficient balance of £474,000 produced? It has already passed away, but it was created by the most extraordinary combination of discordant fallacies for the purpose of appearing rich, without being so, that ever was exhibited, either in public or in private life. Thus we find one sum of £1,400,000 brought in as additional income, but which in reality was only produced by anticipated income unexpectedly called up, but really belonging to the next year. I allude to the repeal of the malt and bop credits. This no more belongs to the income of the present year than do the rents of any of your Lordships' estates for the year 1861 properly form part of your income in 1860. I think, therefore, you will see that even if we went no farther, instead of a surplus of real income, we should have to deal with a deficiency. A similar observation applies to the calling up of the property tax. But is this all? In the case of the charges for the China war every attempt has been made to transfer these charges from the present to the following year— to say nothing about the matter until the Parliamentary pressure became irresistible and in the meanwhile to leave your Lordships to imagine that no such charge really exists. I think that I have accurately ascertained this to be the fact, as the result of the answers given most reluctantly by the Government this evening to the questions put by my noble Friend near me (Earl Grey). The Native troops sent to j to which little or no objection has been China are, it would seem, to be paid out of the military chest; but that chest was not provided for this Chinese war, and cannot properly furnish means to defray its 1486 expenses unless Parliament votes a further sum to replace that which is taken from it. If such a sum is voted you must ultimately place it in your balance-sheet, and it will make your position still more desperate that it to be at present. Any sum so borrowed is left without the provision of any means of repaying it. Both the debt and the means of repayment are kept from the knowledge of Parliament; and I say it will be unpardonable if, even at this period of the Session, a Vote is not taken with a view to replacing in the military chest the sums which have been so advanced without Parliamentary sanction. No provision is made as yet in the Army Estimates for the pay of the Native troops serving in China; the Vote of Credit granted this year is for the expenses of the past one. No Estimate is presented for the further expenses of the China war during the current year; the Army Estimates cover only part of the expenses of the British force in China, and no part of the expense of the Native force; and large charges under these heads must necessarily have to be provided hereafter; I have heard that these costs of the China war will amount to many millions. There is also another unprovided-for charge, more than sufficient for the destruction of that which has already been destroyed—this imaginary balance. Another questionable receipt has been credited to your account of income. You have had a debt paid unexpectedly. The Spanish Government has been both sufficiently rich and sufficiently well disposed to pay its debts; and the sum so received you have, in part at least, carried to the credit of this balance-sheet. This sum is not income in the true sense of the word. Even in this year financial reductions have been already made since the Budget was first announced. During the progress of the debates there has been an extra loss upon the wine duties of £171,000; many to say nothing about the matter until the I of those strange penny duties imposed upon trading operations have been abandoned upon compulsion, attended with a further sacrifice of £110,000. It is under such alarming circumstances that without any full, clear, and distinct explanation, showing your true and available income, and the real charge upon it, your Lordships are called on to abandon a tax, to which little or no abjection has been suggested, and you are pressed to do this without knowing whether you are parting with your own money or that which belongs to others, for whom you should 1487 consider yourself as trustees. Although I may be supposed, from old habit, to view taxation with a more favourable eye than can be expected from those who have not held the ungracious office of national tax-gatherer, I can assure your Lordships that I am not going to praise either the paper duty or any other tax. No doubt it would be better if you could abolish both that and many other duties; but I respectfully warn you that you cannot afford to do so. I remember that Mr. Hunt, when a Member of the House of Commons, a man of no great education, but of considerable shrewdness and common sense, observed in debate with much truth and point, that you could not raise millions without taxing the millions; you may hold out delusive expectations that by substituting direct for indirect taxation you will relieve the lower classes, but you do not venture to tell them how that change may influence wages, and thus affect the interests of the working classes. One of the most extraordinary commendations which has been passed upon this Budget, is that you are now bent on reducing the subjects of taxation to a very few articles, and propose ultimately to place all our Custom duties, so far as I recollect, on fifteen articles. Why, that change augments the danger of your position by exposing your revenue to increased risk of casualty! It is a practice contrary to the old principle of taxation; it is entirely at variance with the system of Mr. Pitt, than whom, in his commercial policy and general views of finance, there seldom has been a greater, wiser, or more successful Minister. It has up to this time been admitted by all writers upon the subject of taxation, that if you wish to diminish pressure and lessen danger you should extend the surface over which that pressure is to rest. Any other doctrine may be plausible, and may be popular for a time, but unless it tends to the general security and credit of the country the poorer classes as well as the richer will eventually suffer. If I have reluctantly but successfully proved that there can be no surplus this year, but on the contrary a great deficiency, occasioned too for the most part by voluntary acts of the Government, I again ask you to reflect how will you stand next year? All this time you have heard nothing from the Government as to that. Let us suppose that all is right for the present year, suppose that everything has been so carefully adjusted that there is no anxiety for the present engagements of the coun- 1488 try; suppose that we are in a position to meet all those engagements; how will you stand in 1861? I will assume the estimated income for the present year to be about £70,500,000. Next year if you reject my Motion you will lose, as deducted from that sum, £700,000, the proportion of the paper duty which is paid this year; and, unless you again break your word and again refuse relieving the people from the war duties on tea and sugar, a further loss will ensue, amounting to £1,500,000. Then you cannot expect to call up a further sum by once more discounting £1,400,000 of malt and hop credits. Neither can you again perform a similar operation on the property tax, which for the present has swelled your receipts. What will you do with the property tax, which you have only voted for a short renewal? This is, indeed, a formidable question. You will have exhausted the whole amount that you can obtain in that way. Therefore your income next year will necessarily be lamentably deficient as compared with that of the present year. Taking the whole of these circumstances, into account, and assuming the ordinary expenditure to be the same as that of 1860, there can hardly fail to be a clear deficiency for the next year from £11,000,000 to £12,000,000. I pray your Lordships' attention to that alarming fact. But that is not all. There are other services yet unnamed which you will have to provide for. Have we not all heard of a great scheme for the national defences? Information on that subject was promised to Parliament some time ago, but long delayed, it has not even yet been produced—we are, therefore, left to conjecture as to the probable cost of carrying out that vast undertaking; the surmise is that it will involve an expenditure exceeding £7,000,000 or £8,000,000 sterling. I may be told that sufficient provision has been already made for at least some part of this object in the present year; but that is all that is relied on for 1860–61, it only shows that a very large sum indeed will be required for what I must presume is a necessary work in the course of next year. Such then, is the condition in which I apprehend you will find yourselves in 1861; and I therefore fearlessly put it to your Lordships whether, under these circumstances, you are warranted in depriving the country of a revenue of £1,400,000 which capitalized would be represented by no less a sum than £36,000,000. It has been said, indeed, that the income from the paper duty cannot 1489 be collected. To that assertion, however, there is this conclusive and triumphant answer, namely, that this tax is the very best and most economically collected portion of our old revenue. It is also increasing annually. The following account will show its satisfactory progress:—
The amount exported has also increased from 1844 to 1859 from 4,900,000 lbs. to 20,148,000 1bs. This much decried duty is also most economical in its collection. The total expense of collecting an annual sum of a million and a half is only £6,250. If any noble Lord should doubt that statement, he will find it supported by the authority of Sir Henry Parnell's Commission of Inquiry in 1835. The Report of that Commission contains returns showing that no greater a reduction than the sum of £6,250 could be effected in the charge for the Excise establishment by the total repeal of the paper duty. Compare that charge with the cost of collecting your other Excise and Customs' duties, or even with the cost of collecting your property tax, and you will see that you are now asked to part with the easiest and cheapest collected part of your entire system of taxation, and that which exhibits the steadiest increase. I had the honour myself, as Chancellor of the Exchequer, to recommend to Parliament the remission of one-half of the paper duty, as well as simplify and amend the law affecting the manufacture. Since that measure was adopted, the revenue received at the diminished rate of duty has increased from £715,000 to £1,400,000. In referring to the reduction of duty I allude only to the first class of paper, but including all used for writing and printing, the augmentation has been steady and continuous. I ask your Lordships by agreeing to my Amendment, to reserve to the House of Commons the opportunity of dealing with this source of taxation next Session, when avowedly the whole of our system of finance must be brought under their review. Do not, by a rash assent to this Bill, practically decide the fate of British finance for years to come by one hasty and 1490 ill-considered vote. I should freely appeal to the House of Commons to preserve to itself in the next year that freedom of action solemnly promised to them by the Chancellor of the Exchequer. I appeal to their o n good sense to leave this part of the revenue to be discussed hereafter in connection with all other branches of the public income, when it can be seen whether we really have a surplus to justify us in dispensing with this tax, and if we have, which however I consider nearly impossible, whether the reduction of other taxes may not then be shown to involve smaller loss to the Exchequer and to afford greater relief to the community than the remission of the paper duties reduced as they already have been by myself to the amount of 50 per cent. Reject the fallacies which have been forced on your attention. My Motion does not ask the House of Commons to surrender any of its valued privileges. I do not even call upon your Lordships to affirm that circumstances may not yet arise when under more favourable circumstances it might be shown expedient to abolish the paper duty; but I hope by our vote to-night we shall induce the House of Commons to claim for itself what it is well entitled to claim in prudence and sound policy—namely, an opportunity of wisely and dispassionately considering the whole question of our taxation, and not the paper duty only, but of that duty as compared with all the other taxes which press upon the trade and industry of the country. My noble Friend the President of the Council referred to the cause of education, and the advantage which it would derive from a repeal of the paper duties. I was really astonished that his good sense did not lead him to discard that threadbare and clap-trap argument. He well knows how much of the duty is paid for packing, not printing, paper. The Chancellor of the Exchequer himself admitted that the paper duty charged on books was scarcely felt, He was candid enough to state, as an example, that Bishop Colenso's Arithmetic was only raised a small fraction in price by the tax — I think the amount of the tax was but three farthings—a sum that would scarcely be shown in the price at all. If the President of the Council will only take any one of the excellent schoolbooks circulated under his administration, in the National schools, and weigh the small fractional part of the price which the paper duty represents at 1½d. per pound, he will find himself compelled to agree with me 1491 that such increase of price can form but a very insufficient argument indeed for the abolition of the tax under present circumstances, and the sacrifice of £1,400,000 of well paid revenue. Nor would this sacrifice benefit the consumer. So long as there is a deficiency in the raw material of paper, a repeal of the tax will produce no reduction of price. If the duty on Constantia and Johannisburgh wines were repealed, no fall of price would ensue. The wine is a monopoly from the natural limitation of its quantity. Under the French treaty we are in this position,—you have either to submit to a prohibition or a prohibitory duty on the exportation of foreign rags; and I should like to know how any reduction of duty without an increased supply can give a real relief to the consumer. It is only when you can get the power of making more paper that the price will be diminished in the market. It was not for the noble Earl, then, to use the hackneyed, worn-out argument that the Excise on paper was a tax on knowledge, and that the diffusion of knowledge was a reason for throwing away a million and a quarter of revenue. But I have detained your Lordships too long. I have endeavoured to state the case in no adverse manner to the Government. The course I have adopted upon this occasion is the same I have taken every year whenever I thought the financial arrangements objectionable. The noble Earl opposite knows well that on former occasions when he was in the Government I commented with equal freedom on his financial measures. I have felt it right, from the position I formerly held, and that which I now hold, to pay some attention to questions of this kind, and to state my opinions on them, though financial questions are, I fear, somewhat distasteful to many of your Lordships. I am the more bound to thank you for your indulgence, and I now beg to move that this Bill be read a second time this day six months.
Paper Duties. Gross Duty. 1bs. £ Average 5 Years ending 1829 88,300,000 715,000 Average 5 Years ending 1859 217,000,000 1,414,000
§ Amendment moved, — To leave out ("now") and insert ("this Day Six Months ").
My Lords, having formerly had the honour of being connected with the Government, but being now released from the obligations which that relationship is supposed to entail, I might take the opportunity of criticising the present measure and illustrating that criticism by a hostile vote. But I confess that, after 1492 anxious inquiry and due deliberation, I have come to the conclusion that it will be my duty on the present occasion to give to Her Majesty's Government my most hearty and conscientious support. I cannot help thinking that this is a case in which it is very much to be deprecated that your Lordships should refuse to give your assent to the measure which has been placed on your Lordships' table. This, I think, will be admitted to be no ordinary occasion. The interests involved in this discussion are, at all events as far as your Lordships are concerned, of far greater importance than any of those with which you are generally called upon to deal. The interests at stake, I may be permitted to consider, are more important than the integrity of a Budget, the reputation of a Minister, or even the existence of a Government. The issue of tonight's discussion involves the reputation of your Lordships' House for wisdom and moderation, and willingness to act in accordance with the spirit of the Constitution. The noble Baron (Lord Monteagle) has criticised with very great severity the financial measures of the Government. Of course whatever falls from him is worthy of your Lordships' attentive consideration, and it would be very presumptuous on my part to attempt to follow the noble Baron into that part of the subject. I could not speak on it with anything like authority, and I am not ashamed to confess that I do not feel competent to deal with it. But there his another part of the subject to which, with your Lordships' indulgence, I would venture to refer for a few moments—I mean the Constitutional part of the question. I confess it is most painful to me to find myself compelled to place any opinion of mine in opposition to that announced by a noble and learned Lord for whose ability, character, and experience it is no exaggeration to say that I entertain the profoundest veneration. I feel, my Lords, that I am but like David against Goliah, with this unfortunate difference, that I cannot presume to have a Divine mission. But, after all, every educated gentleman must have attended somewhat to the Constitutional history of his country; and it is almost impossible for any individual, however humble, not to have formed some very decided opinion on many constitutional points involved in this discussion. With due deference to the noble and learned Lord opposite, I must say it seems to me one of the plainest doctrines enunciated by the Constitutional history of this country, that when the Crown applies to 1493 Parliament for the Supplies to meet the necessary expenditure of the year, it is not your Lordships who are called to undertake the responsibility of deciding how these Supplies are to be provided, or the delicate, difficult, and invidious task of determining how, and in what manner, the necessary taxes of the year may be best adjusted, so as to bear with the least severity on the shoulders of the people. It is the people of this country who themselves have the right of determining how those burdens which they must bear may be most conveniently borne. My Lords, I should be very sorry for one instant to deny your right to deal with any Bill, of whatever kind, to which your assent is asked. The very fact of your assent being required is a sufficient proof of your power of rejection, and I can quite conceive that the occasion may arise when it would be your duty to exercise that power. I do not mean to say, my Lords, that any amount of popular clamour ought for a single moment to be urged as a ground for dissuading you from exercising those powers with which, in accordance with the principles of the Constitution, you are invested. I cannot, however, but think that we should be acting contrary to usage and to the spirit of the Constitution in resorting to the extreme exercise of any one of those powers except upon the most urgent and solemn occasions. The noble and learned Lord opposite, as well as the noble Baron who moved the Amendment, insisted with much earnestness on certain precedents which they quoted in support of their views in this discussion; but, with all deference, I doubt very much whether there has been a single instance in which a financial scheme initiated in the House of Commons has been interfered with in this House, except on political or economical considerations, with which we are not in the present instance called upon to deal. The noble Baron who moved the Amendment laid great stress on the loss to which the revenue would be subjected if the Excise duty on paper were repealed, and even went so far as to capitalize its amount. Now, I cannot help thinking, with all due deference to the authority of the noble Lord, that, to found any argument on the capitalization of the tax, is most unjustifiable. A tax which has been condemned by a Resolution of the House of Commons is like a tree which has been scathed by lightning, and which, though it still may live, puts forth only a sickly vegetation; but a 1494 tax upon which execution has been actually done is like the same tree cut off close to the ground, all efforts to restore it to vitality or to cover it with foliage or fruit being in vain. There is one other point which I would urge upon your Lordships' attention on the present occasion. During the last few years, it seems to me, a great change has taken place in public opinion; sensible people have been revolted by the misrepresentation and exaggeration of men whose strong prejudices tend to render their great talents of less use to their country than would otherwise be the case. These persons have by moans of misrepresentation and the use of exaggerated language, sought to wean public opinion from looking with favour upon your Lordships House; but I firmly believe that the only effect of the exaggerated language held in regard to your Lordships' House has been to induce the people of this country to regard with greater affection and respect the time-honoured institutions of the realm, and I am persuaded that if your Lordships wish to confirm those opinions which have always existed, and which have lately gained more strength, you will, by meeting violence with moderation, by acting on the present occasion with dignity and in accordance with the spirit of the Constitution, justify the expectations of the people and give another proof of the claim of your Lordships' House to the consideration and confidence of the country.
