Lords Sitting of 21 June 1906

Preamble
The Lord Wigan (E. Crawford) took the Oath.

PRIVATE BILL BUSINESS.
The Lord Chancellor acquainted the House, That the Clerk of the Parliaments had laid upon the Table the Certificate from the Examiners that the Standing Orders applicable to the following Bill have been complied with: Buckhaven, Methill, Innerleven Burgh Extension.
The same was ordered to lie on the Table.
Mersey Docks and Harbour Board Bill [H.L.]. Commons Amendments considered, and agreed to.
Dowlais Gas Bill. Reported, with Amendments.
Baker Street and Waterloo Railway Bill. Committed.
Lancashire Electric Power Bill. Committed: The Committee to be proposed by the Committee of Selection.
St. Pancras Electricity Bill; Tottenham and Edmonton Gas Bill; Metropolitan District Railway Bill. Committed.
Kettering Water Bill. Committed for Monday next.
Middlesex County Council (General Powers) Bill; North West London Railway Bill; Bristol Corporation Bill. Committed: The Committees to be proposed by the Committee of Selection.
Local Government Provisional Orders (Gas) Bill. Committed: The Committee to be proposed by the Committee of Selection.
Local Government (Ireland) Provisional Orders (No. 2) Bill; Local Government (Ireland) Provisional Orders (No. 3) Bill; Local Government Provisional Orders (No. 7) Bill. Committed to a Committee of the Whole House Tomorrow.

RETURNS, REPORTS, ETC.

  COLONIES: ANNUAL.
  No. 484. Bermuda (Report for 1905).
  No. 485. Hong Kong (Report for 1905).

  TRADE REPORTS—ANNUAL SERIES.
  No. 3642. China (Chinkiang).
  No. 3643. United States (Hawaii).
  No. 3644. Spain (Malaga).
  No. 3645. France (Society Islands).
  No. 3646. Japan (North Formosa).
  No. 3647. Italy (Lombardy).
  Presented (by Command) and ordered to lie on the Table.

  GREEWICH HOSPITAL AND TRAVERS FOUNDATION.
  Statement of the estimated income and expenditure of Greenwich Hospital and of Travers' Foundation, for the year 1906–07.
  CIVIL LIST PENSIONS.
  List of all pensions granted during the year ended March 31st, 1906, and payable under the provisions of section 9(1) of the Civil List Act, 1901.
  SUPERANNUATION ACT.
  Treasury Minute, dated June 16th, 1906, respecting the addition of years to be assigned for pensions purposes to certain offices under the Board of Education.
  Finance accounts of the United Kingdom of Great Britain and Ireland, for the financial year ended March 31st, 1906.

  UNEMPLOYED WORKMEN ACT, 1905.
  Regulations made by the Local Government Board under the Act, as to the form of financial statement of distress committees having the powers of a central body established under the Act.
  Laid before the House (pursuant to Act), and ordered to lie on the Table.

  EDUCATION.
  Petitions in favour of maintenance of existing religious education in Church of

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  England schools:—Of ratepayers in Hardwicke—Ten Drayton. Of parents of children attending school at Bassing-bourne.
  Read, and ordered to lie on the Table.

  POLICE (SUPERANNUATION) BILL.
  Returned from the Commons with the Amendment agreed to.

FINANCE BILL.
[SECOND READING.]
Order of the day for Second Reading read.
Moved, That the Bill be now read 2a.—(The Marquess of Ripon.)
VISCOUNT ST. ALDWYN: My Lords, it is not my intention to detain your Lordships at any length with observations upon the Second Reading of this Bill, because in the first place, I am cognisant of the constitutional limitations which govern our action in this matter, and in the second place, I have no desire whatever to oppose the Second Reading of the Budget Bill of the year. It was admitted by the Chancellor of the Exchequer in introducing the Budget that it was in the nature of a provisional financial arrangement, and that we must wait until next year for the complete financial policy of His Majesty's Government. That was a very proper and natural suggestion, and I do not in the least complain of it; but precisely on that account I desire to make some observations on one particular point of the financial arrangements of the country—namely, the present position of the income-tax.
The estimated product of the income-tax for the present year is £31,250,000, at the rate of a shilling in the pound. The Chancellor of the Exchequer made some very forcible and true observations on the present position of the income-tax. He said—
"An income-tax at a uniform rate of a shilling in the pound in time of peace is impossible to justify and difficult to defend. It is a burden upon the trade of the country, which, in the long run, affects not only profits but wages; and it presses with extreme and peculiar severity on that large class of the community with incomes from £700 to £2,000 a year, who pay it in addition to their full
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share of taxation on articles of consumption; and it tends to destroy, or, at any rate, to contract a most readily available reserve on which the State can draw in a sudden and unforeseen emergency."
I wish entirely to associate myself with those sentiments. When I had the the honour to be Chancellor of the Exchequer I did my best to carry out those views. When at the commencement of the South African war, I had to look about for increased sources of taxation, besides increasing the income-tax, and besides adding to the indirect taxation upon alcohol, tea, and tobacco, I induced Parliament to assent to three new and important indirect taxes—the duties on sugar, corn and coal. Thus I endeavoured to divide fairly the cost of the war between the comparatively small class of the community liable to direct taxation through the income-tax, and the people as a whole. But I find no attempt whatever on the part of the present Government to carry into effect the wholesome doctrine laid down by the Chancellor of the Exchequer in regard to the income-tax.
The Chancellor of the Exchequer said that to reduce the income-tax by a penny would cost him £2,600,000, and that the means at his disposal were insufficient for the purpose. The right hon. Gentleman budgeted for a surplus of £3,074,000; and in my belief it would have been perfectly possible for him, even if he had considered it necessary, as he did consider it necessary, to add £500,000 to the unprecedented amount which this year will go to the repayment of debt, to reduce the income-tax by a penny, because the loss to the revenue by such a reduction would not amount in the first year to the total yield of a penny in one year. But instead of reducing the income-tax, the Chancellor of the Exchequer proposed to reduce the tea duty by a penny in the pound, and to abolish the coal tax as from November 1st. As to reduction of the tea duty, I would only say that no one for many years has touched the tea duty by less than twopence in the pound, and for the simple reason that the poor consumers of tea, upon whom the tea duty falls infinitely more heavily than upon the larger consumers, are only able to buy their tea in such small quantities that a reduction by a penny can hardly by any I possibility reach them.

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As to the coal duty, I have never argued that it was free from objections. Every tax has its objections; and there were objections, not merely theoretical, to imposing an export duty on any article of production in this country. But the result of the coal duty has not been what its most vigorous opponents prophesied at the time of its imposition. They said that the imposition of 1s. duty would lead to the closing of mines in this country, and would practically lead to many ships being deprived of outward cargoes altogether, and therefore being laid up. The picture drawn of the terrible state to which some parts of England and Scotland would be reduced owing to the imposition of the coal duty was a very lurid one indeed. But what has happened? There has been, I believe, and I think it fair to state it, some reduction in our exports of medium quality coal to the markets of North Europe; but, with regard to our general export of coal, that has continued to increase since the imposition of the duty, though not at so great a rate as before.
Considering that the duty produced £2,000,000 a year, and that the effects of it did not bear out the prophecies that had been made, I must say I believe it would be extremely difficult for any Chancellor of the Exchequer to discover any indirect tax which would produce more to the revenue at less cost to the industry of this country. But that is not all. In some respects the repeal of that duty will be a loss to this country. An instance has come to my knowledge in which a London company, which has to purchase large quantities of Welsh smokeless coal, directly the announcement of the repeal of the coal duty was made had notice from the contractors that in any renewed contract a shilling a ton more would be charged for the coal. And why? Because the contractors expected that by the repeal of this tax the foreign demand for this class of coal would be so much increased that the price might be safely raised to the home consumers.
I am old fashioned enough, in spite of the Report of the Royal Commission on Coal Supplies, to believe that it is not to the interest of this country to encourage the export of smokeless Welsh coal, which is of such enormous value to
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the Navy as well as to the industry of this country. But I entirely admit that both in this matter and in the reduction of the tea duty the proposals of the Chancellor of the Exchequer commended themselves generally to the House of Commons. It is possible that if instead of making these proposals the Chancellor of the Exchequer had proposed to reduce the income-tax, he would not have had the assent of the present House of Commons. But the important point is this—that having £3,000,000 to deal with, and being able thereby to reduce a shilling income-tax by a penny, the Chancellor of the Exchequer has found it necessary instead to reduce taxation on tea and coal, which I think no one can say pressed really hardly on the people.
What sort of hope does that give to the income-tax payer, to whose condition the Chancellor of the Exchequer referred with so much sympathy, of any reduction on the present rate at any future time? Of course, it may be said that it is hoped by His Majesty's present Government that there will be a material reduction in the expenditure of the country in future years. I can conceive one quarter in which there might be a considerable reduction. The Chancellor of the Exchequer quoted some remarkable figures in his Budget speech with respect to the increase in recent years of the cost of the Army and Navy. I will quote them again, as I believe that the attention of the country cannot be too much directed to the remarkable nature of these figures. The right hon. Gentleman said that in the year 1896–97 the Army, the numbers of which were voted at 156,000 men, cost £18,270,000 in the Estimates, whereas in 1906–7 the numbers of men voted were 204,000 and the cost £29,800,000 showing an increase of 30 per cent, in the men and of 63 per cent, in their cost. Those are very remarkable figures, and they are even more remarkable when compared with the Navy. The numbers of men voted for the Navy in this year, as compared with 1896–97, have increased by 41 per cent., but the cost has only increased 43 per cent. Does not that give us—I am bound to say it gives me—a prima facie ground for believing that there must be great waste in our Army expenditure, which is susceptible of material reduction without loss to the efficiency of our Army?

