ROAD FUND.

HL Deb 06 March 1928 vol 70 cc343-78

EARL BEAUCHAMP had given Notice to call attention to the present condition of the Road Fund; and to move, That this House deplores the raids made by His Majesty's Government upon the Road Fund, which have delayed many necessary improvements and added to the unemployment in this country. The noble Earl said: My Lords, in moving this Resolution I am anxious to make one preliminary remark and that is that this Resolution is not meant in any way to affect the users of pleasure vehicles. In these days the number of pleasure vehicles, though comparatively large, does not, I think, represent anything like the majority of the users of the roads and certainly it is the motor lorry, the commercial light van, the motor omnibus, the business man's car, and the steam tractor, with wagons, which are the most frequent users of the roads—much more frequent than the Rolls Royces or the Daimlers. It is, therefore, in the interests of commerce, of industry and of trade that the roads and bridges in this country should be maintained in the highest possible degree of efficiency.

To take the first part of my Resolution, in his Budget Speech in 1925, Mr. Churchill used these words:— I believe that we ought to aim at a net reduction in the Supply Expenditure of not less than £10,000,000 a year. That is not taking an extravagant figure. It would be easy for me to get a more favourable response by giving a more illusory figure, but I should be content if we could be sure that the net diminution of our Expenditure was not less than £10,000,000 a year. He meant each year progressively on Supply Services. He continued:— There should be certainly a saving of about £5,000,000 on the Debt operations of each year, and that will be, I trust and believe, a certain steady expansion of the Revenue. To this figure of £10,000,000 a year it is only fair to add a certain automatic decrease in the expenditure from the decline in War Pensions, the reduced expenditure on Irish Services and so on. Those automatic decreases in three years totalled £12,000,000. Thus a reduction of £14,000,000 a year should have been effected on the 1925 figures. Then to that, of course, we ought to add the figure of £5,000,000 which, as Mr. Churchill said, we ought to be able to save on the Debt operations of each year.

Had His Majesty's Government carried out these hopes of economy which were held out by Mr. Churchill there would have been no necessity for a raid on the Road Fund. What do we find on the other hand? The national Expenditure last year was £46,000,000 greater than in 1924–25 and the Estimates for the current financial year show a sum almost as great. In 1923–4 the Expenditure was £788,000,000; and in 1924–5, it was £795,000,000. Mr. Churchill's Budget in 1923–6 was £826,000,000 and in the year 1926–7 £842,000,000; and for this year the Estimates, including Supplementaries, are no less than £838,000,000. Mr. Churchill attempted to defend the increased Expenditure in his 1927-Budget speech. Comparing the Expenditure of the Labour Government with his third Budget figures, he said he had to face "a little over £40,000,000 of increased Expenditure," which arose, he said, from the automatic working out of the decisions of previous Parliaments and Governments and from the effects of economic forces. He omitted on that occasion to point out that the Expenditure was swollen by no less than £23,000,000 due to the coal subsidy and that in the course of the last two or three years the sugar subsidy has cost us nearly £10,000,000. The explanation was an endeavour to hide the real facts of the case.

The net reduction in the Supply Expenditure of not less than £10,000,000 a year, which he stated we ought to aim at, has not materialised. On the contrary, there has been an increase of nearly £20,000,000 a year in Supply Expenditure over the 1925 figures in each of the last three years. In 1927–8 the Estimates for the Fighting Services totalled £115,000,000, but it is probable that after full allowance has been made for the Shanghai Defence Force the total will be even higher than that. We are at present spending more on the Fighting Services than we did in 1924–5 and nearly £10,000,000 more than in 1923–4, when the lowest post-War figure was recorded. The other Supply Services show very substantial increases on the 1924–5 figures. The increase for the Civil Services is nearly £10,000,000, for the Customs there is an increase of £1,000,000, and for the Post Office an increase of over £7,000,000; though it is only fair to say, in passing, that those expendi- tures are in regard to revenue-producing Services. Then Mr. Churchill tried to defend that increase by attributing it partly to increased expenditure in the repayment of the National Debt. When, however, account is taken, of the Budget deficits—which are added to the Debt—the actual amounts repaid have diminished each year. In 1923–4 we repaid £88,000,000; in 1924–5, £48,500,000; in 1925–6, £36,000,000; in 1926–7, 123,500,000, and we have yet to learn what His Majesty's Government will be able to repay at the end of the current year.

His Majesty's Government have resorted to various devices in order to meet increased Expenditure. First of all, there was the transfer of £1,100,000 from the balance of the Navy, Army and Air Force Insurance Fund to the Exchequer under the Economy Act, 1926. Under the same Act they reduced the State contribution to the Health Insurance Fund by nearly £3,000,000 a year, the exact sum being £2,800,000. They reduced the State contribution to the Unemployment Insurance Fund by £3,740,000 a year. They shortened the brewers' credits by one month under both the 1926 and 1927 Budgets, and, above all, they raided the Road Fund. The raids upon the Road Fund were only made possible by the policy which had previously been pursued by the Ministry of Transport. For some time the Ministry, under Treasury instructions, blanketed proposals which came from county surveyors, and no programmes of roadworks for the relief of unemployment were initiated in 1926–7 and 1927–8. Schemes of road and bridge improvement were held up or not approved. The proceeds of the Motor Taxes accumulated and the size of the Road Fund balance was artificially inflated, and that naturally gave rise to the idea that there was a large sum mounting up which nobody wanted and which indeed nobody wished to use. This state of affairs enabled the Chancellor of the Exchequer to take advantage of it when he, found himself hard pressed for money or to find additional sources of revenue.

In two successive financial years he has raided the Road Fund by appropriating money not only from its reserve created in this artificial manner but also from its current revenue. Under the provisions of the Finance Act, 1926, in the first place, £7,000,000 was taken from the reserve, and, secondly, one-third of the net proceeds of the Licence Duty on motor-cycles and all vehicles taxed on the horse-power basis. That amounted to over £3,400,000. Under the provisions of the Finance Act, 1927, further sums were transferred to the Exchequer—namely, £12,000,000 from the reserve, which was practically the whole credit of the Fund at that time, and one-third of the tax-revenue on motor vehicles taxed on a horse-power basis. The yield from this source is estimated at £4,000,000. During the two years the Chancellor of the Exchequer has appropriated no less than £26,400,000 from the Road Fund.

Assurances have been given from time to time that the proceeds of these Motor Duties would be used for the upkeep and improvement of the roads of the country and that not a penny would be touched for Exchequer purposes. That was a pledge which motorists accepted with pleasure at the institution of the Road Fund. In 1909 the then Chancellor of the Exchequer, Mr. Lloyd George, stated that the brunt of the expense for the improvement of the roads must at the beginning be borne by motorists, and to do them justice they were willing and even anxious to subscribe handsomely towards such purpose, so long as a guarantee was given in the method and control of expenditure that the funds so raised would not merely be devoted exclusively to the improvements of roads, but that they would be well and wisely spent for that end. Later on Mr. Lloyd George declared:— This tax…has been imposed purely for the benefit of the roads of the country and it is no part of the general scheme of the Government for raising revenue. It is purely a tax raised to enable us to set aside a Fund for the purpose of improving the roads of the country. The present Chancellor of the Exchequer was a member of the Government when that declaration was made.

VISCOUNT PEEL

1909?