THE MARQUESS OF CLANRICARDE
—My Lords, I entirely go along with those who assert the power of this House to vote with perfect freedom on the present occasion. I do not think there can, in a constitutional point of view, be the slightest doubt but it lies perfectly within our province to reject this Bill if we please. There exists, however, a wide difference between the possession of such a power and the hasty exorcise of it. No man can doubt that the imposition of an additional penny in the pound in the case of the income tax has been generally associated with the repeal of the paper duty, and I contend that we should not in honour or honesty be, now that we have passed the Customs and the Income Tax Bills, justified in refusing our assent also to the measure under our notice. I was, I must confess, somewhat astonished to hear the noble Baron who moved the Amendment speak in favour of the tax which the Bill proposes to abolish, and against the expediency of continuing which, upon its 1495 own merits, not only has a Resolution of the House of Commons been passed, but the opinions of almost every eminent statesman have, for the last ten years, been pronounced. That the tax is one which is easily collected I deny on the authority of those by whom the collection is made—the Board of Inland Revenue, and who state that it is accompanied with the utmost difficulty and hardship. My noble Friend says the tax has nothing to do with cheap literature; but what was it first imposed for but to check cheap publications? In the reign of Queen Anne a Message was sent down from the Crown complaining of the publication of scandalous and libellous prints; and in an answer to that Message steps were promised to be taken for the purpose of putting down such publications—first, by passing a statute requiring that all printers should be registered, and that not being considered sufficiently repressive, by the imposition of this tax upon paper, as a means of putting restraint upon literature. If the tax is no disadvantage, how is it that you have given an exemption to the printers of the Bible and the Queen's Printers? I was astonished to hear my noble Friend undervalue the cheap literature of the present day, because he is old enough to remember, as I do, what it was thirty or forty years back, when the Government was perpetually involved in prosecutions to put down scandalous and blasphemous publications. Now-a-days, if you look at the cheap publications, you will see that there are among them a large number which your Lordships may with advantage circulate in your own families, and from which you yourselves might derive information. The excellence of this cheap literature has driven that abominable trash which circulated in former times out of the hands of the people, and if there is any class of traders which deserves special consideration it is that class which is engaged in the spread of this useful cheap literature. It is absurd to say that such enterprises are not affected by the duty, for 1½d. per 1b. duty must, as a matter of course, amount to a considerable sum where the manufacture of cheap books is carried on to an enormous extent. The effects of the paper duty are however not confined to literature—it affects every trade and every shopkeeper in the country; it acts in effect as an export duty on a great quantity of manufactures, and, moreover, the foreigner who imports goods into this 1496 country has no duty to pay corresponding to it. My noble Friend says that public credit will be affected by thus dealing with permanent sources of revenue, but I deny altogether that this can any longer be called a permanent source of revenue. The last House of Commons, with the approbation of the Government, passed a Resolution to the effect that it ought no longer to be so regarded. The tax hampers invention to an extent of which your Lordships can scarcely be aware without inquiry, and it has also a very prejudicial effect in checking the discovery and trial of new raw materials for the manufacture, the deficiency of which is just now so much complained of. I agree with my noble Friend that we are just now in a period of financial embarrassment; but it is not the first time, in his own experience, that there has been a deficiency—if deficiency there be—which has not been at once provided for. I deny, however, that there is a certainty of a deficiency, because it is almost impossible to foresee the elasticity of the revenue so long as this country continues prosperous, and that elasticity is never greater than when you have removed some item of ill-judged indirect taxation. I admit that the requirements of the country next year may be great, and that the state of affairs abroad renders circumspection necessary. But it is not by rejecting this Bill and retaining the paper duty that you will meet those requirements. I do not like to prophecy, but I cannot help expressing my opinion that if you reject this Bill, you will do that which many able agitators have in vain attempted to do of late years, and you will bring about a state of things which will have a serious effect on the prosperity of the country. I believe that if you reject this Bill, you will do much to create a spirit favourable to violent Reform, and to give an impulse to that agitation the absence of which has been so remarkable and so much a subject for congratulation. In voting for the second reading, however, it is not that I think the financial prospects of the country encouraging, or that a dangerous tendency has not been shown to place upon property an undue share of the burdens of the country by means of direct taxation; I do so because I believe the House is bound by the position of this question to keep faith with the public, and because I have little doubt that the elasticity of the revenue will speedily replace the temporary loss occasioned by the great boon which the remission of the paper 1497 duties would confer on the industrial classes.
§ THE DUKE OF RUTLAND
My Lords, I certainly cannot acquiesce in the argument which seems to be put forward, that because the Budget and the Treaty have been agreed to, and the principle of the Reform Bill has been sanctioned, we are therefore bound to pass the Bill for the repeal of the paper duty. I agree that in considering the merits of the question it is necessary to regard the subject in connection with the whole financial scheme. The noble Marquess (the Marquess of Clanricarde) has arrived at the conclusion that I the financial condition of this country is one of great embarrassment, and, therefore, he says he will vote for the repeal of a tax amounting to nearly a million and a half. The inference seems to me to point in the opposite direction.
THE MARQUESS OF CLANRICARDE
I did not say, "therefore." The noble Duke has added that word, which makes all the difference.
§ THE DUKE OF RUTLAND
I beg to retract the word "therefore." I never was so much astonished as when I read the speech of the Chancellor of the Exchequer and his plans. His Budget, which has been correctly characterized as "ambitious," if proposed by any Chancellor of the Exchequer, would have been extraordinary; but it is still more so when brought forward by the right hon. Gentleman who at present holds that office. It is impossible for your Lordships or for the country to forget the magnificent speech which he made in 1853, or the promises which he held out that the income-tax should be repealed in 1860. Was it not by that belief that he obtained the passing of the succession duty? The terms in which he then denounced the income-tax as unjust and immoral are fresh in our recollection, and in the following language he justly described the emergencies for which alone it should be retained:Times when the hand of violence is let loose, and when whole plains are besmeared with carnage, are the times when it is desirable that you should have the power of resort to this mighty engine to make it again available for the defence and salvation of the country." … … "The country after so many announcements that have been made to it, from time to time, that the income-tax was to be parted with has become, doubtless, incredulous on the subject, and may, perhaps, conceive that we are aiming at a fictitious and undeserved popularity when we seek to show that together with our remissions of indirect taxation we can enable the House to surrender the income-tax."—[3 Hansard, cxxv. 1305.]1498 The country might well be incredulous. The reasons given in 1860 for retaining that tax, had reference to the Chinese and Russian wars and to other circumstances which intervened, and which could not possibly have been anticipated; but I confess I am at a loss to find a single ground on which the remission of the paper duties can be justified while the income-tax is not only continued but increased. As to the Treaty which has been concluded with France, I must say that I cannot imagine a more one-sided arrangement, for it gives every advantage to France, whilst it reserves scarcely any for this country. As to the protective duty of 30 per cent, I believe it will prove worse even than has been expected, for, as I understand, the ad valorem duty is to be calculated on the present price of goods, and the specific duty will be based upon that. This, however, is nearly double what it usually is, and the duty will therefore probably be nearer 60 than 30 percent. The noble Earl (Earl Granville) has alluded to the great prosperity of the country. I rejoice to think that even under the free trade system great prosperity, both agricultural and commercial, has existed. I say "even under the free trade system," because to show that it is not a consequence of free trade as the noble Earl imagines, I will refer to a comparison instituted by the Due de Brabant in the Belgian Chambers, of the relative progress of the exports from Belgium, France, and England. From 1840 to the year 1858 the increase on English exports was in the ratio of 127 per cent; on French exports it was at the rate of 156 per cent; and on those of Belgium it amounted to 204 per cent. Therefore, France and Belgium, both countries in which protective duties prevail, have outstripped us in the race of commerce. The Chancellor of the Exchequer and the noble Earl opposite both think it highly desirable to follow in the footsteps of Sir Robert Peel. But, however prosperous they may conceive his measures to have been, the present financial schemes do not bear the slightest resemblance to them. The measures of Sir Robert Peel were founded on the principle of admitting the necessaries of life to the poor and of removing the duties off raw material. But the proposals of the present Government are to reduce the duties on wine, while they continue those on tea and sugar and do not favour the introduction of raw material. There is, however, one point of similarity, not between 1499 the measures of Sir Robert Peel and those of the Chancellor of the Exchequer, bnt in the manner in which they have been carried. Sir Robert Peel was enabled by means of enormous majorities he commanded in the House of Commons to carry the repeal of the corn laws. No one but Sir Robert Peel could have done that. He did so from the highest and most honest convictions, I am sure. So also I am convinced the present Chancellor of the Exchequer, acting from similar motives, has been enabled by the power and popularity he obtained in 1853, by his promise that the income tax should cease in the present year, been enabled to double the tax which he was pledged to repeal. Now, as to the question before the House—the paper duties—I will not attempt to argue the constitutional branch of it after the brilliant and argumentative speech of the noble and learned Lord (Lord Lyndhurst), but with regard to the paper duty—I will only observe, that even if you have a surplus, there are other duties which I think should be repealed in preference. I do not desire to defend Excise duties. They were introduced by the Whigs, and they do undoubtedly press upon the industry of our own country; therefore I am not at all an advocate for their continuance. But I repeat, that if any are to be repealed, there are others which deserve a prior consideration to the paper duty. The noble Lord who spoke last referred to the Report of the Commissioners of Inland Revenue, but I will, with your Lordships' permission, quote a paragraph from the Report:—These simple regulations leave the paper-maker comparatively free to adopt the best and most economical modes of working, and he can scarcely assert, as the maltsters and distillers do, that the cost of production is increased, or the quality of the manufactured article impaired, by the fetters imposed upon him for fiscal purposes.If you wish to repeal an Excise duty I think the first for your consideration ought to be the malt tax, which increases the price of beer, a beverage far more to the taste of the poorer classes than any of the cheap wines which it is now proposed to introduce; but I question whether paper will be cheaper even if the duty be removed. The noble Earl opposite has alluded to the benefits conferred upon the consumer by the abolition of the duty on glass; but I remember the same advantages were held out when the duties on leather were removed—but I do not find that boots and 1500 shoes are at all cheaper, and I pay more for my saddles. The only advantage that is offered to me by the noble Earl, is that I may have a saddle made of paper which will be impervious to the wet. I will only add, that, looking at the state of the revenue, that the £400,000 surplus has disappeared; that there will be a certain deficiency next year, as the noble Lord opposite (Lord Monteagle) has shown, of £11,000,000, considering that there is no popular cry for the repeal of this tax, and having regard to the disturbed state of the Continent, I hope your Lordships will exercise your undoubted right, and reject this Bill.
