Sitting of 21 April 1887

MINUTES.
SELECT COMMITTEE—Report—Endowed Schools Act, 1869, and Amending Acts [No. 13],
WAYS AND MEANS—considered in Committee—THE FINANCIAL STATEMENT.
PUBLIC BILLS— Second Reading—Criminal Law (Scotland) Procedure (No. 2) [196].
Considered as amended—Metropolitan Open Spaces Acts Extension* [214].

PRIVATE BUSINESS.
  SUTTON DISTRICT WATER BILL (by Order).

    CONSIDERATION.
    Order for Consideration read.
    MR. DODDS: I have to move that the Consideration of this Bill be postponed until Thursday next.
    Motion made, and Question proposed, "That the Consideration of the Bill be deferred until Thursday next."—(Mr. Dodds.)
    MR. ARTHUR O'CONNOR: In regard to the postponement of the Consideration of this Bill, I wish to ask the hon. Member for Stockton whether it is definitely intended that the Bill shall be taken on Thursday next, or whether there is any prospect of a further postponement?
    MR. DODDS: I have no information that I can give to the hon. Member. I was simply requested to move the postponement of the Consideration of the
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    Bill until Thursday next, but I have no further information on the subject.
    Question put, and agreed to.
    Consideration, as amended, deferred till Thursday next.

QUESTIONS.

  CRIMINAL LUNATIC ASYLUM, DUNDRUM—ALLEGED ASSAULT.
  MR. W. J. CORBETasked the Chief Secretary to the Lord Lieutenant of Ireland, If his attention had been called to the case tried before the Recorder of Dublin, on the 13th instant, in which William Lamb, late a Head Constable in the Royal Irish Constabulary, sued Dr. Ashe, Resident Medical Superintendent of the Criminal Lunatic Asylum at Dundrum, to recover damages for an alleged assault committed while an inmate of the Asylum; whether, according to the evidence as reported in The Freeman's Journal of the 14th inst, Dr. Ashe stated,
  "On the occasion of the bath, Lamb was stripped, his feet tied, and he was plunged in the bath for 10 seconds, and then, after an interval, for 10 seconds more;"
  whether it is a fact that Lamb was plunged under the water head downwards, and held there by the warders; whether this was done as a punishment for refusing to go to church; whether a similar case occurred at the Limerick Asylum in 1873, when a patient named Danford came to his death from submersion in the bath; whether, on that occasion, as stated at page 63 of the 23rd Report on Irish Asylums, the warder who administered the bath was tried for homicide; but, as eight months had elapsed, and no Coroner's inquest had taken place, a conviction could not be had; whether the Resident Medical Superintendent who ordered the bath was called on by the Lord Lieutenant to resign, and did so; and, if the facts are as stated, what course will be taken with regard to Dr. Ashe?
  THE PARLIAMENTARY UNDER SECRETARY (Colonel KING-HARMAN)(who replied) said: I am informed that the facts are not as stated in the Question. The man's head was not held downwards in

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  the bath, and the punishment was inflicted, not for refusing to go to church, but for creating disturbances in church. He brought an action for damages against the Resident Medical Superintendent of the Asylum; but it was dismissed, with costs against the plaintiff; and the Recorder, who tried the action, made some complimentary references to the manner in which the Asylum, was conducted. The incident in the Limerick Asylum was altogether dissimilar. However, the question of punishing lunatics by plunging into cold water is under consideration.
  MR. W. J. CORBETsaid, it was given in evidence that this man's head was held downwards under water for 10 seconds, and again for 10 seconds a second time.
  COLONEL KING-HARMANsaid, he understood the man's head was not held downwards; but he believed his head was held under water.
  MR. W. J. CORBET(for Dr. KENNY)asked the Chief Secretary to the Lord Lieutenant of Ireland, Whether, referring to the case of Lamb v. Ashe, recently tried before the Recorder of Dublin, the rules made by the Lord Lieutenant in Council for the "good conduct and management of District and Criminal Lunatic Asylums in Ireland," sanction the employment of the cold plunge bath as a means of punishment, as stated in the evidence given in above case; and, whether the employment of such punishment is a distinct violation of Rule xviii. of said Rules?
  THE PARLIAMENTARY UNDER SECRETARY (Colonel KING-HARMAN)(who replied) said: The punishment was sanctioned by the Privy Council; but the question is now under consideration.

  AFRICA (WEST)—THE GAMBIA—THE ACTING CHIEF MAGISTRATE.
  MR. DILLWYNasked the Secretary of State for the Colonies, Whether the Acting Administrator of the Gambia has appointed Dr. F. H. Spilsbury, Colonial Surgeon, to be the Acting Chief Magistrate of that Settlement; whether that gentleman has had the legal training necessary to perform the duties of that office; whether, when he was invested with similar
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  functions on a previous occasion, grave complaints were made by suitors and others; whether there is any officer of the Government who has been called to the Bar; and, if so, why he was not appointed; and, whether it is true that the Assistant Colonial Surgeon is about to leave for the Gold Coast; and, if so, who is to perform his duties in the absence of Dr. Spilsbury?
  THE SECRETARY OF STATE (Sir HENRY HOLLAND): Dr. Spilsbury was appointed acting Chief Magistrate; but the Administrator has since been directed to offer the post to Mr. Maxwell, the Queen's Advocate, whose office it has been found necessary, for reasons of economy, to abolish. It is not known that Dr. Spilsbury has had any regular legal training; but he has acted as Chief Magistrate to the satisfaction of the Government on previous occasions; and the Memorial which was sent in against his appointment, in September last, was not of such a character as to induce my Predecessor to alter the arrangement, which appeared to be the best possible under the circumstances of the Settlement. The selection of officers to fill acting appointments is necessarily left to the discretion of the Local Government, and in small Colonies like the Gambia the choice is very limited. I have no information of the reasons which induced the Acting Administrator to appoint Dr. Spilsbury instead of Mr. Maxwell. the Assistant Colonial Surgeon has been transferred to the service of the Gold Coast Colony; and the question of the best mode of providing for the medical requirements of the Gambia is under my consideration, and will be decided upon before any leave, if asked for, is granted to Dr. Spilsbury.

  INDIA—EXPORT DUTIES ON RICE, &c.
  MR. BADEN-POWELLasked the Under Secretary of State for India, Whether the only Export Duty levied on Indian produce is a duty of three annas per maund levied on all rice exported from India, and which, at present prices, is equivalent to 12½ per centum ad valorem on Burmah rough rice; whether the repeal, in 1873, of the Export Duty on wheat was followed by a large and steady increase in the export of wheat; and, whether Her Majesty's Government contemplate the repeal of,

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  or any reduction in, the Export Duty now levied on Indian rice?
  THE UNDER SECRETARY OF STATE (Sir JOHN GORST): Yes; but according to a calculation made in the India Office, the rate is about 7 per cent, not 12½ per cent. The Secretary of State regrets that, for the present, the state of the Indian finances does not admit of a repeal of the Export Duty on rice.

  POOR LAW (IRELAND)—DAVID BROOKS, MASTER OF THE ARMAGH WORKHOUSE.
  MR. BLANEasked the Chief Secretary to the Lord Lieutenant of Ireland, If Mrs. Berry, and her illegitimate son, James Brooks, have been inmates of the Armagh Workhouse since the appointment of David Brooks to the office of Master of that workhouse on the 5th instant; if David Brooks be the same person who was decreed, at the Easter Quarter Sessions held at Armagh, for the seduction of this woman Berry or Vallely; and, if so, whether the appointment of David Brooks as Master of the Armagh Workhouse will be confirmed?
  THE PARLIAMENTARY UNDER SECRETARY (Colonel KING-HARMAN)(who replied) said: Elizabeth Berry and her children were inmates of the Armagh Workhouse since the 5th instant; but they are not there at present. As regards the case of Brooks, the Local Government Board are in communication with the Board of Guardians on the subject.