EARL BEAUCHAMP

1909 and later. At any rate, when this new Fund was instituted on an entirely new principle, this was the pledge which was given and which was acquiesced in by Mr. Winston Churchill, who was a member of the Government. In moving the Roads Act, 1920, when Mr. Winston Churchill was still a member of another Government, Sir Eric Geddes said:— It is a specific Act to ensure a specific revenue to be devoted to a specific object. From whom? For what? From road users for the improvement of the roads. Then Mr. Arthur Neal, the Parliament Secretary of the Ministry of Transport, in the Second Reading debate on December 2, 1920, said:… The motorists have consented to raise money by this particular tax on the definite undertaking that the money shall be expended in the improvement of roads. Therefore this Fund, specially raised by taxation of a particular class, is specially safeguarded against its expenditure being diverted from the use for which it is raised to the relief of general taxation. These pledges, given in 1909 and confirmed as recently as 1920 by spokesmen for the Governments of which Mr. Churchill was on both occasions a prominent member, have been broken by his action in 1926 and again in 1927. That Mr. Churchill was contemplating this breach of faith is clearly shown in speeches which he made on August 4 and 7, 1925.

The raids materialised and motorists, whose consent and active co-operation was obtained in creating and maintaining the Road Fund, now find themselves compelled to make an additional contribution to the general Revenue of the country while those who are not motorists are free from a corresponding obligation. There is no justification whatsoever for the suggestion that the proceeds of the Road Fund are in any way earmarked for "expensive roads." On the contrary the Fund is expended at the discretion of the Minister of Transport, on maintaining and improving existing highways, and constructing and maintaining new highways, but at least two-thirds of the total sum available is reserved for existing highways. Hence the work of maintenance and improvement of existing roads is the more important, and it is just this work which is being hindered by the Chancellor's action. The backward condition of most of our roads, the weak state of many bridges, the increasing congestion on the main thoroughfares through the development of motor transport clearly demand increased rather than reduced expenditure.

There is no doubt that the diversion of the Road Fund from its legitimate purpose has and will have a material effect on road construction, improvement and maintenance and will indirectly affect rates and unemployment by increasing rates and unemployment in the country. The effects of the raids have been twofold. In the first place, schemes already approved have in some instances been modified, cut down or cancelled. Many highway authorities had planned programmes for continuous development to meet the needs of an expanding traffic only to find them held up. Nor are highway authorities now encouraged to put forward new schemes. Secondly, work on other schemes has been slowed down and delayed. It is difficult to point specifically to road works where these results have followed in consequence of Mr. Churchill's Road Fund policy. The county surveyors are dependent upon the Ministry of Transport for sanction of their schemes and they decline to make any official pronouncement—not an unnatural position for the county surveyors to take up in the circumstances. The Treasury, in turn, exercise pressure on the Ministry of Transport to prevent the publication of any statement which may be detrimental to the Treasury's policy. Therefore it is not surprising, when the Daily News motoring correspondent asserted that three glaring examples of the practical abandonment of road development are the Oxford Road, the Great North Road, and the Great Western Avenue improvement scheme, that the Treasury should have denied immediately that "road schemes were being delayed by lack of funds."

Nevertheless a few examples of the hold-up of schemes of road improvement and construction, consequent upon these raids on the Fund, can be cited. In the South of England, the Western Avenue affords the most typical example of a scheme directly held up by the Exchequer. This road was intended to extend from Bayswater to beyond Uxbridge, a total length of twelve miles. The section from Greenford to the Oxford Road has not been started, although the first section of the road has been completed for some years. The final section was actually put out to tender in 1925, prior to Mr. Churchill's first raid of £7,000,000 in April, 1926. Following that raid the Treasury refused to release the money to permit the road to be completed, although it is one of the most urgently needed outlets for Western London, and although the Middlesex County Council is fully prepared to pay 50 per cent. of the cost. I think it is impossible to find a more stupid example of extravagance than to begin a road, finish the middle part of it, and deny people access to either the one end or the other, but to leave just the middle part, on to which nobody can get. That is surely far from being economical, and is a great waste of public money. Yet that is the position in which as I understand it, the Great Western Avenue finds itself at the present time.

Other examples of the way roads are held up, and delaying the business life of London are the Shooters Hill Pass and Colnbrook, Those of us who sometimes motor in that direction have for long cast wistful glances at the beginning and end of the Colnbrook by-pass, the completion of which is held up, I understand, because of some difficulty with regard to a bridge. I must apologise to the noble Viscount for not having given him notice of this particular matter, but if he could give us any assurance that the bridge is likely to be finished within reasonable time, I am sure we should be very pleased indeed. The fact is that these arterial roads end just where they ought to begin. They end just where the traffic into London is at its very worst, and when these large commercial cars use these arterial roads they find themselves planted in London just where the traffic begins to be of the very worst kind. These roads do not enable one to get out of London either. The inadequacy of the bridges across the Thames creates congestion, and the narrowness of several of them results in bottle necks. The ideal to work for is a completed circular road all round London, great extensions of the new thoroughfares right into the country, and new bridges to facilitate cross-river traffic.

The Roads Improvement Asociation made the following statement in their annual report for 1926–7:— The raiding of the Road Fund has been responsible for a great restriction in the volume of new road work authorised during the year, and the abandonment of many previously approved schemes. The full effect of the raid, however, has not yet become apparent to road users generally, as road work authorised in one year is actually carried out in two or three ensuing years. Although unwilling to provide specific details of schemes delayed, local authorities have not hesitated to protest vigorously in general terms, both individually and through their association, against the policy of Mr. Churchill. I might give a number of examples, but I will content myself with a few. Mr. Snowden, in the House of Commons on July 5 last year, stated that the West Riding County Council had made repeated applications to the Ministry of Transport for financial assistance from the Road Fund, and for sanction of the necessary loan, and in reply received the following communication from the Ministry:— I regret, however, to inform you that there are at present no funds available from which such assistance can at present be given, but the scheme will be registered with a large number of others, and will be considered if and when funds become available. In December, 1927, the County Council of the West Riding of Yorkshire convened a conference of some 140 highway authorities of the West Riding to protest against the result of Mr. Churchill's policy, and to press for higher maintenance grants. The highways committee of the County Council pointed out that they had been forced either to turn down or defer demands on the County rate by local highway authorities for road improvement schemes amounting to half a million pounds. Again, a special committee of the Northamptonshire County Council, recently appointed to investigate the possibilities of economy in the maintenance, repair and improvement of main roads and bridges in the County, reported:— During recent years the sums provided in the estimates for improvements on main roads have been kept, as the committee has been informed, at an exceptionally low figure. Numerous applications have been received from local authorities for improvements in various parts of the country, and have been deferred owing to lack of funds. What has happened in fact has been that the local authorities have been discouraged from submitting schemes, or pressing them forward by the knowledge that there is no money available for them, and that the Road Fund would not go on increasing as motor traffic grew. It is, of course, the easiest thing in the world for a Government Department to defer improvement schemes actually submitted, and to postpone the actual submission by months, by the simple process of not telling local authorities what assistance they are likely to get. It is not so much that the scheme has been damped down, or repressed or rejected, as that the whole initiative of the local authorities and of everyone concerned with road construction has been ham-strung.

Moreover, the raids have thrown an additional burden on the rates. The total expenditure of local authorities on highways and bridges (other than expenditure out of loans) in 1925 was £51,750,000. This is nearly £1 4s. per head of the population. Roads are amongst the heaviest burdens borne by the rates. Of the expenditure out of county council funds 15 per cent, is for highways, and out of rural district council funds 59 per cent. or nearly three-fifths of the total expenditure, so that every reduction in the monies of the Road Funds means a heavier burden on the rates, an increase in the rates which have to be paid by the ratepayers of this country. The matter is really an urgent one, and one of those which ought to be dealt with immediately, and dealt with in a broad fashion. The startling increase in motor traffic during recent years calls attention to the great urgency for dealing with the problem of road reconstruction and development.