§ LORD CRANWORTH
My Lords, if this had been merely a financial question, I should not have risen to take part in the discussion; but as the adoption of the Amendment would involve the House in much difficulty, I venture to say, with as much confidence as one tan speak of a negative proposition, that this is a course that has never been before taken by the House. I know the great disadvantage I labour under in attempting to controvert any opinions expressed by my noble and learned Friend who has left the House (Lord Lyndhurst); but still I beg to say, notwithstanding all that has fallen from such an authority, that the course your Lordships are now asked to take is, if not absolutely unconstitutional, at least so thinly separated from what is admitted to be unconstitutional, that to ordinary minds the difference is unintelligible. What did my noble and learned Friend say? He said that we had the power to do that which we were now asked to do—that an existing tax could not be repealed without an Act of Parliament, and that such Act could not pass without your Lordships' concurrence. But that is a truism which never has been disputed. Of course a tax which actually exists cannot be repealed except by an Act of Parliament, and as no Act of Parliament can pass without your Lordships' concurrence, clearly your Lordships can withhold your assent. My noble and learned Friend quoted examples from the year 1689 downwards; but my noble and learned Friend must give me leave to say that he did not at all advance his argument thereby. No doubt this House cannot alter a money Bill without the consent of the House of Commons. All you can do is to reject a Bill, whether it be for relief or burden. But I say that from 1689 up to this hour no such step has been taken 1501 by this House as to refuse to concur in the repeal of a tax in circumstances such as now exist. I will deal with the meagre precedents quoted by my noble and learned Friend presently. Let the House observe in the first instance, what we are now asked to do. The Crown has, in accordance with its constitutional functions, communicated to the House of Commons what are the wants of the State. Those wants have been discussed, modified, and approved, and in the exercise of their constitutional functions the House of Commons have found ways and means wherewith to carry the recommendations of the Crown into effect, and have come to the conclusion that this particular tax is not necessary for the wants of the State. Now, I am bold to say that a Bill founded upon such considerations having been passed by the House of Commons and brought here, there never has been since the Revolution an instance of this House rejecting such a Bill. My noble and learned Friend, treating the subject with great dexterity, has mentioned a few precedents, and stated that he had many others, to which, however, he would not refer; and until he stated them I was under the belief that my search, although laborious, had been imperfect; but when he told us what those precedents were I found that I was justified in my opinion that there had been no deficiency in my research, and that there are no substantial precedents to justify such a course as we are now asked to take. The first instance given my noble and learned Friend was in 1790, when this House rejected a Bill to relieve the coasting trade by removing stamps from certain documents. I do not mean to say that there are not instances where, upon collateral grounds, the repeal of some tax has been thought undesirable, and the Lords have exercised their right of refusing their assent to the repeal. But in this case there is a most important distinction which I must be allowed to point out without exposing myself to the charge of raising a mere lawyer's quibble. My noble and learned Friend, in referring to the precedent on which he relied, omitted—no doubt inadvertently—one little word which makes all the difference in the world. He described the Act as one to relieve the coasting trade by removing certain stamp duties. But the Act had several objects. It was to relieve the coasting trade, to remove certain stamp duties, and to abolish the necessity of giving certain bonds to the Crown. 1502 Now it is matter of A B C that if anything is tacked to a money Bill, this House has a constitutional right to deal with it and to reject the whole if it thinks proper, and in this case what was proposed was not merely to abolish a tax, but also to obviate the necessity of giving certain bonds. The Bill, therefore, had another object besides that of repealing a tax. The instance cited by my noble and learned Friend is open also to another observation. This House was moved to go into Committee on the Bill on Tuesday, June 8. They determined not to do so, and the prorogation came the next day but one. Now, the Lords might very well think that was not the way to treat them. The measure probably came before them at a time when there were not many in attendance; and this of itself would furnish sufficient grounds for rejecting it. Well, then, the two next cases quoted by my noble and learned Friend seemed to me not to touch the question. In two consecutive years, it appeal's, the House of Commons passed Bills to abolish the fees payable to certain Custom House officers. This House rejected them. Did those Bills affect the annual revenue of the country? Technically it may be that the Lords on those occasions refused to repeal a tax, but in substance they did not; and in these matters it is the substance, and not a mere technical analogy, to which we should look. The only precedent which seemed to mo to possess any weight was that of 1811—I mean the Bill respecting molasses. But even that precedent was a good deal strained. In 1811 the price of wheat was enormous, averaging, I think, from 111s. to 120s. the quarter; and, of course, barley was dear in proportion. For the purpose of relieving the pressure occasioned by these high prices, the House of Commons introduced a Bill to reduce the duty on molasses, in order that distillation might go on mainly from sugar and not from corn. That Bill came up hero on the 6th of May. Now, the important point in the case is, that the financial statement of the Government that year was not made till the 20th of May. No doubt, therefore, the Government wanted to know, before introducing the Budget, whether the Bill would be approved by the great landowners in this House; and in the debate, the Earl of Suffolk, who led the opposition to the Bill, gave a clue to the whole case when he said he was happy to find that the Motion was not to be made a party question. The 1503 Government were, no doubt, sounding both Houses to see whether they would or would not adopt this measure as part of their financial scheme. The House, very likely thinking it was a covert way of interfering with the agricultural interests for the benefit of the West Indian interest, refused to pass the Bill; and a Budget was afterwards framed in accordance with that refusal. The case differed entirely from the one now before us, and the course of the Government was open to objection upon totally different grounds. It furnishes no precedent for the course which you are now asked to pursue. Here the Budget has been introduced and has been confirmed, one of its provisions being the repeal of a certain tax which is declared to be not wanted for the public service; and you are asked to say, "Though the tax is not wanted, it shall still be levied." These were the precedents of my noble and learned Friend. My noble Friend (Lord Mont-eagle), who moved the Amendment, alluded to two others, one of which occurred a century ago. From the nature of the tax it was evidently one which this House rejected, not upon any financial grounds, but because it was an interference with one interest in favour of another. In 1758 there seem to have been Bills to allow the importation of cattle from Ireland, and there was also the Tallow Bill. These were two measures having relation to Irish and English produce, and for some reason or other this House thought they ought not to pass. In any case they would only furnish a technical, and not a substantial precedent. Then, again, in 1816 this House rejected a Bill for taking off the duty on stone bottles. At that time the duty on stone bottles was a complicated one; there was one duty on bottles introduced from Ireland, and another on bottles manufactured in England, the general duty being one of 2s. 6d. per cwt. All we know is that a Bill for repealing the duty passed the House of Commons, and was brought up to this House, and that five days before the Prorogation, this entry occurs in the Journals:—"Present, so and so:—Order of the Day for going into the Stone Bottle Bill, put off for Six Months." The Government appear to have boon misled into proposing something which ought not to have been proposed: for in the next Session they introduced a Bill, not for taking off the duty, but for doubling it, and the duty accordingly became 5s. instead of 2s. 6d. These precedents are equally in- 1504 valid as regards the substance of the present Bill. I am aware that this kind of detail is rather dull, and I will not abuse the kindness which your Lordships have shown in listening to me so far by going more minutely into the question. I cannot, however, conclude without expressing a hope that your Lordships will not on this occasion take a step sanctioned by no substantial precedent since the Revolution. I do think that by attempting to make such a precedent in the case of a tax which has been more than once disapproved on principle by the other House of Parliament, and which affects a most influential class of the community, you will be taking a step which will very materially endanger the high position which I am persuaded you hold in the estimation of the country, and which you will continue to hold so long as the country sees that you neither actually interfere with the constitutional rights of the other House, nor do that which is not to be distinguished from such an interference — namely, refrain from imposing, but refuse to repeal a tax, such a step, sanctioned by no precedent, will, I say, be likely to endanger your high position during the discussion of questions which are looming probably at no very great distance, and which may then render it almost impossible for you to retain that hold on the feelings of the country which I believe you now deservedly enjoy.
§ LORD CHELMSFORD
My Lords, I undoubtedly thought, after the admirable speech of my noble and learned Friend at the commencement of the evening, that the constitutional part of this question was entirely settled; and I do not understand, though I have listened with the greatest attention to my noble and learned Friend (Lord Cranworth), whether he means to deny the principles upon which the constitutional proposition has been established, or whether be merely means to submit to your Lordships that because it would be unprecedented to interfere in the way proposed, therefore it would be impolitic and inexpedient for you to do so. My noble and learned Friend does not deny the power of the House to refuse its assent to this Bill. We have heard no denial of that proposition, and none, indeed, can be offered; because it stands to reason that if your assent is required before this Bill can become law, it necessarily follows that you must have the power of withholding your assent—this, in other words, being the power of rejecting. We are all agreed as to the 1505 privileges of the two Houses of Parliament with respect to money Bills. We are agreed in reference to Bills of supply and taxation that your Lordships have, at all events, the power to reject them. You have to a certain extent admitted that you have no power to alter money Bills. A Resolution of the Commons to that effect was passed in 1678; your Lordships, however, have never absolutely admitted that you have no power to alter money Bills, though you have acquiesced to a certain extent in that Resolution, and have taken care not to exercise that which may still be the privilege of your Lordships' House; or if you have exercised it, the other House has taken care to assert its own privileges in such a manner as not to violate the constitutional rights of the other House of Parliament. There are many instances since 1678, in which your Lordships have made Amendments in money Bills. Those Bills have then gone down to the Commons, and supposing the Commons have not thought those Amendments improper, they have preserved their privileges and asserted their dignity by refusing to assent to those Amendments, but have introduced another Bill embodying the Amendments proposed by the Lords. In that way the privileges of both Houses of Parliament have been maintained. I understood my noble and learned Friend who has just spoken, not to deny the principles asserted by Lord Lyndhurst; but he says that the course which the House is called on to pursue, is entirely unprecedented and dangerous, therefore, to be adopted. My noble and learned Friend stated that Lord Lyndhurst had treated the subject with great dexterity by staying that he would mention a few precedents, and that he had many others to which he would not refer — insinuating thereby that that noble and learned Lord had in reality brought forward all the precedents he had been able to discover; and my noble and learned Friend then proceeded to maintain that the precedents which had been brought before the House are not at all like the present case. I, however, ask whether they are cases of money Bills or not? Lord Lyndhurst, however, gave us two instances, not of Bills imposing taxation, but of Bills for the relief of taxation, which were rejected by your Lordships' House. It has been stated that those Bills were rejected partly for political and partly for economical reasons. But what does it signify what were the reasons for rejecting them? If they were rejected 1506 by your Lordships for economical reasons, that is a proof that in dealing with money Bills this House exercised a power which would hardly be contended for by those who say that your Lordships have no right to interfere in these matters. The precedent of 1811, which my noble and learned Friend tries to disable, he has, I think, found too strong for him. That was the case both of the remission and imposition of taxation; and on that occasion this House rejected the Bill. The Commons, instead of making any complaint that there had been an infringement of their privileges, silently introduced another Bill, and that Bill became law. My noble and learned Friend appears to have been reading the journals of the day, and to have adopted the argument which I saw in the leading article of one of them, to the effect that it is the duty of the Commons (as undoubtedly it is) to provide the ways and means for the supply of the year, and that this House has no right to interfere at all with those ways and means, but is bound to adopt them. Now, suppose one of the ways and means devised by the Commons should be a tax highly objectionable and known to be one which the people at large regard with no favour or satisfaction; though it is admitted that the assent of this House is required for the Bill, and, though it is equally admitted that this House has the power not to assent to it, yet we are told that we must not touch the ways and means provided by the Commons. So that in the same breath we are told that we have the power to express concurrence or dissent, and that we have no such power. Is it possible that such an argument can prevail with your Lordships, and yet what other arguments have been advanced by the noble and learned Lord? But it is admitted that we have the power and the right to dissent from a money Bill. If then your Lordships have the power and the right you have also the corresponding duty to decide upon this Bill; the one cannot be without the other. And if, as I believe, not one in a thousand of the people if polled would vote in favour of the remission of this tax while the tea and sugar duties are maintained, then I ask your Lordships whether, having the power and the right, you are not bound to reject this Bill, seeing that the taking off of this tax will render necessary an increase of the income tax and the maintenance of the duties on tea and sugar. If we have the right, what better opportunity 1507 can there be for its exercise than the present? If we forbore to exercise it now, when there is a necessity for such a step, then indeed it will be said that we have established our inability ever to exercise it. Then a precedent will be surely established. It will be said that when an occasion arose which called for the interference of this House, which imperatively demanded that we should not pass the Bill, and we refused to do our duty, we showed in the strongest way our impression that we had not the power, the right, the duty to interfere. I cannot understand what my noble and learned Friend meant by the solemn warning with which he concluded his address to your Lordships. He seemed to think that a great peril was impending over us which we would draw upon our heads by the rejection of this Bill. In my opinion we shall incur an infinitely greater danger by refusing to take the course that has been suggested to us, because we shall then show that we are cyphers in the constitution—that we had no power on any occasion where the public interest is most deeply interested — that if they, the Commons, choose to stamp their work with the magical name of a money Bill, you had no power to exercise your most important constitutional functions. I say, if you lose this opportunity of showing you have the power of interference on an occasion when you would do the greatest possible good to the public, you depose yourselves from the exercise of those important functions which belong to you by the constitution, and will certainly thereby bring down on yourselves infinitely more mischief than that which appears to be threatened by the noble and learned Lord as the result of the adoption of the Amendment.
THE DUKE OF ARGYLL
* My Lords, however great may be the importance which attaches to the constitutional argument, which has been so ably dealt with by my noble and learned Friend on the bench below (Lord Cranworth), I am bound to say I do not think it would be consistent with our duty—hardly respectful to this House—to rest our case upon that argument alone. I do not mean to say that the constitutional argument is not of itself broad enough to sustain the vote which we are now asking the House to pass; I have reason to believe and know that there are many noble Lords who will vote with the Government to-night who, if they had been Members of the Government, would have objected to the repeal of the paper 1508 duty, or, if they had been Members of the House of Commons, would have voted against the Bill, but who now feel that this is not the time or place where it can be opposed with propriety or effect. But there is another section of the House whose opinions we are bound to consider, and to whose judgment we are bound to address ourselves. I have reason to know that there are many noble Lords on the benches opposite and on the benches below me, who feel hardly less than we do, the grave inconvenience and danger of the course which the Amendment asks the House to adopt, but who yet consider that the repeal of the paper duty is connected with what they deem such dangerous principles of finance that they are inclined to vote for the rejection of the Bill as the least of two evils. We are bound, I think, to explain to those noble Lords the grounds on which we propose this measure, considered not merely in itself, but with reference to the general principles of the Budget.
There is, however, one question connected with the financial arrangements of the Government which I trust the House will allow me to pass over in silence. I cannot follow the noble Duke opposite into a discussion of the commercial treaty with France. And yet in passing I may say that there are many prejudices against the Budget which are solely connected with misapprehensions in respect to that treaty. There is especially one great misunderstanding as to what has been called the political aspect of the French treaty. In the earlier debates of this Session we were accused of sometimes denying and at other times admitting that the treaty had a political bearing. The simple truth is, that though it had some political bearing, yet that was not of the kind or nature which some noble Lords supposed. I say distinctly and emphatically that in drawing up that treaty there was no intention to express any opinion, or even any feeling, in regard to the foreign policy either of the existing Government of England or of the existing Government of France. It is true, indeed, that the private opinion of the remarkable man who now presides over the French Empire is in favour of free trade; but beyond that I say the opinions of the French Government have nothing to do with the objects of the treaty. The object of the treaty, in so far as it was political at all, was simply to increase the commercial relations between the people of Eng- 1509 land and the people of France, without the slightest reference to the political relations between their respective Governments, or to the foreign policy of either the one country or the other. There is reason to believe that already that object is being to a certain extent attained. The other day I saw a letter from the south of France which stated that the reduction of the wine duties has already produced a considerable effect; that a large and active trade was springing up in French wines, and, what is more, that a large proportion of the smaller proprietors in the south of France are planting vineyards for the express purpose of exporting wine to England. We have reason to hope that the same process may be carried further, and whatever may be the result of our policy as regards the two Governments, we earnestly trust it will be the foundation of more amicable relations and feelings between the two populations.
I am not going to undertake the duty which the President of the Council has said some one in your Lordships' House will have to undertake in future years— the duty, namely, of a second or Vice-Chancellor of the Exchequer; but there have been some general assertions made with respect to the financial policy of the Government which it is necessary to notice. First of all, I wish to disclaim absolutely, so far as the intentions of the Government are concerned, an object which has been constantly attributed to them—namely, that they drew up their financial scheme with the purpose of breaking down the sources of revenue from indirect taxation, and imposing an undue burden upon the owners of property. I am bound to say that this misunderstanding has not been wholly unnatural or unjustifiable. There have been individuals, who happened for the moment to be supporters of the Government upon certain questions, who have undertaken to defend the Budget upon principles which it is the duty of the Government wholly and absolutely to disavow. I am now speaking of the intentions of the Government; the effect of their measures is matter for argument; but I disclaim as regards their intentions any wish whatever to break down the great system of indirect taxation, and to impose an undue burden upon the owners of property. In all the discussions which took place in the Government upon this question I never heard such a principle mooted; it does not exist in the mind of any Member of the Government, nor is it embodied 1510 in any of their measures. Yet I believe a contrary impression is extensively prevalent in this House. Many noble Lords believe that it was our intention, and that it will be the effect of our policy to break down the indirect taxation of the country, and gradually to put an undue burden upon the owners of property. Not only do I disclaim that as the intention of the Government, but I declare my conviction that direct taxation in its present form has arrived at a point at which it cannot permanently he maintained with safety to the country in time of peace. [Cheers from the Opposition] Yes, I have no difficulty in making the admission that the maintenance of high rates of direct taxation in time of peace is incompatible with the financial prosperity of the country. But noble Lords may ask, "How can you reconcile that with the policy you have adopted?" With the permission of the House I shall at least endeavour to answer that question.
