HL Deb 26 July 1889 vol 338 cc1386-407
THE EARL OF NORTH BROOK

My Lords, I rise to call attention to that part of the Report of the Royal Commission upon the Precious Metals which relates to the duty upon silver plate; and to move for a copy of the despatch from the Government of India to the Secretary of State of the 2nd of July, 1887, with enclosures, and any subsequent correspondence between the India Office, the Government of India, and the Treasury on the subject. My Lords I do not think that after some remarks which fell from the Prime Minister the, other day, your Lordships will think I have done wrong in bringing before you, a matter of so much interest connected with India. We have the advantage in this House of the presence of the Secretary of State for India; we have also the advantage of the presence of those who from time to time have filled the same office before my noble Friend opposite, and we have the great advantage of the presence of the noble and learned Lord Herschell, who was Chairman of the Royal Commission, to whose Report I desire to call your Lordships' attention. It is well known that during the last 14 years there has been a very great fall in the gold price of silver. Although that way of stating it is not very scientific, it is intelligible. Fourteen years ago the gold price per oz. of silver was 5s.; it has now gone down to 3s. 6d. In other words, the rupee, which in 1874 was worth in gold 1s. 10d., is now worth only Is. 4d. My Lords, this subject has been constantly under the attention of the English and Indian Governments, and, lastly, three years ago a Royal Commission was appointed for the purpose of inquiring and reporting on the causes of that great change in the relative values of gold and silver, the effects that change has produced, and the remedies, if any, which can be applied. That Royal Commission was presided over by my noble and learned Friend Lord Herschell with great impartiality and ability, as every one must admit who has read the valuable Report issued by that Commission. With respect to the causes of the change in the relative values of gold and silver, the Commissioners were not unanimous in opinion. With respect to a portion of the alleged effect of the change they differed somewhat; but in respect of two particular effects which have followed from the altered relation of the two metals, they were unanimous. It is with those two points only that I mean to deal. The first of those effects is the great embarrassment caused to the finances of India from the fact that India has to pay annually to this country £14,000,000 to £15,000,000 in gold, while India has to raise that sum in silver from the natives of India. The result has been that the natives of India have now to pay something like 25,000,000 of rupees more than in 1874 in order to pay the £14,000,000 or £15,000,000 in sterling to this country. That has doubtless been a source of great embarrassment to India, a country where it is difficult to increase taxation without causing well-grounded dissatis- faction. There is another effect also noticed by the Royal Commission which is by no means unworthy of your Lordships' attention, and that is the great hardship which the fall in the value of silver has entailed on public servants in India who are paid in silver but who are obliged, for family or other reasons, to make remittances to this country in gold. An official in India not many years ago receiving his salary in rupees would find 1,000 rupees worth £100 sterling in England, if remitted for the education of his family or other charges; but now, in consequence of the fall in the price of silver as compared with gold, for his 1,000 rupees he will only get something like £70 for remittance to England. This has occasioned very great hardship in the junior ranks of the services in India, and it is by no means a light matter that our countrymen employed in India should be placed in so difficult a position with respect to their payments. In old days when Englishmen in India received inadequate pay, great evils followed, and it has, since those times, been a principle to pay not extravagant, but fair and moderate salaries to Englishmen engaged in service in India. Now, my Lords, the Royal Commission had before it many proposals for the purpose of remedying that state of things, among which the principal was that great alteration in the standard of value known in this country under the term "bimetallism," which many people consider would entirely remedy this state of things. I am not going to trouble your Lordships with any remarks on that much-debated question. The Royal Commission differed in opinion about it, and I think the Prime Minister the other day, in reply to a deputation which waited upon him on this subject, said very properly that the arguments on both sides would require to be more thoroughly threshed out before Government could express any opinion upon so difficult and important a matter. But, my Lords, apart from the heroic remedy of bi-metallism, other and more humble proposals were made for remedying that state of things. Silver is becoming an ordinary product in the markets of the world, and with regard to the difference between supply and demand, it has been suggested by those most interested in the subject that the removal of the duty upon silver plate in this country would have the effect of increasing the demand for silver, and therefore, in the result, of increasing the price of silver to whatever extent the increased demand was found to be effective. Now, my Lords, the Royal Commission have so carefully investigated the subject that I think I can