HL Deb 21 July 1920 vol 41 cc393-413

rose to draw the attention of His Majesty's Government to university finance. The noble Earl said: My Lords, my object in putting this Motion upon the Paper was two-fold. Firstly, I had intended to ask His Majesty's Government whether they would consider the total remission of the Excess Profits Duty as applied to funds subscribed to universities, in order to benefit the universities; and, secondly, because I thought that unless some such remission or facility was granted the universities would very shortly find themselves in such. a position that a very great financial burden would be thrown upon the Government in order to prevent universities coming to grief financially.

Since I put the Motion upon the Paper, a discussion has taken place on an analogous Resolution in another place. In the Committee Stage of the Finance Bill an Amendment was moved that 5 per cent. of a citizen's income should be free from taxation if applied to certain charitable purposes, and it was pointed out by the mover of that Amendment that it was not altogether a new suggestion inasmuch as in the United States of America 15 per cent. of a citizen's income is already so freed. The Chancellor of the Exchequer, I am afraid, was not able to give any sympathy to that request, in so far as it affected Income Tax and Super Tax. Although I could find it quite easy to sympathise with him in not seeing his way to meet the request on the point, of Income Tax and Super-Tax, yet I was very sorry to see the reasons that he gave for his refusal. They were two—firstly, that such a request had always been consistently refused by his predecessors, and, secondly, that it would be a very unfair thing to do because a rich man who made a subscription to a university or a hospital would be given a much larger proportion of remitted tax than a poor man who was taxed at a lower rate. I do not think that is at all a wise point of view. Suggestions for the remission of taxation on subscriptions to charit- able objects are not made in order to assist the individual who makes the contribution, but it seems to me that they are made in order to assist the institution which is to receive the subscription.

Universities differ, if I may say so, from other charitable institutions, such as hospitals, in that they already receive very large subventions from the Exchequer, and the relief which would be afforded to universities would really relieve the Exchequer itself from having to make good deficits at the end of the year, as is the present custom. Therefore, the case of universities stands upon a totally different footing from the case of hospitals.

When the Chancellor of the Exchequer come to deal with the situation of a remission of Excess Profits Duty, to some extent he conceded the principle of the request; but, I am afraid, to a very small extent. The actual words of the new clause which he moved, and which was adopted without discussion in Committee in order to be further discussed on Report, are not very dear as I read them, but the noble Earl will correct rue if I misinterpret them. As I read it, the concession that the Chancellor of the Exchequer is prepared to give is as follows: Supposing a firm made £200,000 profits, of which £100,000 was liable to Excess Profits Duty, they would be allowed to withdraw £5,000 out of that £100,000, hut only on the assumption that they added to that £5,000 a sum of £20,000 out of the first £100,000 which was not liable to Excess Profits Duty. The contribution which was freed from Excess Profits was not to exceed 20 per cent. of their total contribution.


The deduction must not exceed 20 per cent. But I will deal with that later, if the noble Earl will allow me.


The deduction, as long as Excess Profits Duty is as much as 60 per cent., would not, I am afraid, alter the total proportion very much. Apparently my figures are a little, too severe, but, as I have worked them out, it seemed to me that three-fifths of one-fifth would be the remission which would be given as long as the Excess Profits Duty stands at 60 per cent.; in other words, that 12 per cent. of a firm's total contribution might be withdrawn. I do not think that 12 per cent. of a firm's contribution is a sufficiently large inducement to be worth anything at all. Presumably, in making even that concession—which I admit is one of some value—the Chancellor of the Exchequer must have realised the real need for making a concession. Therefore, I am sorry that he was not able to go far enough to make the concession he was willing to offer a real one. If I am right that it amounts to only 12 per cent., I think it is also true to say that it would not always amount even to so much as that. For instance, on a falling market it would not necessarily amount to that; because what is paid in one year in Excess Profits Duty can be reclaimed in the following year, if there is a falling off and a loss is suffered instead of a profit made.

There is another reason why I am not prepared to admit that to sacrifice some portion of the temporary Excess Profits Duty is a real sacrifice. Unfortunately, we all know numberless instances of what I am afraid must be called great extravagance, which the nature of the Excess Profits Duty has induced many firms to adopt. I dare say several of your Lordships have received advertisements, printed on the best hand-made paper, with wonderful engravings—cost no object—which would never have been issued unless the firms concerned had been able to do it out of Excess Profits. I know of one case where a firm employed a lawyer to fight in the Courts a case which went on for two years, and which they knew they had no chance of winning. Their reason was that they wished to give employment to a particular lawyer, and, the Excess Profits being at that time at a very high figure, the State, and not themselves, was paying for that lawyer. We all know of numberless cases of really extravagant expenditure—firms, as it is frequently described, looking about to see how they can spend money rather than pay it in Excess Profits Duty.