Striking figures of the rapid growth of motor traffic are given in the Report on the Road Fund. The approximate number of motor vehicles licensed in Great Britain was 1,729,000 in 1926 as against 1,141,000 in 1923—an increase of over 50 per cent, in three years. This great extension of traffic has taken place in a period of great depression. The figure for 1926 represents one motor vehicle for every twenty-six persons in Great Britain, as compared with one to six in the United States and one to eleven in Canada, so that we are far from having reached the saturation point. Moreover, recent traffic censuses have shown that the average weight of traffic has considerably increased on all roads. I will give one or two examples. Among Class 1 roads, the Carlisle-Edinburgh main road has increased from 1,979 tons per day in 1923 to 4,392 tons per day in 1924, and the London-Worthing road has increased in the same period from 2,278 tons per day to 5,213 tons per day. Among Class 2 roads, the Purley-Epsom-Burnt Stubbs road has increased from 838 tons per day in 1922 to 1,505 tons per day in 1924, and the Margate-Broadstairs road from 1,415 tons per day in 1922 to 2,616 tons per day in 1924.

The existing road system is obviously inadequate for modern traffic requirements. The County Councils Association, in a memorandum based upon information supplied by the county surveyors of fourteen representative counties, in 1925, stated:— Approximately only 48 per cent, of the existing classified main roads are fit to carry modern traffic. Of the remainder approximately 38 per cent, require reconstruction at an estimated cost of nearly£25,000,000; approximately 27 per cent, require, in addition, widening or diverting at an estimated cost of nearly £44,500,000.… In many places there are no foundations or foot-paths, narrow carriage-ways, old bridges, and dangerous corners. … In ten typical counties approximately only 7 per cent, of unclassified main roads are equal to the burden of the traffic noon them. Approximately 89 per cent, of the remainder require reconstruction at an estimated cost of over £4,500,000, and approximately 48 per cent, require widening or diverting at an estimated cost of nearly £5,750,000.… The proportion of district roads unfit to carry the traffic which they are now called upon to deal with is probably greater than is the case with regard to county main roads. The same thing applies with regard to bridges There are a large number of bridges wholly unfitted to carry modern traffic. The County Councils Association has figures relating to bridges also. In seventeen counties 740 county bridges require reconstruction. The latest Report on the Road Fund calls attention "to the inadequacy under modern traffic conditions of many of the older bridges" and adds:— From many parts of the country urgent representations have been made to the Minister by manufacturers, traders, chambers of commerce, road-hauliers, etc., that grave disabilities are imposed upon trade by the weakness of these bridges. … The inconvenience is naturally most acutely felt in the busiest industrial areas where the intersections of roads with railways and canals are most frequent. Modern traffic developments have led to increasing congestion on the roads, and, although it is impossible to measure with any degree of accuracy the money cost of delays through congestion, one or two figures serve to indicate the magnitude of the losses suffered. The London General Omnibus Company, according to a statement made in November, 1927, by Mr. Frank Pick, "lost in actual out-of-pocket expenses £1,000,000 a year" through delay in congestion on the streets. The general secretary of the Commercial Motor Users' Association puts the cost of traffic congestion in Greater London as high as £25,000,000 per annum. I think that is enough to prove my point that necessary improvements are being delayed.

I turn to the effects upon unemployment. Mr. Shrapnell-Smith, a member of the Roads Advisory Committee, Ministry of Transport, stated in an article in the Municipal Journal of January 28, 1927, that— The Road Fund is now in a sense the spring and inspiration of employment for about one-tenth of all employed persons in the country. Directly and indirectly the total is some 1,200,000. There are approximately 820,000 employees in commercial road transport, apart from manufacture. The other 380,000 are divided between constructors of vehicles and parts, contractors for road-making and maintenance, and a proportion of those in the service of local authorities. Whilst, perhaps, only 120,000 of these men are now on pay-rolls directly met out of payments from the Road Fund, the livelihood of all the others is dependent upon the continuance of good and strong roads. Any abuse of the Road Fund by abstraction or diversion has now become fraught with most serious economic effects of an adverse character. It is noteworthy that despite the continued prevalence of serious unemployment in this country, to which we have often called the attention of your Lordships' House, no further schemes of road work for the relief of the unemployed have been initiated during the last two Years, and even programmes sanctioned in previous years have been revised and some works cancelled. That is sufficiently proved by figures which I will quote. In 1920–1 the revised figure of the total assistance offered by grants from the Road Fund towards the cost of road works expedited for the relief of unemployment was £2,808,000. For the next year the figure was £4,068,000. In 1922–3 the figure was £5,255,000, in 1923–4 it was £7,494,000, and in 1924–5 it was £13,623,000. In 1925–6 and in 1926–7 no further programmes were initiated at all.

The main effect of the raids on the Fund has been to restrict or hold up further developments and to stop great schemes. We have an example in the Great Western Road in Scotland which was estimated to cost £2,500,000. That would have supplied work for 5,000,000 men-days, or a year's work for 16,000 men, apart from indirect work to a further number of people in providing material and machinery necessary to make the roads. These schemes would have given employment to many thousands of men. Of every pound spent by the Road Fund it is estimated that ten shillings goes in direct wages, and of the other ten shillings a good part goes in indirect wages to workers in the industries supplying materials and machinery. In direct wages alone there is a loss of £13,000,000 through the raids. That is equivalent to a year's employment for 80,000 men at ten shillings a day. If allowance is also made for the indirect expenditure in wages the raids are tantamount to depriving 130,000 men of a year's steady work. I say that the policy of the Government has been to hold up schemes of road improvement and development, and its result has been to add very materially to the number of unemployed in this country.

The policy which my noble friends and myself would advocate is diametrically opposite. Instead of raids and reduced programmes we would advocate a reversal of that policy. A great deal might be done by capitalising the Road Fund and intensifying the programme of road works to be carried out as soon as possible. The Report of the Liberal Industrial Inquiry, which I am glad to see the noble Viscount has been studying with great care, says:— It will be still possible, by raising a loan on the security of the rapidly increasing income of the Road Fund, to undertake a very large programme of road construction without any additional charge to the taxpayer or ratepayer. This would be in every way wise and justifiable finance, The policy of road development should be consistent and continuous, but, if any variation at all is to be made in the amount to be expended, it should be in the direction of increasing, and not reducing, the amount of expenditure in times of depression. If the Road Fund is to be at the mercy of Budget exigencies, it will be just at the time of depression when it is likely to be raided, whereas it is just at this time that the whole of its resources should be concentrated on the large-scale policy of road development as a contribution to the unemployment problem and a counterpoise to the falling off of purchasing power in other directions. I say that expenditure of this kind is, in the truest sense, economy. It means wise and productive expenditure which is to the advantage of the people of this country.

For the benefit of noble Lords opposite, I would like to make a quotation from the Report of the United States Department of Agriculture, in which the Department say:— Improved roads are not a luxury to be enjoyed if we have the means and put aside if we have not. The fact is that we lose more by not improving them than it costs to improve them: so that we may say that we pay for improved roads whether we have them or not and we pay less if we have them than if we have not. A good many years ago, just before the last Liberal revival, we heard a great deal on the subject of economy and efficiency. Refusal to carry out necessary works is not economy, and certainly it does not relieve unemployment. Efficient roads are necessary for the trade and commerce of the country to-day. If we hope to see a revival of trade it must be assisted by an improvement in the roads of the country. We need these roads, and inefficiency in this direction can only lead to greater extravagance in the end. A refusal to spend necessary money is not true economy, and I think the figures and facts that I have ventured to put before your Lordships are sufficient to show that there are a large number of works which are urgently necessary and which have not been undertaken by His Majesty's Government, and that there has been a large amount of unemployment which might have been cured if only these unfortunate raids upon the Road Fund had not taken place. I beg to move.

Moved to resolve, That this House deplores the raids made by His Majesty's Government upon the Road Fund, which have delayed many necessary improvements and added to the unemployment in this country.—(Earl Beauchamp.)