not do better than read in the clear language of their Report the conclusions at which they arrived, rather than endeavour to express them in any words of my own, upon this proposal. The Royal Commission (and in this part of their Report they were unanimous) state in paragraph 173 as follows:— Complaints are made that the use of silver for industrial purposes is much restricted owing to the duty of 1s. 6d. per ounce which is levied on silver plate manufactured in this country or imported from abroad. Not only does the duty (which now amounts to upwards of 40 per cent on the value of the raw material) restrict the demand for manufactured silver, but owing to the hall-marked regulations only silver of the authorised standard can be introduced into this country for purposes of trade, the importation of lower grades being prohibited except for private use; the rupee standard in India is slightly below the standard required by the hall mark regulations in this country, its millesimal fineness being 916 as against 925. Then the Report proceeds:— The repeal of the duty has been repeatedly urged by the Government of India in the interests of those engaged in the industry in that country; and the amount of revenue which is now raised by it (between £50,000 and £60,000 per annum) is so small that it could be surrendered without creating any serious disturbance of the financial equilibrium. The main difficulty which is understood to stand in the way of the repeal of the duty is the question of the drawback to be granted on the plate now in the manufacturers' hands which has already paid the duty; but the concession of the drawback might be limited to a moderate period—say three years, and this difficulty ought not to be an insuperable obstacle in the way of a desirable reform. Now, my Lords, the Report of the Royal Commission is divided into two parts, and in the first part, the Report of the majority, there was a distinct recommendation of this proposal as a step in the right direction. The minority, in their part of the Report, entirely concurred with the majority in recommending this proposal so far as it went; and Mr. Barber, confidential member of the Council of the Viceroy of India, who was a member of the Commission, ex- pressly stated his opinion as to the desirability of this being done, although he said he would go much far there if possible. My Lords, I should now like to make a few remarks upon the duty itself, and next upon hallmarking, those being the two particular features of the proposal. As regards the duty, this was not the first time it had received attention from such a body, for a Committee of the House of Commons, sat upon the subject of hallmarking in 1878–79, and they were unanimous in recommending the abolition of the duty. That Committee, in their Report, in May, 1879, used these words:— The imposition of a duty hearing so great a proportion to the intrinsic value of the raw material has a tendency to diminish the use of silver as an article of manufacture. Mr. Gladstone, two years afterwards, influenced, I have no doubt, by the Report of that Committee, seeing the importance of the subject, in his Budget speech held out expectations that he would be able to abolish this duty; and the reasons he gave were, first, the dangers in regard to such an Excise Duty; and, secondly, that India, there was every reason to believe, would largely manufacture silver articles were it not for its operation. No words, my Lords, could be stronger than those words, though unfortunately Mr. Gladstone, like other Chancellors of the Exchequer, finding that the consideration of the matter involved the question of drawback, was prevented from carrying his wishes into effect. Now, as regards the effect on the demand for silver which would probably be produced by the abolition of this duty, I venture to think that the Royal Commission have not been sanguine enough. I do not think they have attached quite sufficient importance to the increased demand for silver which may be produced by the abolition of the duty. There is probably, my Lords, no higher authority upon such a subject as this than Mr. Giffen, of the Board of Trade, who was called before the Committee of the House of Commons in 1879. In his evidence he expressed the opinion which I think is entertained by every one with regard to the trade in manufactured articles subject to Customs Duties. He said if there were an increased consumption of even 100,000 ounces per annum, it would have an effect in regard to the general price of silver. And, again, he said it might have a very important effect upon the price, because small differences between supply and demand have very often a considerable effect upon prices, and that that was borne out by what had happened in regard to Customs Duties upon other commodities. My Lords, notwithstanding the imposition of the duty, as compared with the great reduction in the price of silver which has taken place in late years, there has been a certain increase in the production of silver plate. From 700,000 ounces during three previous years, in 1878–79 it had risen to 850,000 ounces. That shows the difference which the abolition of the duty of 1s. 6d. per ounce would make. A trader has to recoup himself not only the duty he has paid, but interest upon the amount. My Lords, the trade at the present time is quite insignificant. We may say it amounts to 800,000 ounces of manufactured silver articles, representing a value of £420,000. In this country the sum of £420,000 per annum expended for silver late seems doubtless a very small sum think it is exceedingly probable that the abolition of the