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But what is there to be said on the other side? Supposing His Majesty's present Government are able materially to reduce the Army Estimates without injuring the efficiency of the Army, there must certainly in the future be an increase under the head of works both in the Army and in the Navy Estimates if they carry out the policy which they have declared, and on which, I hope I may add without offence, they are very much disposed to plume themselves. In 1895 Lord Rosebery's Government initiated the policy of providing for the charges of military and naval works by a system of loans for a term not exceeding thirty years. That policy was continued by the late Government, and the total addition to the debt incurred by that policy is considerable. But the policy was necessary. Necessary works had been allowed to fall behind through mistaken ideas of economy, and the increase in the size of our ships, the increase in the number of soldiers and sailors, necessitated exceptional expenditure in providing new dockyards in different parts of the world, in barracks, hospitals, training grounds for soldiers, and in permanent works, which in our judgment was more fairly spread over a period of thirty years than imposed on the taxpayers of the present day. There is no doubt that the system has its faults, for probably there have been instances in which it led to unnecessary expenditure on ill-considered schemes and money has been wasted in that way. But if you abandon it there is this danger on the other side, that for the sake of economy and in order to diminish the Army and Navy Estimates of the year, the Chancellor of the Exchequer of the day will reduce the item of works in his Estimates to a point which is inconsistent with the efficient maintenance of the Army and Navy. That was done in previous years, and I hope that it will not be done again. But if it is not done, the item of Works in the Army and Navy Estimates will show a considerable increase in future years.
But can anyone who has watched the action of the House of Commons throughout this session believe that it will be possible for any Government, however strong their desire for economy, to make any very great reduction in the expenditure of the country? Resolutions have been passed one after another
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in the present House of Commons in favour of adding largely to the expenditure on elementary education, which has already increased 60 per cent. in the last ten years, by providing meals for hungry children; in favour of imposing the cost of elections on the public, of providing payment for Members of Parliament; of providing employment for those who call themselves "unemployed;" of providing better housing accommodation for the poor; and finally of giving pensions to all persons indiscriminately over the age of sixty-five; and also there is a constant pressure on the Government largely to increase the pay and other advantages enjoyed by those who are employed in the public service.
All these proposals together would involve an enormous increase in expenditure. How have they been met by the Chancellor of the Exchequer? They have been met with great sympathy, with speeches to the effect that he would be glad to accede to the demands, but he had no money. But what is the first thing that the Chancellor of the Exchequer does? Having a surplus of £3,000,000, he abolishes an equivalent amount of taxation. I wish to credit the House of Commons and the Government in accepting resolutions of this kind with a sincere desire to carry them out, but this desire is surely somewhat inconsistent with the repeal of £3,000,000 a year of taxation, which, as far as I know, has not pressed, with any real hardship on any one. I am confident, however, that this plea of there being no money will not last much longer, and that when the Gentlemen who are in favour of this increase of expenditure make these proposals again they will not be satisfied with such an answer, but will require that means shall in some way or other be provided by the Chancellor of the Exchequer to meet them. Well, my Lords, what does this mean? Is there any form of indirect taxation to which a Chancellor of the Exchequer, representing the present Government, could resort with a view to adding to the revenue of the country and in order to provide for the increase in expenditure suggested? Of course, His Majesty's present Government cannot adopt the proposals of the Tariff Reform League for levying duties on all manufactured and partly manufactured imported goods. I should entirely agree with them in objecting to any such

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proposals, because I believe that any reasonable study of the past would show that the result of duties of the kind would be infinitely more injurious to the trade and industry of the country than it would be beneficial in the majority of cases to the Exchequer. His Majesty's Government are debarred by their own opinions from any course of that sort. They have repealed the taxes to which I have referred. Is there any other indirect tax which it is possible for them to impose in their place. I do not believe that there is one. This means, therefore, that the present expenditure of the country, and any increase of expenditure that may be required on account of what I have mentioned, will have to be provided by the direct taxpayer—in other words, by the payers of the income-tax.
I may be told that a Committee has been appointed by the House of Commons to inquire into the present incidence of the income-tax, and whether it is possible to introduce any graduated system by which it would press less severely on smaller incomes—I suppose between £700 and £2,000 a year—and more upon the wealthier classes. Personally I am glad that the inquiry has been instituted. I have no objection on principle to graduation. We have accepted it in this country for many years in the house duty, and more lately in the estate duty. But I believe that the practicability of increasing the revenue by graduating the income-tax is a very doubtful matter indeed. I do not know how it can be done unless you are to single out through the officials of the Inland Revenue persons who might be suspected of having more than the limit of income above which you propose to impose a higher rate of taxation, require them to return the total amount of their income, and levy an additional income-tax upon them. I am sure that nobody who has the least acquaintance with the working of the income-tax would desire to see its mainstay removed—namely, the payment of the income-tax at its source. Supposing that such an additional tax were levied, there would be even a greater inducement than now exists, in schedule D of the income-tax, to make an incorrect statement of the total income. There would be, I believe, so many cases of incorrect statements of the
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kind on the part of persons who might be liable to the additional tax that its yield would be very small, and the Exchequer would run the risk of a very grave loss on the existing sources of revenue, because many taxpayers, thinking an additional tax unjust, would endeavour to avail themselves of all kinds of means to receive, in a way that the Inland Revenue, could not ascertain incomes from foreign dividends or foreign business, and matters of that kind, incomes which are now paid through bankers in London who deduct the income-tax before the dividends or profits are paid. I do not anticipate, therefore, that, even supposing this Committee should report that it would be possible in some way or other to graduate the income-tax and that the Government should adopt some proposal of the kind next year, the increase of the yield on the present income-tax would come to any very large amount.
I have been referring to the matter merely so far as it affects the burden on the income-tax payers in time of peace; but I believe there is a more serious and a more important side to the question, as it affects the resources of the country in time of war. When I was Chancellor of the Exchequer, during the South African war I had to raise a large increase of revenue to provide for the war charges. I turned, like all my predecessors, in the first place to the income-tax, which at the beginning of the war, stood at 8d. in the £. I raised it until in one year it reached 1s. 3d. in the £. But the income-tax now stands at 1s. in the £. Supposing it unfortunately happened that next year we were involved—and nobody can tell when this may happen—in some serious and costly war, the Chancellor of the Exchequer of the day would start with an income tax of 1s. in the £. He would be deprived of no less than £10,000,000 a year which was available to me for war purposes, and which is now being dissipated in time of peace.
I wish I could impress sufficiently on the House and on His Majesty's Government how seriously I regard this diminution of the necessary resources of the country in the event of a possible war. You may invent, as I had to invent, other kinds of taxation, but there is no tax which is so essentially useful in