  FISHERY BOARD OF SCOTLAND—SALARIES OF OFFICERS.
  MR. MACDONALD CAMERONasked the Lord Advocate, Whether his attention has been drawn to a Memorial, dated June, 1883, presented by the fishery officers of Scotland to the Fishery Board of Scotland, and to the reply of the Fishery Board to this Memorial, declining to recommend any improvement in the condition of the fishery officers, and also declining to allow any application to be made to the Secretary for Scotland; whether additional duties have since been imposed upon the fishery officers—namely, monthly Returns of all fish caught on the sea-board of Scotland, duties under
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  the Sea Fisheries (Scotland) Amendment Act, 14th August, 1885, s. 7, and the administration of £20,000 for the benefit of crofter fishermen, thrown upon the Fishery Board by the Crofters' Bill; and, whether, in consideration of the facts, that no alteration in the remuneration of the fishery officers has been made since 1861 (except some minor alterations affecting some seven stations only in 1877), that the duties of the fishery officers since 1861 have greatly increased, that the cost of living has also largely increased, and that the increased duties of the fishery officers places a considerable surplus at the disposal of the National Exchequer annually, he is prepared to recommend that the position of the fishery officers of Scotland be investigated, with a view to an adequate increase of salary and allowances?
  THE LORD ADVOCATE (Mr. J. H. A. MACDONALD): My attention has been called to the Memorial referred to, and to the answer given by the Fishery Board to it. I am not, however, aware that the Board declined to allow any application to be made to the Secretary for Scotland; I believe they only said that they did not see their way to make any recommendation to the Secretary for Scotland. With reference to the additional duties imposed by the Sea Fisheries and Crofters Acts, in the Estimates for 1887-8 there is an extra Vote, for travelling and incidental expenses, of £255. An inquiry having recently been made into this matter, the Secretary for Scotland is not prepared to recommend any further investigation in the meantime; but should it be found, after experience of the working of these two Acts, that the additional duties imposed on the fishery officers are very heavy, the Secretary for Scotland will then be prepared to consider whether the matter should not again be brought before the Treasury for their Lordships' consideration.

  POST OFFICE (ENGLAND AND WALES)—THE IMPERIAL INSTITUTE—"OFFICIAL PAID" LETTERS.
  MR. BRADLAUGHasked the Postmaster General, If large quantities of letters recently sent through

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  the post, containing matter relating to the Imperial Institute, are stamped with the words "official paid;" whether ordinary prepaid letters have merely the word "paid" so stamped; whether the words "official paid" always mean that money has been actually received by the Post Office for the postage of all the letters on which these words are stamped; if not, what is the exact ordinary meaning of the words "official paid," when used by the Post Office Department; and, whether such words have not, in some cases, been used to mark letters which have been sent through the post without any money payment?
  THE POSTMASTER GENERAL (Mr. RAIKES): In reply to the hon. Gentleman, I beg to state that the Imperial Institute pays for its postage; but that instead of paying letter by letter an account is kept, and rendered quarterly, of the postage on the whole correspondence emanating from the office of the Imperial Institute. This correspondence is marked "official paid," to indicate that no charge is to be collected on delivery. There are two stamps in use—one being the "official paid" stamp, and the other the "paid" stamp. The latter stamp is only used when a large number of letters or circulars are posted at one time, and the amount of postage is paid at the time of posting. In the result, it makes no difference to the Revenue which stamp is used.
  MR. BRADLAUGHasked whether any quarterly account had yet been made up and paid?
  MR. RAIKESsaid, he was not aware; but he would make inquiry if the hon. Gentleman gave Notice of a Question.

  ARMY—"SPECIAL RESERVE" FOR QUARTERMASTERS OF THE ROYAL ARTILLERY.
  CAPTAIN COTTONasked the Secretary of State for War, with reference to a statement made in the House on the 5th March, 1886, by the then Secretary of State for War, that there is a special reserve for Quartermasters of a proportion of the grant for distinguished or meritorious service, If he can now state to the House what is the amount reserved for the Quarter-
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  masters of the Royal Artillery, and for how many of these officers?
  THE SECRETARY OF STATE (Mr. E. STANHOPE): At the present time, 1-14th of the sum reserved for the Royal Artillery is assigned to officers of that corps commissioned from the ranks. I do not, however, feel satisfied that this is a satisfactory arrangement, and I will undertake to make an inquiry into the matter.

  CHANNEL ISLANDS—MILITIA LAW OF JERSEY.
  MR. FENWICKasked the Secretary of State for War, Whether his attention has been called to the arrest of William Burch, Patsy Breen, and William Naish, Militiamen on the Island of Jersey, and reported in The Jersey Advertiser for the 16th March, 1887; whether the law provides that judgment may be given by default; and, if so, whether such arrests were legal; whether information has reached him that strong opposition prevails amongst the working men upon the Island to compulsory military service, and that a great number of the inhabitants are fined and imprisoned for refusing to attend drill; and, whether he will consider the advisability of appointing a Civil Commissioner to inquire into the working of the Militia Law on the Island?
  THE SECRETARY OF STATE FOR THE HOME DEPARTMENT (Mr. MATTHEWS)(who replied) said: No, Sir; I have no information as to the particular cases quoted, and cannot express an opinion as to the legality of the arrests. Under the Militia Law of 1881 persons who failed to attend when summoned are liable to a fine; and on the third default, if the fine is not paid, they may be imprisoned for four days. The law provides for exemption from drill in special cases. Although some complaints have been received at the Home Office, I have no reason to believe that the feeling against compulsory service is general in the Island; or that a great number of persons are fined or imprisoned for declining to serve. The present Militia Law was passed on the Report of a Committee sent by the War Office to the Channel Islands in 1879; and I do not think any further inquiry necessary.

  WESTERN PACIFIC—REGULATIONS FOR THE LABOUR TRAFFIC.
  SIR GEORGE CAMPBELLasked the Secretary of State for the Colonies, "Whether the Regulations under which the labour traffic in the Pacific is now carried on are to be found in any Papers already presented to Parliament; or, if not, whether he will present them; whether breaches of those Regulations by vessels belonging to the various Australian Colonies, and other offences committed by the crews of those vessels, when committed beyond the territorial limits of the Colony, are now exclusively triable by Her Majesty's High Commissioners for the Western Pacific, or are dealt with by the Colonial Judicatures; and, whether Her Majesty's Government have departed from the intention that offences committed by Natives against British subjects should always be dealt with by that Commission, and have approved a reversion to the system of dealing with them by act of war against tribes and peoples, as in some recent cases?
  THE SECRETARY OF STATE (Sir HENRY HOLLAND): Two Colonies employ Polynesian labourers—Fiji and Queensland. The Fiji Ordinances and Regulations were given to Parliament in 1878 (Parliamentary Paper, 111). Those relating to Queensland have not been given; but could be given if the hon. Member thinks it desirable to move for them. Speaking generally, Regulations made under Colonial Acts have no effect beyond Colonial waters, except as being conditions under which licenses are granted and enforceable by forfeiture of the licensee's bonds; but any acts amounting to criminal offences committed on the high seas, or elsewhere, within the jurisdiction of the Admiralty by the crews of vessels belonging to the various Australasian Colonies are, by the Act 12 & 13 Viet. c. 96, triable in the Courts of any British Colony, or in the High Commissioners' Court, and some cases have been dealt with in the Supreme Court of Queensland. There has been no departure from any intention such as that described in the Question. The hon. Member will find the object of the High Commission accurately described in extracts from a Memorandum written by Sir
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  Arthur Gordon in 1881, which were given to Parliament in 1883, C3,641 pp. 28 to 31. He will there see that the jurisdiction of the High Commissioner extends only to British subjects; and that the High Commissioner has no authority whatever to deal, whether judicially or in his executive capacity, with the offences of natives not under the dominion of the Crown; and that the Law Officers have invariably advised that insuperable obstacles exist to any assumption of jurisdiction by Her Majesty over other than British subjects.

  AFRICA (WEST COAST)—CHARTER TO THE ROYAL NIGER COMPANY.
  SIR GEORGE CAMPBELLasked the Under Secretary of State for Foreign Affairs, Whether Her Majesty's Government will submit to Parliament any Papers showing the circumstances under which the Government of the day were induced to grant a Territorial Charter to the Royal Niger Company, the extent of the territories and protectorates now claimed and possessed by that Company, the progress they have made in establishing government and jurisdiction, the fiscal system and commercial tariffs which they have established, their relations with neighbouring Native Powers, and the degree to which they have reconciled the sovereignty of a Trading Company with free trade or the contrary?
  THE UNDER SECRETARY OF STATE (Sir JAMES FERGUSSON): The request of the hon. Member is reasonable. I will, as soon as possible, lay upon the Table Papers on the subject. I cannot pledge myself to all the details of the Question; but the House shall be fully informed.