And, first, let me call the attention of the House to the facts with which we had to deal—and to one fact especially, namely, this—that by no means in our power could we have provided for the finances of the country with a lower income tax than existed in the hitter half of last year. We could not have done with less than a nine-penny income tax. Unless I am contradicted, I will not stop to prove this by figures; because I believe that some noble Lords who held a different opinion when this subject was last before us, are now convinced that by no arrangement could the Government have avoided demanding from Parliament the continuance of the income tax at the rate of 9d. in the pound. What follows from that? I say distinctly that such a high rate of income tax cannot be maintained with safety in time of peace, except upon one condition— namely, that you continue to connect the tax with both the great objects for which it was originally proposed by Sir Robert Peel. The one object is to remedy a deficiency, the other is to promote commercial reforms.
In order to illustrate this, it is only necessary to direct the attention of the House to the history of the income tax since Sir Robert Peel proposed it. It has passed through three stages. First, there were three periods during which it was imposed for three years each time; then there was a period of two years, during which it was voted for a single year; and lastly, there has been the period of seven 1511 years which has elapsed since 1853. It is a remarkable fact that when Sir Robert Peel first imposed the income tax, he did so mainly for the purpose of remedying a deficiency. In his great speech of 1842, comparatively little stress was laid on the subject of commercial reform. His chief arguments went to show the enormous deficiency with which he had to deal; but when 1845 came round, so successful had his commercial policy been that he was enabled to inform Parliament that he was actually in a condition, to dispense with the income tax if Parliament so desired. At the same time, he advised Parliament to adopt another course; he recommended it to continue the income tax with special reference to the continuance and extension of those great commercial reforms which had already given indication of such eminent success. But when the next period of revision came round, mark what took place. Then appeared the great danger of the income tax when used as a mere ordinary instrument of finance. The Government of Lord J. Russell, in 1848, proposed an increase of that tax in time of peace, and they made that proposal without reference to any other object than provision for a large expenditure. I believe that proposal was a great mistake; but I say that no Government ever had a better excuse for such a proposition. There had been an accumulation of calamities in the country, and a consequent failure in the ordinary sources of income. There were the effects of the Irish famine; there was an expensive war raging at the Cape; there had been a financial crisis; and last, not least, there was a revolution in Europe, which, to a great extent, excited the minds of the people of this country, and for some time previous to the breaking out of that revolution, the attention of the country had been set, precisely as it has been lately set, upon the question of fortifications for national defence. It was to enable the Ministry to deal with this position of affairs that Lord J. Russell's Government proposed the increase of the income tax—an increase, let mo again observe, no longer connected with any commercial reforms whatever. Now, what was the immediate result? The proposal of the Government was resisted with indignation; they had to bring in a new Budget, and it was with great difficulty that they even secured the continuance of the income tax at the former rate for a further period of three years. What is the lesson that I wish to draw 1512 from these events? It is that which I have already endeavoured to impress upon this House, that a high rate of income tax, to be tolerated by the people of this country in a time of peace, must be connected not merely with deficit, but also with commercial reforms. I say that with this history before us, with our knowledge of what happened in 1848, and with what we knew of the principles with which the income tax had been hitherto connected, it would have been absolutely fatuous in us to come down to Parliament and to ask for a high rate of income tax in a time of peace without making any attempt to continue those great reforms of which it has been the efficient instrument, and by which mainly it has secured the acquiescence of the country.
I am not going to dwell upon a mere question of Parliamentary position; at the same time, as we have in the course of this evening been twitted, indirectly, no doubt, but still pretty distinctly, with a certain amount of supposed alliance with the hon. Member for Birmingham, whose opinions are naturally obnoxious to the Members of this House, I may be allowed to say that we have never observed on the part of the leaders of the Conservatives in the other House of Parliament any great reluctance to join with Mr. Bright whenever a fitting opportunity presented itself, and I am certain that if the Government had come to Parliament with a policy so absurd as that of asking for a high rate of income tax in a time of peace, without connecting it with any commercial reforms, we should have seen, and should rightly have seen, an immediate junction between the Conservative leader in that House and the Liberal section which goes under the name of the Manchester school. I have not a doubt of it; but whether we should have seen that or not, what I say is, that such a junction would, under the circumstances, have been justifiable. We could only have defended the adoption of the course which I have mentioned upon the ground that there were no more commercial reforms to be effected such as those which had been so successful in previous years. But if we had made such a statement, we should have been immediately met by the emphatic statement of Mr. Disraeli that great reforms had still to be effected, and that this was the time to accomplish them. In order that I may not be supposed to speak without book upon this subject, I beg to refer your Lordships to a speech which was actually de- 1513 livered by Mr. Disraeli upon this very question of the paper duty at the time that a Resolution upon the subject was assented to by the Government of noble Lords opposite. In June, 1858, Mr. Disraeli made a speech, in which he stated to the House of Commons the reasons why he deprecated the passing of that Resolution in the form in which it then stood, and he said:—I agree with the right hon. Gentleman 'that the maintenance of the Excise on paper as a permanent source of revenue would be impolitic;' but I cannot agree with him 'that such financial arrangements ought to be made as will enable Parliament to dispense with that tax.' I think that if a Resolution such as that contained in the latter part of his Motion is carried, you will only cripple and hamper the Government; and I do not think it is fair to hamper the Government with any such declaratory Resolution on this particular tax, as we entertain very little difference of opinion on the topic with the right hon. Gentleman who proposes this Resolution."—[3 Hansard, cli., 125.]Now this is the passage to which I wish to direct the attention of the House: —The paper tax alone, however, is not the only tax forming one of the great sources of revenue derived from indirect taxation that requires our consideration. Whether we look at the revenue derived from our Customs, or at the various branches of our inland revenue, there is no doubt that notwithstanding the great changes and the great improvements which have occurred with respect to the mode of raising the revenue in these two particular departments during the last ten years, or I might say, generally speaking, during the last twenty-five years, still there is a great deal that deserves our consideration, and still there is great room for improvement in both these branches. Now, there are many duties in our Customs that really do not pay the cost of collecting and receiving them. That is a state of affairs which, in my opinion, it is not at all desirable should be maintained."—[Ibid.]And he concludes:—I am not prepared to say that the tax upon paper itself is not one which requires, if not immediate, yet early consideration; but the subjects are so numerous, both in the Customs and in the Excise, that I think it is the duty of the Government to submit both these branches of the revenue to an early and severe revision."—[Ibid, p. 126.]Now, if we had come to Parliament and said, "There are no more reforms that will pay as well as those which were initiated by Sir Robert Peel," we should have been met by this declaration —that both in the Customs and Excise, and in other branches of the Revenue, there were many duties which actually did not pay the cost of their collection, and I have no doubt that that argument would have been used successfully in Parliament.
In passing, let me remind your Lordships of one special danger connected with 1514 the maintenance of a high rate of income tax in time of peace, if it be not used as an instrument of reform. I mean the danger of breaking down the structure of the income tax by reviving the agitation for a different scale of duty upon different kinds or sources of income. When did that danger arise? Precisely at that period when commercial reforms had ceased to be connected in the minds of the people with the continuance of the impost. It was with some surprise that I heard the noble Duke (the Duke of Rutland), who spoke a few minutes ago, allude to the speech of my right hon. Friend (Mr. Gladstone) in 1853, for no other purpose than that of blaming him for not having fulfilled the promises which he then made. I think that the noble Duke ought to remember that great effort of Mr. Gladstone with reference to a very different question. He ought to remember that when, as I think, by the mismanagement of the Government in which the noble Duke placed confidence, the question of the income tax was approaching a very dangerous solution, when those who were the natural leaders of the owners of real property had given up the sound financial principles which bad hitherto been maintained by every finance Minister in this country; when a Conservative Government had announced that they meant to establish a different rate of taxation against the owners of real property, compared with those who derived their incomes from trades and professions, it was by the individual efforts, by the genius, the eloquence, and, let me add, the public virtue of my right hon. Friend, that that great danger was averted, and an equal rate of income tax was maintained. Then, I say, my Lords, that every consideration impressed upon the Government the absolute necessity of maintaining the connection between a high rate of income tax and the continuation of the great commercial reforms which were commenced by Sir Robert Peel.
The noble Duke has said that the reforms which we are proposing are wholly different from those of Sir Robert Peel. I venture entirely to dispute that proposition,: I remember that during a former debate in the course of the present Session, the noble Earl opposite (the Earl of Derby) said that we upon this bench were perpetually endeavouring to confound our reforms with those of Sir Robert reel, but that in reality there was a very wide distinction between them. We might say 1515 that the noble Earl had been perpetually trying to establish a distinction which did not exist, and these assertions would be equally valueless unless supported by distinct arguments. I venture to propound this as a test of the similarity of the duties which we are about to repeal to those which were abolished by Sir Robert Peel. I say that all the duties which were repealed by Sir Robert Peel came under one or other of these four categories; either they were duties which were protective, and which we, on this side of the House at least, believe to be ruinous in principle, limiting trade and not benefiting those for whose aid they were intended; or they were excessive, limiting the consumption of the articles upon which they were imposed; or they were trivial in amount, and not worth the cost of collection; or, lastly, they were taxes interfering with process. Now I venture to assert that among the taxes which we repeal there is not one which will not come under one or other of these heads. All those taxes are either protective or trivial, or very often both, or they are so excessive, as in the case of the wine duties, as greatly to limit consumption, or, as in the case of paper, they interfere with process and in a special manner limit the trade and enterprise of the country. I shall be very glad to hear any noble Lord point out a single tax which does not come under one or other of those heads. The wine duty, by the reduction of which we make the largest sacrifice upon any one item, is beyond all others which now exist a tax which is of so high an amount as to limit consumption. Whatever may be thought of the policy of increasing our commercial relations with France, and however much some noble Lords may doubt whether the increase of consumption will repay the loss of revenue, no noble Lord will venture to dispute that that tax limits consumption to an enormous extent. The next principal item is silk; that was one of the principal articles referred to in the French treaty. The duty upon silk was strictly a protective duty; and I will mention to the House another reason which induced the Government to propose its repeal. It was one of the objects of my right hon. Friend the Chancellor of the Exchequer to gain a revenue not merely by the imposition of new taxes, but also by effecting a saving in the establishments of the country. Now, I have been informed by the officers who preside over the Customs department that 1516 of the duties which necessitate the employment of a skilled and expensive class of officers the silk duty stood far above all others. And this for obvious reasons, because a large class of skilled officers have to be employed in protecting the silk revenue by watching other fabrics into which silk enters, but of which it does not constitute the sole material. It is desirable to get rid of that class of officers, but their services cannot be dispensed with unless the silk duties are repealed. I mention that as only one instance of the manner in which these taxes have been selected.
This brings me to a point of great importance with reference to the question of indirect versus direct taxation. It is a very common error to suppose that because there are many items in our Customs' tariff they have the effect of dispersing the revenue over a great number of articles, and of thus broadening the basis on which our indirect taxation rests. I hold in my hand the amended tariff of Mr. Gladstone's Budget. It has greatly alarmed some noble Lords. There are only forty-eight articles altogether retained in it. That fact, I believe, makes the hair of many of my noble Friends stand on end. What a revolutionary measure! they say. How it endangers the whole system of our indirect taxation! But have those noble Lords considered from how many of the existing articles the great bulk of our revenue is raised? I have inquired into this matter, and the result, I confess, surprised me. I took the whole Customs' revenue for the year before last, 1858. There were then about 420 articles on the tariff, yielding a revenue of £23,299,570, and I found that the whole of that vast sum, with the exception of only £850,000, was raised from eleven articles alone! Is it, then, very revolutionary to sweep from a long list of articles some 370 which produce on an average little more than £2,000 a-piece, and yet add in no inconsiderable proportion to the total cost of collection? Now, how has Mr. Gladstone treated the eleven articles which, as I have shown, contribute all but a fractional part of your entire Customs' revenue? He has abolished only two of them, and these among the smallest—butter and silk; whilst at the same time he has made one not unimportant addition to the number. Among the various reductions made in recent years, that which appears most to have failed in respect to the replacement of revenue was the reduction of the duty on coffee. Several reasons have been as- 1517 signed for this, but the principal one is that coffee has become adulterated to a very large extent with chicory. Now, so careful has Mr. Gladstone been, not only to strike off unproductive duties, but to select for retention those which really pay, and to build up others which appeared to decay from causes capable of being removed, that he has endeavoured to aid the revenue from coffee by imposing a new duty on chicory calculated to yield from £90,000 to £100,000 a year, an amount, as the House will see, that will fully compensate for the disappearance from the tariff of many dozens of trumpery articles hitherto included in it. I mention this case, my Lords, as an instance of the care and the knowledge displayed by Mr. Gladstone in his revision of the tariff, a care and knowledge which stands in marked contrast with the vague fears and loose assertions with which my right hon. Friend has been assailed.
The noble and learned Lord (Lord Lyndhurst), who himself spoke with such eloquence tonight, praised the eloquence of my right hon. Friend's speech in proposing the Budget; but he ended by drawing a marked, and, I thought, somewhat invidious, distinction between the eloquence of Mr. Gladstone and his prudence or wisdom. Now, I venture to maintain that, if ever there was a speech delivered in Parliament free from anything like mere declamation, it was the speech with which my right hon. Friend introduced his financial scheme to the consideration of Parliament With the exception of the last sentence, in which some play of fancy is usually allowed to an orator, it was strictly and exclusively a clear statement of facts combined with close reasoning and the distinct enunciation of principles. There was not a single word calculated to carry away the imaginations even of the most popular assembly; although, indeed, the whole address went to the heart and intellect of those who listened to it.