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time of war as the income-tax. There is no other conceivable tax which can be raised and which can be lowered again without the smallest injurious effect on trade, commerce, and industry; and looking to the financial condition of the country, anything which deprives us of the full yield of that tax for meeting the cost of war is to my mind a very serious financial danger.
I thank your Lordships for the patience with which you have listened to my observations. I will conclude by saying that I make these criticisms in no hostile spirit to the Budget of this year or to His Majesty's Government. What I do desire is that in that large consideration which they have promised of the finances of the country this important fact should not be lost sight of—that an income-tax of 1s. in the £ is hard on the income-tax payers, most of whom are comparatively poor men, and in time of peace is utterly indefensible, as depriving us of necessary resources in time of war.
LORD WELBY: My Lords, I have listened with very great attention to the speech that has just been delivered by the noble Viscount, and with a very largo part of his observations, if I may venture to say so without presumption, I agree I cannot help regretting, however, that the noble Viscount devoted some part of his speech to a defence of the coal duty. The noble Viscount, when he was proposing the tax, guarded himself by saying that care must be taken in aiming at revenue not to sacrifice trade. I cannot help thinking that the experience we have had of the working of the coal tax shows that we have endangered trade in seeking revenue from that source.
It appears to me that a duty of this kind must have one of two results—either it must add to the price and so far handicap the English trader, who is exposed to very great competition both from Germany and America, or it must diminish the productiveness of the trade, and to that extent diminish the fund from which the wages of the labourers employed are met. I lay stress upon this last point because of the very large proportion labour occupies in the cost of the production of a ton of coal. It is, I believe, admitted that the labour in-
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volved in the production of a ton of coal represents 80 per cent, of the whole cost. If that is the case, it appears to me that the imposition of any duty which has the effect of restricting either the export of our coal or the output, and thereby diminishing the labour employed, is a very serious matter, and I venture to think that the late Chancellor of the Exchequer, in seeking revenue, to a great extent endangered trade. I gathered that the noble Viscount did not object very greatly to the course that has been taken. Indeed, it would be somewhat hard for noble Lords opposite to do so seeing that the Chancellor of the Exchequer of the late Government had announced his intention of giving up this duty. On both sides of politics this duty was regarded as one of the first to be surrendered.
I have much sympathy with the noble Viscount when he speaks of the difficult position in which we stand with regard to taxation. I hope that before any preconceived doctrine is laid down that direct taxation has a prior claim upon the Government, care will be be taken to review the whole position of the taxpayer. I am constantly struck with the fact that an enormous amount of property is in the hands of a very small number of people. For instance, if we look at the Inland Revenue returns we see that something like 4,000 people in a short time died leaving £300,000,000 of property. Taking into consideration the deductions which are now made from the lower incomes, has a case been made out for a reduction of income-tax in preference to a reduction on those articles of consumption the tax on which weighs so heavily on the wage-earning classes?
I do not wish to offer any criticism upon the action taken this year by His Majesty's Government. It is clear that it would be impossible for a Government coming into power in the month of December to effect any great change in our financial system in their first year. The difficulty of ascertaining the real facts of the financial situation is at once a bar to any effective action being taken by a Government in the first year. If I might express a pious opinion, I should have been very glad if His Majesty's Government had seen their way not to

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reduce taxation this year, but to devote the money which they would then have had in hand to the reduction of debt, so that next year, when they had thoroughly studied the financial situation, they might have been in a stronger position to carry out important financial reforms. I remember that, in the year 1873, Mr Gladstone devoted a large surplus to paying off the Alabama debt instead of reducing taxation, and thereby he secured in the following year a revenue which gave an opportunity, which I suppose has never since been enjoyed by a Chancellor of the Exchequer, of carrying out large and important financial reforms on a scale in ordinary years impossible. But in the case of a new Government having just taken office, I quite admit that that is a policy which they could hardly be expected to follow. I think by next year the Government ought to have fully considered the situation and be in a position to give effect to some of the large financial measures which are before the country.
I remember a conversation I once had with the late Lord Northbrook, a statesman of very great practical knowledge and at the same time one of the most prudent financiers. From his long experience at the War Office and the Admiralty, Lord Northbrook had a full sense of our responsibilities in the matter of defence, and his general training led him to know how dangerous it was to diminish or endanger our resources in time of war. He told me that he had before him at one time several recommendations from his expert advisers regarding fortification in India. He told me that the demand was large, and he referred it back to them in order that they might endeavour to reduce it and bring it more within the limits which he thought they could afford. They were not able to present a result such as he desired, and he then said that he could not agree to it. In a question of this kind there were, he pointed out, two dangers—the danger of not being provided with a sufficient military force, and the greater danger of putting the finances of India out of gear; and for the moment he felt that he must give the preference to establishing and maintaining a sound financial condition in India. I was very much struck by the manner in which he told me that, and I think it
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is important that this should be borne in mind in dealing with this question. I venture to hope that His Majesty's Government will accept the canon which Lord Northbrook then laid down.
The noble Viscount referred to the position in which we were in 1899. In the whole course of our experience there has hardly been a more favourable year, financially speaking, then 1899. For years we had been reducing the taxation of the country. We had also been reducing the Debt, and our Consols stood higher than ever before. Not only had the Debt been very largely decreased in consequence of the action of Chancellors of the Exchequer of both Parties, but owing to one of the most difficult and at the same time successful measures which. I remember during my career at the Treasury—namely, the conversion of the Debt by my noble friend Lord Goschen—the charge of the Debt had immensely decreased. Never before in our history were we in such a favourable position to face the heavy cost of war as in 1899, owing to the wise finance of both Parties, in the State for many years previously.
What is the position in which we find ourselves at the present moment? The reduction of the Debt, which had amounted to ƣ150,000,000 in the space of thirty years, has been obliterated, and our Debt stands now at a higher figure than, or at as high a figure as, it has stood since since 1870. The sum of ƣ23,000,000 has been added to our taxation, and on every side we see symptoms of excessive expenditure. One result has been that whereas in 1899 Consols stood at 110, or, perhaps at 109, allowing for the fact that Consols were bearing for a year or two a quarter per cent, additional interest, they are now at eighty-nine or ninety.
The country possesses two great instruments for employment in the case of such an emergency as war. The first is its defensive forces, and the second its financial position. It is difficult, in my opinion, to say which is the more important. But I am afraid that should the emergency of war now arise the country would not be able to start from the sound condition of finance from which it was able to start at the outbreak of the South African war. The position is

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therefore a very grave one, and I hope that during the present year His Majesty's Government will be able to give such consideration to the national finances as will restore them to a sound basis. In this connection I would again quote the late Lord Northbrook, who declared that if he must run some risk he would rather run the risk of not accepting some of the recommendations of his expert advisers than endanger the stability of Indian finance. It ought to be the canon of every Chancellor of the Exchequer that under no circumstances will he endanger the stability of English finances.
The noble Viscount held out very little hope of reduction of expenditure in the future. Indeed, he apprehended rather an increase. If the House of Commons is bent not only on maintaining the present scale of expenditure but on listening to every demand that is made upon it for fresh expenditure, I fear that the present unsound condition of the national finances will not be removed, and that if the present strain is long continued the country will be in a most unfavourable position to meet an emergency.
VISCOUNT GOSCHEN: My Lords, I shall trouble your Lordships with only a few observations. I can associate myself entirely with the principles laid down by my noble friend Lord St. Aldwyn, and I think that he has rendered a great service by placing before your Lordships his review of the financial situation. There is one remark which I would like to add in consequence of what has just fallen from my noble friend Lord Welby. The noble Lord quoted, naturally with admiration and approval, the doctrines laid down by Lord Northbrook, but I venture to think that such a question cannot be decided by any general principle. It must depend entirely upon the circumstances of each successive phase of European and other politics.
If there arose an emergency in which the country were called upon to act suddenly, there might be a frightful disaster if we were not prepared sufficiently with our naval and military defences, and certainly it would be a greater disaster than a disarrangement of our finances. It is essential, therefore, to look around, to consider the risks,
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in order to judge of the present necessity for preparedness. If there is one fact that must be borne in mind, a fact of supreme importance, it is that in the most modern wars they who strike first and hardest are most likely to win. I agree with Lord St. Aldwyn that there may possibly be room for considerable reduction in the Army expenditure, though I cannot form a judgment upon it, because my experience of the Navy shows how exceedingly difficult it is for those who are not acquainted with the inner working of the establishment to judge upon general principles as to whether there is extravagance or not.
But with regard to the Navy, you must take into consideration the new developments of foreign navies. Navies have been developed by three nations which before counted far less in any review of naval power. Therefore the public ought not to take it for granted that because the present cost of the Navy is much larger than it was ten years ago, there is now an opportunity for reduction in naval expenditure. The Chancellor of the Exchequer in his able speech in the other House quoted comparative figures in relation to the increase in expenditure and said, "These facts speak for themselves." That is just what they do not do. The facts do not speak for themselves. If a battleship that formerly cost £750,000 now costs £1,500,000, it is idle to charge the Admiralty with extravagance because they have spent £500,000 more upon the battleship. The additional £500,000 spent on the ship is now absolutely necessary.
I think the public will delude itself, and the Radical Party will delude itself, if it thinks the Navy offers any wide scope for economy in the coming years. Those who have read the political programme of other countries this year must see that we live in times when a reduction in our defensive forces would be one of the greatest mistakes of which the country could be guilty. I therefore offer these few words, not of warning, but of caution, that the hopes of those who so much desire a reduction in expenditure are, so far as the Navy is concerned, doomed to disappointment.
LORD JOICEY: My Lords, I have some hesitation in intervening in this