Therefore, if the result of making a real concession as regards contributions to universities being free from liability to Excess Profits Duty, did bring about a certain proportion of that money going to the universities instead of being wasted on other objects, I believe it would be not only a great primary gain to the universities but also an indirect gain in that the deficit, for which the universities expected to be reimbursed—and are to be reimbursed at the end of the year—would not be so large as it will otherwise be. I should say that any remarks I make about universities are made to apply only to provincial universities in England, in which the case is entirely different from that of Oxford and Cambridge, and, I regret to say, also different from that of Scottish universities, which are so much better looked after by the noble Lord whom I see here. The expenses that fall upon provincial universities are, to a very large extent, forced upon them by the educational policy of the Government. They are the coping-stone to a great building of which the foundations have been laid by the Government; and you cannot broaden the foundations and at the same time narrow the roof you put upon it. Therefore, if the great extension of primary and secondary education, which is the accepted policy of the Government, is carried through—as I hope it will be—it is impossible to accuse universities of extravagant plans if they are forced to develop at the same time.

The Armstrong College, which is the Newcastle branch of Durham University (a body with which I am connected) received a letter from the Chairman of the University Grants Committee, in May last, in which he 'quoted the average percentages of the various sources from which the incomes of the English universities are drawn. The Parliamentary grants account for 39 per cent., the local authority grants for 14 per cent., the endowment incomes for 12 per cent., leaving fees and miscellaneous sources to supply the other 35 per cent. I give those figures in order to remind your Lordships that a very large proportion of the existing expense is already borne by the Exchequer. In a letter that I received no later than yesterday from the distinguished principal of Sheffield University, he said— I have talked over the matter with my colleagues in other universities, and I am afraid that we shall all have this year a pretty heavy deficit. I do not know to what extent it is true to say that the Government is always pledged to meet those deficits; but, as a matter of practice, so long as the Government is satisfied that these universities have done their best to meet their own burdens, those deficits are, as a matter of fact, borne out of Parliamentary grants.

Why is it that these difficulties are arising to-day? The answer is really very simple. The value of money has halved, and the number of students seeking admission to universities has doubled. There is not a university in the country which has not been forced to create a waiting list, to turn people away; even ex-Service students, whose university career is to be financed by the State, are not able to obtain immediate admission. I suggest to your Lordships that that congestion is not a temporary phenomenon. It is not a phenomenon solely due to the war. It is, no doubt, accentuated by the war, but I do not think it is fair to say that it is primarily due to the war. Public schools and secondary schools are just as crowded, and that, at all events, cannot be said to be a result of the war. I think it is also true to say that the Education Act of 1918 is not responsible for that congestion. That Act is only a sign. It would not have passed through as easily as it did if there had not been a very wide demand for increased facilities for education, and it is a sign of the permanent increased demand, the difficulty to meet which we have to face to-day. When that Act comes into operation the present congestion will be further increased. A very much larger number of men and women will go through a course of education which will take them up to matriculation standard, and a large proportion of them will be of a calibre which is fitted to make the utmost use of university teaching.

An answer was given in another place, the day before yesterday, as to the yearly sum we are spending on education. The amount was, I think, upwards of £45,000,000. That is bound to be an increasing sum. Yesterday I received from the secretary of the County Education Committee in Northumberland his estimate of what it will cost to put the 1918 Act into operation in the county of Northumberland. It is not a complete estimate. For several items,—evening class instruction, and university education, for example—he puts down no figures. The estimate is deferred; he cannot tell me yet what it will cost. But in the County of Northumberland, which has no really large towns, his estimate of the capital expenditure for bringing that Act into operation is over £700,000, and of-the annual expenditure, £280,000. Half the annual expenditure, I know, is to be borne by the State, but the other half means an additional county rate of over 1s. in the £ on the top of all the other increases from which we are suffering at present, and it is very difficult to over-rate the gravity of those figures. Practically it means that provincial universities will not be able to look for any considerable amount of help from municipal rates. Such heavy educational burdens are already being thrown upon municipal rates by the Act of 1918 that it is very doubtful—until, at all events, we have some rearrangement of local and Imperial taxation—whether the universities will be able to receive any help additional to that which they receive now from that source.