  ROYAL IRISH CONSTABULARY— TRANSFER OF SERGEANT MOLONEY TO MOUNT NORRIS.
  MR. BLANEasked the Chief Secretary to the Lord Lieutenant of Ireland, If the County Inspector of Constabulary, County Armagh, some two years ago held an investigation into certain charges preferred against Sergeant Moloney, now of Mount Norris; and, whether the County Inspector was so satisfied of the truth of the charges that he caused the transfer of Sergeant

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  Moloney to another station; and, if so, whether the Government will consider the advisability of having him removed from Mount Norris to some other station, having regard to former charges made against him there?
  THE PARLIAMENTARY UNDER SECRETARY (Colonel KING-HARMAN)(who replied), said: It is true that in March, 1885, an investigation was held at Mount Norris into charges made against Sergeant Moloney. The charges could not, however, be substantiated; but the Sergeant was removed from that station in the interests of the Service, but not as a punishment. I am informed that Sergeant Moloney has now been sent to Mount Norris simply to take temporary charge under unavoidable circumstances.

  THE MAGISTRACY (IRELAND)—RESIDENT MAGISTRATES.
  MR. M'CARTANasked the Chief Secretary to the Lord Lieutenant of Ireland, Whether he can state the number of the counties in Ireland, "being in a state of disturbance," in which Resident Magistrates appointed under the 6&7 Vict. c. 13, s. 31, are now doing duty; the names of the counties for which Resident Magistrates have been appointed "owing to the absence or non-residence of a magistrate in the county;" and the number of counties in which Resident Magistrates are now residing "for any other sufficient cause;" and, whether he will mention what these "sufficient causes" are?
  THE PARLIAMENTARY UNDER SECRETARY (Colonel KING-HARMAN)(who replied) said: I can only say that, as Resident Magistrates at present serving in Ireland have been appointed by successive Goments since 1857, it would be extremely difficult to prepare the Return; and, as the Return would prove of no great practical utility, the Government will not undertake to give it.

  SAVING LIFE AT SEA—NOMINATION OF THE SELECT COMMITTEE.
  MR. HOWARD VINCENTasked the Secretary to the Board of Trade, When the Select Committee
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  on Saving Life at Sea, promised several weeks ago, will be nominated?
  THE SECRETARY (Baron HENRY DR WORMS): In answer to the hon. and gallant Member, I have to say that the Committee will be nominated immediately.

  INFIRMARIES (IRELAND)—WICKLOW COUNTY INFIRMARY.
  MR. W. J. CORBETasked the Chief Secretary to the Lord Lieutenant of Ireland, If it is a fact that the Grand Jury of the County Wicklow reduced the amount passed at the Presentment Sessions for the maintenance of the Wicklow County Infirmary; whether he will inquire into the grounds for the reduction; and, whether it is a fact that the Board of Governors of the Infirmary recently refused to allow the Secretary of the Grand Jury to act as a member of the Board?
  THE PARLIAMENTARY UNDER SECRETARY (Colonel KING-HARMAN)(who replied) said: The relations between the Grand Jury and the Governors of the County Infirmary are matters in which the Government cannot interfere. I have, however, been informed that the facts as stated are substantially correct; but it is not proposed to make any further inquiry into the matter.

  INDIA—THE UNCOVENANTED SERVICE.
  MR. KINGasked the Under Secretary of State for India, Whether a Despatch was received by the Secretary of State for India, in or about September last, on the subject of the grievances complained of by the Un-covenanted Service in India; and, whether it is true that the Government of India has made recommendations for changes in the condition of the Un-covenanted Service as to length of service for pensions, leave counting as service, a graduated scale of pensions, or any other matters; and, if so, whether he will lay the Despatch, and any Correspondence which has taken place on the subject, before the House?
  THE UNDER SECRETARY OF STATE (Sir JOHN GORST): The facts, as indicated in the Question, are correct; but as the Correspondence

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  is not complete, no Papers can at present be laid on the Table.

  EGYPT—THE SOUDAN—THE SUAKIN- BERBER RAILWAY.
  MR. HANBURYasked the Secretary of State for War, What was the original cost of the material of the Suakin-Berber Railway; for what purpose was it subsequently employed, and where; and, where is it at the present moment?
  THE SURVEYOR GENERAL OF THE ORDNANCE (Mr. NORTHCOTE)(who replied) said: The original cost of the materials for the Suakin Railway was £315,000. Of the materials returned from Suakin, or not sent out, of which the aggregate cost was about £320,000, stores to the value of £30,000 had been issued for the use of various departments. The remaining plant had been stored at Woolwich, Portsmouth, Plymouth, Chatham, Lydd, and Strensall, with a view to its being employed at those stations in the construction of military railways as funds became available. One of those railways was under construction at Plymouth, and one at Chatham would be commenced this year. Steps were being taken to dispose of all surplus materials, and some part of them had been already sold.

  BURMAH (UPPER)—THE RUBY MINES.
  MR. BRADLAUGHasked the Under Secretary of State for India, Whether he can now give the House any information as to the Ruby Mines in Burmah; whether any contract or arrangement has been made, or is in the course of being made, with any, and what, person or persons, and on what conditions; and, whether more than one person or firm has been permitted to inspect the mines, with the view to any contract?
  THE UNDER SECRETARY OF STATE (Sir JOHN GORST): No further information has been received since the date of my last answer to the hon. Member on the 17th of February, and I am not aware that any contract has been, or is being, made. There is no objection to the inspection of the mines by any persons interested; but I believe that the representatives of
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  no firm other than that of Messrs Streeter have visited the mines.
  MR. BRADLAUGHasked whether there was any truth in the statement published in the Press, that Messrs. Streeter had entered into such a contract?
  SIR JOHN GORSTsaid, he was not able to say. There were so many rumours and statements in newspapers that were found to be untrue that he should advise hon. Members to suspend their judgment for the present.

  NAVY—CONVERSION OF THE ROYAL MARINE CORPS.
  SIR SAMUEL WILSONasked the First Lord of the Admiralty, Whether his attention has been called to an article, which appeared in The Times of the 13th instant, explanatory of a scheme submitted by Colonel Crease, C.B., E.M.A., for the conversion of the whole Royal Marine Corps into Marine Artillery; whether this proposition of Colonel Crease's is being at present considered by the Board of Admiralty; and, whether he has any objection to lay Colonel Crease's complete scheme upon the Table of the House, so that Members may have the opportunity of making themselves acquainted with a proposition which, while claiming to save some £18,000 a-year in the Naval Estimates, seems likely to prove advantageous to the Service and to the country?
  THE FIRST LORD (Lord GEORGE HAMILTON): A scheme for the conversion of the whole Royal Marine Corps into Royal Marine Artillery has been forwarded by Colonel Crease, and is under examination by the Admiralty. I am informed that this examination has made clear that the scheme will not fulfil the promise of economy claimed for it. It is not usual, and would not in this case be advantageous to the Service, to officially publish an inchoate scheme of this kind.

  MERCHANT SERVICE—WRECK OF THE CHANNEL STEAMER "VICTORIA"—THE D'AILLY LIGHTHOUSE.
  MR. T. W. RUSSELLasked the Parliamentary Secretary to the Board of Trade, Whether gas or electric light is the illuminant of D'Ailly lighthouse; whether the fog signal is

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  sounded by gas, as in the Irish lighthouses of Howth Baily, Poolbeg, and Mew Island, and the Scotch lighthouses of Langness Point and Ailsa Craig, or steam; whether, if the former, it could have been sounded in one minute after the commencement of the fog, as compared with one hour required to get up steam for the latter; and, whether the facility with which gas-sounded fog signals can be put into immediate action is one of the advantages of the gas system of illuminating lighthouses?
  THE SECRETARY (Baron HENRY DE WORMS): Gas-sounded fog signals can, of course, be put into immediate action; but I would point out to the hon. Member that his Question relates to a lighthouse not under the control of the Board of Trade, but under that of the French Authorities, and that I cannot, therefore, give him any official answer. If, however, the hon. Member will call at the Board of Trade he is welcome to see any information which the Department possesses respecting this lighthouse.

  INDIA—LEAVE OF ABSENCE— "URGENT PRIVATE AFFAIRS."
  MR. DILLWYNasked the Secretary of State for War, Whether a military officer, whatever his rank, serving in India, can obtain leave of absence for three months on urgent private affairs; and, whether a member of the Executive Council of Bombay can obtain leave of absence on urgent private affairs for three months?
  THE UNDER SECRETARY OF STATE FOR INDIA (Sir JOHN GORST)(who replied) said: Any military officer in India, except a Commander-in-Chief, can obtain, if the exigencies of the Service permit, three months' leave on urgent private affairs. A member of the Executive Council of Bombay cannot obtain such leave; but he can obtain six months' sick leave, if necessary.