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debate after the speeches to which we have listened from noble Lords who are recognised throughout the country as great financial experts. But, though I have not had the experience that the noble Lords who have spoken enjoy, I have been largely concerned in great financial operations of different kinds. I cannot agree with the noble Viscount who spoke first that the Chancellor of the Exchequer was wrong in remitting the coal duty. My views are pretty well known on that subject, and I have as large an experience of the effect of that duty upon the general trade of the country as anyone. Your Lordships must not forget that this question was gone into very carefully by a Commission appointed by the late Government, and that that Commission decided clearly and distinctly that the duty was a very serious injury to the trade of the country and ought to be abolished at the first opportunity.
VISCOUNT ST. ALDWYN: Will the noble Lord quote the words of the Report? I do not recollect that.
LORD JOICEY: I cannot quote the words, but that was the spirit of the whole Report. I know that many people are under the impression that the coal duty was not paid by this country, but by the consumers of coal abroad. But as the frontier that was taxed was the frontier between this country and the foreign consumer only, and all other countries which produced coal were open without the tax, it was quite impossible to make the consumer pay the tax. I have been asked more than once how it was that the consumer in this country paid the tea duty, and yet the consumer abroad did not pay the coal duty. Surely the answer to that is obvious. If a tax were put upon tea coming into this country by the east coast, and the whole of the west coast were left entirely free from duty, could anyone argue for a moment that the tax would be paid by the consumer?
The coal tax has now gone. It was based, in my judgment, on a wrong principle. I do not believe in any export tax. I think it is always in restraint of trade, and I hope this country will never again be so
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foolish as to put a tax on anything exported from this country. I am bound to say that with much that fell from the noble Viscount I entirely agree. The great increase in the expenditure of this country got its impetus during the South African War, and we are now feeling the effects of that enormous expenditure, and it will be many years before we shall be able to relieve ourselves from them. I agree with the noble Viscount that the income-tax is a great advantage in time of war. It is a tax which can be very easily levied and collected, and a huge sum can be secured in that way in a very short time. But I cannot take quite the same alarming view as the noble Viscount. While our taxation in this country is increasing to a serious extent our wealth and our population are increasing certainly at the same ratio, and I do not think, therefore, that we need be unnecessarily alarmed, even if the income-tax should stand at 1s. in the £.
What may take place after the Committee which has been appointed by the present Government to deal with this question has reported I am unable to say. At the same time, I do not think it will be any serious burden upon people who have large incomes if they have to pay a larger proportion to the Exchequer than they are paying at the present time. I do not think that there are any men with huge incomes who would not willingly pay at all events their fair share to maintain the services of the country. With regard to the Navy and Army, there is no doubt that the country fully believes in their being kept up to the highest point of efficiency. So far as I have been able to gather the feeling of the country, I have never found a man, I have certainly never found any body of men, in favour of reducing the efficiency of the Navy. With regard to the allusion made by the noble Viscount opposite to the desire of certain Radicals to get the expenditure on the Navy reduced, I am bound to say that so far as I have had experience of the working classes, in particular in the north of England, I have always found them thoroughly in favour of maintaining the Navy at the highest point of efficiency, and if further money should be required for that purpose I think it would be forthcoming, and would be given freely

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by the country if the Government could show that it was absolutely necessary.
As to the Army, certain promises have been held out of a reduction of expenditure. I think it quite possible that there may be means of reducing expenditure on the Army without impairing its efficiency; but if any reduction should be proposed which, in my judgment, would interfere with the efficiency of the Army, I should certainly feel it my duty to oppose it, because I think the vast interests we have to protect demand that we should have both services as efficient as they can be rendered. I congratulate the Government on having got their Budget through without any serious opposition in another place, and I account for it to a large extent by the fact that, as has been stated, this is the Budget of the late Chancellor of the Exchequer. Surely, if it were his own child he could not very well disown and attack it. When the present Chancellor of the Exchequer comes to deal with the financial affairs of the country we shall probably see great changes, and I hope they will be such changes as will conduce to the raising of money easily for the services of the country.
THK LORD PRIVY SEAL (The MARQUESS of RIPON): My Lords, we have had a very important and interesting discussion, and those who have addressed your Lordships have spoken from various points of view, and with great authority. We all listened, I am sure, with interest to the speech of the noble Viscount opposite, Lord St. Aldwyn, who gave us the result of his long experience. I am not able to agree with all the conclusions at which the noble Viscount arrived, but at the same time every one in this House will recognise that he spoke only from the results of his own experience, which is so great and to which we owe so much respect, and that he did not do so from any Party considerations whatever.
There was a great deal which fell from the noble Viscount with respect to the income-tax with which I imagine most of us will agree, and it is well that he should have availed himself of this opportunity to call attention to the value and importance of the income-tax and to its special position in our system of finance. But, my Lords, I do not think that it would have been possible for my right
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hon. friend the Chancellor of the Exchequer to have based his financial arrangements this year solely upon a reduction of the income-tax. I do not know where he was to have found the means of doing anything else if he had taken a penny off the income-tax. The noble Viscount made a slight error, I think, in the figures he quoted. He spoke of my right hon. friend as having budgeted for a surplus of £3,704,000.
VISCOUNT ST. ALDWYN: No, £3,074,000.
THE MARQUESS OF RIPON: Then I did not hear the noble Viscount correctly.
VISCOUNT ST. ALDWYN: A reduction of the income-tax would have been possible, but no other taxes could have been reduced.
THE MARQUESS OF RIPON: I do not think that was a possible course for my right hon. friend to have taken. As the noble Viscount knows, very important questions connected with the structure and the mode of raising the income-tax are now under consideration. Those questions have been referred to a Committee. They cover a very wide range. They relate to that difficult question of graduation to which the noble Viscount alluded. They relate also to the problem of the difference between permanent and temporary incomes, a question which I remember was settled in the year 1853 for at least a generation by the great speech of Mr. Gladstone, one of the most remarkable efforts that was ever made by any Chancellor of the Exchequer in the House of Commons. Those questions are under consideration. I do not put that forward as a conclusive reason, but I think it is a reason of considerable weight, against having made a reduction of the income-tax the sole financial arrangement of the year.
The noble Viscount touched upon the question of the coal tax, but I do not propose to delay your Lordships long upon that matter. The noble Lords behind me who have spoken have touched upon some of the objections which can be raised to that tax. I venture to think it has not been a successful tax. The noble Viscount seemed to think that the quotation given by my noble friend.