It seems, my Lords, to be a general agreement on both sides of the House that there should be very little debate on the subject of the paper duty itself. Although we are now nominally discussing the repeal of those duties, yet that question has been mainly considered with reference, not to its own merits, but to its connection with the general financial affairs of the country. I wish, therefore, to solicit attention to only one or two observations bearing upon this particular tax. In the first place, I 1518 think that nobody will deny that the paper duty stands very much in the same category with the Excise duties upon soap, upon glass, and upon bricks. These are the three great branches of Excise which have been successively abolished cither by Sir R. Peel or by Governments which have succeeded his; and the paper duty is the only remaining branch of the Excise which stands in the same class and rank. I think it is quite impossible to dispute that this tax does interfere with trade and production. Among the petitions presented by a noble Earl opposite on this subject was one from the town of Leeds; and, as that petition was introduced with some remarks that led me to believe it possessed some importance, I have taken the trouble to read its prayer and look at its signatures. I confess, my Lords, that I was rather astonished at the arguments used by the petitioners to influence your judgment. They say that "the increasing expenditure for the national defences has imposed on the middle and upper classes a largely increased burden of taxation." I venture entirely to dispute the proposition that the burden of taxation has rested exclusively or even mainly on the upper and middle classes, as distinguished from those below them. Without going farther back than this very Budget, it is surely a fact not undeserving of consideration, that, although the Tariff Bill which was passed a few nights ago was condemned by the noble Earl opposite as involving a reckless sacrifice of revenue, that measure actually imposed more duties than it took off. It reimposed duties comparatively high on tea and sugar. Those duties are not raised exclusively from the higher classes, but the great bulk of them are paid by the middle and lower classes. I am not now supporting the assertion, which however is frequently made, that these duties on consumption are levied substantially on the working classes. This may be an overstatement of the case. But undoubtedly the working classes contribute a very large share of the total revenue derived from those sources. Therefore, it is not true to say that the taxation imposed on the country for the national defences is, even as respects the Budget of this year, entirely or mainly thrown upon the upper and middle classes. The Leeds politicians, speaking, I presume, of the income tax, say, "that by diverting capital from its natural channels, it must, if it is long continued, impede the development of the industrial energies of the people." I 1519 have no doubt that the income tax is a serious inconvenience; but how it can divert the capital of the country from any particular channel I am at a loss to conceive. At least, I am prepared to maintain that it cannot have that effect to anything like the same degree as taxes levied from special branches of industry or modes of production. The petition goes on to say, "that under these circumstances your petitioners have viewed with alarm the fact that the House of Commons has passed a Bill for the repeal of the paper duty, the collection of which has been a fruitful source of revenue, bearing with equity upon all classes, and protecting from foreign competition a large and important branch of manufacture." There, my Lords, we get at the true argument; and I am bound to say it has been frankly avowed by certain noble Lords, who admit that the paper duty is to a great extent a protective duty. The fact is, that all these Excise duties on one particular trade tend to concentrate that trade in the hands of a few great capitalists, who prevent other capitalists from entering the field. Thus they most seriously interfere with trade. And how is it that we have interested persons coming forward to ask your Lordships not to repeal this tax? Why, some of these large papermakers know very well that the moment this duty is repealed a very considerable number of mills, requiring a small capital to establish them, will spring up and enter into competition with them; or, on the other hand, they apprehend that foreign paper will be introduced more cheaply.
I say, then, that if these persons dread the rivalry of their own countrymen at home, or of the manufacturer abroad, in either case that is an argument why, in strict consistency with the principles you have adopted for the regulation of your finance, you should press forward in the abolition of these taxes, rather than suffer them to continue. Several noble Lords have spoken to-night as if the paper duty could be maintained as a permanent source of revenue. The noble Mover of the Amendment has, indeed, gone so far as actually to capitalize the produce of this duty, valuing it, I believe, at thirty years' purchase. Now, I will strike a bargain with the noble Lord. I will give him long odds that the paper duty will not last much more than another year. If he will give me only one more year's produce from it, I will give him his chance of all the rest. 1520 After a tax of this kind has been given up by the House of Commons, with the consent of the Ministers of the Crown, it is utterly hopeless to suppose that it can ever be maintained as a permanent source of taxation. It can only be handed over for further agitation, involving the commercial community in constant agitation and uncertainty.
This brings me, my Lords, to the last part of the argument with which I shall trouble the House. I am not going to deny the legal power or right of this House to refuse any Bill which may be sent up for your assent. Unlike, perhaps, most Members of this House, I have never had the honour of belonging to any other assembly, and my own feelings are as warmly interested in maintaining the powers and privileges of this House as those of any other Member can be. I fully admit you have the legal power and the legal right to refuse your assent to any Bill which seeks it. But surely legal power and legal right are wholly different from constitutional practice. It is vain to deny that many, perhaps most of those who will support the Amendment to-night, are aiming at the condemnation of a policy of which this is but a single and almost the last remaining step. The repeal of the paper duty stands on precisely the same grounds as the repeal of the soap tax, the repeal of the glass duty, and of the duty on bricks. I contend, therefore, that you are aiming at the condemnation of a policy which has been eminently successful, and which on repeated occasions has received your own assent. But there are objections applicable to the paper duties which did not apply to the other taxes to which I have alluded. Unlike almost any other tax, the paper duty has been twice condemned by the House of Commons. It has been condemned by an abstract Resolution, and afterwards by a Bill passing through all its stages. Surely this is a very strong reason why, in the exercise of a wise discretion—to put it on the lowest ground—your Lordships should not exercise your strictly legal right. But there are grounds somewhat higher. I fully admit that there is no technical distinction between rejecting a Bill imposing a tax and a Bill repealing a tax. But every noble Lord must feel that it does make a very serious substantial difference in respect to an unusual exercise of power, whether it be exercised in relief, or in the imposition of a burden on the people. The very gist of my objection to such a course 1521 is that the danger of it does not lie in technical grounds—it lies on substantial grounds. In opposing the repeal of this duty you are going to the very heart and root of the constitutional powers of the other House of Parliament. You are not invading their technical privileges; you are not transgressing your own technical privileges; but in truth and in substance you are striking at the very root of the constitutional usage which has hitherto regulated the relations between the two Houses. It is not that this is a money Bill merely. We have rejected many Bills which involved taxation. But there is a plain distinction between a mere money Bill and a Bill of Supply. There are money Bills of every kind and degree, from those partaking of the nature of a "Tack," against which this House has always protested as an invasion of your own privileges—to others, which, though involving taxation, involve also questions of general policy, I believe if you examine the precedents brought forward to-night by the noble and learned Lord, it will be found that, although they were all money Bills, not one of them was, in the proper sense of the word, a Bill of Supply. I happened last week to see the same list; I went with some care over each of them, and I believe I am correct in saying that not one of them was in the nature of a Supply Bill. I beg to direct the attention of the House to the peculiar nature of what are called Supply Bills. I will take the very Bill we are now proposing to repeal. This is the preamble of a Supply Bill, entirely different from ordinary Money Bills, which belong to a different class.Most Gracious Sovereign,—We, your Majesty's most dutiful and loyal subjects, the Commons of Great Britain in Parliament assembled, finding it absolutely necessary to raise large supplies of money to carry on the war, until your Majesty may be enabled to establish a good and lasting peace, and to defray your Majesty's extraordinary expenses, do by this Act give and grant to your Majesty the several and respective duties in this Act mentioned," &c.I believe there is not one of the Bills referred to by the noble and learned Lord which was in the nature of Supply, or had that paragraph in the preamble. I believe farther, though this I must to a considerable extent state on the authority of others, that there is no instance on record since the Revolution in which your Lordships have thrown out a Bill strictly in the nature of Supply—that is, a Bill either granting, or repealing a grant of taxes, in strict con- 1522 nection with the financial requirements of the State as declared by the Crown, and passed by the House of Commons. Such a course runs against the whole spirit of the Constitution. Not merely does it invade the peculiar province of the House of Commons, but to a very large extent also it is at variance with the constitutional relations of both Houses of Parliament, to the Crown and its constiutional advisers. In Mr. Erskine May's Treatise on the Law and Usage of Parliament, the constitutional doctrine in respect to taxation is laid down distinctly;—"That the foundation of all Parliamentary taxation is its necessity for the public service, as declared by the Crown through its constitutional advisers." And thus—not only is there no instance of the House of Lords rejecting a Supply Bill of this nature, but I believe, consistently with the principle above stated, it is unusual, and almost unprecedented, even for the House of Commons itself to throw out a Bill of this nature, proposed by the responsible advisers of the Crown, except in cases where the rejection of a Budget altogether has been used to overthrow a Government.
The noble Lord made rather light of another circumstance, which, though I fully admit it has no technical force in this House, constitutes surely a very strong moral obligation. It is true that, as far as the Government is concerned, they did not set the 1d. additional income tax as against the repeal of the paper duties; but it does so happen that in the House of Commons a distinct Motion was made on this subject by a distinguished Member of the Opposition, and an important division was taken on that occasion. It was then decided that the additional 1d. of income tax should be imposed, rather than the repeal of the paper duties should be abandoned. But if the House of Commons had foreseen the decision your Lordships are now called upon to pronounce, they might have taken another course from that which they did take, not doubting that the usual practice of Parliament would be observed. I do not say that is a technical objection to your proceeding; yet surely it is but fair, when the House of Commons came to a distinct and decided vote against one tax as compared with another, we should consider it an additional obligation to decide the question before us with very strict reference to the constitutional practice of the two Houses.
And now, my Lords, with reference to 1523 the only remaining point—I mean the question of the deficit. I need hardly remind the House that there have been many occasions on which a deficit has been threatened by the Opposition. There was a very recent case in 1857; your Lordships will no doubt recollect that on that occasion the whole pressure of the Opposition was directed to show the necessity of farther reduction, and that there would be an enormous deficit in 1858–9. It was quite in vain that Sir George Lewis maintained that he was not bound to go into any year beyond that for which he had immediately to provide; Mr. Disraeli would insist there was a large deficit ahead; and, as a specimen of the danger of these figures, I would for a moment direct your Lordships' attention to the actual results. On the 20th of February, 1857, Mr. Disraeli insisted that in the following year it would be impossible to take the income higher than at £61,404.000, and the expenditure at £62,804,000, showing a deficit of £1,400,000, without taking into account the Exchequer bills, of which we have again heard to-night. Sir George Lewis endeavoured to prove that a more favourable result might fairly be anticipated, and in particular that the Revenue might he estimated considerably higher. He placed it at £62,300,000. It so happened that before the year was out the noble Earl was in office, and Mr. Disraeli had to deal with the finances of the country. In happier mood Mr. Disraeli, in April, 1858, was able to announce to Parliament that, instead of the Revenue being at the outside £61,404,000, it amounted to £63,120,000, a sum which exceeded the estimate of Sir George Lewis by £820,000, and Mr. Disraeli's own by £1,716,000! Let us beware therefore of the oft-paraded proofs of deficit. There is a very large margin you must allow for the ordinary increase of revenue in the country, an increase which is likely to be all the greater if important commercial reforms such as those which are now under the consideration of Parliament should be carried into effect.
I may now be allowed to offer to the House one or two observations on that portion of the brilliant speech of the noble and learned Lord who spoke at the commencement of the evening, in which he indicated that the popularity of the financial proposals of the Government was now somewhat on the wane. In answer to that statement, I am perfectly prepared to admit 1524 that there has, naturally enough, for some weeks past, been a cessation of those songs of triumph which were chanted throughout all the commercial cities of the country when the scheme of the Government was first propounded, and which resulted from the almost universal appreciation of its value. If any change in public opinion with respect to it has since taken place, I can ascribe that change only to misinformation as to certain failures which, it is industriously circulated, though I believe without any foundation, are likely to arise in connection with the Commercial Treaty with France. My own belief is, however, that no such change has in reality been brought about, and that if there be any apparent difference in the sentiments now entertained by the public as contrasted with those which at the outset prevailed in regard to the proposals of the Government, that difference is to be attributed to the fact that the people at large were confident that the passing of the Budget was a thing perfectly secure. They were animated by that confidence because they placed reliance on that constitutional usage through which we are now invited to break, and because they were actuated by a spirit of faith in the proceedings of the Legislature which I am afraid we shall, if we reject this Bill, be doing much to turn into a spirit of distrust. I may add, in the reply to the remarks of the noble and learned Lord opposite to which I have just alluded, that during the last week or two time has been afforded to individual interests, some of which are injured by every great scheme of reform, to work their way to the surface and to exhibit that apparent change in the current of popular opinion in relation to proposals of the Government to which he has drawn our attention.
I have now, my Lords, trespassed at considerable length upon your notice. My excuse must be the deep interest which I feel in your decision to-night—an interest which animates me far more strongly as a Member of this House than as a Member of the Government, or a supporter of the policy of my right hon. Friend the Chancellor of the Exchequer. That policy no opposition which may be made to it on the part of the noble Baron who moved the Amendment will, I am confident, eventually have power to reverse. I am of this opinion because I feel assured that those principles of commercial policy, originating with Mr. Huskisson, which were matured by Sir Robert Peel, and which are now 1525 being carried to their final triumph by my right hon. Friend, have been irrevocably sanctioned by public opinion. So far as the individual tax with which we are immediately dealing is concerned, it is, I believe, impossible even for the authority of this House to maintain it as a permanent source of revenue, and I have no doubt that one of the effects of our coming to the decision at which the noble Baron asks us to arrive to-night would be at once to revive that interest in the financial scheme of the Government which to some noble Lords of late appears to have flagged. Any such revival of interest, would, however, in my opinion, be very dearly bought if the Act which led to it should contribute to create any doubt in the minds of the people of England as to the spirit of wisdom and moderation in which your Lordships' House is disposed to exercise the legal privileges which it enjoys.