  LAW AND JUSTICE (IRELAND)—THE REVEREND MATHEW RYAN, C.C.
  MR. P. J. O'BRIENasked the Chief Secretary to the Lord Lieutenant of Ireland, Whether a communication inclosing a Resolution of sympathy and condolence with the
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  Reverend Mathew Ryan, C.C., was forwarded by the Tipperary Board of Guardians to that reverend gentleman at Kilmainham Prison, where he is at present confined; whether said communication was withheld from Father Ryan by the prison authorities; whether, subsequently, Father Ryan having learned of such a Resolution, sent an acknowledgment thanking the Guardians in reply; and, whether this communication was also withheld by the prison officials, who refused to forward it; and, if so, will he state on what grounds or by what authority the prison officials acted in withholding these communications?
  THE PARLIAMENTARY UNDER SECRETARY (Colonel KING-HARMAN)(who replied) said: the communications referred to were detained under the Regulations governing the Correspondence of prisoners, who, though allowed full liberty to write or receive letters upon private matters, are not permitted to discuss questions of a public or Party character.

  CRIME AND OUTRAGE (IRELAND)— ATTEMPTED MURDER OF MR. JEREMIAH HEGARTY, J.P.
  MR. JOHNSTONasked the Chief Secretary to the Lord Lieutenant of Ireland, If it is true that Mr. Jeremiah Hegarty, a magistrate, of Mill-street, Cork, was shot at and seriously wounded on Saturday, the 16th instant; if he will narrate the circumstances that preceded the attempted murder; and, if any person or persons have been apprehended for the crime? I also wish, to know whether it is the fact, as stated in The Times of this morning, that Mr. Hegarty has written a letter in which he says—
  "I have no hesitation in attributing this outrage to the slanderous attacks made on me by The Cork Herald and by Dr. Tanner."
  MR. DILLON: Before that Question is answered, I wish to ask you, Sir, whether it is in Order for the hon. Member opposite to read from a newspaper, in the form of a Question, a quotation which every Member must see casts a grave reflection on a Member of this House? I ask, you, Sir, if it is in Order?
  MR. SPEAKER: I have not seen the terms of the latter part of the Question,

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  which is put by the hon. Member on his own responsibility. If it should prove to be in Order it ought to be put in the presence of the hon. Member for Mid Cork.
  THE PARLIAMENTARY UNDER SECRETARY (Colonel KING-HARMAN)(who replied) said: I am unable to answer the latter part of the Question, which is not on the Notice Paper. But, in reply to the part which appears on the Paper, I have to say that Mr. Hegarty was shot at and wounded as stated. He had proceeded to Cork by a morning train, and returned by the train reaching Millstreet at 8.35 p.m. His son and a servant were awaiting his arrival with his conveyance. On driving out through the gates leading to the road from the railway yard he was fired upon. No arrests have so far been made.
  MR. FLYNNasked, Whether it was true that a large number of policemen were on the road where Mr. Hegarty was shot?
  COLONEL KING-HARMANsaid, he was not aware of that; but he was informed that a large number of suspicious persons were seen on the road.

  ARMY (THE AUXILIARY FORCES)— VOLUNTEER ARTILLERY CORPS.
  MR. COGHILLasked the Secretary of State for War, Whether any arrangements are being made for training, in the service of heavy guns, and the various and complicated stores and war material now in use, the Volunteer Artillery Corps situated at great distances from any suitable forts or fortresses; when are the field guns, promised to Artillery Volunteers, to be issued; and, how many are to be issued, and to what corps?
  THE SECRETARY OF STATE (Mr. E. STANHOPE): All Volunteer Artillery situated within a reasonable distance of a port or fortress to be defended are assigned to those posts by the new mobilization scheme. After making every provision for this service there still remain a certain number of corps of Artillery Volunteers, who are mainly assigned to the defence of London. I am disposed to agree with the statement attributed to my hon. and gallant Friend the Member for Birkenhead (Sir Edward Hamley)
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  two days ago, that for tins purpose guns of position would probably be the most useful arm with which to provide them. But I may say generally that I am in favour of arming each corps, so far as its peculiar circumstances and its resources will permit, with the arm best suited to the duties it will have to perform.

  UNITED STATES OF AMERICA—INTERNATIONAL INDUSTRIAL PROPERTY CONVENTION.
  MR. HOWAED VINCENTasked the Under Secretary of State for Foreign Affairs, Whether the United States of America have yet acceded to the International Industrial Property Convention; and, what States are now parties to it?
  THE UNDER SECRETARY or STATE (Sir JAMES FERGUSSON): I am glad to be able to inform the House that the official notification of the accession of the United States of America to the International Industrial Property Convention was received yesterday from the President of the Swiss Confederation. The following States are now parties to the union:—Belgium, Brazil, Spain, Franco, Guatemala, Italy, Netherlands, Portugal, Servia, Switzerland, Great Britain, Sweden and Norway, Tunis, Dominican Republic, and United States.
  MR. MUNDELLA: Can the right hon. Gentleman say whether Germany has been invited to join the Convention?
  SIR JAMES FEEGUSSON: Yes, Sir; but up to the present she has not replied.

  INDIA (MADRAS)—THE COVENANTED CIVIL SERVICE—LAND SPECULATIONS—CASE OF MR. SULLIVAN.
  MR. BUCHANANasked the Under Secretary of State for India, Whether Mr. Sullivan, late Senior Member of Council, Madras, was reported to the Government of Madras by Mr. Crole, then Collector of Madura, for owning an estate at Ootacamund and attempting to sell the same to a Native in the Madura District, in contravention of the Civil Service Covenant; whether Mr. Crole was suspended for one year by the Madras Government; whether the late and the present Secretary of

  1415
  State found, on inquiry, that Mr. Sullivan was in truth dealing in land, and that Mr. Crole was justified in reporting him; whether it was in consequence of the contravention of the Civil Service Covenant that the Secretary of State agreed to accept Mr. Sullivan's resignation; and, is it the intention of the Government to allow Mr. Sullivan to retire on full pension?
  THE UNDER SECRETARY OF STATE (Sir JOHN GOEST): Without pledging myself as to the absolute accuracy of the phraseology of the hon. Member, I answer his Questions generally in the affirmative. I must, however, remind him that Mr. Sullivan, as a subscriber to the Madras Civil Fund, was entitled to an annuity out of this fund, on his retirement.

  CELEBRATION OF THE JUBILEE OF HER MAJESTY'S REIGN—SERVICE IN WESTMINSTER ABBEY.
  MR. LABOUCHEREasked the First Lord of the Treasury, Whether any Estimate has been made of the cost of the contemplated Jubilee Service in Westminster Abbey; and, if so, whether he will inform the House what that cost will be?
  THE FIRST LORD (Mr. W. H. SMITH): Yes; an Estimate is in preparation; but it has not been definitely determined upon yet. It will be presented to the House in the course of a few days.

  BUSINESS OF THE HOUSE—EMIGRATION.
  MR. RANKINasked the First Lord of the Treasury, Whether, in view of the large amount of interest taken in the question of Emigration, the Government will allow the Business on Tuesday, 26th April, to run its ordinary course, so that the discussion upon the Motion first upon the Paper may come on?
  THE FIRST LORD (Mr. W. H. SMITH): I am sorry to say that it is not in my power to accede to the suggestion of my hon. Friend. It may be necessary for the House to proceed with the consideration of the Criminal Law Amendment (Ireland) Bill.

  THE BUDGET—APPROPRIATION OF SURPLUS TO EDUCATION IN WALES.
  MR. MUNDELLAasked the First Lord of the Treasury, If, before the Chancellor of the Exchequer disposes of his surplus, the Government will make some provision for technical education, local Colleges, and Welsh intermediate education?
  THE FIEST LOED (Mr. W. H. SMITH): I am somewhat surprised at the Question. It is not usual to deal with Questions of this sort in the Budget speech. If it should appear to the Government to be necessary to make provision for those objects in which the right hon. Member and other Gentlemen take an interest Supplementary Estimates will be presented in the course of the Session on the subject.

  WAR OFFICE—THE ORDNANCE COMMITTEE—DISCLOSURE OF THE PROCEEDINGS BY AN OFFICIAL.
  SIR HENEY HAVELOCKALLAN: I wish to ask the Secretary of State for War a Question of which I have given him private Notice—namely, Whether there is any truth in the statement which appears this morning in The Standard newspaper, that a grave breach of trust has been committed in the communication of official information to a Foreign Government by a subordinate official in the Office of the Ordnance Committee at Woolwich; and, if so, whether the right hon. Gentleman is prepared to give to the House any information which will re-assure it that effectual steps will be taken to prevent such breaches of trus in future?
  THE SECRETARY OF STATE (Mr. E. STANHOPE): Yes, Sir; it is a fact that a military clerk in the Office of the Ordnance Committee at Woolwich has been discharged from the Service for communicating information to persons outside the office, though not to a Foreign Government. This course has been taken, not so much on account of the importance of the information, but as a punishment for a grave breach of trust in divulging it. Every possible precaution will be taken to prevent such breaches of trust in the future.