At the same time it is unthinkable, if you embark upon such an enormous scheme for progress in education, costing so much, that you are going to turn round when you come to the final stage, which many people would say is the most paying stage of all, and the one most worth while persisting in, and say to would-be students, "Well, we are very sorry. It is quite true that we should like to give you this education, but we simply have not got the funds with which to do it." The extent of the demand, if they are to have funds to do it, is really very great. It comes under three headings, first the heading of salaries. The existing salaries are wofully inadequate, and not only so, but if you double the number of your students you cannot expect not to increase the size of your staff. The Principal of Sheffield University, in the same letter that I have already mentioned, says— The other day we Advertised a junior lecture ship in physics at £300. If we had advertised it before the war at £200 we should have got a score of applicants. This time we got one, which was so insufficient that we had to withdraw the advertisement and start afresh at a higher figure. The increase in the number of students, which is the result partly of a national awakening and a wish for education, intensified as it will be by the operation of the 1918 Act, forces the hands of those who are in charge of our universities.

They have to do what they can to extend. It is not a matter of choice with them; they are bound to increase their staffs, and if they are to retain professors and teachers and lecturers who are qualified to give the high class instruction which the provincial universities have been so famed for giving in the past, the salaries themselves will have to be very much increased. Not only that, but on the science side an increase of students means not only an increase of staff, it means also an increase of equipment. It is not like the art side, where you can perhaps cram eighty students into a classroom which before was meant to hold forty. On the science side an increase of students must mean more building and more equipment. Already, at all the universities, lectures are being given in relief. The same lecturer has to give his lecture to two, or even more, classes in order to fill the room by reliefs, because it is impossible to deal with them all at once. That, again, puts a very great strain upon the professors themselves.

Lastly, another very great need with which they are faced is the need for hostels and playing fields. No doubt to some extent hostels are a counsel of perfection, but if you are going in for university teaching at all it seems to me a thousand pities that you should have to cut off the provincial universities from giving what is probably the most valuable feature of all the valuable features to be got at the old universities of Oxford and Cambridge. It is in the corporate life outside the classroom where a great deal of the best education and interchange of thought take place. Therefore, I hope that the Government will consider very seriously whether they cannot go rather further than they now propose in order to induce the private benefactor to make larger subscriptions.

As regards the Excess Profits Duty, we still believe that it is only a temporary tax, and if, at the cost of some remission of a temporary tax, you can encourage firms to get into the habit of making real, substantial contributions to their local universities yon will have achieved a very great deal, and you will have given real relief to the Exchequer; because, when that tax is withdrawn, the habit of contributing to provincial universities will remain, and the more you encourage that habit of contributing, the smaller will he the deficit which the Exchequer is called upon to meet at the end of the year. I, therefore, urge upon the Government to look upon this question of the universities, and the question of hospitals and other charitable institutions in a different light, and, if they cannot meet them in the way that has been suggested, at all events to devise some other way of encouraging private benevolence.


My Lords, I think that the noble Earl who has just sat down has rendered a public service in bring- ing this question before the House. It is a question which is too much neglected. We hear, on all hands, of other phases of education, but the serious situation as regards the future of the universities is one which is commonly overlooked. I agree with the noble Earl in thinking that the concession which has been made, for which those of us who are interested in the universities are grateful, is one which will not go far towards solving the problem which we have to face. But it is a good sign that, since the noble Earl first gave notice of his Motion, the Government have moved in this direction even to the extent of making this concession.

I have lived in close communion with these young provincial universities since their birth. I am Chancellor of one. I know their difficulties; I know their financial struggles, and I know the almost desperate condition of their finances. But it is not only to the new universities that my sympathies extend. Oxford and Cambridge are fulfilling great national missions; so are the Scottish universities; and they are all in need, partly for the reason to which the noble Earl alluded—that there is a great influx of students and a great demand for further teaching—and partly for the still more deep-seated reason that, there has been, as the result of the war, an immense increase in the demand for higher knowledge. I call it the higher knowledge to indicate the learning of the university type as distinguished from the learning of the school type.

As I shall point out in a moment, I do not think we have got to the end of that demand. If the demand is to be met, it means spending money, and I am one of those who have shared the national concern about the increase of expenditure. There is, however, a certain amount of expenditure which you cannot avoid. If you wish to raise a crop, you cannot avoid spending money on preparing your fields, and that is what you do when you start your educational institutions. Whether you are starving them or not, depends upon the necessities which they have to meet. If we are to produce more in this country, if we are to keep up to the level which international, competition is demanding of us, if we are to respond to the demand of our own people for the spread of that knowledge which is one of the most tranquillising influences, not only in the relations of Labour and Capital but in almost every other social relation, then we have to meet what is asked of us. And the worst thing we can do is to attempt to economise, or stint money, in the provision of what is necessary for the attainment of these great sources of the national life.