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behind me from the Report of the Royal Commission on Coal Supplies was incorrect. In one respect I must admit that it was, inasmuch as the Report of the Commission contains the facts which were collected and the results at which they arrived, but does not draw any conclusion. But, on the other hand, the Report tells us that the witnesses generally were of opinion that the maintenance of a large coal export trade is of supreme importance to the country and essential to the prosperity of the coal-producing districts. On page 23 of the Report it is stated that—
"It is difficult to resist the contention that the tax had some effect in reducing the tonnage exported in the year 1901, although it is probable that the high level of prices, which was still maintained, and the declining condition of trade, both at home and abroad, had some influence on the figures. It will be seen that the total output of coal in 1901 in the United Kingdom was less by 6,000,000 tons than in 1900, but it should be noted that the home consumption in 1901 was 5,500,000 tons less than it was in 1900. It should not be overlooked that the coal-exporter has had the advantage of much lower export freights for coal in 1901 and subsequently than prevailed in 1900, and this must have mitigated the effect of the tax to a large extent."
All this tends to show, together with other portions of the Report, that the tax has interfered with trade, and I venture to think there is clear evidence in this Report that it has hampered the operation of our trade in France, Belgium, and Holland, and that in those countries German coal has had a tendency to take the place of British coal. From the facts contained in the Report we find that wages and profits have had a tendency to decline. I think these are good grounds for repealing the tax. Certainly we know that it was the intended policy of the late Chancellor of the Exchequer to repeal the coal tax. Therefore, my right hon. friend cannot be charged with taking a step the necessity of which had not already forced itself upon the minds of those who at the time were responsible for the finances of the country. I need not dwell on that subject. All I say is, that as far as the facts are known to me, I believe the coal tax to have acted in a manner injurious and hampering to our interests, and I think it was one of the first taxes marked for repeal.
The noble Viscount seems very much afraid of what may be done by the House
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of Commons in regard to the increase of taxes. That is a complaint which ever since I first entered Parliament I have heard made by every Chancellor of the Exchequer and ex-Chancellor of the Exchequer, and there have been but few men who have stood up to demands of that kind in the way in which Mr. Gladstone did. I quite admit that each demand for money for this purpose or for that must be considered not only upon its abstract merits but in connection with the financial condition of the country, and I am quite sure that that is the course which my right hon. friend will take. Large reductions of expenditure, if they are made, must be made upon the large items, while at the same time a careful Chancellor of the Exchequer would always keep his eye upon small items also. The noble Viscount pointed out with great force the startling difference between the rate of expenditure on the Army and the rate on the Navy. I agree with the noble Viscount in thinking that that is a fact which needs most careful consideration, and it is receiving that consideration from His Majesty's Government.
Your Lordships are aware, from what has been said before in this House, that the Secretary of State for War is considering the whole of our military arrangements very carefully and deliberately. I do not think your Lordships will be inclined to condemn him for taking his time over that. We have had too many successive experiments made with the Army during the last few years, and it is very desirable that any further changes should be made with the utmost deliberation. I have every reason to believe that my right hon. friend Mr. Haldane will find it within his power to reduce the Army expenditure in an effective manner, although it is not possible for me at the present moment to make any statement upon that subject. I believe it is probable that an opportunity will be taken by the Secretary of State to make some statement with regard to it in some of the discussions on the Estimates before the end of the session.
I do not know that I need detain your Lordships longer. Unlike the noble Lords who have addressed you, I do not profess to be an expert on this subject.

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I can only say, however, that I am unable to agree that the one thing to have done was to reduce the income tax. My noble friend Lord Welby seemed to think that the Chancellor of the Exchequer would have done better if he had made no reduction of taxation at all. That, my Lords, is a counsel of perfection, and I do not think my noble friend himself believes that it would have been advisable or possible for the Chancellor of the Exchequer to have taken that course. Neither do I think that it would have been possible for him in the present state of public opinion, in the face of a Parliament like the present, to have reduced the income tax and nothing else. Therefore, he has dealt with two taxes—the coal tax, which was marked especially for removal, and the tea duty, the reduction of which will afford relief—limited relief, I agree—to the people of this country in one of the most important articles of consumption. The noble Viscount said he did not think that reduction would reach the people.
VISCOUNT ST. ALDWYN: The poorest of the people.
THE MARQUESS OF RIPON: The information with which I have been furnished from the financial departments leads me to think that it has had that effect, if not always in the reduction in price, in some cases in the improvement of the quality. The statement made by the noble Viscount at the commencement of his speech really represents the truth of the present position. He said this was a provisional Budget. He accepted it as a provisional Budget. A provisional Budget it is. It is not to be taken as indicating what is likely to be the financial policy of His Majesty's Government in coming years. It is a provisional Budget dealing with the finances as they were left to us by our predecessors, dealing with the Estimates of expenditure which we received from them, and it is intended solely for the purpose of making such reduction—limited, I quite agree—in taxation as was possible in the circumstances in which we took office.
On Question, Bill read 2a; Standing Order No. XXXIX. dispensed with. Bill read 3a, and passed.

RESERVE FORCES BILL.
Reports of Amendments received.
Amendments moved—
"In page 1, line 7, after the word 'any' to insert the words 'British Protectorate or in any'; in line 9, after 'any' to insert the words 'British Protectorate or in any'; and in lines 10 and 11, to leave out the words 'a self-governing colony' and to insert the words 'in a colony possessing responsible government.'"—(The Earl of Portsmouth.)
On Question, Amendments agreed to. Bill to be read 3a To-morrow, and to be printed as amended. [No. 130.]

INDIAN RAILWAYS ACT AMENDMENT BILL.
[SECOND READING.]
Order of the Day for the Second Reading read.
EARL BEAUCHAMP: My Lords, this is a small Departmental Bill about which I do not think there can be any controversy. The original Railways Act of 1894 enables the Indian railway companies, upon certain conditions, to pay interest on their share capital out of capital during construction. By Section 9 of that Act the duration of it extended only to December 31st, 1905, or to the end of the then next ensuing session of Parliament and no longer, unless Parliament should otherwise determine. It appears desirable to make this Act permanent, and the Bill now before your Lordships has been drawn up with that object. I beg to move that it be read a second time.
Moved, That the Bill be now read 2a.—(Earl Beauchamp.)
On Question, Bill read 2a, and committed to a Committee of the Whole House To-morrow.

GREENWICH OBSERVATORY.
LORD ELLENBOROUGHrose, in accordance with notice, to call attention to the electrical works that the London County Council have lately built about half a mile from the Royal Observatory at Greenwich, and to point out that the presumed position of every ship when at

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sea, and out of sight of land, is based upon a comparsion of the results of observations taken by her officers, and other observations taken years previously by astronomers at the Royal Observatory, and that the positions of all places shown on British and American maps and charts, whether European, Indian, or Colonial, and also on most foreign maps and charts, are also dependent upon observations taken at Greenwich; that at a conference of delegates from the principal countries in the world, twenty-seven in number, held at Washington in October, 1884, for the purpose of fixing on a meridian proper to be employed as a common zero of longitude, twenty-two representatives voted in favour of adopting the meridian passing through the centre of the transit instrument at the Observatory at Greenwich as the initial meridian for longitude, and that, in consequence of this, nearly all nations of importance now use Greenwich time as a Standard or Universal time; that if a single ship is lost in consequence of confusion being introduced into longitudes its value might well be treble that of these new electrical works; that during the last two hundred and thirty years many millions of observations connected with cartography and astronomy have been made at the Observatory and other places, the value of which largely depends upon the fixity of the Royal Observatory as a reference point; and to call attention to the action of the London County Council in building furnaces and tall chimneys nearly due north of the Observatory, and in using engines which cause some of the astronomical instruments to vibrate in such a manner as to destroy all possibility of accurate observation; and to ask the Government if they will apply to Parliament for power to prevent the Royal Observatory from being shaken or smoked out, either at present or any future time.
The noble Lord said: My Lords, if the London County Council, encouraged by the success of their line of river steamers, launch out into ocean traffic, they will soon learn from their sea-going captains that it will be necessary to supply their ships with chronometers, whose error on Greenwich mean time is always known. The first thing that a seaman has to do when he wishes to find his ship's position when out of sight of
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land is to take the angular height of one or more heavenly bodies with a sextant. The next thing he does is to find the time that it was at Greenwich when he took his observations. This is done by means of a chronometer. This process is called getting a Greenwich date. It is a preliminary to working almost every class of observation at sea, whether for the purpose of ascertaining the position of a ship or for finding the error of a compass.
When he has obtained his Greenwich date, he proceeds to calculate how far he is east or west of Greenwich and how far he is north or south of the equator. This he does by comparing the results of observations made years previously at Greenwich, with those he has just made himself. If he or Greenwich make a mistake the ship may be lost with all hands. If out of the whole of the commerce of the globe a single ship is lost, her value might well amount to three times that of the Greenwich electrical works, to say nothing of her crew, who, after all, count as something. The London County Council have as yet only put up 20,000 horse-power at Greenwich. Well, there are many ships afloat that carry more than that. In the Royal Navy alone there are more than twenty-five such ships.
In 1884 what had been the general practice was made the rule, and the meridian passing through the centre of the transit instrument at Greenwich was selected as the common zero of longitude for the whole world, and the centre of that instrument became the chief reference point in universal geography. The railways and telegraphs in America and many other countries are all dependent on Greenwich time. For instance, Inter-Colonial time, that is, Nova Scotia time, is four hours slow on Greenwich. Eastern time is five hours slow, Central time is six hours slow, Mountain time is seven hours slow, and Pacific time is eight hours slow on Greenwich. There is also Mid-Europe time, one hour fast, Eastern Europe, and South African time, two hours fast, and Australian, Japanese, and New Zealand time, all of which depend on Greenwich. If in obedience to the London County Council we change our point of reference, we shall have remonstrances and possibly demands for compensation