EARL RUSSELL

My Lords, there is always the difficulty, in discussing in this House a question which involves finance, that we are bound to feel that we cannot do anything effective in the matter. But that is no reason for not raising the question which the noble Earl has raised and calling the attention of the House to the deplorable state of things that he has sketched to your Lordships. I recollect very well the occasion when this tax was first suggested and proposed to motorists, and I desire, if I may, to pass a little beyond the detailed figures of the noble Earl, valuable as they are—perhaps your Lordships will appreciate them even more fully to-morrow when you come to read them—to some of the general considerations involved. At that time motorists, represented by their organisations, were immensely flattered at being, as it were, consulted by the Government about this new taxation, and they permitted themselves very easily to walk into the net that was spread before them. I ventured at that time to advise them that no Government was to be trusted and that no promise made by any Government had any validity in this country, where we have, no Act of Parliament which cannot be repealed in the following year. The advice that I ventured to give them was that their only protection was to adopt the attitude of a militant and well-organised body like the Licensed Victuallers' Association and to make themselves into a body so forcible in votes that these pledges were more likely to be kept. They did not take that advice and they walked readily into the trap that was spread before them.

The noble Earl was fully justified in saying that there was a definite pledge and a definite understanding. I know that this matter has been discussed before. I know that it was discussed in another place when the raid on the Road Fund first took place, and various explanations and various softenings, if I may use the word, were given in mitigation. But the fact remains that there was a perfectly clear understanding, as the noble Earl has said, between the taxer and the taxed that these Funds, when raised, were to be devoted to road improvement and were not to be diverted to the general taxation of the country. That pledge has been broken. What was the object with which this tax was imposed? It was not imposed as a luxury tax and it was not suggested at the time that it was imposed as a luxury tax. If it had been, it would have been appropriate to suggest many other luxuries that would have been fitting objects for taxation. For instance, as I am not an owner of racehorses, it has always seemed to me that a tax of £100 a year for each racehorse that a man may keep would be a very moderate and equitable tax if you were taxing luxuries. But the object of the tax was said to be that those who used the roads should pay for them. I confess that I considered this to be a bad principle in itself, because I thought it was going back to the principle of the Turnpike Acts. I have always taken the view that roads are valuable to the whole community and not only to those persons who actually with their wheels traverse them, and that they should be paid for by the community as a whole. That was said to be the object of the tax. Great improvements were promised and very great improvements have been made. I will make the concession that I think that in some cases there have even been unnecessary improvements here and there and that there are a few instances of needless extravagance. But the necessary improvements that have been made far exceed anything of that sort.

These Funds had an ample use before them, even as they were in their unraided condition. There is not merely the contribution to the upkeep of the roads, which has not been very much interfered with, but there is also the construction of new arterial roads, the rounding off of dangerous corners and all those other improvements which your Lordships see as you go about the country. Those improvements from the motorists' point of view—and I beg your Lordships to understand that I am not speaking from the motorists' point of view; I am merely mentioning his point of view, but I am speaking as a person interested in principles of taxation—from the motorists' point of view those improvements were worth paying for. They have reduced considerably the cost of motor travel and they have reduced the cost of commercial motor transport. It was for that reason, among others, that I was inclined to think, on general principles of taxation, that they should have been paid for by the community, because the van which you see running along the public roads carrying parcels is carrying your parcels, and it is in your interest that those parcels should be carried cheaply and that it should be possible to make a cheap rate for your parcels, for heavy stuff or whatever it may be. There is, I say, an ample use for these Funds. What has happened, as the noble Earl has truly said, is that improvements have been held up and improvements that have been contemplated and arranged for have been stopped by the raid on the Fund. I use the word "raid" because it is a Parliamentary word. I confess that I should not hesitate to use a very much stronger word—

VISCOUNT PEEL

What word?

EARL RUSSELL

I do not propose to use it, but I say that I should not hesitate to use a much stronger word in other surroundings. It would not be suitable to your Lordships' House. Let me give you one specific instance. Your Lordships will remember that this Government appointed a Committee with instructions to report urgently upon the question of London bridges, That Committee did report, and recommended an expenditure amounting to a considerable sum. It has been pointed out that this expenditure could be met and financed on a loan basis by an annual subvention of a comparatively small amount from the Road Fund every year. But that amount is not available. And what has happened to the Report and to the urgent matter of Waterloo Bridge? So far as I know, nothing has happened. The Committee were asked to report urgently and I think it is a year since they reported—it may be more—and nothing has been done about it, and we do not know how the matter stands. There is a matter on which the Road Fund could most properly have been expended.

I wonder if many of your Lordships remember a speech which gave me great pleasure at the time, though I was not optimistic enough to hope to see it realised, which the noble Earl, Lord Balfour, made some twenty years ago regarding radiating roads in London. That always seemed to me to be an eminently necessary and desirable scheme and, if it could have been carried out ten years ago, the roads would, of course, have cost less than one half of the sum that they would cost if they were made now. But, even so, they are held up. The western exit is not completed, and the additional part of it that was expected to go westward along the Cromwell Road is not completed. The circular road round London has been in contemplation and has been talked of for many years, but it is not completed. There are portions that are said to belong to the circular road, but they are not yet dealt with and they cover very large stretches. All these are matters in which I agree heartily with the noble Earl that expenditure would be a real economy for the country, because you would be getting value for your money in every sense of the word.

The Chancellor of the Exchequer, when he took this money, said, perhaps with his tongue in his cheek, that the Exchequer proposed to act as banker to the Road Fund. That, I think, was one of the phrases that were used. What is the good of a banker who will not honour your cheques? That is now the position when local authorities apply for authority to get on with these projects. They are told, as we have heard, that there is no money. These Funds cannot possibly support the loss of 226,000,000, a large part of which really was pledged to schemes of development made many years in advance. Many of these large schemes take three years, or it may be five years to complete, and a local authority has to consider that long time ahead and to budget that long time ahead, and, of course, has to rely upon the Government promise of contributions. How they will ever dare to do so in the future, if they feel that they cannot rely upon the contributions promised by the Government, I do not know. It seems to me that until confidence is restored, you will have a great deal of difficulty in getting the local authorities to undertake this large expenditure, and these large road developments, again.

The noble Earl mentioned in the course of his speech a body called the Road Improvements Association. I have been a member of that association since its foundation, and it is, and always has been, an association employing very moderate and very reasoned language, and your Lordships have heard what they thought proper to say in their last report about this matter. Twenty years ago, on that association, we regarded with hope, but without much expectation, an expenditure of £1,000,000 a year upon the roads of this country, and we felt that if £1,000,000 of national money was expended, it would be something to be thankful for. Now the amount expended is very much more than that, and the necessity is something out of all proportion to the necessity which existed twenty years ago. It is still growing day by day and with very great rapidity. Your Lordships must have seen calculations constantly appearing as to the cost to the community of traffic delays, and of the amount of money wasted. That hurts the trade and progress of the country. In that association we have pressed, and always shall press, that the roads of the country may be given their proper share of attention.

I want to say a few words upon, as they seem to me, the ethics of these raids upon the Road Fund. You have raised this tax for a particular purpose, and finding a sum of money there, you have suddenly seized that sum of money, and applied it to the needs of the National Exchequer. That is taxation of a particular class of the community for the national needs, under a pretence that you are taxing them for something else. That does not seem to me to be ethically a sound proposition. You have no particular reason, so far as I can see, for saying that those who use motors upon the roads should contribute, out of proportion to their means, to the National Revenue of the country, as compared with other taxpayers; but you desired to do this, among other reasons, I suppose, in order to take sixpence off the Income Tax, which ought never to have been taken off, in my opinion. You are now going to tax a particular class of the community, and without any excuse for taxing that particular class. If the taxation of cars, which is very heavy, is producing more than is required for the roads, then that taxation ought to be in some way reduced, and I will point out to your Lordships one manner in which it ought to be reduced, in equity.