I have not risen to reproach the Government on this head at all. On the contrary, I think this Government, in the matter of the care of the universities, has been a very good Government. I am not alluding, to the little concession mentioned just now, although it is a good sign, but I think the Chancellor of the Exchequer on this and still more on other occasions, has shown himself really conscious of the magnitude of the problem, and the importance of attention to it. Not only have the grants to the universities been increased in recent years, but the whole system of administration has been put upon a better footing. The Government has a very efficient body of advisers in the Treasury Committee, and in the personality of Sir William M'Cormick, who is unique in his knowledge of the necessities of the universities, also, I think, of how to provide them with what they require, in a manner which is as efficient as it is frugal. The Government have responded, and the question is what ought the Government to do now in the national interest. There are new demands, but the demands to which the noble Earl referred are not the only demands which we shall have to face in the near future.

Hitherto, the higher leaning, as I have called it, has been the monopoly of the well-to-do classes. It is quite true that through the Workers' Educational Association, through summer schools, and in fashions of that kind, you have been able to extend something to those who work with their hands, but only a fragment, only a fraction, of what is necessary. What has been done has, at least, had this extremely valuable result, that it has proved that if you use the best quality of university knowledge and bring it to bear, it has a marvellous effect and is received with marvellous appreciation by the working classes. The success of men like Mr. Albert Mansbridge and the school which he has founded, in extending university education to those who toil in the pit and the factory, who will come miles at night to work, only shows that there is a great field which we have to cultivate and which, if adequately cultivated, will probably result in great fruits. We are in the happy position in this country of having been pioneers even in that small experiment. The matter has been taken up here as it has not been taken up elsewhere, although the interest in it is growing all over the world, especially in parts of the British Empire. Still, we are in a position of being able to keep well in front, and I think it is desirable that we should keep in front.

Speaking for myself, I see the time approaching when the State will recognise the duty of educating its democracy. In the year 1870 the State assumed the responsibility for the education of our youth, and for seeing that youth was compulsorily educated. A new duty looms in front of the State, and that is the duty of making adequate provision whereby the adult, who cannot have, and has not had, the opportunity of entering the walls of a university, may yet have brought to him that higher education from which circumstances have shut him out. Circumstances have shut him out, Yes; and thereby produced the class consciousness which is one of the most disturbing things in this country at the present time. It is that class consciousness—the division between a small class that has had a full opportunity of getting the higher learning, making the best of its leisure, coming into communion with the great minds of the past, and the vast and less fortunate majority who are shut out by hard necessity from all these things—which is the source, I am satisfied, of a great deal of the want of tranquility at the moment. Whether the State takes it up, as its deliberate policy or not, I am quite certain that it will be forced to contemplate the necessity of assuming in these early years of the twentieth century a duty analogous to, that which it undertook in 1870 when they made themselves responsible for providing adequate education for youth.

it is not so large a matter as it seems. After all the higher learning can only be the possession of what you may call the élite. We send our sons and daughters to the universities, but even those who go (and by no means the whole of them) do not get the best; they do not get what they need in very large numbers. Consequently, those who go to the universities will always be a comparatively small class of the population, simply because they are a class which is limited by a capacity to take these things in. But then it is this small class which is the very salt of the earth. It is from those who form it that the leaders in thought and in action come. Where should we have been in the war hut for the thinkers from the universities who added greatly to the strength of our Army and Navy? I am not suggesting that you should contemplate the time when the working man will enter the walls of the university. He will do so, I hope, but he cannot do so in more than small numbers. I am contemplating the time when if Mahomet does not come to the mountain, the mountain will go to Mahomet. I am looking forward to the universities, through extra-mural work, reaching every district that requires it, training a new class of university tutor and, armed with that organisation, extending their beneficent work to the colliery districts, the pottery districts, and the factory districts all over the country Until you do that you will not have completed your system of giving educational opportunities, nor will you have laid the foundations of that tranquillity which you can only attain when you have got rid of class consciousness.