§ THE EARL OF DERBY
However important, my Lords, may be the subject which occupies your attention this evening, it is, I am afraid, one to which it is difficult to impart an amount of interest at all proportionate to its intrinsic magnitude. I feel, also, that I labour under considerable disadvantage in rising to address your Lordships at this hour of the night (a quarter to twelve), and at the close of a lengthened debate, more especially as my observations must be mainly directed to dry financial details, which are in themselves of a character not very inviting. I may, however, be permitted, before passing to those details, to say a few words with respect to the constitutional question involved in this discussion, which — notwithstanding what has just fallen from the noble Duke or from the noble and learned Lord opposite, who formerly occupied a seat on the woolsack, or from a Member of your Lordships' House who came forward as a friendly critic, but not in the capacity of a voter hostile to the Government on the present occasion—I should be perfectly satisfied to allow to rest on the footing on which it has been placed by my noble Friend behind me, and by my noble, learned, and venerable Friend who spoke early in the debate, and who has signalized the close this day of the eighty-eighth year of his honoured life, by a speech combining the utmost clearness and power of statement, with a knowledge the most complete of the details of constitutional law and practice. Now, the noble Duke opposite (the Duke of Argyll) did not, I must say, 1526 in dealing with this point of constitutional usage, succeed in establishing the position which he laid down upon the subject, or at least did not materially strengthen the argument by the position he took. He said that there was no instance in which your Lordships' House had rejected a Supply Bill, and he quoted the ordinary language of a Bill of that nature. I, however, hold in my hand the very Bill to which my noble and learned Friend near me has already alluded—namely, an Act granting Her Majesty certain duties to be levied on wash and other liquors used in the distillation of spirits, and which begins with precisely that form of expression, "Most gracious Sovereign, we your Majesty's most dutiful and loyal subjects," and so forth. This, therefore, is a Supply Bill, and yet the Bill, so distinctly marked with that character, was absolutely rejected by your Lordships' House, notwithstanding the statement of the noble Duke, to the effect that there was no instance in which such a course had been taken in reference to a measure of Supply. But this is not all. The argument drawn by the noble Duke from this source completely fails in the present instance; he contended that we cannot reject this Bill because it is a Supply Bill, whereas the Bill under our notice is, as it happens, not a Supply Bill at all, but a Bill for the repeal of a tax. There was another argument of the noble Duke which certainly carries this constitutional argument rather further than it has hitherto been considered to apply. He says that almost all money Bills have a twofold character—that they have a political as well as a financial side. Does he see what is the natural inference of that? If we are unable to amend a money Bill, or to reject a money Bill—that is, if we are unable practically to express any opinion at all upon a money Bill, and if all these money Bills have a joint political and financial character, by the assumption of the noble Duke your Lordships' House is deprived, not only of the power of dealing with matters of finance, but also with those political considerations involved in the Bill. Surely Her Majesty's Government are not contending for a limitation of the power of your Lordships' House so extraordinary, and I will, with all respect to the noble Duke, say so absurd, as that contended for by him. He says again, that though what is proposed is not technically a violation of the privileges of the House of Commons, yet it is practically a violation, inas- 1527 much as they have assented to an income tax increased by one penny in the pound, which they would probably not have assented to if they had not relied on our passing this Bill. If you are not to exercise any discretion, in what position are your Lordships? We could not, when the Income Tax Bill was brought up, do more than give notice that we intended to object to the paper duty; we had no power to do more, for we could not make such an Amendment on the Income Tax Bill as would enable us to deal with this Paper Duty Bill. We might have rejected the Income Tax Bill, or have passed it for the full amount of the tax, and what we did do was to adopt a course which we thought entitled us to credit. We said, however we might object to an Income Tax, or to a portion of the Budget, or to the Treaty, we should not interfere with the provisions of the Bill because we would not embarrass the finances of the country and the general arrangements of the Government; but on that occasion I guarded myself by stating that there was a broad distinction between that and another Bill, the rejection of which would not embarrass the finances of the country, but would put a larger sum at the disposal of the Government, I should reserve to myself full liberty to deal with it. Leaving the constitutional part of the question where it was left by my noble and learned Friend, and by the noble Duke who spoke last, whose advocacy does not seem to have very much improved his case, I proceed now to the main point, the abolition of the paper duty, and the grounds on which we object to that abolition. The noble Earl who opened this discussion occupied a considerable part of his speech by doing me the honour to refer in great detail to an address which I delivered to a deputation a day or two ago. He called it an unfortunate speech; but, however much it may deserve the term as regards myself, it certainly is a fortunate one in this, that it furnished my noble Friend with matter for almost the whole of his speech. He commented on the statement I made, that I thought it was a fortunate thing that this Amendment was brought forward without any concert with me by the noble Baron opposite, who is generally a supporter of the Government; and he says that it surely is a question of such importance that I ought not to have waited for its being taken up by an independent Member of the House, but that it ought 1528 to have been taken up on the ground of policy and principle by a great party like that which sits opposite to him.
§ EARL GRANVILLE
What I said was, that the question was of such importance that the noble Earl ought to have made up his mind about it, without waiting until the notice of this Amendment had been given by my noble Friend.
§ THE EARL OF DERBY
I do not know that I have ever said anything that could lead the noble Earl to the conclusion that I had not made up my mind. On the contrary, I had made up my mind completely and absolutely long before; and what I said then, and what I repeat now, is that I was very glad it had been taken up by the noble Baron, who is generally a supporter of the Government, because I thought that if it had been brought forward by me, there would have been fair room— there would have been ground laid—for objecting on the other side that it was brought forward merely as a political question, and not as a financial question and a question of the greatest possible interest to the country. I was glad, therefore, that the initiation of this Amendment should lie with the noble Baron, who could not be suspected of being actuated by any feelings hostile to the Government, or who is unfriendly to their general views. But I will go further, and I will say that in supporting this Amendment with the full conviction that I am performing a sacred and solemn duty, I can assure noble Lords opposite, sincerely and distinctly, that I do so with no desire whatever to embarrass, still less to disturb or overthrow, Her Majesty's Government. I can assure them I have no desire to relieve them from the responsibility which they have incurred; still less do I desire that any friends of mine should be so unfortunate as to be the persons to replace them. I do not hesitate to go further, and to say that in the present state of affairs — in the threatening state of affairs abroad—in the alarming condition of our financial prospects at home —I think it would be a national misfortune if to these causes for anxiety were added the complications and difficulties which might arise from the noble Lord at the head of the Government being compelled at this moment to relinquish the high office he holds. Therefore, I assure you, with all sincerity, that it is with no spirit of hostility to the noble Lord at the head of the Government or his colleagues that I am taking this course. I come for- 1529 war because I believed that your Lordships' interference is necessary to save the country from great present and much greater future financial difficulties. With regard to the paper duty, the noble Earl was right in conjecturing that it was not my intention to rest my argument upon the intrinsic merits or demerits of the tax. I shall, consequently, follow the example set me by the noble Earl, and abstain altogether from discussing the objections to the duty on the one hand, or the advantages which it may offer on the other. I may be permitted, however, to correct one misapprehension of the noble Earl in reference to what he imagines me to have said the other day—still in that unfortunate speech —as to the course pursued by the Government in 1858. Your Lordships are aware that that Government was one not very strong in Parliamentary support. We had brought forward a Budget which had given general satisfaction. We did not find ourselves in possession of a large available surplus. The noble Duke stated that whereas the revenue was estimated at £61,000,000, it actually was £63,000,000; but he omitted to mention that the estimated expenditure was £67,000,000; and that, consequently, there was a deficiency to make up of £4,000,000. What I said the other day in reference to this paper duty was this: —Resolutions wore brought forward in the other House of Parliament that the paper duty was not a fit source for a permanent revenue; and, next, that it was desirable so to frame the financial arrangements as to enable Parliament to dispense with it. My right hon. Friend the Chancellor of the Exchequer stated that in the abstract he agreed with the Resolution—as I do—that if the country could afford the loss, the paper duty was not a desirable source of permanent revenue; but he objected to the further Resolution. That, he said, was not the fitting time to take it off. We had proposed a Budget which remitted a certain amount of income tax in conformity with the provisions of the existing law—next year we shall have to deal with the tea and sugar duties, upon which there will be another fall, we shall have to provide for the gradual extinction of the war duties and for the entire lapse of the income tax, and we cannot give the income tax the preference over these two great objects.That was the argument used then, and that is the argument I use now. I do not defend the paper duty theoretically as a desirable source of revenue; but if the Exchequer were full, if the finances were flourishing, if the prospects abroad were more certain, and if your income tax were at a less exorbitant rate than that at which your necessities have compelled you now 1530 to place it, —if you had relieved the taxation which presses on the labouring classes by the remission of the tea and sugar duties—if circumstances, in fact, were altogether different, it might be desirable to repeal the paper duty; but, while they remain as they are, you are only adding to the financial embarrassments of the country by this improvident and reckless proposal. Proceeding now to the financial part of the question—I am obliged to say the noble Earl need not have reminded me of my own inadequacy to deal with this financial question, and of the reluctance with which the House will listen to figures, even at the period of the evening at which he spoke, much more now. Though I do not pretend to the character of a prophet —in financial matters more especially—I have this satisfaction, that I found all my statements and all my figures on those of the Chancellor of the Exchequer, and in the objections which I shall offer to the present scheme of finance, there is not one in which I am not able to appeal to the high authority of the same right hon. Gentleman. Whether I refer to the obligations, strict binding pledges, which were given by the Government that the income tax should finally expire in 1860—whether I look to the feeling that the falling in of the Long Annuities should be used as a means of affording relief, not in the shape of indirect taxes, but to contribute to the abolition of the income tax—whether I look to the necessity of looking beforehand to another year, and not being satisfied to deal with the finances of one year only —whether I look to the necessity of postponing the abolition of the paper duty, or to the necessity of abrogating the war duties on tea and sugar—upon all those points I am happy to say I have the high authority of the Chancellor of the Exchequer, who has recently placed himself in direct opposition and hostility to the financial schemes of the right hon. Gentleman who was then Chancellor of the Exchequer, and who is now his Colleague at the head of the Homo Department. In the first place let me deal with the finances of the last and present year, according to the statement of the Chancellor of the Exchequer. In looking at the revenue and expenditure of 1859–60, the right hon. Gentleman was anxious to show what would have been the surplus for the year 1859–60 if unexpected causes had not arisen to increase expenditure on the one hand and diminish the produce of taxes on the other. 1531 Even by taking advantage of a very unexpected sum received from Spain in payment of an old debt—for which, I believe, he was mainly indebted to the exertions of my noble Friend, who the year before filled the office of Foreign Secretary—the right hon. Gentleman made the expenditure and income exactly alike. This year the estimated revenue is £60,700,000; the estimated expenditure, £70,100,000, —you might call it £71,000,000, because there is 1,000,000 of Exchequer bonds which have to be provided for in some way this year. That leaves a deficiency of £9,400,000. The Chancellor of the Exchequer offered us various modes of filling this up; for instance, there were the tea and sugar duties which might be kept on, which would make £2,100,000, or we might have a 9d. income tax. He says an income tax at 9d. will produce £9,772,000, and will give a surplus of £372,000. Well, my Lords, in the circumstances in which this country was placed, and looking to the causes which necessitated such great expenditure—which was not an outlay of the ordinary character, but a war expenditure in the time of peace, which became absolutely necessary for the security and for the safety of the country—I do not believe the slightest objection would have been raised to the imposition of the 9d. income tax, providing it was shown to be necessary for the safety and security of the country. And, although, it would not have been as striking and as brilliant a Budget as that brought forward by the right hon. Gentleman, in my opinion it would have been one more likely to receive the general assent and sanction of Parliament. But the right hon. Gentleman thought this was a fit occasion for a display of his matchless rhetorical powers. Having had the pleasure of listening to that most eloquent and most able speech, I came away with the fullest conviction that such a Budget as was then proposed, such a financial arrangement, combining so many difficulties and so many dangers, never could have commanded the consent of any legislative assembly if the listeners had not been so dazzled by the brilliancy of the rhetoric of the right hon. Gentleman as to be willing to blind their eyes to the dangerous consequences of that reckless course on which he was urging them to enter. With a deficiency of £9,400,000, the right hon. Gentleman proceeded to make his statement, and, adopting the principle which seems also to have been followed by the 1532 noble Duke opposite — who contended that because you could not strike off the income tax at all, you might therefore proceed to enlarge the deficiency—he proposed that you should make great experiments in finance. I shall not stop to show how completely different the measures now proposed by Her Majesty's Government are from those successive systems and plans originated by the late Sir Robert Peel; but the Chancellor of the Exchequer laid down this paradoxical doctrine:—Most persons hold the opinion that periods of prosperity, in which the revenue is fairly productive, are those in which you ought to make financial amendments and improvements; on the contrary, says the Chancellor of the Exchequer, that is quite a mistake; the worse the position of your affairs, the more desperate your deficiency, the more serious your loss and the greater your dangers, the more imperative is the necessity for an audacious and daring Minister to enlarge that deficiency and to increase the difficulties, so that you may take your chance of throwing "double or quits." You are already half through, he tells you; one more dashing move, it is possible you may recover your fortunes; and if you fail you cannot be much worse off than you were before. My Lords, I say that is not the policy of a statesman— it is the policy of a desperate and improvident gambler. What is the course the right hon. Gentleman proposes to take? Finding a deficiency of £9,400,000, he introduces a further deficiency by the French treaty, which he estimates at a gross loss of £1,737,000, or a net loss of £1,190,000. I take all his figures as I find them, and I suppose him to be perfectly accurate in his calculations. The loss by the abolition of the Customs duties is set down in the gross at £1,440,000, or £910,000 net; and he winds up the whole by the abolition of the paper duties at the net sum of £990,000 for