When this tax was first instituted, it was provided that cars more than, I think, seven years old should pay at a reduced rate. That date, of course, has long gone by, but you ought to make that obviously a progressive figure. You ought to provide that cars which are more than five or seven years old should pay tax at a reduced rate. A car which is five years old, or seven years old, nowadays, is almost unsaleable, because the annual tax comes to something like 20 or 25 per cent. of the second-hand value of the car. It may be desirable that old cars should be scrapped while still capable of service, though that is not real economy, but the result of the tax now is that old cars are practically unsaleable, and people cannot use them. There is another result that is incidental, and that is that many people would keep a second car, or a car of an old type, for a station car, or something of that sort, if the tax were reasonable, but no one can do that now unless a car is in full and continuous use. If you have too much revenue, obviously what you ought, in the first place to do is to reduce the tax upon old cars.

What the noble Earl asked the House to do is really of extreme mildness—so mild that I hope the Government may see their way to accept it, because he only asks the House to deplore the raids upon the Road Fund, and I cannot help thinking that your Lordships must deplore those raids, and should deplore them. I can only say that if my noble friend thinks fit to go to a Division upon the matter, I certainly will vote with him, hopeless as any Division on such a matter would be in this House; but I ask your Lordships to consider this matter in its general aspect of taxation, and not with particular regard to motorists or the roads, and also to consider it from that other important point of view, the point of unemployment. This is a method by which, not by wasteful but by useful expenditure, you can employ a very large number of the unemployed, and it was at one moment much pushed and commended for this very reason. You have, however, stopped that, and you are not reducing the army of unemployed, but are throwing extra burdens upon the rates to the benefit of the National Exchequer.

I have always disapproved of the sort of indirect taxation which is involved here. If you find that this revenue is more than is wanted for the roads, then the proper course is to reduce that revenue. If it is not more than is wanted for the roads, then it ought to be spent upon the roads, and in the present condition of unemployment, and with the number of schemes which are waiting to be carried out—schemes of first-class importance, and of the greatest benefit to the country—I do not think the noble Viscount opposite will be able to show that the revenue is more than is reasonably required. I do not know that I altogether envy him his task. I do not know whether he is going to explain with gusto that he represents the burglar and rejoices in the diminution of the sums at the disposal of the Ministry of Transport. It is, I suppose, the Ministry of Transport that he is going to represent when he replies, and if so, he is going to show a very Christian and forgiving spirit. The Ministry of Transport have to deal with the matter, and to make the allocations. That they should be pleased to have their opportunities of improving the roads of the country interfered with I cannot imagine, and therefore I should be surprised if the noble Viscount's defence comes from his heart, rather than from his instructions, or, if he prefers it, from his head. I do regard this as a very serious matter, and think that a very serious wrong has been done. I regard it as a breach of a Parliamentary pledge, which is in itself unfortunate, as a bad method of taxation, and a very unfortunate thing from the point of view of unemployment. For all these reasons we should get some assurance from the Government that this vicious practice, which has been carried out for two years running, will not be repeated. We cannot hope that they will make good sums which have once been put into the National Exchequer, but if they will give us an assurance that this will not be repeated, I think we shall feel more comfort than we are able to feel at present in this matter.

LORD COTTESLOE

My Lords, if I might for a few minutes speak from the point of view of the county councils and the County Councils Association, I would say that there are other aspects of this question besides that to which the noble Earl mainly devoted himself. It seems to me that the schemes under which money might be borrowed specially to provide employment in order to make particular improvements that otherwise would not come within the practical programmes of road authorities, are not what is really required at the present time. As one concerned with county administration I am interested in the meek man who really bears the burden of it, and that is the ratepayer. When I consider the enormous burden resting upon the ratepayer it seems to me that what is really required is not great new schemes, but the application of all our resources to the proper maintenance and improvement of the roads we already have in use.

In 1888 Parliament accepted the principle that half the cost of the roads should be borne by the Imperial Exchequer, and provision was made at that time for that purpose. The whole cost of the roads then was £2,000,000 a year, and the contribution then made was not increased, and, of course, has become, if it still exists, entirely negligible compared with the enormous sums which we are now spending. The local authorities, as the noble Earl told us, are spending over £50,000,000 a year upon road-making, and of that sum the ratepayer—who, in matters of education and police, sees the Imperial Exchequer providing 50 per cent. to meet his contribution of 50 per cent.—is paying between 70 and 75 per cent. It is admitted that the grants from the Road Fund have been large, and, so far as money is available, generous, but they are not sufficient because the cost of our roads is out-running the ability of the ratepayer to pay.

I recently had occasion to go into the figures of a scheme for reconstructing a considerable length of main road in the county with which I am most concerned. The reconstruction of main roads costs about £15,000 a mile. That is £8 10s. a yard, or, if you like to come down to smaller units, it is £2 17s. per foot or 4s. 10d. per inch of length of road. Towards that sum the ratepayer of the county has to provide £1 8s. per foot—that is, if he pays ready money; but if he obtains a loan for a long term of years he and his successors will pay from 10s. to 15s. a foot more than the figure I have given. This cost is incurred upon roads where up to 95 or even more per cent. of the traffic may be through traffic, This oppression of the ratepayer is becoming, I think, more than it is fair to ask any Englishman to tolerate. The road programmes of counties are limited by the amount which they think they can fairly ask for in rates, and they constitute a heavy item for the counties and for the rural or urban districts.

It seems to me, therefore, that we ought to turn our attention from schemes of what may almost be called luxury improvements, the great by-passes, the vast roads which are necessary to carry at its highest speed that very great amount of traffic which is now on the roads, and which is particularly noticeable in the neighbourhood of London on Saturdays and Sundays—when, I may add, trade and commerce are not at their height—and we ought to spend what money is available in helping the ratepayer, because otherwise the improvement and necessary reconstruction of roads are delayed, or held up indefinitely. If, therefore, we desire to make the best of the present situation—and I have not attempted to touch upon the particular aspect of finance which has already been dealt with—we should focus our attention on endeavouring to get larger contributions for the ratepayer towards the ordinary expenditure and the ordinary schemes of improvement which are going on every day.

VISCOUNT PEEL

My Lords, the noble Earl, Lord Beauchamp, has introduced this subject in a very eloquent speech, and not unprovided with figures and quotations. I was thinking of another eloquent speech he made only a year ago in which he was urging on us all the practice of economy. I always admire a man who displays versatility, and what struck me most was that, whether he was urging economy upon us or driving us to expenditure, he displayed the same force, the same conviction, and the same eloquence. And, indeed, I cannot help thinking that he was to some extent stimulated on this occasion by this great document to which he had already alluded, and which I hold in my hand. I do not see his name as one of the Executive Committee, nor indeed the name of any noble Lord on that Bench, but, having studied Chapter 22 of this book, I came to the conclusion that the noble Earl himself had not only studied it but agreed very closely with some of the passages in that book. Because while he was making that eloquent speech I was myself reading some of those passages, and I found that word for word, and sentence for sentence, there was a remarkable coincidence between the speech of the noble Earl and the passages in that book.

I further note, that though the noble Earl was not on this Committee, he has, as it were, by the appropriation of these passages set the seal of his approval upon them, and that we may take it that that is the definite policy of the Liberal Party represented in this House. I was so interested in the views of the noble Earl on these questions of economy and expenditure that I ventured to make an extract from the speech that he made last year. He said:— Economy is not the same thing as extravagance; economy does not mean spending more money, but spending less money. His present view is represented by a quotation which I took almost with the premonition that it might be used by the noble Earl, and he has used it. It is from this work on "Britain's Industrial Future." Economy is not synonymous with the restriction of expenditure—Oh, no—that is my gloss— Economy means wise and productive expenditure.

EARL RUSSELL

Hear, hear.