It probably is not a very expensive business, but it will require a certain amount of money. It will require the universities to be put in such a position that they can contemplate and begin to lay the foundations of the system. They are not even equipped for the work they have to do now. They are not able to carry through the business of preparing and organising the education of the limited class which now goes to them. How much less are they able to contemplate these larger duties which I am sure are going to come upon them at a period not very remote. If that be so then the Government, which has been much alive in this matter and has done a good deal to prepare the way, will have a problem before them which I think will necessitate the spending of money, and the best thing that can be done in the interests of the State will be for them to face the situation and deal with it.

I know it is making a very formidable appeal to the Government to ask them to spend money directly, but I am sure it is much better than relying on the contributions which come by chance from benevolently-minded firms. It is easy to get rid of the Excess Profits Tax. It is a system I never liked, but, if the State is going to take excess profits, the State should make sure that it gets its share and then apply the money to the purpose for which the money was designed. It is only by a system of this kind that the universities will get that steady increase of their income which is required if they are to do this work efficiently. While I welcome the concession I hope it does not preclude altogether, or in a substantial measure, the contribution of a more satisfactory kind such as would put the universities on a more assured footing for the work they have to do at present and also strengthen them for those further functions which I feel certain they will have to fulfil.


My Lords, I should like to refer, briefly, to the higher elementary schools which now have to give a larger number of free scholarships. The Minister of Education is asking these schools to give these additional scholarships and only allowing them to raise the fees of the other scholars by such an infinitesimal amount that many of them are going to lose even more money than formerly. As a member of the East Riding Education Committee I should like to appeal to the Government to allow the fees in these higher elementary schools to be raised more in proportion to the increased expenses of to-day. We have heard from two noble Lords the difficulties in large counties like Northumberland in which there are no big towns. My county, the East Riding, is in a similar position, and the financial situation is viewed by members of the Education Committee most gravely. It is quite right to give everybody the best education possible, but as the country is so hard up I hope the Government will allow us to raise the fees in order to try to meet the increasing expenses.


The last point raised by my noble friend Lord Nunburnholme is not quite relevant to the Question asked by the noble Earl and I hope he will, therefore, excuse me from giving an answer at the present moment, beyond saying that the matter is one of importance and is, naturally, engaging the attention of the Board of Education. For the moment I hope he will not press me to give any further reply.

Now I start by conceding everything that Lord Grey has said, and most of what Lord Haldane has repeated, about the hardships of the universities. They are suffering from increased cost of staff, of equipment, of superannuation, of pensions. Repairs and maintenance of their fabrics are more costly, especially in the case of the older universities. Students are much more numerous, and, with their increased numbers, they require fresh outlay upon residence and recreation, as well as upon their tutorial necessities. The difficulties, in short, are immense. But I should like at the outset to enter a caveat against some of Lord Haldane's remarks. He always makes speeches, in my Opinion, which balance between optimism and pessimism, with the tendency, perhaps, rather towards pessimism when one hears him, though when one reads his speeches afterwards optimism is rather more apparent. I take him as I heard him, and I must demur to the statement which he made. that our universities are not equipped to deal with the limited class now in attendance. We always say that about ourselves—not about universities alone but about our Army, our Navy, or our Diplomatic Service. We always depreciate our Diplomatic Service all we can in this country, and yet, when one asks or listens to the opinions of foreign countries who find themselves in official relations with it. one hears very different stories indeed. Therefore, I do not want Lord Haldane, who occupies a position of very special responsibility in this matter, owing to his large influence, to over-do the depreciation, which, in itself, is rather agreeable, but which one does not want at the present juncture to be exaggerated.

In two words let me remind your Lordships what the Government have done in this respect. £1,000,000 have been granted, which is administered by the Committee of which Sir William M'Cormick is Chairman, and I rejoice that Lord Haldane should have paid a very just and well deserved tribute to that distinguished man, and to the loyal work performed by his colleagues. In addition, there is a grant of £500,000 for so-called non-recurrent outlay, and furthermore, there is another large liability assumed by the State, which, of course, is not a help to the universities as such, but which none the less is a Government contribution in aid of university education. That is the grant made to ex-Service men, in the nature, I think you might say, of maintenance allowances. Last year that was £2,000,000, and this year it has been put up to £3,000,000. Consequently, although your Lordships may be perfectly clear that the money is no help to the universities as such—in some ways it adds to their difficulties and liabilities—none the less it is a contribution by the taxpayers as a whole towards promoting the wide extension of university education, for which Lord Haldane has just now been pleading.