  PARLIAMENT—THE NEW RULES OF PROCEDURE, 1882—RULE 9 (ORDER IN DEBATE)—SUSPENSION OF A MEMBER.
  MR. SEXTON,: I wish, Sir, with your permission, to ask a Question on a matter arising out of the suspension of my hon. and learned Friend the Member for North Longford (Mr. T. M. Healy). On Friday last my hon. and learned Friend sought admission to this Chamber, and was informed that he could only be admitted to the Strangers' Gallery. I wish to ask whether a suspended Member, during the period of his suspension, is regarded as a stranger, and, if so, whether he is to be regarded as a distinguished stranger; and, whether, Sir, he is eligible for admission to any part of the Chamber usually reserved for persons who are not Members of the House?
  MR. SPEAKER: In reply to the hon. Gentleman, I have to say that when an hon. Member of this House is suspended from the service of the House, the doorkeepers, acting under general orders, exclude that Member from entering within the outer doors of this Chamber. As a matter of custom, it has been usual to allow the hon. Member so suspended to sit in the Strangers' Gallery. I can assure the hon. Gentleman there has been no distinction made between this case and other previous cases of suspended Members.

PARLIAMENT—RULES OF DEBATE— OFFENSIVE IMPUTATIONS ON MEMBERS OF THIS HOUSE—MR. DILLON AND THE MARQUESS OF HARTINGTON.

  PERSONAL EXPLANATION.
  MR. DILLON: Mr. Speaker, I desire to say a word or two in the nature of a personal explanation, and if the House will allow me I shall only occupy its time for a few minutes. I regret very much to be compelled to refer to the matter; but a custom has arisen in this House of hurling the most odious and detestable personal charges at Members of this House in the course of debate, when it is perfectly impossible that they can reply to them. On Monday last the noble Marquess the Member for Rossendale (the Marquess of Hartington) stated in this House that two Gentlemen, who were well known
  1418
  and who acted for months under my direction, went over to Ireland counselling assassination; and when I directed his attention to the fact that these Gentlemen were responsible to me and acted under my instructions, he repeated the charge, emphasized it, and said that those charges were made in the period to which I refer. That is a charge of a most odious character. I sat, and I waited to hear him proceed further; be cause I understood that you, Mr. Speaker, had ruled what any Member is bound to do when he makes charges of a criminal character against another Member—namely, substantiate his charges. The noble Marquess proceeded in his speech without even answering my appeal, without giving references to time, dates, or authority, so that I might be able to convince him of his mistake. Not only did he not substantiate his charges, but he did not even make them definite. I hold that I am entitled to take this opportunity of stating that this statement—which was given greater currency to by the noble Marquess under the authority of his great name and position in the country is utterly and most absolutely false. There is not a shadow of foundation for it. I think I am entitled to ask that he shall furnish me with the particulars of dates and extracts from speeches and references to the circumstances to which he alluded, when I shall be able to show him that his statement is entirely without foundation.
  [The Marquess of HARTINGTON was not present, and there was no reply to the Question.]

ORDERS OF THE DAY.

  WAYS AND MEANS—FINANCIAL STATEMENT—COMMITTEE.
  WAYS AND MEANS—considered in Committee.
  (In the Committee.)
  THE CHANCELLOR OF THE EXCHEQUER (Mr. GOSCHEN): Mr. Courtney, I have now to ask the Committee to pass from the region of higher politics in which we have been engaged during the last two or three months into the calmer sphere of the discussion of the national balance-sheet. But although the discussion may be conducted, I hope, in a calmer atmos-

  1419
  phere, it involves, as every Member of this House must be aware, questions reaching deep down into the foundations of the prosperity of the country, and consequently interesting to every member of the community. I have, in the first place, according to custom, to call the attention of the House to the Expenditure of the past year; but before I do so I should wish to impress one sot of broad figures upon the minds of Members of the Committee, and that is that in the past year both the Expenditure and the Revenue may be said, in round numbers, to have reached the figure of £90,000,000. That £90,000,000 admits of easy sub-division, both on the Expenditure side and the Revenue side. On the Expenditure side it divides itself into two great heads—namely, £30,000,000 for the charges on the Consolidated Fund, and £60,000,000 for the Supply Services. That is to say, that one-third represents the Consolidated Fund charges and two-thirds represent the Supply Services. Of the £90,000,000, on the receipt side,£75,000,000, in round numbers, are derived from taxes, and £15,000,000 from non-tax revenue—in other words, five-sixths of the revenue is derived from taxation, and one-sixth is derived from other sources, such as the Post Office, telegraphs, and miscellaneous sources of that kind.
  I now come to the Expenditure of the last year. The Budget Estimate, as hon. Members will see by reference to the Papers which are in their hands, was £89,610,000. The Supplementary Estimates amounted to £1,259,000, giving a total estimated Expenditure of £90,869,000. The actual Exchequer issues were £89,997,000, just £3,000 less than £90,000,000. The result is that the Exchequer issues were £387,000 more than the original Estimate and £872,000 less than the total estimated Expenditure, including Supplementary Estimates. Now, it is interesting to consider how far this reduction of £872,000 on the total Estimates was due to real economies in the Services, and represents so much saved to the nation. In the first place, there is on the Consolidated Fund charges a saving, in round figures, of £100,000, which is due to the fact that the interest on Treasury Bills and Exchequer Bills was estimated at a higher figure than ultimately had to be paid. The estimate
  1420
  taken was 3 per cent for all Bills. As a matter of fact, the average rate of 3 months' Bills was about 2¼ per cent; and that of 6 months' Bills about 2½ per cent. There is an apparent saving on the Army of £263,000; but that does not represent real economy. It is due to what is sometimes considered by hon. Gentlemen rather a complication—namely, the difference between the Exchequer issues and the actual Expenditure of a particular year. I think I can illustrate the nature of this apparent reduction to the Committee by the following illustration. Suppose that a man had an agent whose travelling expenses he had agreed to pay up to the sum of £ 1,000 a-year maximum; but that, at the same time, he had agreed only to pay the actual expenditure. Suppose that the agent expended only £900, there would be £100 left. The £100 would not be at the disposal of the agent, nor would he be entitled to spend it in that year; but it would go against his next year's allowance. So it is with the Army. It is impossible to foresee the exact amount of money that may be lawfully spent within the year, especially in respect of our troops abroad. An approximate sum is, therefore, issued, and the amount by which the actual expenditure falls short of that sum is carried over to the next year, and constitutes, as in the present case, a balance "which will relieve the Exchequer issues of the following year. I have thought it best to make this explanation, as I believe the point is one which sometimes puzzles hon. Members. When they see an apparent saving of £260,000 in this particular Vote, they ought to know that it is really no saving in the sense that the Army has spent so much less money. The short issue in the year 1886–7 is mainly due to the fact that £260,000 had been issued under the Vote of Credit to the Army in the previous year, which was not spent, and which, therefore, came in relief of the Exchequer issues of the following year. The same applies, to a certain extent, to the saving of £347,000 shown on the Civil Service Estimates. But here, I am happy to say, the whole apparent reduction is not swallowed up by a matter of account. On the Civil Service Estimates there has been a real and substantial economy of about £200,000 by the Departments