duty would cause a very considerably increased demand for silver plate, and would therefore create a very great effect upon the silver market; it would have a tendency to raise the price of silver, and to remedy some of the difficulties which we now have to meet. Now, my Lords, that opinion is held by all the Chambers of Commerce in England. They are watching the trade with India, and they speak no doubt with higher authority than anyone else can speak. The Chambers of Commerce in; Calcutta, and throughout India, in Bengal, Madras, and Bombay, have not once, but continually, year after year, memorialised the Indian Government to repeal this penal duty; and they have stated, over and over again, that from their knowledge of the trade of India, they are satisfied that a very largely increased demand for Indian silver would follow from relief so given. Only the other day I find from an Indian paper that the Bombay Chamber of Commerce has used some very clear language on this subject. Bombay, your Lordships know, is one of the most important commercial towns of India. A very large firm of merchants there, Messrs. Watson and Co., have brought into that town some fine silver workers, and a very considerable amount of silver plate is made there. More might be made if there were a demand for it; and in a memorial sent by the Chamber of Commerce of Bombay to the Government of India in April last, they pointed out how enormously the arguments for the repeal of the duties had gained in strength since the movement was first initiated—"Silver in the interval has fallen from 51d. to 42d. per ounce," so that the duty of 1s. 6d. per ounce, which is justly described as repressive, now amounts to nearly 43 per cent, and has become almost prohibitive of that industry. The removal of the duty would not only benefit the artizan class in that country, but would have a perceptible effect on the value of silver, and afford a remedy for the loss in exchange now felt. That, my Lords, was the opinion of the Chamber of Commerce of Bombay a few months ago, and I think they urged no more than the reasonable probabilities of the case. Now, my Lords, so far I have spoken of the benefit to the people of India which would result from taking off these duties; but I am also satisfied that it would be of great advantage to the people of this country that there should be free trade in silver. Let us look at a very common thing indeed—namely, silver spoons. In consequence of the imposition of this duty, electro plate spoons and articles of that description are used—that is to say, plated articles. At present the lower classes in this country buy electrotype spoons, as they cannot afford to buy silver spoons. Now, a working man is sometimes in difficulties, and can hardly keep things going until he succeeds in obtaining employment. His electrotype spoons are of no value; but if this duty were taken off silver, it is quite possible that the price of silver spoons would be so reduced that the poorer classes could have silver articles and could realise their value in times of need. Consequently, I think that if the people of this country should be able to get those silver articles at the lowest price at which they could be produced it would be of great advantage to them. I must now say a few words about the hall-marking. In my opinion, it would be impossible for human ingenuity to devise any system so restrictive of trade as this duty of 40 per cent combined with the regulations for hall-marking silver in this country. There is only a difference of nine in the 1,000 in the purity of the Indian rupee as compared with the English standard. In India the millesimal fineness is 916; that means that there is .84 of alloy in the rupee. The English standard being 925, so that in 1,000 ounces there are 75 ounces of alloy in standard English silver. Yet, notwithstanding there is only a difference of nine in the 1,000 in the purity of the Indian rupee as compared with the English standard, your Lordships will hardly believe that, according to our law at the present time, supposing that a silver spoon was imported from India into England, and that the 1s. 6d. per ounce duty was paid upon it, it would not, if taken to Goldsmiths' Hall for assay, be allowed to be assayed, and it would be broken. In point of fact, the importation for sale in this country of silver articles manufactured in India is actually prohibited. Consequently we are in the position, as governors of India, that we are setting up in that country a standard of value which we do not recognise in this country as fit to be manufactured into silver articles for our own use. Perhaps it might be said that Indian manufacturers could easily get silver of the proper standard; but, in point of fact, anyone who knows the customs of the country would know that is not so. It is the custom in India, when they want to manufacture silver articles, to take a certain number of rupees to the manufacturer to be made up into cups or other articles. He gives back the silver in the manufactured article, receiving something beyond for the value of his work. Your Lordships will not be surprised to learn that this subject has been brought in the most forcible manner from time to time before Her Majesty's Government at home; and your Lordships will not be surprised to learn that a distinguished statesman who has filled the office of Secretary of State for India has supported the Indian Government in pressing on the Home Government and on the Chancellor of the Exchequer the iniquity of such a law as that. My noble Friend (Lord Kimberley) was very keen in this matter, and used language