the present year. In this manner he increased the deficiency of £9,400,000 by £3,090,000, and he left the House of Commons to deal with the very nice little deficit of £12,490,000. Now, how did he deal with that amount? In the first place he proposed a number of new charges—and these numerous petty and vexatious imposts on commerce will, I believe, be found productive in practice of infinitely more embarrassment and annoyance than the trifling reduction in the duties will compensate for. He estimated that from new charges and savings on the 1533 Customs establishment he would realize £982,000; he continued the war duties on tea and sugar, from which he derive £2,100,000; he put on an income tax of 10d. in the pound, producing £8,472,000; and carrying out the principle which pervades the whole of this Budget, by a new arrangement of the income tax lie managed to get in for the present year a larger amount than would he yielded by the ordinary mode of imposition. Instead of half a year's proportion of the tax he is to receive three-quarters of the amount in the present year, in addition to the one-fourth which remained for the service of the year, arising from the previous 5d. income tax. Even this would have left him in a deficiency of something like a million after taking his new charges; and so, after he had continued the present war duties on tea and sugar, after he had saddled the country with an income tax of 10d. in the pound, three-fourths of which was to be raised in the first half-year, he found it necessary to take for the year 1860–61 the malt and hop credits, amounting to £1,400,000, which properly belong to the service of the years 1861–62. And thus, by anticipating revenues, he converted his large deficit into an apparent surplus of £464,000, at the expense of the year 1861–62, and without making the slightest provision to meet the difficulties which in the year 1861–62 must come upon the Exchequer. My Lords, I said an apparent surplus of £464,000; but the noble Earl opposite has admitted in the first place one very manifest error, arising from a very simple cause. The Budget estimate for the collection of revenue was £4,700,000, but the Chancellor of the Exchequer in bringing forward this brilliant Budget forgot that the cost of collecting the income tax was by poundage; and consequently the increased production of the income tax must be acquired at an increased charge; so that when the Estimates are brought forward the amount no longer stands at £4,700,000, but at £4,932,000, being an increase of £232,000, or exactly half the estimated surplus. The noble Duke behind me pointed out—and it has not since been denied—that the Chancellor of the Exchequer has been compelled to admit drawback to the extent of £250,000 on this very paper duty. That of itself would be sufficient altogether to exhaust the remaining surplus for the present year, and to leave the Chancellor of the Exchequer with a deficiency. My noble Friend the President 1534 of the Council, in his opening speech, stated that some further concessions, which were estimated at £100,000, had been made. When we come to look at other matters, I think it will be manifest that even in the present year the Chancellor of the Exchequer has landed us in a most formidable deficiency, and to that you wish voluntarily, spontaneously, and unnecessarily to contribute to the amount of a million by the abolition of the paper duty. The Miscellaneous Estimates are seven in number, and they were taken at £7,503,000. The six already presented amount to £6,644,000. The seventh has not yet been presented, but if the estimated amount for the whole be £7,500,000 it follows that for the seventh there is only left the sum of £855,000. The similar article in the Miscellaneous Estimates last year amounted to £1,128,236, and, therefore, to bring it within the seventh estimate with the stipulated amount of £855,000, you must accomplish a saving this year of £272,000. But on the whole of the remaining £6,644,000 you have only effected a retrenchment to the extent of £107,000; and I therefore leave your Lordships to conjecture what chance there is of your saving £272,000 out of a total sum of £855,000. We are told that in the Budget credit was taken for a Vote of £500,000, which, I suppose, must be taken in addition to the sums voted for the military and naval forces engaged in the Chinese war. And, therefore, by whatever amount the expenses of the war in China exceed that Vote of credit of £500,000—and we maybe sure that it will not be a trivial excess—by so much will there be, on the showing of the Chancellor of the Exchequer, an addition to the deficiency in his Budget for the present year. There is one point on winch I should like to hear some explanation, and perhaps the noble Lord the Under Secretary of State for the War Department will enlighten me on the subject. He will remember that the Army Estimates were taken back and altered after they had been laid on the table of the House, in consequence of the arrangements of the Government having been materially interfered with by a number of troops which were sent back from India. They were altered, but they were increased by a very small amount indeed. I want to know the meaning of this phenomenon. The establishment was added to by 1,900 men, in addition to those charged on the previous Estimates, and those men had, I suppose, to 1535 be clothed, provisioned, and stores found for them; and yet, although a slight addition was made on account of the men, I find no addition made for any articles of clothing, provision, or storage. I want to know how this additional expenditure is provided for, since it does not appear in the Budget. I believe the Vote of credit of £500,000 will be mainly absorbed by these items; but at the present moment we are unable to obtain the slightest information on the point. In the Budget for the present year no reference is made to any contemplated outlay for fortifications with a view to the defence of the country, and yet we are given to understand that it will be necessary to expend a large sum of money in this manner. Any portion of this charge which may be incurred in the present year must increase the deficit which will have to be encountered in the year 1861–62. Then the Foreign Office and the Colonial Office had been found to be too dangerous for habitation. Plans have been I framed, and everything has been got ready, and I expected that this year we should have seen the erection of a new Foreign Office, if not also of a Colonial Office. But no, no Estimates have been taken for any-thing of the bind; but if the expenditure does not fall upon this year it must fall upon the diminished resources of 1861–62. Therefore I say that, following the Chancellor of the Exchequer's own figures, and only allowing for those corrections which are absolutely necessary to make, and which have not been denied by the right hon. Gentleman's Colleagues, even for the present year there will not only not be a surplus of £464,000, but there will be no surplus at all; and, as it does not need the gift of prophecy to show, there will be a considerable deficiency, even supposing the Chancellor of the Exchequer's calculations to be correct. Again, we must remember another element of danger. The Chancellor of the Exchequer calculated upon a loss upon French wines of £1,700,000; but, in consequence of increased consumption, it would be only £1,100,000. To make lip that loss the consumption of French wine must increase in the course of three-quarters of a year no less than 35 per cent, and that without affecting—for if it did it would alter the whole balance — without affecting the consumption of beer or spirits. Then, again, as to the trifling articles amounting to £910,000, a nett estimate of loss upon a gross loss of £1,040,000; and yet I do not know where the great increase 1536 of consumption is to come from, seeing that upon a greater portion of those articles the duties are remitted altogether. Now, before I proceed further, this is, perhaps, a convenient time to deal with the financial prospects of 1861–2. I am assuming that the expenditure of 1861–2 will be no greater than that of the present year—that is, £70,100,000; and the amount by which it is underestimated, £230,000, makes it £70,330,000. The revenue of 1860–1 is £70,564,000. From that sum we have to deduct the malt and hop credits, which will not be available again, £1,400,000; the Spanish payment, £250,000; the loss upon the tariff, according to the Chancellor of the Exchequer, £700,000; and another sum of £150,000, being the difference of the balance of income tax for the first quarter of a year. These sums taken together make £2,500,000; and therefore, supposing all other things to remain as they are, the surplus in 1861–2 will be less or the deficiency greater by that amount, reducing the amount of the income for 1861–2 to £68,064,000, leaving a deficiency of £2,266,000 — that is, supposing the Chancellor of the Exchequer's calculations are all correct, that no additional charge for China be necessary, that there be no charge for building public offices, no charge for fortifications—admitting none of these matters which are postponed from this year, and must fall into some succeeding year; admitting the continuance for another year of the income tax and the war duties on tea and sugar; giving him every source of revenue upon which he has calculated, and calculating no source of deficiency, the Chancellor of the Exchequer's scheme will lead to a deficiency in 1861–2 of £2,268,000. Now, my Lords, I did state, as the noble Earl has remarked, to the deputation which I saw on Saturday that I would not ask your Lordships to reject this Bill unless I could show that upon the statement of the Chancellor of the Exchequer himself there was every probability that in 1861–2 there would be a deficiency approaching to £2,000,000. I have shown you it must be £2,700,000, and will probably be much more. I said I would not only confine myself to the facts and figures of the right hon. Gentleman, but upon the various points of the Budget to which I object I would produce the sanction of his high authority. And first, my Lords, as to the pledges, to use the right hon. Gentleman's own terms in 1853, that measures should be taken, or, as he phrased it, every 1537 nerve should be strained, to take off the income tax in 1860. I am not finding fault with him for not taking off the income tax in 1860, because I know circumstances have been too strong for him; but what I am contending for is this, that the Chancellor of the Exchequer had no right to say that the large falling in of £2,400,000 afforded him means, or could be made a justification, for taking off a corresponding amount of indirect taxation, inasmuch as that very sum -was known to be about to fall in during the present year, and had been estimated by him as one of the principal means for removing the income tax in 1860. Listen to the statement of Mr. Gladstone in 1853:—How are we to obtain a rational prospect of being able to part with the income tax in 1860 estimated tax, £6,140,000; new sources of income, £2,549,000? Then we come to the anticipated reductions of charge, which of course will be as effectual to the purpose in view as positive additions to the revenue. The first of these reductions of charge is that on the Three-and-a-Quarter per Cents, which we owe to the wise measure of the right hon. Member for Cambridge in 1844. That measure will bring to the account £624,000. … Then in 1859–60 there will fall in the heavy burden of the Long Annuities, and of another large portion of our terminable annuities. The first of these is £1,292,000, the second £854,000; together they will operate a relief of £2,146,000. Adding this amount to the sum of £3,813,000 … there will be an available increase of means of no less an amount than £5,959,000 against the £6,140,000 of income tax, which will be the total amount of that tax at that period. In the years 1860–61 half of the income tax at 5d. will be available. The balance will be applicable as respects the following year. The Committee may now judge whether I have been justified in the language I have used with respect to the surrender of the income tax.—[3 Hansard, cxxv. 1420.]The Motion then made by the Chancellor of the Exchequer was, that in April, 1860, except as to the collection of moneys then duo, the said rates and duties shall cease and determine. That was in 1853, and, no doubt, the circumstances have since altered. But, in 1857—and this supports me in another argument, — namely, as to the necessity of looking ahead and providing not only for the service of the present year, but for future years—the following Motion was made by Mr. Disraeli, as an Amendment to the financial statement of the right hon. Gentleman now Home Secretary:—That in the opinion of this House it would be expedient, before sanctioning the financial arrangements for the ensuing year, to adjust the estimated income and expenditure in the manner which 1538 shall appear best calculated to secure the country against the risk of a deficiency in the years 1858–9 and 1859–60, and to provide for such a balance of revenue and charge respectively in the year 1860 as may place it in the power of Parliament at that period, without embarrassment to the finances, altogether to remit the income tax."—[3 Hansard, cxliv. 971.]That Motion was strenuously supported by the present Chancellor of the Exchequer, and I must say in the speech he then made he bore somewhat hardly upon his now Colleague, who then filled the office of Chancellor of the Exchequer. I must also do him the justice to say, that the Budget he has now brought forward is very much in accordance with the views lie then expressed; but if he had endeavoured to frame a Budget in such a manner as to negative item by item and point by point the principles laid down by the then Chancellor of the Exchequer he could not have done so more faithfully and successfully than he has done. What were the main points of Sir George Lewis's Budget in 1857? That it was not expedient to abolish the paper duties; that it was not expedient to do away with the wine duties; and that it was of great importance that you should not so reduce the tariff to small number of articles as to endanger the permanence of the revenue derived from that source. The Budget of the present Chancellor of the Exchequer goes upon the principle that you should abolish the paper duties, that you should abolish the wine duties, and that you should simplify the tariff so as to make it comprise the smallest number of articles possible; and his predecessor in office had the satisfaction of sitting behind him and hearing those principles enunciated, and of giving to them, of course, his cordial approbation. As I am going back to the question of pledges, your Lordships will observe the language in which Mr. Gladstone commenced his speech on that occasion:—I have stood at that box, Sir, and have addressed the House of Commons, and I have received on the part of the Government to which I belonged the assent of the House of Commons to financial plans which were in every point contradictory to those which are now proposed. How it is that hon. Gentlemen still sitting on those (the Treasury) benches find such facility for giving assent to contradictory propositions it is not for me to say; but of this I feel convinced, that if I may assume to exist in this House of Commons the same feelings which existed four years ago—I do not mean as to questions which were the subjects of party contentions, but as to the duty of balancing income and expenditure — the express pledges which were given to the country on the 1539 subject of the income tax will be rigorously maintained."—[3 Hansard, cxliv., 985.]Well, my Lords, it was hinted—meekly hinted — that there were circumstances previous to 1857 which might modify these pledges. No. He would not listen to any such proposal. True, he did own that he had been deceived in his estimate of the Succession Duty, respecting which I may say that there has never been a more gross and signal failure in a financial point of view, while, at the same time, upon those luckless individuals who have become subjected to the tax it has pressed with the utmost severity. In 1857 there had been a failure in Mr. Gladstone's expectations respecting the Succession Duty, and there was also the trifle of the Russian war. Mr. Gladstone was not then Chancellor of the Exchequer, but Sir George Lewis was. Then, with fervid eloquence, the right hon. Gentleman exclaimed that those circumstances were not sufficient to absolve the House from those pledges, and that, as the person upon whom they most pressed, lie should not feel absolved, in honour, or in conscience, from the duty of straining every nerve still to uphold and carry out those pledges. Was 1857 the last occasion on which this language fell from the Chancellor of the Exchequer? By no means; for when my right hon. Friend (Mr. Disraeli), being then Chancellor of the Exchequer, brought forward that comprehensive scheme which came to its final termination in 1860, proposing not to interfere with the fall of the income tax, the right hon. Gentleman quite concurred with him. He said—It is perfectly true that the war has made a permanent addition to your burdens of about £1,250,000 per anuum; but no one will say that a change in the circumstances of the country to that extent is of itself sufficient to cause an abandonment of the expectations which the country has been taught to entertain with regard to the extinction of the income tax."—[3 Hansard, cxlix. 