  1421
  not having spent all the money which they were entitled to expend under the grants; and there is also in the Revenue Departments a real saving of about £100,000. If hon. Members will add together £100,000 saving on interest, £200,000 on the Civil Service Estimates, and £100,000 on the Revenue Departments, they will see that there is a real saving of about £400,000 on the past year. The other amounts which are short of the Estimate are due rather to matters of account. At all events, we arrive at this conclusion—that the total Expenditure contained in Exchequer issues was £872,000 less than the amount which was granted by Parliament.
  Turning now to the Receipts, hon. Members will see that the Budget Estimate was £89,869,000, and the Exchequer Receipts were£90,773,000, showing a Revenue beyond what was anticipated of £904,000. It will be interesting, I presume, to the Committee to have some explanation with regard to the causes which have brought about that comparatively satisfactory result. It is due to an increase of £681,000 in the produce of taxes, and an increase of £223,000 in the produce of non-tax revenue. Looking at the figures under the several heads, hon. Members will see that there is an increase in the Customs of £455,000, and a decrease in the Excise of £444,000. These are, together with an increase of £465,000 in stamps, the most remarkable points about the Revenue of 1886–7.
  I may now touch upon one or two details of importance. The revenue from alcoholic drinks is a matter which has always had great interest for the hon. Members of this House. In 1885–6 the actual revenue derived from alcoholic drinks was £26,898,000, and in the last financial year it was £26,690,000, a falling off of £208,000. Comparing the receipts under this head in the past year with the Estimate, I find that where we have gained is on foreign spirits, in which there has been an increase of £406,000, while in home-made spirits there has been a decrease of £548,000 below the Estimate. If you take the two together the Budget Estimate was remarkably accurate; but certain circumstances have disturbed what may be called the internal relation between different forms of alcoholic drink. While on this subject of
  1422
  spirits I wish to say that the most able officers of the Customs and the Inland Revenue are never able to say for a certainty whether the run will be on foreign spirits or on British spirits, nor are they able easily to forecast whether brandy, rum, Geneva, or any other kind of spirit will be a favourite in any particular year. I believe it depends to a considerable degree upon the climate, and I am told that the great increase in rum of £208,000 over the Estimate is due to the cold weather which we have had. Another explanation which is given is, that there has been a decline in the price of rum. When my right hon. Friend the Member for Derby (Sir William Harcourt) framed his Estimates rum was dear; therefore it was thought recourse would rather be had to English spirits; but, in fact, rum has been cheap, and the consequence has been that the increase has been upon foreign spirits. Then, again, with regard to wine. The revenue from wine has been constantly declining, partly in consequence, as the Committee will be aware, of the change in the duty; but above that there has been a constant tendency to decrease in the consumption of wine. From 1877 to 1886 the revenue from wine has fallen off 30 per cent. This is a subject to which, with the permission of the Committee, I shall advert to in a later portion of my Statement.
  Coming to articles of consumption other than alcoholic liquors, there is no increase in the revenue from coffee. It is a somewhat extraordinary fact, but the revenue from coffee never increases; the consumption of coffee and the revenue from coffee are less now than they were 20 years ago. On the other hand, the consumption of cocoa and the revenue from it have doubled within the last 15 years. The consumption of tea has doubled between the years 1857 and 1887. In 1857 the consumption was 2·45 lbs., and in 1884 it is 4·87 lbs. per head of the population. Looking at the position of our Indian Empire, we may congratulate ourselves upon the following facts with regard to the consumption of tea:—Whereas 10 years ago we received 156,000,000 lbs. from China, and 28,000,000 lbs. from India, or 184,000,000 lbs. altogether, in 1886 we received 145,000,000 lbs. from China, and 81,000,000 lbs. from India, or 226,000,000

  1423
  lbs. altogether, the increase from India having thus been 53,000,000 lbs., whereas there was a decrease of 11,000,000 lbs. from China. It would be extremely satisfactory to the Chancellor of the Exchequer if great general advantages were always accompanied by fiscal advantages; but I am sorry to say that that is frequently not the case. In the same way that we rejoice over the progress of the temperance movement in spite of the loss to the revenue which it entails, so our satisfaction at the substitution of the tea of India, a part of our Empire, for that of China, a foreign country, is somewhat marred by the fact that it is accompanied by a loss of revenue. This is due to the curious circumstance that the teas of India are stronger than the teas of China, and, therefore, go further, so that a smaller quantity of tea is required to mate the same number of cups. The consequence is that the consumption of tea, though progressing, does not show so great a rate of progress as it used to do.
  I have now spoken of the revenue from alcoholic liquors and from other articles of consumption; the only remaining notable increase in revenue is due to the item of stamps, under which head we have exceeded the estimate by upwards of £450,000. This increase is about equally divided between the Death Duties and the Stamp Duties proper. The increase in the Death Duties is due to the falling in of some heavy legacies; but there is a further increase which is due not to expanding revenue, but to the collection of arrears. By the adoption of a bettor system of collection, Income Tax, and Death, and other Duties are collected much more closely than they used to be, and so you find that what you would at first believe to be an increase of revenue due to increasing wealth and prosperity represents little more than the increase of energy on the part of the officers of Somerset House. In the revenue from stamps proper there is, however, a more satisfactory cause for the increase—namely, that the receipts have been sensibly affected by an improvement in business. There have been more transactions which have required stamps, and particularly an exceptional number of foreign bonds to bearer which have been presented to be stamped.
  These are, I think, the main incidents in the Revenue of last year with which
  1424
  I need trouble the Committee. I now come to the final result of the past year. It will be remembered that the surplus was estimated by my right hon. Friend the Member for Derby at £259,000 at the beginning of last year, and the Supplementary Estimates were £1,259,000. If you deduct that from the estimated surplus you have a deficiency of £1,000,000 on the Expenditure; but there were savings to the extent of £872,000, which reduced the deficiency to £128,000. The excess of the actual yield of revenue over the Estimate I have stated at £904,000, which converts the deficiency into a final surplus for the past year of £776,000, as against the anticipation of my right hon. Friend of £259,000. I think the Committee will admit that, on the whole, looking to the events of the year, that is a satisfactory result. This result is due in the very smallest measure to the present Chancellor of the Exchequer. It is due, in the first instance, to the Chancellor of the Exchequer who made the accurate provisions which have been so satisfactorily justified; and, in the second place, to the Chancellor of the Exchequer—my noble Friend the Member for South Paddington (Lord Randolph Churchill)—who was responsible for the greater part of the financial year, and who has rendered such successful service to the cause of economy.
  Now, I will state—and it is always a matter of interest to the Committee—how this affects our balances. We began the year with a balance of £5,626,000. We took out of balances, principally for advances to Local Authorities for local loans, £452,000, leaving a balance of £5,174,000; and, adding to that the surplus of £776,000, we have a balance—a very creditable balance I hope the Committee will think—at the end of the year of £5,950,000, which is an increase of £324,000 over the year before. We have paid off Debt during the year to the amount of £6,046,000; and if I add the amount by which the balances are increased, and which is equivalent to a diminution of Debt, the real reduction of Debt is £6,370,000.
  But I hope the Committee will not run away with the idea that because in the last year there has been this satisfactory balance of £776,000, therefore we can look at the financial situation of the country with absolute complacency. I should wish, with the indulgence of the

  1425
  Committee, to examine in some detail the position in which we stand as regards our resources and the calls made upon them. And, first of all, let me make some general observations on the Expenditure and Revenue for a certain period of years. With regard to the Army and Navy there has been considerable discussion, and I do not wish to dwell at length upon this point; but I would simply call the attention of the Committee to the fact that during the last two years, and during the present financial year which we have now commenced, we have had to bear a heavy extra charge. Let us hope it may be an extra charge and not a permanent charge. This extra charge is due to that which is commonly known as the naval scare of November, 1884, and if I call it a naval scare I do so without intending to imply either that it was justified or that it was not justified. I simply refer to it as a historical event. In that year the House agreed to an extra expenditure for the Navy of £3,100,000 on ships, and £1,600,000 on armaments. But I believe it is not infrequently the case that such Estimates expand during the course of their being worked out. In this case the Estimate for ships expanded to £3,600,000; and when the authorities of the time had to deal with the armaments, it was found that the Estimate had not included the necessary amount for new ammunition, and that involved a further sum of £500,000. We arrive, therefore, at this result—that, whereas the original Estimate was £4,700,000, the total extra expenditure is £5,700,000 in round numbers. The Admiralty have carried out the programme with considerable vigour and rapidity; and while it was the intention of Lord Northbrook that this additional sum should be divided between five years, the increased sum of £5,700,000 has been spread over and will be discharged in little more than three years. The Committee will see that this involves a heavy sacrifice on the part of the taxpayers during the last two years and this year. The increase due to that historical event on Navy Votes alone has been more than £1,000,000 a-year during the past two financial years, and involves £900,000 in the present financial year. Let hon. Members, therefore, keep in mind, when they are looking at the Estimates for
  1426
  the Navy, that those Estimates have been increased by that which has been a temporary, and, I hope, an exceptional outlay. The same will hold good for the armament of the Navy, which comes within the Army Estimates. The Army Estimates this year include no less a sum than £1,700,000 for naval armaments. But of this extra shipbuilding programme, there fortunately remains only £200,000 for completion in the next financial year. So that we may look forward, I trust, to the fact that at the end of this financial year we shall have arrived at a great diminution of the necessary charge which has been made upon the taxpayers owing to these exceptional circumstances; and I am glad to be able to state that the arrangements which are being made about our fast merchant steamships, adapting them at a very small cost to the State for naval purposes, and the arrangements which are also in progress with the Colonies, afford good reason to hope that the time is not far distant when the Naval Estimates will not require to be swollen by exceptional items such as those which have fallen so heavily upon the taxpayers during the past two years.
  And now, Mr. Courtney, I pass away from the expenditure on the Army and Navy—in regard to which I hope and believe that it will be possible to make considerable reductions in the future—I pass from that point to the Civil Service Estimates, to which I should wish to be allowed to call the particular attention of Parliament, because here the intervention of Parliament is involved quite as much, and, I believe, more than the action of successive Governments. This year, notwithstanding the constant automatic increase in these Estimates, for education and other services, over which the Departments have no control at all, the amount asked for—namely, £17,931,000, is only £104,000 in excess of that expended in the year 1886–7. And here I wish to say that to a large extent the smallness of this increase in the prospective Estimates of this year is due to my hon. Friend the Secretary to the Treasury (Mr. Jackson), who has been through these Estimates with the greatest care, and who has subjected them to as rigid an examination as they have ever been subjected to before. Now, let us look back to the first year of the new system,