stronger than any that I am now using. At that time not only was this silver not allowed to be sold in the United Kingdom, but it was actually broken into pieces, and in that state sent back to India. Lord Kimberley will remember that, and I am sure he will confirm what I have said. He recommended for consideration certain proposals which were not adopted, and he said at last it appeared to him that the then (which is the present) state of things was wholly indefensible, and, indeed, a discredit to the country. On the last occasion when a remonstrance was forwarded by the Government of India, the present Secretary of State supported the opinion of the Government of India, and directed his Under Secretary to write to the Treasury that he entirely concurred in the arguments used by the Government of India upon the subject. Now, my Lords, I do not think I have entirely exhausted the absurdity of this system. Let us 'suppose that a fine piece of plate manufactured in India, and there are many fine pieces of plate manufactured there, is imported to England. I will assume in this case that the manufacturer has taken care to bring the purity of the silver quite up to the English standard. The importer has to take it to Goldsmiths' Hall to be hall-marked, and there it is so scraped in every part that the poor unfortunate piece of plate when returned to the importer is in a condition which renders it perfectly worthless for the purpose of sale. Every conceivable portion of the piece is scraped; they scrape the handles, the sides, the bottom—if there is a cover to it, that is scraped, and if there are ornaments upon it, they are scraped. That, my Lords, is the present condition of the law with regard to silver articles imported from India into this country. The law, moreover, is bad for another reason. It is hardly to be believed in these Free Trade times that we should impose a protective duty in favour of the silver manufactures of our own country and against the silver manufactures of India. But that is the fact. It is hard to believe in these times that we should have any protection at all, but it is still harder to believe that the protection which we have is against the interests of our own Indian Empire in regard to articles manufactured of silver which we are bound in every way we can to raise the value of. I will explain to your Lordships how that happens. The duty which has to be paid by the English manufacturer when he sends plate to be assayed at Goldsmiths' Hall is 1s. 6d. an ounce. The duty which the importer pays is also 1s. 6d. an ounce. But the English manufacturer, in order to prevent his piece of plate being scraped in the way I have explained, sends it in an unfinished state to Goldsmiths' Hall. In consideration of its being unfinished, and presumably a little more in weight than the finished piece would be, he is allowed a rebate of 3d. per ounce, so that he actually pays 1s. 3d., whereas the importer has to pay 1s. 6d. It is admitted in respect of certain kinds of plate that 3d. rebate is a good deal more than it should be, and that in reality 1d. would be enough. Consequently, there is a protective duty of 2d. per ounce in favour of the English manufacturer and against the Indian importer. I think, my Lords, that is clear. Your Lordships cannot have more valuable evidence than that of Sir Thomas Farrer, Secretary of the Board of Trade, who admitted, in his evidence before the Committee of the House of Commons, that the rebate acts as a protective duty against imported silver goods. Another high authority, which cannot be disputed, is to be found in the Annual Report of the Commissioners of Indian Revenue. That Report for 1884 says that a one-sixth rebate is excessive, and therefore operates in the way I have described. So much, my Lords, for the effect of these hall-marking regulations. As I said before, I do not think it would be possible for human ingenuity to devise a system of imposing an enormous ad valorem duty, coupled with the method of marking this unfortunate imported plate, which would be more entirely prohibitive. Nor is this all. The effect upon our home-trade silver manufactures has been exceedingly injurious. "We are not very proud of our English artistic fame. One of my hon. Friends, who was examined before one of these Committees, and who had the good fortune to win prizes at agricultural shows, said the cups were of such a description that he would rather have had a plain lump of silver. My Lords, everybody knows that if a good piece of silver plate is wanted, one has to go back to the reign of Queen Anne. We do not get it in the time of Queen Victoria. Our artistic development in the manufacture of silver articles is by no means equal to our advance in other branches of manufacturing industry. And the reason is obvious—that these restrictions, like all restrictions, operate against the real interests of trade. There has been a great development of silver work in the United States, and a firm called Tiffany has produced admirable articles, and has in particular introduced beautiful silver bowls and other ornaments in silver combined with copper, and wrought in the most artistic manner. I have been told that one of the most beautiful things in South Kensington is a teapot from Japan. It will hardly be believed that if these articles were sent to Goldsmiths' Hall they would probably be smashed up, because nothing but pure silver is allowed to be used. As copper is introduced into their manufacture, these beautiful articles would not be assayed. Well, my Lords, that being so, our English trade has nothing to lose by freedom as respects these