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from all parts of the globe. The position of every place in the world, of every lighthouse and of every rock, as depicted on an English or American map or chart, and on most foreign maps or charts, is known by the angle between the plane of its meridian and that of Greenwich.
It is somewhat difficult to explain to any one who has never studied any branch of science the value of the nearest obtainable exactitude in measurements. Nearly all the discoveries which make the progress of the world, in the application of which to various industries many millions of men find work who would otherwise be unemployed, have been due to experiments conducted with the greatest possible accuracy. More exact instruments for measuring weight and length are constantly being invented. The advance in our chemical, metallurgical, and electrical industries is largely due to their employment. In chemistry, when a substance is too small to be weighed, you dissolve it and see how much water its equivalent will discolour. All branches of science are more or less interlaced, and receive from time to time unexpected help from one another. Continuity of observation is also a matter of great importance. All large astronomical instruments take some years before they settle down to their work, and if the observatory was moved there would be a most regrettable gap.
I have been told that nearly £500,000 has been spent on these works by the London County Council. Even if this is the case, what is that in comparison with what has been spent in bygone years on surveys and scientific expeditions, and on other work more or less connected with Greenwich? What are the interests of a few thousand people living near Greenwich compared with those of the millions whose navigation, clocks, watches, and geography depend on Greenwich? The observatory was there first, and if people choose to come and live in its neighbourhood they must accept the few restrictions involved by such a residence. If they put up machinery it must be at the risk of being ordered to remove it. Perhaps business men may understand the matter better if put in this way. To move Greenwich Observatory for the sake of the London County Council engines would be like changing the value of the
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British pound sterling to that of the Egyptian pound for the convenience of a few Cairo financiers.
If it was necessary to erect engines at Greenwich, one would naturally ask, Why not put up turbines, which in all probability would cause no vibration at all? Failing them, why not put up triple expansion engines with horizontal cylinders, a pattern that has been in use for many years? They run very smoothly. Instead of that, double expansion engines were selected with the first cylinder placed perpendicularly above the crank so as to get as much thumping as possible. Is the astronomy and geography of the whole world to be put out of joint for the sake of the perpendicular cylinders of the London County Council? Their interests are infinitesimal compared with those they claim the right to interfere with. The Council must be made to grasp the fact that, omitting purely scientific considerations, the navigational, geographical and business interests of the world do not permit the removal of Greenwich Observatory, and that if anything has to go it is their works. But before going to the expense of removal, it would be well to consider the practicability of reducing the height of the chimneys by 100 feet, of introducing additional machinery for the consumption of smoke, using forced draught, of substituting turbines for reciprocating engines, and of adding many tons of concrete to the foundations. The latter method was successfully employed in reducing the vibration of some of the tube railways. Of course no further extension of the works should be allowed.
The London County Council chimneys are nearly due north of the Observatory. They extend to a height of 2½ degrees above the horizon of the Observatory, and the four chimneys together obscure a horizontal sky space of about 3½ degrees, thus excluding from all future observation a celestial space of about nine square degrees on the horizon. When smoke is coming out of the chimneys a still further space is obscured. At present only two chimneys are in use and the other two are approaching completion. The present plant of reciprocating engines can work up to 20,000 horse-power, though only 5,000 is in use at present.

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It is impossible to estimate how much smoke and vibration there will be when the whole of this plant is in full working order, and how many instruments may then be disturbed.
If a clause is introduced into a private Act of Parliament it would give insufficient protection against future attacks by other persons. For instance, any company or person who chose to do so might build factories with still taller chimneys, and put up machinery, such as steam-hammers, which would shake the Observatory fifty times as much as the existing engines. I consider it absolutely necessary to pass a public Act of Parliament to protect the Royal Observatory from all future encroachments or interference. On March 13th, the London County Council actually wrote to the Astronomer Royal saying that they were—
"unable to acknowledge any liability in regard to the effect on the Observatory of the working of the station."
It is clear that the London County Council do not realise the mischief they are doing. It seems sad that the education of half a million of London children should have been entrusted to a body who are evidently ignorant of the first principles of geography. The London County Council are like little children playing with fire, and should be gently but firmly pulled off the hearth-rug—that is, the neighbourhood of Greenwich —before they have had time to do serious mischief.
I expect the next thing that the London County Council will do will be to order the Equator to clear out of the tropics and not to take more than its fair share of sunshine. A redistribution of sunshine would be a popular measure, but there might be some difficulty in carrying it out. Why not throw all the latitudes in the world out of order as well as the longitudes? As a matter of fact, the Poles and the Equator are not exactly always in the same position as regards the Earth. They oscillate to the extent of about fifty feet, while the Greenwich transit instrument remains the fixed reference point of the Universe. Another point on the same meridian would not serve the same purpose, with exactitude, as it might be more or less affected by
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this oscillation. When the London County Council engines are running, accurate observations for testing this oscillation cannot be taken. When I looked at the instrument used for measuring it, the lines in the mercurial mirror were constantly vibrating, though only 5,000 horse-power or less was being used. I was told that formerly they were only disturbed when trains were passing, but that now the movement is continuous. If ever the Greenwich railway directors ask for further Parliamentary powers, they should be told that they can only have them on condition of reinforcing the foundations of their line with concrete.
This is not the first attempt that has been made to destroy the usefulness of the Greenwich Observatory. A Fenian or an Anarchist once tried to destroy it. He met, however, with a well-deserved fate, for he blew himself to pieces instead. But he has, I believe the unique honour of being the only person whose crime has been timed to a tenth of a second by the institution that he wished to destroy. If the power of making accurate observations is denied to Greenwich Observatory it will be as much destroyed as if it had been blown up by a Fenian. A considerable portion of the observations and calculations that have been made at Greenwich and in other places during the last 230 years will be rendered useless. If the London County Council continue to interfere with the means of obtaining universal standard time and longitude, they will bring upon themselves the dislike and contempt of the whole civilised world. The Royal Observatory should not be shaken and smoked out of its place by a local body ignorant of what Greenwich is to the world in general. A public Act of Parliament should be passed to protect the Observatory from interference.
THE FIRST LORD OF THE ADMIRALTY (Lord TWEEDMOUTH): My Lords, the noble Lord has made a very vigorous speech on this subject, and I am glad to be able to sympathise with him in his care for the future of Greenwich Observatory. Since this subject has been raised it has been closely considered at the Admiralty. We have been in conference with the authorities at Greenwich and with the representatives of the County

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Council. As to the origin of this generating station, in 1901 the London County Council resolved on it, and in 1902 a Bill was passed through Parliament. In this Bill was inserted a clause known as the Observatory Clause, which gave to the Board of Trade the power, if any use of electrical power was likely to affect injuriously the instruments used in the Observatory, to require reasonable and proper precautions to be taken. This proposal was made public and approved by Parliament. It is a pity that the County Council had not more closely apprehended the possibility of danger to the Observatory in choosing this particular site, but I think that there was some responsibility also to be attached to the various departments and also to Parliament.
I think that the noble Lord has given an exaggerated account of what has taken place. This afternoon I had a conversation with the Astronomer Royal, and he thinks that at present, at any rate, no absolute damage has been done. I admit, however, that there is an apprehension of it when the station is developed to its fullest power. It will be almost the biggest generating station in the world when completed. Eight engines will work up to 52,000 horse-power, and the electricity generated will, it is supposed, be sufficient to work the whole of the London tramway system. But at the present time the Astronomer Royal says that no serious effect has as yet arisen in the working of the principal meridian instrument. This is a stationary instrument not easily subject to vibration. The Astronomer Royal says, however, that the instrument which has been affected is the portable transit instrument used for determining longitude. There has thus been evidence of some disturbance in this instrument, but the Astronomer Royal says that the interferences are variable and intermittent, and sometimes stop altogether. He added that from the large generating station at Deptford, which is only a quarter of a mile further from the Observatory than this generating station, no damage has resulted, and there is no indication of any disturbance.
What we have to do is to take very careful observation as to what exactly is going on at Greenwich. At present, I believe that the station is never worked
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up to more than 3,000 horse-power. A trial has been made of two engines, but the experiments were in no sense complete or satisfactory. What I propose to do is to ask Professor Ewing, who lives at Greenwich, and is a distinguished engineer, intimately acquainted with scientific instruments, to represent the Admiralty—he is our Director of Naval Education already—in the observations to be taken, which must extend over a considerable time. I am told that the disturbances that do occur vary very much, and that there is a great deal to be said as to the possibility of meeting the difficulties by reducing the height of the chimneys, though the Astronomer Royal does not think that the vapour of the chimneys as yet seriously interferes with the observations.
I propose also to ask the London County Council to name a representative of their own for the Committee I am about to appoint to report on the whole subject. I have had a conference with members of the County Council—the chairmen of the various committees—in company with the Astronomer Royal, and the County Council have expressed themselves very desirous to meet the wishes of the Admiralty and to do anything reasonable in the way of making such alterations in the plant as would prevent damage to the Observatory.
VISCOUNT GOSCHEN: My Lords, I cannot say that the statement which has just been made by my noble friend is very reassuring, and there are certain defects in the information which he has been good enough to give to the House. His expressions as to varying interferences and the time that will be taken in order to show the exact effect of them must fill every one of your Lordships with alarm.
One of the questions which suggests itself, however, is whether the County Council in the meanwhile are going to continue this gigantic work? Are there no means of coming to an arrangement with the County Council, that, pending inquiry, they should not continue to spend large sums of money upon these works? Evidently a gigantic mistake has been made—a mistake by the Admiralty, by the Astronomer Royal, by the County Council, and by Parliament,