VISCOUNT PEEL

I am not criticising the noble Earl, Lord Russell. I know that he and his Party are in favour of expenditure. I do not make the least complaint about him, because he and his Party are always telling us that if they get into power the rates must rise and taxation must rise, and millions more will be taken from savings. Therefore, I hope he will not think I am criticising him. I know that he and his Party like expenditure. I was only pointing out what I thought was a slight discrepancy between the principles enunciated with so much force by the noble Earl, Lord Beauchamp, last year and those which he has expressed with such skill to-day. I may, of course, be wrong; but if I may say so, it seems to me that these adjectives "wise" and "productive" do not mean anything at all. I have a distrust of adjectives and I never use them if I can possibly help it except as terms of abuse. Of course, we regard our expenditure as wise and productive. Is there a Government which would say: "We want to spend this money but it is not a wise expenditure"? Moreover, the Minister will tell you it is productive expenditure, and if you ask: "Where are the dividends?" he will say "No sordid dividends; nothing of that sort. I meant dividends in the increased health, pros- perity and happiness of the people." Therefore, we can cut out the words "wise and productive" and we are left with the apothegm: Economy means expenditure. That is the true theme on which the noble Earl held the House entranced for twenty-five or thirty minutes this evening.

I do not think I need go into his criticism of the Chancellor of the Exchequer regarding the suggestion that it would be a very good thing if we could save £10,000,000 a year. After all, so formidable of himself is the Chancellor of the Exchequer that he does not need any defence from me. But will it be forgotten what difficulties and troubles afflicted us in 1926, and was a saving of £10,000,000 to be expected then in exactly the same way as if there had been no General Strike and no coal dispute? I should prefer rather to deal with realities and to pass to other matters. There is one thing to which I object, if I may say so, in this Motion. The noble Earl, Lord Russell, thinks it perfectly harmless. He does not think it is strong enough and he cannot imagine why I am not able to accept it. For one thing, I do not like accepting words which do not accurately represent facts, and I think the noble Earl has really prejudged the situation by talking about raids. After all, a raid may suggest hurried determination and action; but there is a sense of obliquity about it which I do not like. Therefore, I do not like accepting the Motion because no obliquity can be cast on any action of the present Government. The noble Earl will understand that I really cannot accept it for those reasons.

I want to say a word in a moment as to what the raid means and what was the particular financial transaction that was criticised. From my point of view I do not think it was stated with fullness and carefulness by either of the noble Earls who spoke. I was rather surprised to hear the contention of one noble Earl. It was not that of the noble Earl, Lord Beauchamp. He did not speak of any moral obliquity; he did not say that he was very much distressed by the ethics of the case. The noble Earl, Lord Russell, however, was suffering from a deep sense of moral wrong because certain funds had been diverted from the Road Fund to general taxation. It is true that at first in 1909, which is a substantial time ago, there was a suggestion—I do not like to use the word pledge, but anyhow I believe that Mr. Lloyd George used in his Budget speech the phrase that the money should be used for the purpose of improving the roads and that the motorists should pay for it. But you could hardly build upon that or even on the subsequent statement in 1920, a pledge that for all time all the money that was raised, whether increased or lowered or doubled, from motorists and those using the roads, whatever might be the developments in motoring, should be for ever used for the purpose of the roads. There are great difficulties sometimes when, as for instance, in trusts, the money is so piling up that you can hardly use it. There cannot possibly be any pledge or principle laid down that one particular tax shall always be used for one particular purpose. That, after all, is contrary to the whole principles of our finance in this country.

We have moved from the medieval principle that one particular purpose should be met from one particular fund, to the principle of the whole of the money being paid into the Exchequer and the whole of the expenditure being dealt with from the total. I might have asked the noble Earl, Lord Beauchamp, what contract there was between the Government and any taxpayer or any set of taxpayers that what was drawn from them compulsorily by taxation should always be used for the same particular and specific purpose. But the sole question which we are discussing to-night is what proportion of that which is raised for taxation can wisely and usefully be spent upon the roads? It is a question of proportion. One of my difficulties to-night is that the noble Earl ranged over the whole finance of the Government during the last two or three years, which is a big subject. The amount of money to be spent each year upon the roads must obviously depend upon the particular financial condition and all the considerations which come before the Chancellor of the Exchequer in that year. So that really to weigh up this subject you want to recall and recast the whole of the atmosphere that determined the formation of the Budgets in 1926 and 1927, and that is a formidable task.

I only ask this because I think it is a fair question to put to the noble Earl, Lord Beauchamp. Take the transference of £12,000,000 in 1927 from the Road Fund to general taxation. There was a gap to be filled. As the noble Earl well knows, owing to the terrible events of 1926 there was a great shortage of money from taxation, and the question arose as to how that great gap was to be filled. It could have been filled in many ways, but I only suggest two. Another threepence could have been put on the Income Tax. I do not know whether that appeals to the noble Earl, Lord Russell; but it is certain that if at that time, when trade and business were staggering under the tremendous weight resulting from the crash of the General Strike, an extra threepence had been put upon the Income Tax, it would have had a far more damaging psychological effect on our reviving trade than, perhaps, four times that sum put on at a different time. And the amount of unemployment that would have resulted can hardly be measured. The other way would have been to take it from the Sinking Fund. I apologise for going into these details, but they are practical questions because the money had to be found. Surely it is far better that we should show that we were able to meet the full amount of the repayment of the Debt, even in the year after the General Strike, than abate the amount of the Sinking Fund and not transfer this money from the Road Fund.

I want to say a few words about the so-called raid itself—the transfer of the money. The noble Earl was very meticulous on this point, insisting that the money taken from the Fund should only be used for the roads. If that is so, I do not quite see why money coming from other sources should be used for the roads. Both noble Lords have, I think, forgotten that in 1920 there was a grant from the general Exchequer Fund of no less than £8,000,000. If you are going to examine the matter from a profit and loss point of view, or the balancing of some particular account with another, that £7,000,000 obtained in the year 1926 might be regarded simply as a repayment to the Treasury and a very cheap repayment for the £8,000,000 granted to the Road Fund by the Government seven years before, and for which no interest was ever charged. The noble Earl referred to one-third of the receipts from Motor Licence Duties paid in respect of motor cars and motor cycles, amounting in 1927 to £3,500,000—I think he hoped it would be £4,000,000 in the coming year. That sum, no doubt, was transferred from the Road Fund, but another tax was put at that time on heavy commercial vehicles and large hackney vehicles, and the amount produced from that tax practically filled the gap which was made by the transfer of £3,500,000 to £4,000,000 to the General Account. Therefore those two matters may almost be considered to be wiped out.

Then there was the question of the £12,000,000. I do not want to go in any great detail into a defence of it. This sum was practically the capital of this great business of the roads. From the point of view of the country and the Exchequer it was absurd to have two working capitals—a great working capital for carrying on the work of the country, and a special working capital for carrying on the road business. The Treasury, therefore, undertook the duty of financing the Road Fund—that is to say, in the first nine months of the year the Treasury meets the expenditure of the Road Fund, and then there comes the magnificent rush of payments for motor taxes, and the whole of the money which the Treasury has previously advanced for road work is repaid to the Treasury. It is very difficult, therefore, to see that by merely handing over to the Treasury the financing of this Road Fund any of these great evils of the curtailment of road schemes and delay in dealing with them can possibly be brought about.

EARL RUSSELL

Would the noble Viscount make it quite clear what he means by the word "financing"? Does he mean repaying to the local authorities such an amount as has been taken out?

VISCOUNT PEEL

I mean that if money is required before the taxes have come into the Road Fund, that money is advanced by the Treasury and repaid at the end of the year. It is, in fact, very much the same thing as happens in the case of all the financing of the country.

EARL RUSSELL

Not a repayment of what is taken out, but merely an advance on what is coming in?

VISCOUNT PEEL

An advance, and then a repayment. The money advanced by the Treasury is repaid by the Road Fund when the taxes come in.