articles. I will give your Lordships another illustration as regards the effect upon our silver trade. If, for example, an unfortunate silversmith had an old-fashioned teapot which he could not sell, and which therefore had to be melted, he must pay the duty over again, and can get no drawback. That is one restriction on the trade. Another restriction on the English manufacturer is that the present system of hall-marking is such as to prevent any export trade in silver. It is ridiculous to limit the percentage of alloy in our silver so that the percentage is different from that which is prevalent in other countries, and our silversmiths find it impossible to manufacture silver of the requisite purity in competition with the silver of other countries where the percentage is different. The consequence is that the export trade of this country is a mere trifle. It only averaged in the years 1887–9 about 100,000 ounces, representing about £50,000. Absolutely none of our silver goes to the Continent, and only a certain quantity is sent to our colonies and places where there is a traditional regard and demand for old English plate. Besides that, it is admitted by the authorities of Goldsmiths' Hall that the exemptions from the duty are so capricious and so doubtful as to occasion great hardship. The fact is, that absolutely there are at present 39 Acts of Parliament in connection with these duties, so that it can readily be imagined how complicated the law is, and that the complication of the whole system is an additional evil to those which I have already alluded to. There is one curious point to which I will refer. Small articles of jewelry are exempted, and wedding rings are the only articles which have to pay the duty. Every man who marries a wife with a gold ring pays a 12s. duty upon it, so that actually the Government have put a tax of 12s. upon every man who chooses when he marries to use a gold wedding ring. The effect of that is, according to the evidence taken before the Royal Commission, that among the poor the same wedding ring is handed from one couple to another, and used for three or four marriages. Then, Her Royal Highness the Princess of Wales has introduced the fashion of wearing a broad single gold ring, which, though not a wedding ring, is somewhat like one, but three or four times its weight. A clever person in connection with the Assay Office, at Birmingham, found out that these rings ought to be stamped because they were in the nature of a wedding ring. And a learned Judge laid down in the case of an unfortunate dealer, who had innocently made a number of rings of this character, that the law was perfectly clear, and that these rings ought to be stamped. The unfortunate tradesman, who had quite innocently manufactured these rings, which were by no means wedding rings, was ordered to pay a considerable fine and the costs. I merely give that as an instance of the position of the law and the difficulty which exists in these matters. Now, my Lords, I have myself endeavoured in vain to ascertain what is the precise law with respect to the importation of silver work. An alteration was made by the Inland Revenue Act of 1874 which apparently allows certain kinds of Indian plate to be imported without being assayed; whether it is sold without being assayed I do not know; but I gather from my noble and learned Friend's statement of the law in his Report that they are sold at the present time. At any rate, that alteration of the law does not affect the merits of the case, because it only applies to a small number of articles. I have already stated that all the authorities in India, and successive Governors General, have urged upon the Home Government the repeal of this duty in justice to India, and Secretaries of State have adopted the same view. I would not have it supposed that I am saying for a single moment the English Government intend to act unfairly to India, and I trust that when the question is carefully investigated by English statesmen it will be satisfactorily settled; and I appeal with confidence to the Prime Minister in this matter. If it were settled the manufacturers of India would receive that encouragement which is so necessary for providing another source of wealth than mere reliance upon the land. The repeal of these duties must have an appreciable effect upon the price of silver. Something can be done, and consideration should be given to the question. It is notorious that the fall in the price of silver is very embarrassing to the Government; and a measure which undoubtedly, whatever effect it may otherwise have, must have a favourable effect on the price of silver, should I think be adopted without further delay. It is now about 40 years since the question was first started, and I, therefore, earnestly hope that another year will not pass before this great anomaly is removed and justice done to India. I cannot believe for a moment that this question of drawback to which I have referred can interfere greatly with the revenue. Taking it that such articles may take two or three years to manufacture, £60,000 a year would be quite sufficient to assume; therefore, for three years it would only amount to £180,000, and, in all probability the total sacrifice to the British taxpayer would not exceed one year's revenue, £60,000. As regards the Papers I ask for, I will, of course, submit to the discretion of the Government in the matter.

Moved, That an humble Address be presented to Her Majesty for any correspondence between the India Office, the Government of India, and the Treasury, on the Plate Duties since November, 1888."—(The Earl of Northbrook.)