Now let me refer to what the Government proposes to do, because I have to announce that the Government are going to do their best to increase the outlay upon university education. I came down with some nervousness, bearing in mind that last week your Lordships passed a Vote of Censure upon the Government for spending too much money. Lord Haldane, of course, voted for that, and Lord Crewe also, and I think that Lord Grey, had he been present, would have acted as Teller for it. But university education is a thing apart and next week perhaps some of my noble friends will come here and say you must not spend money on university education, but you must re-establish the old Militia, or you must spend more money in Mesopotamia, and there lay the foundations of a great home for the population of India who desire to occupy a new land, and so on. However, this afternoon I am only in the presence of friends, however critical they may have been last week. in the new clause—I will not bother your Lordships by reading it—Clause 45 of the Finance Bill, as amended (winch I hope will reach your Lordships in ten days or a fortnight) a grant in relief of Excess Profits Duty is given in favour of trades or businesses which make charitable contributions, not, of course, merely for universities or education or scientific research, but also for the relief of the poor or the sick.

I will give to your Lordships a short exposition prepared for me by the Board of Inland Revenue. It does not apply only to universities, and probably universities will not be the chief beneficiaries under this new Clause 45. Let me try to make it clear to Lord Grey how the incidence will arise. It is very complicated I agree, but that is the way with all Finance Acts. In arriving at the excess profits of a trade or business liable to Excess Profits Duty, a contribution, for the purpose of relieving the poor or sick, or for universities or education or scientific research, made after July 16 last—that is the date of the announcement—is allowed as a deduction, subject to the two following limitations—namely (a) the deduction must not be more than 5 per cent. of the profits of the trade or business in the period of account in which the contribution is made; (b) the deduction must not be more than 20 per cent. of the amount of the contribution.

I think, probably, the best way to explain that is to give a concrete example. Lord Grey and I arrive at the same percentage basis, though, so far as I can make out, we entirely differ as to how we reached that point. I am going on the 60 per cent. Excess Profits Duty, and I, or rather the Board, arrive at this conclusion. In the case of a trader who makes a contribution of £10,000 to a university fund, the net result to the Exchequer, provided that the trader in question is liable to Excess Profit Duty, and that condition (a) is satisfied—the condition that the deduction is not to exceed 5 per cent.—is that the trader obtains a deduction of £2,000 (i.e., 20 per cent. of the £10,000) from his excess profits, and his Excess Profits Duty (now charged at 60 per cent.) is thereby reduced by £1,200. Roughly it comes to this, therefore, that while the Excess Profits Duty is charged at 60 per cent., in any such case the State in effect bears 12 per cent. of the charitable contributions made by the trader.

Lord Grey thinks that is a beggarly contribution. I do not. I think it is a very large concession for the Treasury to have made. To bear 12 per cent. of the contributions made by a firm which can allocate money from its excess profits in this way seems to me to be handsome. The Excess Profits Duty is, of course, a temporary tax. It has been re-imposed year after year since its first imposition, and the precise date of its repeal cannot be forecast. But I think it is reasonable to hope that so long as this tax is in operation the allowance now granted in respect of charitable and educational contributions may be expected to continue. This 12 per cent. contribution is an exceptional grant from an exceptional tax, made to great public or quasi-public services which, owing to the war, have met with exceptional obstacles. I give no estimate of the cost of this concession to the Exchequer. I do not feel quite prepared to do so. I have no doubt that it will be a very considerable sum, though in my opinion probably the bulk of it will not find its way to the universities.


I wish to point out to the noble Earl that, although it is an immediate loss, it will lessen the deficit which comes from the Parliamentary grant at the end of the year, and is not a real loss.


I do not know. That is on the assumption that the Parliamentary grant at the end of the year is to extinguish all deficits. That is a strong assumption to make. It is equally an assumption that, if there is any deficit in addition, Parliament is going to make it up. I do not think we are entitled at the present juncture to assume quite as much as that. However, the Government is not going to-limit itself to this Excess Profits Duty concession. Indeed, so fully does the Government appreciate the importance of this university work in national development, that, quite apart from the recurrent grant in aid and the non-recurrent grant in aid to which I have referred, the Government desires to go still further. I must, however, say at once that under present conditions it is not proposed that any Supplementary Vote should be granted during the present financial year.