EARL RUSSELL

I want to be clear about this. This does not mean that there is any repayment to the Road Fund of any of the £12,000,000 taken out of it?

VISCOUNT PEEL

I was not suggesting there was the repayment of that particular £12,000,000. I will not be meticulous about a million or so, but the £12,000,000, or a great part of it, must always have been kept as a balance in the Road Fund to meet expenses that would be incurred. Now it is not necessary to have that balance in the Road Fund because the financing of it has been undertaken by the Treasury. As regards the so-called moral obliquity, the situation is, I think, very much altered by the facts which I have put forward. I want to meet the point that was really made by the noble Earl, Lord Beauchamp, and the noble Earl, Lord Russell, that a great deal of work is required to be done upon the roads, and that that work is being held up unnecessarily, and also that useful developments are being delayed. I think the best thing is to give figures. I can show very easily on the figures that the amount spent on new roads, or advanced for road maintenance or re-conditioning is increasing from year to year. I will read the figures of net revenue, after the appropriations of which I have spoken:—1925–6, £16,700,000; 1926–7, £17,300,000; 1927–8, £19,255,000. The payments out for these different purposes have been:—1924–5, £14,750,000; 1925–6, £16,000,000; 1926–7, £17,000,000. The estimate for 1927–8 is £19,000,000. Therefore, so far from all these wonderful schemes being curtailed, there is, on the contrary, a steady growth by a million or two millions a year from the Road Fund for financing these schemes. It is merely inaccurate to say that this is increasing unemployment. On the contrary, more employment is constantly being given by the funds which are expended in this way.

EARL RUSSELL

Those figures include maintenance, and not new schemes only.

VISCOUNT PEEL

Certainly. I am dealing with employment. The noble Earl knows that whether the money is spent on maintenance or new roads, men are employed. As regards assistance for the maintenance of roads, we have had a very strong plea from my noble friend behind me, who said in effect "We want far more money from the Exchequer; we want a much larger percentage of the money paid for road maintenance." The noble Lord rather deprecated great new schemes, whereas it was these great new schemes which had excited the imagination of the noble Earl, and which he so strongly impressed upon us. The House is familiar with the grants for Class 1 and Class 2 roads. For the current year, as regards Class 2 roads, the grants have been increased from 25 per cent. to 33⅓ per cent. Not only that, but a special grant is being given and is increased this year for rural roads which have been scheduled. I am advised that the result of that is that almost every rural road of any importance is included under the schedule system. That is a very solid contribution, I think the noble Lord will admit, towards the relief of the rates, and especially towards the assistance of agriculture.

I must give one or two figures, if your Lordships will bear with me. Take the total mileage of all highways in England and Wales, and you get these figures:—The total mileage of all highways is 153,661 miles. Class 1 roads, with a mileage of 19,392 miles, get 50 per cent. grants, representing 12.6 per cent. of the total. Class 2 roads, with a mileage of 12,038, get 33.3 per cent. grants, representing 7.8 per cent. of the total. The scheduled roads, with a mileage of 36,000, get 25 per cent. grants, representing 23.7 per cent. The total classified and scheduled roads in the whole country, representing 67,775 miles, get 44.1 per cent. That is a very substantial proportion which are assisted. As regards the main roads for which the county councils are responsible the figures are very interesting. The total mileage of these main roads is 30,702. Of Class 1 roads there are nearly 17,000 miles, of Class 2 roads 7,500 miles and of scheduled roads 5,000 miles. The total of classified and scheduled roads is 29,668 miles, representing 96.6 per cent. of all the main roads in the country. There is only left over about 1,000 miles of roads which are neither classified nor scheduled, and they are mainly old dis-turnpiked roads which bear very little traffic. I have given these figures to show how very wide the net of the Road Fund is cast, and how great are its activities in the improvement of the roads.

Then comes the question of new roads. That has been pressed strongly by some local authorities in the past, but now, I think, that is changing, and there is an opinion which has been very well voiced by my noble friend behind me, who says that we do not want great new roads, but what we want is large sums for the maintenance of old roads. I am bound to say that some of these authorities have made very large demands, running up to as much as 75 per cent. But the rural district councils beat the larger authorities altogether. They say: "75 per cent.! Not a bit of it. We want the lot. We want you to bear the whole cost." I leave your Lordships to consider what might be the effect on local government if the whole expenditure was to be borne by the Central Fund. There is also the question of the reconstruction of roads. I will not go into the details, because I do not want to weary your Lordships, but I may say that in 1924–5 a sum of no less than £6,500,000 was allocated towards the reconstruction of 500 miles of some of the main trunk roads of Great Britain. The total cost of reconstruction, when it is finished, will be in the neighbourhood of £8,000,000.

Then there is the question of reconditioning important roads in rural areas. In the four years 1923–1927 no less a sum than £6,250,000 has been spent on that. From whatever aspect you examine the work of the Road Board you will see that, although the noble Earl may say we ought to have done more—it is easy to say we ought to have done more—certainly the Board have done a great deal. Then there is the question of bridges. That has caused a good deal of anxiety to the Ministry of Transport, and in the coming financial year a sum of £250,000 is to be set aside for special grants to assist highway authorities in dealing with some of the bridges that most require reconstruction. The idea is to initiate in this way a scheme of bridge reconstruction which will be continued until the bridges are able to bear loads comparable to those carried on the roads themselves.

There is one other point, that of unemployment. Of course, all this assists employment. The noble Earl, I think, complained that during the years 1926–7 no new schemes had been set on foot. As a matter of fact one reason for that is that the programme started in 1920, which was to cost £52,000,000, has not yet been worked out. There still remained in December, 1927, about £13,250,000 to be disbursed on that general programme. Obviously it would not be wise to launch any big scheme of this kind before finishing existing schemes. I say that in all these matters, new roads, reconditioning of rural roads, and provision of employment, enormous sums have been spent and great activity is being shown by the Road Board. I will not go into the question of London bridges, which was referred to by the noble Earl, but he knows that schemes are being put in hand for the improvement of these bridges, and that there is also the Victoria Dock Road and other big schemes of that kind. May I calm the mind of the noble Earl, Lord Beauchamp, by telling him that I have just received information that the bridge on the Colnbrook by-pass will be opened in July, so that when he goes westward in July he will have the opportunity of motoring down that by-pass.

Now let me just give three reasons why it really is inadvisable to proceed in too hurried a way in road-reconstruction and the making of new roads. There has first to be considered the great question of the redistribution of population. The redistribution of population is affected by the roads; certainly in newer countries and probably also in older countries. It is not possible, with the great changes that are going on in the industrial situation, to prophesy at present what will be the ideal system of roads to be laid down all over the country. We must go perhaps more slowly than otherwise would be the case because of these great industrial changes that are taking place. We have heard a great deal about competition between road and rail. In looking at the roads and considering the immense development of motor traffic on the roads, you must not give heed to one form of transport only and forget all about the other. It may be right to develop the roads, but you must consider how that will affect the railway position and what would be the proper distribution of weight of traffic carried on rails and on roads. And there is another technical matter to which I should like to allude—that we have not yet arrived at the ideal system of road construction. There are all sorts of problems which are being worked out, problems of slipperiness of surface and so on, and, as the noble Earl said, this question of building roads is like building battleships. Each year you get a little more experience. You do not want to build all your battleships in one year, and it would be a great mistake to cover the country with a great mass of new roads and find that they had to be rebuilt nine or ten years hence because they had not been properly constructed.