THE EARL OF KIMBERLEY

My Lords, I think my noble Friend in the very interesting speech which he has delivered has almost exhausted the arguments on this matter, and I should not intervene in the Debate if it were not that I have taken a great interest in the question ever since I had the honour of being Secretary for India. Therefore, I do not like to pass the matter by without expressing my agreement with his views. When I was at the India Office a letter was written upon it which expressed not merely my individual opinion but also the opinion of every member of the Council of India. In point of fact there has been no great difference of opinion on this subject as regards all who, either in India or in England, have been connected with the Government of India or have paid attention to the subject. My noble Friend has described the barbarous system which prevails in this country—a system which one would hardly believe could have existed. It has every possible vice which can be conceived. It hinders the importation of silver from India, where the silver manufacture is in consequence by no means an extensive one, as my noble Friend has pointed out. It hinders the home production as well as that of India in articles of silver plate, and brings in a mere paltry sum to the revenue. I do not know how long the imposition of this duty has subsisted, but I believe it arose in the time of the great war. I should imagine it was one of the inventions of Pitt when he was in great difficulties for money at that period. At all events, it would be not far from coincident with the decay of the silver industry in this country. My noble Friend has spoken of the time of Queen Anne, and most of us know that the old silver manufactured in this country is possessed of some artistic merit until we come to about the year 1780. Indeed I believe the decadence of art in respect of silver work in this country dates from about 1780, as the work of the period of George I. and George II. and throughout the early part of George's III.'s reign was, as a rule, extremely good. An expert can at once test the value of the plate of those reigns, and say how much it would letch beyond the price of the silver. But if one brings silver plate manufactured in this century to auction one can hardly get more for it than the price of the silver. My noble Friend alluded to the measure passed at the time when the noble Marquess opposite was at the head of the India Office—I mean the repeal of the duty on cotton goods imported into India. I do not agree with the view held by many persons that that was an injury to India. I believe the measure was right, not only in the interests of England but of India itself. It is worth observing that the apprehensions felt at the repeal of the duties on cotton manufactures in India have been most singularly falsified. As your Lordships know, the apprehensions that the repeal of the duties would be destructive to Indian manufacturers have been absolutely falsified by the result, because there has never been a time when the manufacture of cotton goods in India has shown greater vitality. In point of fact, the manufacture of certain kinds of cotton goods in Bombay has taken such a start as to seriously compete in the China trade with the manufactures of other countries. And so I believe that nothing would be better for the silver manufacturers of this country than competition with the manufacturers of other countries. If foreign plate and plate from India were brought free into this country, I have no doubt we should see a great change in the manufacture of silver articles in this country, and that we should no longer see such miserable productions in comparison with the articles manufactured in foreign countries. I remember seeing once in Moscow a wonderful collection of silver plate, and some of the finest was in olden times manufactured in England, when we were second to no nation in that manufacture, nor should be now but for these intolerable regulations. When I was a Member of the Government and this subject was discussed we were met by financial objections. But I am bound to say that no one who has not been connected with India could be aware of the greatness of the grievance. In consequence of this grievance in India the silver manufacturers are not numerous, though silver-work is one of the industries in which they excel, and it is felt as a very great grievance indeed that for this very small amount of duty, and for the sake of financial arrangements which are thoroughly foreign to themselves, we should refuse this demand from India. Whenever this subject has been discussed, Members of the Government who, like myself, hold that this duty ought to be removed, have always expressed that opinion very strongly. This is not a small matter. If it were a small matter it might be put off to a more convenient season, but the grievance is a real one. Anything which will stimulate the consumption of silver and tend to relieve the Indian exchanges from part of their present burden would be most desirable. My Lords, there is really a whole series of arguments at the present time for the repeal of this duty, and therefore I have some hope that your Lordships will hear from the noble Viscount opposite that next year the Chancellor of the Exchequer will do something in the matter.

* LORD STANLEY OF ALDERLEY,

in supporting the Motion, said: The production of the correspondence would do a great deal to allay the soreness which was felt in India at the exclusion of Indian silver, and should the Secretary of State not be able to lay these Papers on the Table, still very great good would be done in India by the speech of the noble Earl (Earl Northbrook). There was a point which had been omitted by the noble Earl, who moved for the correspondence, and that was an obstacle to the abrogation of the duties, or, at any rate, an obstacle to the abrogation being beneficial to India—that was the most favoured nation clause. Under that clause if the duties were abolished, Germany and any other country, having a most favoured nation clause, would be able to inundate this country with cheap silver, and they would undersell the Indian manufacture, which, being made of rupee silver, would not be very inferior to our own plate, and would not compete with the inferior manufactures that would come from the Continent. This seemed to be rather a question for the Foreign Office than for any other Department, and for negotiation with other countries for the exclusion of free imports of Indian silver manufacture from the operation of the most favoured nation clause. If Indian silver of Indian design and patterns only were admitted duty free, the English duties might remain as they were, and no difficulty would arise with foreign nations. The noble Earl (Lord Northbrook) had stated that if these duties were removed, working men would buy silver spoons, and would be able to get assistance upon them from the pawnbrokers, which they could not get upon the imitation spoons. There were classes in far easier circumstances than working men who were unable to use silver spoons, but that was because silver spoons were a dangerous property, very tempting to burglars, who could at once melt them down. But even if this objection were removed, and police protection made complete, the pawnbrokers would not take these spoons, which were no longer hall-marked, any more than they now would the imitation spoons.