1314.]Up to 1858, therefore, we find the Chancellor of the Exchequer declaring that he was bound by the most solemn pledges, that he must positively redeem those pledges, that he depended on the falling-in of the Long Annuities to enable him to reduce the income tax; and now, when these annuities have fallen in, he feels it to be his first duty to apply the amount in the remission of indirect duties, and not of income tax. There is something more. The right hon. Gentleman says, in refer- 1540 ence always to this reduction of the income tax—An hon. Member, I think very naturally, cries out for the abolition of the paper duty; another Gentleman calls for the extinction of the hop duty; another speaks in a most touching manner of the advantages to be derived from the abolition of the malt tax. Some of these proposals may be unreasonable, and some of them may be and are very reasonable; but at this time, owing to the state of our expenditure, we are not only precluded from the process of reduction of debt, but precluded from carrying forward beneficial changes in our commercial system.And thereupon the paper duties, on account of the state of the expenditure, could not be reduced in that year. Now, the estimated expenditure in 1858 was £67,000,000, the estimated income £63,000,000, leaving a deficit of £4,000,000. In the present year the estimated expenditure is £70,100,000, and the receipts are £60,700,000, leaving a deficit not of £4,000,000 but £9,400,000, besides those little items which we will not talk about at present, notwithstanding which the Chancellor of the Exchequer thinks he is bound to take off the very paper duty which the state of the revenue prevented him from dispensing with in 1858. But really the number of objections which I could advance to the Chancellor of the Exchequer's scheme, and which have the sanction of the Chancellor of the Exchequer himself, render his speech on this memorable occasion as useful to me as my speech the other day was to my noble Friend. He considers it of the utmost importance that an accurate estimate should be taken, not only for the expenditure of the current year, but of the year following; and no Chancellor of the Exchequer ever stood such an attack and such an amount of badgering respecting his inability to produce such an estimate as Sir G. Lewis did from Mr. Gladstone. On one point the right hon. Gentleman was particularly eloquent and impressive, and that was upon the propriety of having a large margin in the Estimates for a war in which they were engaged, and the expenditure of which was not provided in the Budget of the year. Now, only substitute the word "China" for "Persia," and you might at the present moment read to the right hon. Gentleman from his own speech just that which he then read to Sir George Lewis:—When we recollect that we have to carry on two wars in the East, and that the right hon. Gentleman has not called upon us to vote any money for the expenses of those wars; that among all the Votes he has submitted to Par- 1541 liament he has not asked for one farthing for the Chinese war, while, with respect to the Persian war, he finds it the most convenient course to keep it as long as possible out of sight—can you believe, with these considerations before you, that the right hon. Gentleman is correct in his estimate of £900,000 surplus? He confines himself, as to the Persian war, to covering the expenses of last year, and does not call upon us to vote any money for its charge in 1857–8. If there be any life in the House of Commons, any sense of its constitutional duty, it will not allow the Persian war to be conducted on those principles. I give the fullest notice that I do not understand it to be the function of the representatives of the people, while attending in this House, to allow wars to be begun by the Government, to be carried on by the Government, without any explanation or estimate of the charges being submitted to us: until after the conclusion of the war, after the money has been spent and the lives of our countrymen sacrificed the little Bills are presented, and we are told by the Chancellor of the Exchequer that we have nothing to do but to consider how they shall be paid. That is not my understanding of our duties as representatives of the people. If the Government form such an estimate of our duties, I tell them that I, for one, will never conform to that estimate; and if the House of Commons shall be of the same determination as myself, we shall invite the Government to give us a distinct explanation of the character and expenses of those wars. If they decline our invitation, we shall urge them to do so; and if they still refuse, we must coerce them by outvotes to give us an estimate of the expenses of the Persian war, that we may know precisely what it is before the war goes further, and not allow ourselves to be kept in ignorance of it until the walls over."— [3 Hansard, cxliv., 991].One point more. The Budget is proposed to be taken, not for a period of three years, which has the high approbation of the noble Duke opposite, and which, according to him, would give time for the great commercial change which he thinks very desirable, but it holds good for one year only; and it is to be taken for that period for the purpose of enabling the future Parliament, however constituted, to deal freely with the finances of the country at a moment when you have created a deficit of £12,000,000, and by repealing the paper duties have dried up that source for supplying the deficit. What did Mr. Gladstone say in March, 1857?—The hon. and learned Member for Newcastle (Mr. Headlam) says that the only way to keep the income tax under our control is to vote it from year to year. Now, I beg leave to differ in opinion altogether from the hon. Member. I believe that the transition from voting it for a term of years to that of voting it from year to year is the sign of another transition which we should endeavour by all means to shun—namely, a transition from a solid and steady system of finance to a vacillating and merely provisional system of finance."—[3 Hansard, cxliv. 2067.]1542 I leave it to the right hon. Gentleman, with all his eloquence and ability—and no one admires them more than I do — to reconcile these two principles. One more declaration on the subject of finance was made by the right hon. Gentleman in 1857. lie said the House was called on to take a burden off the shoulders of the wealthy classes in order to impose taxes on tea and sugar, which were articles consumed by the poor man; that he entertained a decided opinion against such a proposition; and that before the Speaker left the chair, if health and strength remained to him, he should endeavour to induce the House, whatever taxes were proposed, not to levy more on the tea and sugar of the poor man. Yet the right hon. Gentleman himself now takes off the wine duties of the wealthier classes, and continues the war duties on the tea and sugar of the poor. I have endeavoured, my Lords, to show, and I said I would at the outset, that whatever objections I entertain to this Budget—namely, because of its improvident character; because of its rendering it absolutely impossible to take off the income tax; because of the necessity which I conceive we are under of looking forward to our resources for the supply of future years; and because of the impropriety of reducing the taxes on the rich man's luxuries, while we retain those on tea and sugar—in these objections I am supported by the recent, repeated, eloquent, and energetic declarations of the Chancellor of the Exchequer in opposition to his own Budget. Once more, following his example, I do not object to the repeal of the paper duties if you can afford to do so; but I do object, when our finances are in an undue, or rather in a hopeless deficiency in 1861–2, and when, with the prospect of foreign disturbances, of greatly increased taxation, of a large military and naval expenditure, with the necessity of incurring great expense in fortifications and in the national defences, you voluntarily deprive yourselves of a source of permanent revenue, collected without difficulty, and yielding £1,400,000 a year. I was charmed to hear from the noble Duke opposite a declaration on the part of the Government that they have nothing in common with the principles announced by those who are described as forming the Manchester school; but, whatever may be the intentions of the Government, they are by their acts playing into the hands and furthering the avowed objects of that party. What is the announce- 1543 merit of that party? The announcement made—not concealed, but openly proclaimed—is, that they will effect a change of taxation, and so cut down the indirect taxes as to make the whole dependence of the country be upon direct taxation; and the pressure of that direct taxation, they anticipate, will be so grinding and so odious that, whatever the circumstances of the country may be, war will be avoided, because no party will be willing to defray the expense necessary for carrying it on. That is the avowed object of those persons. They say, "We will secure peace by taking away the power of making war, by throwing the whole burden of taxation on direct taxation, and making the pressure odious." The Government have quite different views, I have no doubt; but if they had the same objects they could not more effectually promote them than by the system of finance they are encouraging. My Lords, it is not, therefore, solely on account of the amount, though that is considerable, that I object to the abolition of the paper duty; but because you are taking away an important branch of revenue, and establishing principles and promoting objects contended for by those parties who, by weakening the financial condition of the country, desire to effect the purposes they have in view. For these reasons of political as well as financial importance I object to the proposition of the Government, and shall not feel myself justified in giving my assent to it. I have troubled your Lordships at greater length than I desired, and in closing my observations I will again avail myself once more of that valuable speech to which I am already so largely indebted, and I will read the passage in which the light hon. Gentleman sums up his objections to the Budget of 1857 in language more eloquent and forcible than any I could use. I shall not, therefore, add a single word to the concluding observations of the right hon. Gentleman. The present Chancellor of the Exchequer on the 20th of February, 1857, used these eloquent words: —I feel strongly upon this subject, and I dare say I have expressed myself in strong language. I hope it has not been stronger than the occasion demands. I confess I do feel strongly the nature of these propositions. I will conceal nothing. I may be wrong, and my judgement may err, like that of other men; but this is the first time— I will not say, that I have heard a deficiency recommended and sanctioned by the Government, for, and unfortunately, I have hoard that, and in principle it was quite as bad as this proposition, 1544 though in degree it was entirely different; but, certainly, that I have heard propounded from the Treasury Bench by the Chancellor of the Exchequer a plan which seems to threaten to throw the land into financial confusion. I felt that it was our duty to strip the veil from a statement which was certainly calculated to convey false impressions to the country, and from the discharge of that duty I could not shrink. Every year that a man lives he learns to estimate more humbly his own powers. He must be content to see remain unaccomplished much that he may earnestly desire; but in this free, happy country there is one privilege and one corresponding duty which remains to man—it is to bear his testimony in open day to the duty and the necessity of maintaining public obligations, and to strip away every veil from every scheme which tends to undermine this principle. That duty, with the indulgence of the House, I have endeavoured to discharge. No consideration upon earth would induce me by voice or by vote to be a party to a financial plan with regard to which I feel that it undermines the policy which has guided the course of every great and patriotic Minister in this country, and which is ultimately associated, not only with the credit and the honour, but even with the safety of this country."—[3 Hansard, cxliv. 1017.]
§ EARL GRANVILLE
in reply, which was imperfectly heard, was understood to say that he could not follow the noble Earl who had just spoken into the many questions of detail which he had submitted to their Lordships, but he wished to protest against the statements which the noble Earl had made to the House. He emphatically denied that the financial scheme of the Chancellor of the Exchequer was that of a gambler who played at "double or quits." Such a phrase could not properly be applied to a person who merely repeated an experiment which had been found eminently successful. Nor was it correct to say that there would be a deficiency in the present year, unless, indeed, there came in claims on account of the Chinese war which it was impossible to calculate or foresee. The wine duties, in the short time which had elapsed since their reduction, had produced the estimated amount even without the system of refreshment-houses which formed part of the financial scheme of the Government. It was possible that there might he a deficiency next year, but that was a matter which could not be dealt with at the present moment. The noble Earl had reproached the Government with having imposed an income tax for one year only. He maintained that the Government would not have been justified in proposing a 10d. income tax for a term of years in the absence of any knowledge whether it would be required. In conclusion, he hoped their Lordships or the public would not be 1545 led away by the calculations of the noble Earl with respect to next year— calculations in which he had refused to take into account a sum of £1,200,000 which would then be available.
§ On Question, That("now") stand part of the Motion?—their Lordships divided: —
§ Resolved in the Negative; and Bill to be read 2a on this Day Six months.1547
|Campbell, L. (L. Chancellor.)||Salisbury, Bp.|
|St. Asaph, Bp.|
|Devonshire, D.||Audley, L.|
|Newcastle, D.||Belper, L.|
|Somerset, D.||Camoys, L.|
|Carysfort, L.(E. Carysfort.)|
|Bristol, M.||Chesham, L.|
|Lansdowne, M.||Churchill, L.|
|Townshend, M.||Clandeboye, L. (L. Duferin & Claneboye.)|
|Abingdon, E.||Congleton, L.|
|Albemarle, E.||Cranworth, L.|
|Caithness, E,||Dacre, L.|
|Carlisle, E.||Dartrey, L. (L. Cremorne.)|
|Chichester, E.||De Tabley, L.|
|De Grey, E.||Dunfermline, L.|
|Denbigh, E.||Ebury, L.|
|Devon, E.||Foley, L. [Teller.]|
|Ducie, E.||Glenelg, L.|
|Dudley, E.||Harris, L.|
|Durham, E.||Hunsdon, L. (V. Falkland.)|
|Ellesmere, E.||Kingston, L. (E. Kingston.)|
|Fortescue, E.||Leigh, L.|
|Granville, E.||Lismore, L. (V. Lismore.)|
|Lichfield, E.||Llanover, L.|
|Minto, E.||Lurgan, L.|
|Saint Germans, E.||Lyttelton, L.|
|Sommers, E.||Lyveden, L.|
|Spencer, E.||Methuen, L.|
|Minster, L. (M. Conyngham.)|
|Falmouth, V.||Mont Eagle, L. (M. Sligo)|
|Leinster, V. (D. Leinstrer.)||Mostyn, L.|
|Sydney, V.||Ponsonby, L. (E. Bessborough.) [Teller.]|
|Bath and Wells, Bp.||Portman L.|
|Carlisle, Bp.||Rivers, L.|
|Derry and Raphoe, Bp.||Saye and Sele, L.|
|Durham, Bp.||Sefton. L. (E. Sefton.)|
|London, Bp.||Somerhill, L. (M. Clanricarde.)|
|Stafford, L.||Sundridge, L. (D. Argyll.)|
|Stewart of Stewart's Court, L. (M. Londonderry.)|
|Talbot de Malahide, L.|
|Strafford, L. (V. Enfield.)||Teynham, L.|
|Stratheden, L.||Wodehouse, L.|
|Portland, D.||Granard, L. (E. Granard.)|
|Lindsey, E.||Howard de Walden, L.|
|Radnor, E.||Kenmare, L.|
|Yarborough, E,||Londesborough, L.|
|Rossie, L. (L. Kinnaird)|
|Oxford, Bp.||Stuart de Decies, L.|
|Elgin, L. (Elgin and E. Kincardine.)|
|Beaufort, D.||Howe, E.|
|Buckingham and Chandos, D.||Lanesborough, E.|
|Cleveland, D.||Lucan, E.|
|Manchester, D.||Macclesfield, E.|
|Marlborough, D.||Malmesbury, E.|
|Rutland, D.||Mansfield, E.|
|Abercorn, M.||Morley, E.|
|Ailsa, M.||Morton, E.|
|Bath, M. [Teller.]||Nelson, E.|
|Cholmondeley, M.||Orkney, E.|
|Exeter, M.||Pomfret, E.|
|Salisbury, M.||Portarlington, E.|
|Westmeath, M.||Powis, E.|
|Airlie, E.||Rosslyn, E.|
|Amherst, E.||Sandwich, E.|
|Aylesford, E.||Shaftesbury, E.|
|Bantry, E.||Shrewsbury, E.|
|Bathurst, E.||Stanhope, E.|
|Beauchamp, E.||Stradbroke, E.|
|Belmore, E.||Tankerville, E.|
|Brooke and Warwick, E.||Verulam, E.|
|Camperdown, E.||Westmoreland, E.|
|Cardigan, E.||Wilton, E.|
|Carnarvon, E.||Winton, E. (E. Eglintoun.)|
|Chesterfield, E.||Winchilsea and Nottingham, E.|
|Dartmouth, E.||Canterbury, V.|
|De La Warr, E.||Combermere, V.|
|Derby, E.||Do Vesci, V.|
|Desart, E.||Doneraile, V.|
|Doncaster, E. (D. of Buccleuch & Queensberry.)||Dungannon, V.|
|Ellenborough, E.||Hood, V.|
|Erne, E.||Lifford, V.|
|Graham, E. (D. Montrose.)||Melville, V.|
|St. Vincent, V.|
|Grey, E.||Stratford do Redcliffe, V|
|Hardwicke, E.||Bangor, Bp.|
|Harewood, E.||Cashel, &c., Bp.|
|Harrington, E.||Chichester, Bp.|
|Hillsborough, E. (M. Downshire.)|
|Home, E.||Abinger, L.|
|Ashburton, L.||Lovel and Holland, L. (E. Egmont.)|
|Bagot, L.||Mendip, L. (V. Clifden)|
|Bateman, L.||Monteagle of Brandon, L.|
|Blantyre, L.||Moore, L. (M. Drogheda.)|
|Boston, L.||Overstone, L.|
|Braybrooke, L.||Petre, L.|
|Brodrick, L. (V. Midleton.)||Plunket, L. (Bp. Tuam, &c.)|
|Calthorpe, L.||Polwarth, L.|
|Carrington, L.||Raglan, L.|
|Castlemaine, L.||Ravensworth, L.|
|Chelmsford, L.||Rayleigh, L.|
|Clements, L. (E. Leitrim)||Redesdale, L.|
|Clifton, L.(E. Darnley.)||Saltoun, L.|
|Clinton, L.||Scarsdale, L.|
|Clonbrock, L.||Sheffield, L. (E. Sheffield.)|
|Colchester, L.||Silchester, L. (E. Longford.)|
|Colville of Culross, L. [Teller.]|
|Conyers, L.||Sondes, L.|
|Crewe, L.||Southampton, L.|
|De Freyne, L.||Stewart of Carlies L. (E. Galloway.)|
|De L'Isle and Dudley, L|
|St. John of Bletso, L.|
|Strathspey, L. (E. Seafield.)|
|De Ros, L.|
|Digby, L.||Templemore, L.|
|Dinevor, L.||Tenterden, L.|
|Downes, L.||Tredegar, L.|
|Egerton, L,||Vaux of Harrowden, L.|
|Farnham, L.||Walsingham, L.|
|Feversham, L.||Wensleydale, L.|
|Gage, L. (V. Gage.)||Willoughby de Eresby, L|
|Hawke, L.||Worlingham, L.(E. Gosford.|
|Kingsdown, L.||Wycombe, L. (E. Shelburn.)|
|Lovat, L.||Wynford, L.|
|Northumberland, D.||Exeter, Bp.|
|Winchester, M.||Chaworth, L. (E. Meath)|
|Bandon, E.||Denman, L.|
|Beverley, E.||Forester, L.|
|Cadogan, E.||Foxford, L. (E. Limerick.)|
|Leven and Melville, E.||Gardner, L.|
|Manvers, E.||Kilmaine, L.|
|Mount Cashell, E.||Panmure, L.|
|Munster, E.||Sandys, L.|
|Onslow, E.||Seaton, L.|
|Poulett, E.||Saint Leonards, L.|
|Vane, E.||Tyrone, L. (M. Waterford.)|
|Hutchinson, V. (E. Donoughmore.)||Wemyss, L. (Wemyss, E.)|
|Wigan, L. (E. Crawford at Balcarres.)|