I hope I have shown that the situation is not nearly as dark as the noble Earl has pictured it, and that really we may congratulate ourselves. Though much remains to be done, much is being done, and when we compare ourselves with any other nation I think we may say that our roads are probably the best in the world. Let us take a little comfort and not be too gloomy about it. If we were lashed last year for our extravagance, and if we are criticised and put on the rack by the noble Earl this year for our parsimony, I trust that next year—and next year is a very important year because it is the year of the General Election—the noble Earl will arrive at the conclusion that so far from being extravagant or parsimonious we have hit exactly the line which divides those two great principles, and that we shall go on our way unalarmed and unterrified by the lean and haggard throngs of economists on the one side and the roaring hordes of spenders on the other. I am afraid that there are certain words which prevent me accepting the Motion.

LORD DANESFORT

My Lords, after the very clear speech from the noble Viscount I hesitate to occupy your Lordships' time, but perhaps you will kindly allow me to mention in a very few words one or two points which have occurred to me. We have heard a good deal from the noble Earl, Lord Beauchamp, about so-called "pledges" and I hope I am the last person to minimise Parliamentary pledges or to say that they should not be carried out. But whatever those pledges were in 1909 and 1920, can any one say that they mean that, whatever the necessities of the country may be, whatever the magnitude of the Road Fund, on no account would it be right to take one farthing from the Road Fund and apply it to the necessities of the country? I think that this would be an extravagant, construction to put upon any of the pledges, and I do not imagine that the noble Earl, Lord Beauchamp, would go so far as that. He certainly does not go so far as to express that view in his Motion, and I feel pretty certain that he would not go so far as a deduction of that kind from these so-called pledges. The noble Earl, Lord Russell, who is evidently a high priest of financial and ethical purity, would not, I think, go so far as that, and I hope I have his assent when I say on his behalf that he would repudiate any such construction being placed upon those pledges. The truth is that a pledge, if it is to be called a pledge, must be construed in accordance with the widely different conditions of to-day and of the time when it was given, and I venture to say with some confidence that the highest financial purist would not hold that in a time of great necessity, if you have a large fund which can be utilised, it is not perfectly right to take something from it to meet the needs of the country. Lord Beauchamp deplored the raids that took place. I do not deplore them at all. So far as I am concerned, the so-called raid in 1927 was more than justified and, speaking only for myself, I am very glad that it was made.

The only other point to which I wish to refer is the character of the great expenditure that is now being made upon the roads. To my mind a great part of that expenditure is of the most extravagant and unnecessary kind that you could imagine. The noble Earl, Lord Russell, candidly admitted that there were certain so-called improvements which he could not justify. I think he said that they were unnecessary and, if I may be allowed to say so, I cordially agree with him. I think that the noble Lord, Lord Cottesloe, laid down the right principle to be followed in road expenditure at the present time. Do not let us embark, he said, upon these enormous, grandiose, extravagant schemes for new roads all over the country; let us maintain and reasonably improve the roads that we have. That is what I understood the noble Lord to say, and it seems to me that, at a time like this, when economy in every respect, and especially economy that will save the pockets of the ratepayers, is so vital, this extravagant expenditure on roads is greatly to be deplored. If the noble Earl, instead of deploring the raids, had deplored the extravagant expenditure, I should have been most delighted to support him.

What do I mean when I speak of extravagant expenditure? I have recently been motoring, in order to see what is going on rather than for pleasure, on some of these great new tracks, which have been spoken of with such pride, radiating from London in different directions. I confess that they filled me with horror. These vast new tracks are to my mind nothing more than racing tracks for the amusement of people who want to break the law and to go fifty or sixty miles an hour, as I saw them doing.

VISCOUNT PEEL

How fast were you going?

LORD DANESFORT

I was going at the normal pace of from twenty to twenty-five miles an hour—

EARL RUSSELL

Twenty-five?

LORD DANESFORT

—which is quite enough, I think, for anyone who wants to admire the beauty of the country. Let me call your Lordships' attention to another point. Who were the people using these great racing tracks in the neighbourhood of London? They were not commercial people, carrying goods here and there for the benefit of the consumers and the poorer class of people. They were out for "joy rides." I do not complain of people going for "joy rides," but I do say that you ought not to spend enormous sums out of the pockets of the taxpayers and ratepayers for the purpose of providing "joy rides" for people who want to travel at fifty miles an hour on Saturday and Sunday. I think that their desire for pleasure would have been adequately met without these enormously expensive tracks. So much for these great tracks near London. But, like many of your Lordships, from time to time I have to go along country roads, and I confess that I have been horrified to see what goes on. There is a gentle bend in the road, which is really rather useful for preventing people going at an extravagant speed, and I see in many cases that great pieces of adjoining fields are bought by the county council for the purpose of abolishing such a slight bend, not for reasons of safety but for the purpose of enabling people to go faster. I frequently see the road widened enormously without any necessity.

I grant that all these works are in some ways excellent in that they give employment, and I entirely endorse anything that is done to give legitimate employment. But I want to know who really pays. In the first place the Road Fund pays, and in the second place the ratepayer pays. I do say that, at this time of all others, when farmers are in such desperate difficulty, no extravagant schemes for new roads ought to be embarked upon that would throw additional burdens upon them. Whatever might be done in a time of great prosperity when we are able to pay more taxes and rates, the present time is not the time for indulging in this expenditure upon the roads. From that point of view, as well as from the point of view that I have already indicated, I cannot deplore the so-called raids, and I trust that the ratepayers of the country will insist upon smaller commitments and that the Road Fund will in that way be relieved to some extent.

EARL BEAUCHAMP

My Lords, I am much obliged to the noble Viscount who replied on behalf of His Majesty's Government to the various questions that I put to him. He gave me, as he always does, a very full and complete answer. It will not surprise him to know that it is not my intention to ask your Lordships to divide on this Motion, but perhaps he will permit me to make one or two remarks. In the first part of his speech he told us how much he disliked the use of adjectives. He was economical in his use of adjectives at that stage, but when he came to his peroration he was extravagant beyond words. For my part, I find it difficult to reconcile his economy at the beginning of his speech with his extravagance at the end of it, and that within so short a period as twenty minutes he should be so economical and so extravagant filled me with admiration at the way in which he manages to combine the two qualities in one oration. I turn from that point to one remark of the noble Lord behind him (Lord Danesfort), who spoke of the money contributed by the Road Fund and the money contributed by the ratepayer. He seemed to forget the very large sum contributed by the motorists as their contribution towards the upkeep of the roads. That, however, was not really the question around which the discussion has ranged this afternoon. I am much obliged to the noble Viscount for his information with regard to Colnbrook Bridge, but I hope I shall not be misunderstood when I say I shall not invite him to accompany me when I journey westward.

The discussion has really ranged over two points mentioned in the Resolution—unemployment and the raid upon the Road Fund. Of course it is quite clear, as the noble Viscount claimed, that money spent on the roads will increase employment, and that the more money is spent the more you reduce unemployment. I think there are some large extensions which might be made in this direction, which would have the effect of reducing unemployment. There is no real point of difference between us on that matter. The real point is one of economy and extravagance. I confess that I do not see any inconsistency, such as delighted the noble Viscount so much in the first part of his speech. Let me take an example from his own Department. Would he think it true economy to neglect the repair of this great building in which we are now sitting? Surely you must go on spending money year by year. To neglect a building entirely means that you must spend a great deal more money in the end upon maintenance than you would spend by proceeding in the economical and careful way in which I am sure the noble Viscount administers the funds at his disposal for the maintenance of the Houses of Parliament. So it is with regard to the roads of the country. There must be a very large extension of the road system of this country, both in the improvement of existing roads, and in making provision for increasing traffic, year by year. It seems to me, therefore, to be the truest economy to be ready, and have your roads ready, before traffic really becomes congested, and that it is not true economy to wait until the roads are so congested that they cannot be used for the purpose for which they were intended, with the result that you cause traders and commercial users the loss of a large sum of money. It is not necessary that I should now detain your Lordships any longer on this matter, and I will therefore ask leave to withdraw my Motion.

Motion, by leave, withdrawn.

House adjourned at five minutes past six o'clock.