LORD HERSCHELL

My Lords, notwithstanding that this, as has been pointed out by the noble Lords who have spoken, is a matter of great importance, I should not, after the very exhaustive speeches which have been addressed to your Lordships, have intervened but for two circumstances—first, that I was Chairman of the Royal Commission on Bimetallism to which my noble Friend has alluded, and, secondly, that having been recently in India, I am strongly alive to the feeling there on this question. Whatever differences of opinion existed among the members of the Commission, they were all strongly impressed in considering the varying relations of silver to gold with two circumstances. One was the financial difficulty which was thus created for the Government of India, and the other was the hardship which it imposes in many cases on Civil servants employed in India who are obliged to make remittances to this country. They find that their silver is not worth so much, that it will not produce relatively as much gold in this country as it did, and therefore they are not able to make as satisfactory provision for the education of their children and for other expenses which they may have as they were formerly. Certainly very drastic remedies were proposed by some to put an end to this inconvenience, which were not thought practicable by others. But we were all of opinion that there were certain changes which would be productive of advantage, and one of them was the abolition of the duty on silver plate. I agree with what my noble Friend has said that it is difficult to estimate the change which might be produced in the demand for silver, or still more in the price of silver, by abolishing this duty. At first sight one would think that the increased demand for silver was likely to be so small that its effect must be inappreciable; but I think that reflection leads one to doubt whether this is the necessary conclusion. My noble Friend has pointed out that a comparatively small increase in the local demand for a particular commodity might have an effect upon prices far exceeding that which might naturally be expected. If an effect be produced upon price by such an increase of demand, the fact that such a change has been made and that it has produced some influence upon price, may lead to the belief that silver is not destined to go down, and may have a greater influence in raising or keeping up the price than could be expected from the mere relation of the new demand to the old, without reference to the sentimental or imaginative considerations which might strongly affect the price of the commodity. Therefore, though there might be little or nothing apparently to produce the effect desired, we might find that it would in reality do more than was expected. At all events it is a change in the right direction, and the influence, if it have any influence, would be such as we desire to see. Now, my Lord?, those are the reasons and considerations in relation to this matter, which I think give the Government of India a right to call upon this country at the earliest possible moment to make this change. And, again, I am strongly impressed with the view which both my noble Friends have touched upon, that the fact that we have insisted upon the Indian Government adopting a fiscal policy which we believed at the time to be not only in the interests of India but in the interests of our own manufacturers, constitutes a very strong moral claim on the part of our Indian fellow subjects to say that no fiscal arrangements ought to exist in this country which would injuriously affect Indian manufactures. There is a strong feeling I know on that point that there ought to be no fiscal arrangements in England which would interfere with the development of Indian industry My Lords, I have urged this because I believe the moral claim of India for the abolition of this duty can not be too strongly insisted upon for the purpose of moving the Chancellor of the Exchequer. I am quite aware that where a fiscal change would involve difficulty, the Chancellor of the Exchequer is naturally enough very much indisposed to make it. There are only two motives which ordinarily influence that member of the Government; one is the desire to produce an increase of revenue, and the other to benefit a large number of the community by diminishing or abolishing a tax. Those are the chief actuating motives with Chancellors of the Exchequer, and they can be successfully appealed to in regard to any change which would not involve too much financial difficulty. But there is in this case another motive which may influence the Chancellor of the Exchequer. I trust that the moral claim on the part of our Indian fellow-subjects to have this change made will induce the Chancellor of the Exchequer to effect it at the earliest possible moment. That is the particular point which I desire to enforce upon your Lordships; that it is not a matter on which there ought to be any delay. Nobody pretends that this is a good tax. Nobody pretends that as a matter of finance it is worth thinking of for a moment. The sole difficulty has arisen from this question of drawback. But in that respect the Chancellor of the Exchequer is in a very strong position. If he abolishes this tax—and it is quite certain it is going to be abolished—he can stand in the way of any extravagant demands on the part of those who would have any claim to drawback. I trust, my Lords, another year will not pass by without this change being made. I have a special reason for urging it, because after labouring at this question of the precious metals and the depreciation of silver for some time, one naturally desires to see an outcome from it. Now, my Lords, here is a simple practical outcome which everybody admits to be desirable, reasonable, and beneficial. As I have said, if the tax is abolished, the Chancellor of the Exchequer would be able to dictate his own terms and prevent any extravagant demands being made. There is a strong moral claim for enforcing the change, and I think, under the circumstances, I have some personal claim to urge on Her Majesty's Government that there should be no further delay in the matter.