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and I do not gather from the tone of the noble Lord, anxious and determined as he is to bring this matter to a satisfactory conclusion, the slightest note of confidence that it will be possible to remove all the objections that have been raised. The matter affects not only the Greenwich Observatory, but the whole scientific world. In these circumstances I scarcely think that the device of continuing the experiments and watching the observations is quite adequate to the enormous importance of the position.
I am aware of the great abilities of Professor Ewing. I am sure, too, that the County Council will bring to bear on the matter the greatest anxiety in the choice of their representative; but I question whether this is not a work in which the greatest scientists in the Kingdom should be associated in some form or another, so that the country and all those interested should be assured that every scrap of scientific knowledge available in this country, of whatever class, is being brought to bear on the subject. The idea that Greenwich Observatory, that historic scientific monument which has rendered such vast services to the world, and on which so much depends, should be imperilled even in the slightest degree, even by "varying interferences," is really a prospect which few persons can contemplate with equanimity. I conceive that it might come to this, that the whole scheme of the London County Council, notwithstanding their half-million expenditure, might have to be abandoned rather than that the scientific accuracy of Greenwich time should be endangered. It seems only reasonable that the amount involved should not be increased during the considerable time which my noble friend says will be necessary for the conducting of the experiments.
THE EARL OF CRAWFORD: My Lords, I ask your Lordships' indulgence while I say a few words. The noble Lord in introducing this subject dealt with two aspects of the question, first, the chimney, and second, the effect of the machinery when set in motion inside the generating station. The effect of the chimney is in its relation to the refraction of light, and I would illustrate my meaning by referring to what takes place when the orb of the sun as seen from the deck of a steamer touches the water line on
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the far horizon. At that instant it is in truth below the horizon. A star seen through a column of heated air is thrown about. A column of air rising up from a tall chimney below the line of vision of the telescope is not uniform in its temperature, and according to the blowing of the wind it passes either to the right or to the left, forward or backward. Consequently the temperature does not remain the same, and the result is that the image of the star which is seen is thrown about violently, and the individual observer is unable to fix it with the definite precision required, and the refraction error is unknown.
It has been suggested that there might be a possibility of lowering the chimneys, but I do not think that would have any very great effect. The chimney at the present time is not much more than two or three degrees above the horizontal point of the horizon. The danger is the heat from the furnaces below the chimneys and the column of hot air passing away. It was found that when the wind was blowing nearly due east, the hot air rising from the chimney was caught by a smart wind and blown away in a horizontal direction before it could rise up and practically destroy the northern horizon. But on a fine night, when there is no wind, the heated air would undoubtedly rise and certainly reach fifteen or even twenty degrees of altitude, destroying all observations which might be required to be made at that altitude by the introduction of the unknown errors.
Reference has been made by the noble Viscount who has just sat down to the mistakes committed by many and various public Departments, but I think there is one mistake which has not been alluded to, but which ought to be noticed in this connection, and that is that the architect to the London County Council had been employed at the Royal Observatory at Greenwich. He was employed to put up the buildings for the important instrument to which the noble Lord the First Lord of the Admiralty referred. The chimney is absolutely on the meridian of that instrument. That ought not to have been allowed. The chimney might easily have been placed in a different position, and I think the architect, knowing the importance of the instrument erected in

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the Observatory, ought to have noticed this defect.
Tremor is a matter that we are now familiar with in London. I can compare it to what a person feels in walking along the street when one of the large motor omnibuses comes along and shakes the pavement. Another thing one might liken it to is the feeling when you wish to write a note in a train. The shaking to which attention has been called by Lord Ellenborough is so small that an ordinary person might treat it with contempt, yet the movement is very large when taken in connection with the delicate observations which have to be carried on at Greenwich. The essentials for observation of an astronomical kind are stability and quietude. All astronomical observation is a question of measurement either from one body to another or the referring of a heavenly body to a fixed point. Astronomers are compelled to use as a horizon a mercurial mirror, in which the observer is able to see, when the instrument is in perfect order, the real images. As will be readily understood, tremor will affect a basin of mercury. The slightest tremor, set up either by a person walking, by a carriage at a distance, by a train passing, or an engine working, would show itself instantly. The effect is that a star, instead of appearing as a small round disc which one is able to see sharply, is ill-defined and unsteady.
If errors are introduced in this manner, whether by shaking or by abnormal refraction, no harm is done provided we know the magnitude of those errors. Nothing is so dangerous in astronomical observation as the unknown errors which have to be guarded against in the present circumstances at Greenwich. The instrument which I alluded to just now, which has its meridian obstructed by this chimney, is that which is devoted to the observation of the moon. For many years the moon has been given over, by the charter, as it were, of the scientific world, to Greenwich Observatory. Astronomy has grown so vast in its extent, that, as in the case of other branches of science, persons take up groups, none being able to carry the whole work in their heads or to do practical credit to the study of the whole. The Royal Observatory at Greenwich has specialised on the moon, mainly owing to
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the grand labours of Sir George Airey, the late Astronomer Royal, who by examination of the many hundreds of thousands of observations of the moon reduced those observations down and produced what is called a lunar theory. That is to say, by means of tabular arrangements and mathematical formula the position of the moon at any given time hence may be fairly accurately predicted.
The observations at Greenwich and the manner in which they have been carried out by the late Astronomer Royal have led the whole scientific world to say, "Gentlemen, you know your moon so well, pray continue to be responsible for her." In the same way the observation of the minor planets rests with Berlin, and other matters are looked after by American observers. If now Greenwich is reduced to the position of saying that its lunar observations have not the weight and value which so far have attached to them, it will be a terrible blow to the reputation of our Royal Observatory and also to our existence as a scientific country. Another difficulty is that disputes as to boundaries between countries are mainly settled by astronomical observation as to the position of the moon. The easiest way for taking such observations naturally would be by telegraph, but you do not find telegraph cables all over the world, and consequently these boundaries have to be settled by astronomical observations. As the moon is being constantly watched at Greenwich Observatory, applications are frequently received from foreign countries as to the error of the moon at such an hour on such a day. That also shows how extremely important it is that the observations at Greenwich should be reliable.
I understand that in any case Greenwich Observatory will not be the one that will have to move. If it were so, I hardly know how to imagine the result of destroying the position of the meridian of Greenwich. It is difficult for those who are not acquainted with the scientific minutiae to realise that such is the accuracy demanded of the instruments at Greenwich Observatory. Measures of extension are in fractions of the diameter of a spider's web and hundredths of a second of time. These measurements seem so infinitesimal that you may not think it