A general statement on this subject will shortly be issued by Mr. Chamberlain, but, meanwhile, I should like to say that the urgency of the matter has been very much emphasised in view of the opportunity which now affords itself of stimulating local support and private beneficence. Subject to any over-riding necessities of national finance, the Chancellor of the Exchequer is prepared to submit to Parliament an increase of the present Vote of £1,000,000 to £1,500,000 in the Estimates. for the year 1921–22. The expenditure, of course, must be guarded with care, and the present activity of universities must he secured on a sound footing before extensions and developments can properly be aided from Government funds. In addition to the grant in aid, the Chancellor of the Exchequer is prepared further to consider the advisability of proposing another non-recurrent sum to help universities in meeting the grievance of those of their senior members who are precluded from profiting to the full by the benefits of the university superannuation scheme. I ask your Lordships to take special note of the guarded terms in which I make that announcement on behalf of the Government. No pledge is given in this respect, and the announcement is, therefore, framed in most cautious terms, but it expresses the desire of the Government—the very anxions desire of the Government—to meet grievance which is a real and tremendous personal hardship with which we are fully in sympathy, and which we have every desire to mitigate, if not entirely to remove. The object of what I have just announced—the policy of the Government—is not merely to help the universities such, but to stimulate the benefactions of others. Benefactions, of course, are still most urgently required.

I may perhaps be allowed to express my personal hope that in the relations between universities and the State, which apparently will grow more intimate as time goes on, the maintenance of the individuality, the impress of personality and tradition belonging to each different university, shall be secured. Each university now has its own and its intimate character which should be preserved at all costs. I am one of those who do not believe that uniformity, except in very rare instances, is desirable, and I hear a good deal of talk which makes me think that those who have theories about democratising the universities imagine that this will best be accomplished by making them as uniform as one school is with another under the local education authority of some great city. I should regret that. In my opinion, standardisation is not democracy. There should be the greatest variation of method, and indeed of ideals as well, in our university life, and the present system by which Government grants are made in aid of universities seems to me rightly to safeguard this high principle as much as possible. Notwithstanding the very great difficulties by which these universities are faced, I am confident that with courage and with moderate assistance from the Government, especially if that assistance stimulates private benefactions, their future is secured.


My Lords I am conscious that this debate represents in some respects a contradiction, as the noble Earl opposite did not forget to point out, and as was also mentioned by my noble and learned friend Lord Haldane. It is quite true that we do keep on bombarding the Front Bench opposite with admonitions for economy, and now my noble friend Lord Grey comes down to the House and in a most admirable speech appeals to the Government for further help—that is to say, for further expen- diture. He is supported by my noble and learned friend behind me (Viscount Haldane), and I find myself also giving him unqualified support. It is also quite true that such a demand as this is not the only one. Noble Lords and members of the House of Commons interested in other causes continue to come down and ask the Government to spend more money. It may be upon agriculture; it may be, as the noble Earl said, on some foreign adventure; it may be to assist in the purchase of a famous picture which would otherwise leave the country; it may be for some form of military or naval expenditure. That undoubtedly means that those who come down to Parliament and ask for further expenditure of money have on their shoulders the burden of giving proof of the absolute necessity of their expenditure on national grounds.

I take it that my noble friend Lord Grey is not the least afraid to accept that test, and we all of us feel that it, is not only because we have, or may profess to have, a special interest in culture, that we ask for this expenditure, but because we believe that expenditure on the universities does represent a definite national necessity. My noble friends have spoken of the university needs. First and foremost, I think, come salaries, and, more especially, the salaries in the lower departments on the humbler scale. It is less difficult for a university to pay a substantial salary to a professor, and endowments for special Chairs are more likely to be forthcoming. But the assistant professors, lecturers, demonstrators, and others, paid on a comparatively low scale, are those who have been so desperately hard hit by the rise in the cost of living, and whose case it is absolutely necessary to meet. Then, of course, as Lord Grey also pointed out, the further demand for science teaching in particular means a heavy cost in apparatus and in the materials that are used. The humanities can be taught comparatively cheaply, although I do not agree that they can be reasonably or profitably taught to large classes of 70 or 80 people; and the recognition of the fact that no teaching is of much use unless delivered to small classes has added considerably to the cost of education by making it necessary to employ a larger number of teachers.

We have all listened with deep interest, and also with no little satisfaction, to the extremely important speech which the noble Earl, Lord Crawford, has made; and I join with all that has been said in recognising not merely the good intentions but the good work that has actually been done by His Majesty's Government through the Ministry of Education. I desire to join in a special tribute to Mr. Fishier, and also, as my noble friend opposite did, to Sir William M'Cormick, with the details of whsse work I am well acquainted. We heard with satisfaction that in addition to the £1,000,000 already provided, and to the other grants, it is proposed to apply £500,000 more to the needs of universities, although without calling on Parliament to pass a Supplementary Vote for that purpose. Did I understand the noble Earl aright?