* THE SECEETAEY OF STATE FOR INDIA (Viscount Cross)

My Lords, my first duty is to thank the noble Earl who has brought forward this Motion for the manner in which he has urged it. I agree almost entirely with what has fallen from the noble Earl, and I thank him most cordially for Laving furnished me with some arguments which I shall not fail to use when the time comes. During the short time I have had the honour of sitting in this House I think the practice has been that when once an argument has been put forward power fully and fully as on this Motion, no noble Lord seeks to repeat it. I am afraid I cannot say the same with regard to another place. The arguments which have been used before your Lordships to-day were put forward with so much force and eloquence that I really do not know how I can say anything further. All I can say is, I most entirely agree, with every word that has fallen from my noble Friend. Like former Secretaries of State for India, I have for my own part done my best to induce the Chancellor of the Exchequer to take off these duties which are, I think, practically bringing in a very small sum of money. I believe that the comparatively small sum of money which these duties produce is as nothing to the benefits which would be conferred by their removal. I am convinced that the abolition of the duties would benefit enormously the people of India, besides being of service to the manufacturers of this country in the way the noble Lord has stated. Moreover, these duties cause a very strong feeling of grievance in the minds of the Indian people, which ought to be removed, irrespective of the benefits which would accrue from their repeal. I can speak of the feeling which exists so largely in India. The people there think we are inflicting the greatest possible hardship upon them by maintaining this duty. I entirely sympathise with them in that feeling. I think it would be right to take off that duty. I am one of those who have done all we possibly could to get it taken off. I think we do owe something to the people of India in this matter, especially after having abolished the Cotton Duties, and above all to my mind it is necessary that we should not allow a grievance of that kind to be operating upon the people of India. With regard to hall-marking, I have heard it described as iniquitous and barbarous, and its bad effect has been so clearly shown that there can be little doubt entertained on the subject by anyone who has studied the question for a moment. I believe that there is no other country in the world where such a system exists. How far taking off the duty on silver plate would affect the great question of bi-metallism I do not know, but it would be a step in the right direction, and would go far to satisfy the feelings of the people of India by showing them that we are in earnest in the matter and desirous of doing all we can in their interest. My noble Friend Lord Stanley of Alderley said he thought there might be some difficulty because of our treaties with foreign nations, and on account of the most favoured nation clause. As far as I understand that would really only apply to Germany—it would not affect any other country. If that is so it would remain for the people of India to say whether they would like this duty taken off or not. This being a purely fiscal question I cannot, of course, answer for the Chancellor of the Exchequer in the matter, but I am quite sure my right hon. Friend is perfectly willing to remove the duty when he finds himself able to do so. A question on the subject was asked Mr. Goschen by Sir Richard Temple in "another place" some time ago, and the answer then given by Mr. Goschen was as follows:— In reply to my hon. Friend behind me (Sir R. Temple), I may say that two days ago, if he had raised this question, I should have told him that I was going to deal with the matter in my Budget, and that I was going to make a proposal which I thought was favourable to the introduction of Indian silver into this country. At the last moment, however, a difficulty arose which prevented me from doing so. If I should see my way to deal with the subject, I will certainly do so. This answer showed that he contemplated abolishing the duties, and that he certainly intended to have mentioned them in his Budget, but had up to that time found himself prevented from mentioning them. Those words were very strong, and they at all events give us hope. I for one will continue to press the Chanceller of the Exchequer upon the matter, and will give him no peace until he can find his way out of the difficulty, and take off the duty. The noble Earl has asked for certain Papers. Most of them, the correspondence between the Government of India, the India Office, and the Treasury, have already been laid before the House of Commons up to the end of 1888; but there have been certain communications between the Government of India, myself, and the Treasury, which have passed since that time which I shall be happy to lay on the Table of your Lordships' House. Before I sit down there is one thing I would allude to. The noble Earl concluded his speech by saying he hoped another year would not pass without this duty being taken off. Of course, we cannot say what the money at the disposal of the Chancellor of the Exchequer next year may be, but I hope it will be ample to give us this small satisfaction that we ask. I may say that, when I asked a question on the same subject upon another occasion, the answer was—"I trust that another year may not pass without this much-needed relief being afforded to the Indian industries." My Lords, I do not know that I can say more on the present occasion.

On Question, agreed to.