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possible that they could be effected. I will give you an instance. About twenty-eight years ago I had the honour to be on the Board of Visitors of the Royal Observatory. I was at that time President of the Royal Astronomical Society. The Astronomer Royal then told us that the right pier of the transit circle had been sinking for a period of time. It had been going on for some six years. Previous to the meeting of the Board of Visitors in June the errors due to the sinking of this pier had become so great and were so laborious to correct that the Astronomer Royal determined to put the thing right mechanically. He therfore had the transit circle lifted up, moved off the pivots, and beneath the right pivot which carried the big telescope was placed a sheet of paper 180th part of an inch thick. The pivot before this had been too low; after that piece of paper had been put under it it was very slightly too high. But it had taken six years to fall that amount, and the errors were so great, that it was necessary that this should be done.
The Astronomer Royal has told the First Lord of the Admiralty that at the present time, no actual damage has been done. I grant that that is the case, but at all times observations are taken which might be necessary for the purpose of determining a longitude, and I can give you the effect which those observations would have at the present time. I suppose there is no geographical distance, so far as longitude is concerned, better known than the distance between London and Paris. That distance is known certainly with an error not greater than five feet astronomically. Observations which can be obtained at the present time give, not an error of five feet, but an error ranging from fifty to 300 feet. Therefore, though the disturbance caused to the instruments at the Observatory by the County Council's electric works may be infinitely small, that infinitely small disturbance may lead to irreparable damage.
LORD KELVIN: My Lords, I am sure we are all deeply indebted to the noble Lord who has introduced this subject, and to the noble Earl who has just sat down for his very interesting speech. We must all be deeply impressed with the extreme gravity of this question. The difficulty
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of seeing what is the right solution is great. But we are comforted by the assurance of the noble Lord the First Lord of the Admiralty that, if either of the two structures is to be removed from Greenwich, it shall not be the Royal Observatory. It would be intolerable that the site of the Royal Observatory should be compulsorily changed. On the other hand, there is a serious responsibility on account of the large amount of ratepayers' money which has been spent by the London County Council.
If there is any solution by which the electric works at Greenwich can go on without crippling or seriously interfering with the work of the Observatory we shall all, I am sure, be glad. Even at present I think we may look forward to possible changes in the arrangement of the electricity works by which they may not seriously disturb or practically cripple the astronomical observations at Greenwich. A solution which has been suggested—the substitution of steam turbines—is easily spoken of, but not so lightly to be undertaken in respect of machinery already completed. The substitution of steam turbines for reciprocating engines would probably necessitate a different type of electrical machines, and the result of such a substitution might lead to a gigantic piece of "scrapping." I do not know how far the County Council works have progressed.
LORD TWEEDMOUTH: About one half of the works have been completed, but it has not been decided what the engines are to be.
LORD KELVIN: Then there is still time?
LORD TWEEDMOUTH: Yes.
LORD KELVIN: I am glad to learn from the noble Lord that there is still time to avert half of the possible damage. I believe that the disturbance caused at the Observatory by the vibration from the electric works might be practically annulled by the substitution of steam turbines for reciprocating engines. The Metropolitan Electric Supply Corporation some ten or fifteen years ago had a great number of complaints of vibration from occupiers of

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neighbouring houses and from a neighbouring hotel. Several years passed and the complaints became more serious. At last the company boldly resolved to do away with the reciprocating engines and put steam turbines in their place. Since that was done no further complaint has been received. Of course, that does not prove that in the case of the Greenwich Observatory, where such a slight vibration is injurious, the remedy would be effective, but I think most engineers would come to the conclusion that the substitution of steam turbines would practically annul the vibration. I trust that both Houses of Parliament will unite in defending the Royal Observatory from the tremendous disaster which has seemed to be impending. It is no exaggeration to say that the whole world outside, as well as the British Empire, would deplore anything that would injure the great and good work done in the Royal Observatory at Greenwich, and I hope the Government will succeed in preventing that.
EARL CAWDOR: My Lords, your Lordships will all have listened with much interest to the instructive speeches which have been delivered this evening, and I am sure the noble Lords who have spoken will think that the statement of the First Lord of the Admiralty is not quite satisfactory. I do not propose to go into the question as to who is to blame. We all agree that something has taken place which ought to have been avoided. I was glad to hear from the noble Lord that he had been met in a friendly spirit by the London County Council, but I am bound to say that it does not appear to me quite satisfactory that it should only be propossd to appoint an expert in the person of Professor Ewing, whose great skill we all recognise most fully, and a representative of the London County Council to watch the effect of what is going on.
What we want is to guard most carefully against the slightest increase in the evils which are admitted to exist. The mischief that is being done is not regular. It seems to vary; but the minute difference in measurements effected shows that these matters want watching with the utmost possible care. I hope the noble Lord the First Lord of the Admiralty will be able in a short time to
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assure us that some further action is being adopted. The first step to be taken, if it is possible to do so, is to stop any further expenditure by the London County Council that may be found to be useless or worse than useless. It appears certain that any further development of the powerful engines that are being used must increase the evils. Therefore we should guard against any further increase in the horse-power used in these works, and I beg the noble Lord to consider the question of getting the assistance of the best expert advice obtainable in this country. I do not undervalue the great ability of Professor Ewing, but the question at issue is a very big one, and one which deserves to the full the best scientific advice that can be procured. I do not know whether there is any legal process by which the London County Council can be stopped from carrying out works that do mischief to the Observatory, but, if not, I think powers should be obtained. I hope the question of cost will not be allowed to stand in the way. The half million of money expended, or partly expended, by the County Council is comparatively a small item when it is remembered what is at stake.
LORD MUSKERRY: May I ask the noble Lord the First Lord of the Admiralty whether the Board of Trade could not act under the Observatory Clause in the County Council's Bill?
LORD TWEEDMOUTH: I have not stated all that I have done in the way of endeavouring to obtain information on this subject, which has only arisen within the last few days. The Law Officers have had the whole question of the powers of the Admiralty and the Board of Trade before them, and they are to advise what those powers are. I have also consulted the Chairman of the Visitors, and he told me that the Visitors comprised all the leading astronomers of this country, and they will, of course, give all the assistance they can in elucidating the question. The London County Council have told me that they would not go on with the two chimneys, which are now only partly erected, and I imagine there will not be much more done with regard to the installation, which is incomplete, and for which the type of engine has not yet been decided.

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I hold that it is desirable to discover what the effect of the existing installation really is. It is, I think, necessary that that installation should be worked at its full power in order that we may discover what is the effect on the instruments at Greenwich. I think the House will agree that before doing anything we are bound to discover whether by any rearrangement of the machinery the threatened damage can be averted—for I cannot admit that up to the present moment it is more than a threat of damage. I undertake that every effort shall be made to make the inquiry a thorough one and one which shall command everyone's respect.
THE LORD BISHOP OF SOUTH-WARK: Am I right in understanding that the full installation is to be 52,000 horse-power, and that up to the present I only 3,000 horse-power has been worked?
LORD TWEEDMOUTH: The full power will be 52,000 horse-power. The amount already installed represents, I think, 26,000 horse-power.
LORD ELLENBOROUGH: I should like to ask whether I correctly interpreted the noble Lord as saying that only 3,000 horse-power had up to the present time been worked, and that it was intended that the full plant should be 52,000 horsepower.
LORD TWEEDMOUTH: I said that on the occasion on which some tremor was observed 3,200 horse-power had been developed.
LORD ELLENBOROUGH: How much is the whole?
LORD TWEEDMOUTH: Fifty-two thousand horse-power.
THE LORD BISHOP OF SOUTH-WARK: If all this difficulty has been caused by 3,000 horse-power and there is a possibility of 52,000 horse-power, the gravity of the matter is considerably enhanced.

JUSTICES AND THE RATES.
LORD BARNARD: My Lords, I rise to ask His Majesty's Government whether the requirement that the consent of two or more justices must be obtained to certain rates now serves any useful purpose, and, if not, whether they will
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take any steps to repeal such requirement. I may explain, for the information of those of your Lordships who are not familiar with this matter, that in rural townships and parishes the last proceeding after the poor-rate has been made, and before the rate can be collected, is that it requires to be allowed by two or more justices. I have not been able to discover what the origin of that allowance was, though I think it goes back to the year 1601. There was no doubt good reason at that date for this allowance being required, but I have been unable to ascertain that at the present time the proceeding is of any public utility what-ever. On the other hand, I am able to state that it is a matter of some slight expense to the ratepayers, and of very considerable inconvenience. I have before me a letter written by an assistant overseer in which he informs me that in his union it costs the ratepayers some £30 a year, because a fee has to be paid for this allowance by the magistrates. Many of the officials have to go eight or ten miles to find magistrates. What the principle is on which this requirement is based I have not been able to find out, and I beg to ask whether steps cannot be taken to repeal the requirement.
EARL CARRINGTON: My Lords, I agree that on the face of it it is rather difficult to understand why this requirement should be necessary. The requirement, however, is a very old one. I believe it is over 300 years old. The justices do not enter into the question as to whether a rate ought to be made or not; if it is in proper form they must allow it. That is the law as it stands. I have no information that there is any fee to be paid when this ceremony takes place, but I understand from the noble Lord that that is so. So long as the overseers have the duty of making the poor rate it is thought that there is not any very great or sufficient reason for abolishing altogether the allowance of the justices. I am informed that the allowance of a rate by the justices is to prevent the possibility of any bogus rates being raised. Under the present conditions it is thought to be best upon the whole to allow the ancient custom to continue.
House adjourned at a quarter past Seven o'clock, till To-morrow, half-past Ten o'clock.