I should like to be very exact. No Supplementary Vote will be presented during the present financial year, but, unless over-riding financial necessities make it impossible, an extra £500,000 will be put down in the next financial year.


Now I am quite clear. I hope and believe that we need not be too greatly alarmed by the use of the phrase "over-riding financial necessities." That phrase represents only, I take it, the habitual precaution proper to the Treasury; and we may take it also, I think, that unless some cataclysm, of which we have no conceivable alarm at this moment, should occur, in the next year this £500,000 will be forthcoming. I noticed also that a word of caution is presented by the Department—namely, that it is hoped that this assistance will not be employed for works of extension and development., but rather for the perfecting of the existing branches of different universities. That caution, again, I take it, may be read in a reasonable sense rather as cautioning universities not to break out, on the strength of that further grant, into large extensions which would involve recurring expenditure in the future; and that, I have no doubt, as a general principle, will be accepted.

Personally I do not find myself differing from the noble Earl in hoping that this further Government assistance will prove to be an encouragement to private donors and benefactors. I thought that my noble and learned friend went a little far in his suggestion that the proper course was for universities to depend for assistance rather upon the Taxes than upon such assistance as private donors might be encouraged to provide by the remission of taxation. I confess that so long as the money is forthcoming from private sources, I should not be particular to make too many inquiries as to the motives from which it is given. The only doubt, I think, about this 12 per cent. remission which the noble Earl explained so clearly, exceedingly difficult and technical as the point is, is as to whether the psychological effect—which, after all, is what matters—upon the minds of the firms which make the excess profits, will be sufficient. And that, I think, is all that either Lord Grey or Lord Haldane meant when speaking somewhat doubtfully about it. The concession undoubtedly means a definite sacrifice on the part of the, Chancellor of the Exchequer, and, as such, merits all our gratitude. The doubts that have been expressed simply mean that it does not seem quite certain whether the scale will be such as to attract people to make benefactions which they would not otherwise have made.

In conclusion, I should like to say a word or two about the point which was raised by my noble friend Lord Haldane and also dwelt upon by the noble Earl opposite. This is much more than a mere question of assisting the education of a certain number of young men and young women to do their work in life. It is one of the widest and deepest of our national problems. My noble friend spoke of the feeling of the mass of workers on this subject of university education. It was said fifty years ago, when the franchise was first further extended after the great Reform Bill, that "we must educate our masters," and I have no doubt that there is much education which the wisest members of the Labour Party and of the workers desire to see diffused among those whom they represent. Nobody supposes that all workers can be turned into dry economists, but we want the workers of the nation to understand that the Government is not possessed of a bottomless purse with which it can meet all the claims that are made upon it. We want the workers to realise that wages must bear some relation to the profits made in any industry, whether that industry is carried on by the Government or carried on for private profit.

So far as I am able to judge the demand of the Labour Party, and of those who are entitled to speak for the workers in this matter of education, is moderate and reasonable. I do not believe that they desire that complete standardisation of higher education of which Lord Crawford—and I entirely agree with him—spoke deprecatingly. So far as I know, they fully understand that there must be, and will continue to be, different types of schools, colleges, and universities. But what they really demand is that there should be, not merely nominally but in fact, an equal chance to both the picked and average boy and girl, from whatever class they may come. That does not mean that they expect every boy to have the chance or the desire to go to Eton, or every girl to have the chance of going to Girton. But they do desire that there should be no form of the finest and highest education—by no means only technical, but also literary and humane—which it is not possible for any capable boy or girl to enjoy. And I believe there is no reason why, in the course of years, that should not be done.

As has been well said, the system of education, which was formerly spoken of as a ladder, and has been preferably spoken of later as a highway, ought to be a broad road along which everybody can travel, with extra opportunities from which those specially fitted may profit. And it being the case that the universities are, as we all know, the crown of our national system of education, it must be that we look to them for the attainment, if not at once, in years to come of that perfect system of national education for which my noble and learned friend hopes. I will not go into the very interesting suggestions which he made on the possibility of universities stretching out tentacles, so to speak, all over the country. Something has already been done in that way, and I have no doubt more may be done. Meantime, I merely desire once more to express our gratitude to His Majesty's Government for the further assistance which they have given, without attempting to ask the noble Earl opposite or His Majesty's Government to believe that we may not one of these days come and suggest that still further assistance may be necessary.