  1427
  established under the Exchequer and Audit Act. In the year 1868–9—that is to say, not 20 years ago—the Estimates for the Civil Service were £9,173,000. Now they are £17,931,000, or an increase of £8,758,000. You must deduct some items owing to changes of account; but there is a genuine increase remaining of £8,079,000, or 88 per cent. The first impression of the Committee may be—what extravagance has been committed by successive Governments in this respect; but I would call their most particular attention to the origin of that increase, and to the parties who are really responsible for it. It is not due to the fact that the business of the State has been conducted in a more costly manner, but that new functions are constantly being forced upon the State, and that new services are being demanded of it. The voice of Parliament, acting under the pressure of public opinion, has been constantly imposing new duties upon the State, and compelling it to bear, in whole or in part, the burden of work that has hitherto fallen on local authorities or private individuals, or that to a certain extent has not been performed at all. It is for Parliament in the future to decide to what extent it will continue that policy, but it is my duty, as the present guardian of the public purse, to call attention to the result of its legislation, so far as expenditure is concerned, and to show that that legislation—in many respects beneficent legislation as it may justly be called—has added 80 per cent in less than 20 years to the cost of the Civil Service.
  It is a remarkable fact that out of the increase of £8,079,000 no less a sum than £7,505,000 is due to the direct action of Parliament, and only £474,000 is an administrative increase. If we deduct from the latter sum an increase of £629,000 in the cost of Irish Police, there is an absolute saving during the period of more than £150,000 on what may be called the cost proper of the Public Departments. That the cost of administration is not higher than it was formerly is proved by this fact—that in 21 Departments there has been a total increase of £172,000, while in 18 other Departments there has been a decrease of £200,000, the net decrease being £28,000. Therefore, the growth of these Estimates is not due to the
  1428
  administrative Services, and the saddle should be put upon the right horse. It is of no use denouncing the costly system of Government from year to year, and in Department after Department, when fresh duties are constantly being thrust upon the State, frequently in opposition to the views of the existing Government of the day. The question is one of such importance that I will not apologize to the Committee for the details into which I am about to enter. Of the increase I have mentioned there was due to new services imposed upon the Government by Parliament £5,057,000, and to the automatic increase in services previously imposed £2,548,000. Classified according to its nature, £4,153,000 of the increase was for Educational Services, and I would call the attention of the right hon. Gentleman the Member for Sheffield (Mr. Mundella) to that fact. This includes not only education, but the surroundings of education, such as the Science and Art Department at Kensington. Then there has gone in relief of local taxation £2,548,000, and for Miscellaneous Services, consisting chiefly of new forms of State control, £612,000. Education includes primary education in Great Britain, Irish industrial schools, reformatories, Science and Art, Welsh Colleges, & c. Relief of local taxation includes police, pauper lunatics, roads, prisons, & c. Miscellaneous Services include mines and factory inspection, fishery inspection, Irish Land Commission, Crofters Commission, Wrecks Commission, registrars of friendly societies, registrars in bankruptcy, surveys of the United Kingdom, and a number of other items. I am not saying that every one of those Services is not a valuable service, but I am only reminding you that they are now performed by the State, while previously they were performed in a large measure by local bodies or private individuals, or were not performed at all, and that it is due to the action of Parliament that the State has now undertaken them. And even at the present moment, when our finances are not in that entirely satisfactory position which some people believe, there is not a single object in which hon. Members take an interest as to which they are not urging on the Chancellor of the Exchequer their claims for his support. Persons interested in Art want

  1429
  grants to be made to the National Gallery, or money to be given for the purchase of pictures or other objects which may be for sale in the market. One hon. Gentleman is pressing me to purchase a valuable collection of coins. My right hon. Friend (Mr. Mundella) is going to press me heavily for technical schools and University Colleges, and I am also pressed for Colonial defence and other matters. I hope I have succeeded in placing before the Committee the growing nature of the Civil Service expenditure quite apart from any questions about the Army and Navy, which are the Departments which generally occupy the attention of the House.
  I think I have shown the Committee that the Expenditure of the country is—I may say at least—very elastic, that its growth is certainly large and automatic, and that, besides the automatic growth, there is an artificial growth fostered by the public generally. I wish I could turn from the Expenditure side, which I have characterized in these terms, to the Revenue side, and say that there, too, we have got the necessary elasticity which would enable us from year to year to meet easily the extra pressure and to make head against these increasing charges. But that, unhappily, is not so. On the side of Revenue I would wish to call the most serious attention of the Committee to some important facts. I have made a calculation with respect to the progress of the produce of the taxes under the main heads of Customs, Excise, Stamps, and House Duty. I will deal with Income Tax separately. That fluctuates to such an extent, according to the number of pennies imposed, that it is not a fit subject to be included in my present comparison. I have started with the produce of these taxes in 1859–60 and bring the calculation down to the past year, taking periods of five years up to 1884–5, and then taking 1885–6 and 1886–7 separately. I am going to state what the same taxes have yielded at different times in order to show whether there is that elasticity in the Revenue which we might have hoped for and to which we used to be accustomed. To make the comparison correct, the net taxes imposed in each period have been added, and the net taxes reduced hare been deducted. In the first period of five years the produce of these taxes increased 10·8 per cent; in the next
  1430
  period of five years 9·9 per cent. Then we come to the flourishing period between 1870 and 1875, when the increase in the produce of the same taxes was 24·2 per cent. During the next period, from 1875 to 1880, there was no increase at all, but a decrease of 2·9; but in the next quinquennial period, from 1880 to 1885, there was an increase of 5·8 per cent. In 1885–6 there was a decrease of 3·7 per cent; while in the past year there was an increase of 0·8,, or less than 1 per cent.
  I do not know whether the Committee grasp at once the full significance of those figures. They show that in the earlier quinquennial periods the produce of the taxes was developing very much faster than the growth of the population, whereas during the latter periods the produce of the taxes was scarcely increasing at all. The calculation I have made does not take into account the increase of the population. If we look to the best of those periods, the period from 1870 to 1875, the increase was, as I have said, 24 per cent, while the population increased 5 per cent. Therefore, the rate of increase in the produce of the taxes was nearly five times as great as that of the population. But in the last year the increase was not quite in proportion to the increase in the population, and in the year before there was a large decrease as compared with the increase of population.
  MR. MUNDELLA: Alcohol will account for it.
  MR. GOSCHEN: Well, alcohol will account for a good deal of it. That is; a point to which I was about to call attention. But while we have lost a great deal on alcohol we have not gained sufficiently upon other articles to make up for the loss, partly because the other articles subject to taxation are now so few, and partly from other causes, I am not looking at it now from the point of view of the consuming power of the country, but simply from the fiscal point of view. I trust that the Committee follows me. Now, the amount of duty on alcoholic liquors was, in 1876, over £31,000,000; in 1886 it was under £27,000,000, a fall of more than £4,000,000, due in great part—I trust by far the greatest part—to the increase of temperance. Now, in former times, when there were a large number of articles

  1431
  subject to duty, it was generally expected that when there was a falling-off in one branch of Revenue the loss would be recouped under other heads. But now the articles on which duty is levied are so few that, when you lose this great revenue on alcoholic drinks, you have nothing to fall back upon but the Tea Duty, the Tobacco Duty, and the small duties upon coffee and dried fruits. Let me ask the Committee to consider the props upon which our taxation rests. The basis of our taxation is extremely narrow, and it is incumbent upon us, therefore, to examine both the strength of those great props on which the Revenue rests, and also the forces on the side of Expenditure which may be brought against those props. It is not any diminution of the power of consumption on the part of the people, but it is the diminution of the number of taxed articles, which brings about these striking results to which I have alluded. While the revenue from alcohol has fallen off by more than £4,000,000, the revenue from tea, tobacco, coffee, and dried fruits has only produced an increase of little more than £2,000,000. In 1876 alcoholic liquors brought in £31,000,000, and all other consumable articles £12,000,000; while in 1886 liquors brought in £27,000,000, and everything else £14,000,000, making a total of only £41,000,000, as compared with £43,000,000 in 1876. 'That is, after 10 years a diminution of £2,000,000, and that with an increase of 10 per cent in the population. Had the population continued to consume dutiable articles at the same rate as it did 10 years ago, the Revenue at this moment ought to be £48,000,000, whereas it is only £41,000,000. That shows the weakness of our position if we intend to rely in the main—I will not examine at this moment whether we ought so to rely—upon taxes on articles of consumption.
  I do not wish, in the slightest degree, to rest an argument upon the cost of the breakfast table as it is now compared with what it was 10 or 20 years ago. But it is an interesting fact, which I may mention by way of digression, that the fall in the prices of tea and sugar has been greater than would have been the effect of the total repeal of the duties upon those articles in 1866, and that, at the present time, a cheaper breakfast can be secured with a sixpenny duty on
  1432
  tea than could have been obtained in 1866 had the duties upon tea and sugar been entirely repealed. The fall in the prices of tea and sugar has been so great that, whereas in 1866 a pound of tea and a pound of sugar—I am taking the average wholesale prices—cost 2s. 6d., including the duties, and would have cost 1s. 10½d. without the duties, and whereas in 1876 they cost 2s. l¾d., including the duty on tea, and would have cost ls. 7¾d. without that duty, in 1886 their cost is only 1s. 7½d., or 3d. less than they would have cost in 1866 with all the duties taken off.
  I have lingered over these matters in order to prove that from a fiscal point of view the revenue from consumable articles is not in what one would call a satisfactory or an elastic condition. But I do not attribute that fact to the diminished consuming power of the people, but rather to a change in the habits of the working classes. But the fact remains that we have, as compared with 10 years ago, a declining Revenue, and one which, on the present basis, must continue to decline as far as consumable articles are concerned. I must now ask the Committee to turn from these duties which affect the mass of the population to those which affect the well-to-do classes. Let me see whether, in this higher region of prosperity, we can make up for the want of elasticity we find to prevail in the region below. Passenger Duty has decreased from £800,000 to £300,000. But there have been large exemptions in respect of that duty—the exemption of third-class passengers above all—which account for the falling-off in the amount of its produce. The revenue from licences remains nearly stationary, being about £3,500,000; but there is one particular portion of it to which I would direct attention—namely, the licences on the luxuries of the rich—which during the last 10 years have shown a decided and continuous decline. On male servants the amount of licence duty has decreased between 1877 and 1886 from about £167,000 to £137,000. On armorial bearings there has been a diminution from £82,000 to £77,000, and on carriage licences there has been a decrease from £555,000 to £545,000. That is precisely what we should expect would occur during a period of commercial and agricultural depres-

  1433
  sion such as has existed during the last few years, and which has affected the well-to-do classes, and to a certain extent curtailed their luxuries. I will now turn to a more interesting item of the Revenue—I mean the Income Tax. The produce of the Income Tax per penny has increased very slowly during this period, it having fluctuated between £1,850,000 and £2,000,000. But while the total produce per penny has undergone little change, there has been a great change in the produce of the different kinds of property upon which Income Tax is levied. The assessment of lands under Schedule A was £69,000,000 in 1876–7, and £63,000,000 in 1885–6. Houses, on the other hand, which are also assessed under Schedule A, rose in the same period from £103,000,000 to £131,000,000. Under Schedule B, which includes only farming profits, there has been a great falling off. The produce of Schedule B per penny was £74,000 in 1875–6, and only £52,000 in 1885–6. Last year it fell to £47,000 per penny, a fall of 36 per cent in 11 years. That is a fact to which I would call particular attention. What I wish to press upon the Committee is to avoid the mistake of looking at the total of the Income Tax assessments without examining the items. With regard to Schedule D, which is the great stand-by of the Revenue, and the Schedule upon which we used to expect the greatest increase, and by means of which former Chancellors of the Exchequer have been able to treat us to pleasant surprises—Schedule D, containing as it does the profits of trade and business—in 1869 the assessment was £161,000,000, while in 1876 it was £242,000,000, being a jump of £80,000,000 in seven years. But from 1876 to 1886 it only rose from £242,000,000 to £247,000,000, being an increase of only £5,000,000 in 10 years. I wish the Committee to grasp the full significance of these figures. While in the earlier period there was this gigantic increase in the Revenue of the country the turn came in 1876, and since then there has been only an aggregate increase of £5,000,000 in 10 years. I hope the Committee are following me in the line of argument I am pursuing with reference to the elasticity of the Revenue, as it will enable us to see how far we may count upon that elasticity in future.
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  I now approach a point which I think will be of some considerable interest to the Committee—namely, the distribution of wealth as shown by the produce of Schedule D, because there we arrive at some extraordinary results. In order to test the matter I will take a particular and important district in the City of London, where the assessment under Schedule D is between £16,000,000 and £17,000,000. The gross assessment in respect of individual profits from trades and professions in that district declined from £7,050,000 in 1876 to £6,150,000 in 1886; but, meanwhile, the profits of Public Companies increased from £7,200,000 in 1876 to £10,700,000 in 1886. That, so far, is a circumstance very notable from a social and economic point of view. The creation of large Companies such as those of Guinness and Allsopp secures, at the moment, to the owners the accumulation of past years; but in future the profits of those large undertakings will be distributed over a much wider area, and a much greater part of the population will share in industrial, commercial, and banking undertakings. This is a change which I hail with considerable satisfaction. My inference as to the greater distribution of wealth is singularly borne out by the analysis of the individual profits to which I have just alluded. In the district referred to, the profits of persons whoso business income was less than £1,000 per annum increased from £1,540,000 to £1,663,000 between 1876 and 1886, being an increase of 7 per cent; while those of persons having a business income of between £1,000 and £5,000 fell from £1,580,000 to £1,363,000, being a fall of about 14 per cent; and business incomes over £5,000 fell from £3,925,000 to £3,120,000, or a fall of 21 per cent. So that there is this remarkable fact—that below £1,000 the incomes have increased 7 per cent; between £1,000 and £5,000 they have decreased 14 per cent; and on incomes of £5,000 and upwards there is a decrease of 21 per cent. That brings us to the point at which I was driving before—namely, that there is more distribution of wealth, and it is perhaps what I may call the distributing classes whose incomes are below £1,000 who have suffered least from the general depression. The commercial depression

  1435
  has struck at the top; it has struck the great manufacturers; it has also affected the wage-earning class to a certain extent, though they have been largely indemnified by the fall of prices; at has struck at the agricultural classes and the farmers; but the middleman has not suffered to the same extent.
  Now, I shall soon be finished with this review of the sources of revenue; still, it is a matter of such importance to the community at large, that I ought not to apologize for lingering so long upon it. To recapitulate, the Committee will remember the position of the consumable articles; they will remember the position of the luxuries of the rich, and what I have said with regard to the slow growth of the Income Tax; and now there only remains the great item of revenue from stamps. And here one would have expected that the progress of business would result in considerable progress in the Stamp Duties. But that is not the case. More business is clearly done, as the Clearing House Returns show; but I am sorry to say that there has been more and more cleverness in evading the Stamp Duties on transfers; and though there is some increase in this Department, I consider the whole region of the Stamp Duties not to be in a satisfactory position. Stamps fall under two great heads—Death Duties, and the duties on deeds, transfers, and conveyances. With regard to the Death Duties, there has been an increase, and a decided increase; though that has been due, as my right hon. Friend opposite is aware, in great part to legislation. But with regard to other stamps there is little change; and there is one curious reason for this that I may mention. All bills, as hon. Members are aware, are taxed ad valorem with a rather high tax; but the telegraph has introduced a system of making telegraphic transfers, and now when a remittance has got to be made of £100,000 from New York to London, instead of sending it in bills, which would have to pay a handsome contribution to the Exchequer, men simply send a telegram, saying—"Pay to So-and-so, on such a day, £100,000," and the operation escapes altogether. The result has been a considerable loss; and the ingenuity of Chancellors of the Exchequer ought to be directed, whenever they can find time, to a revision of the whole theory of the Stamp Duties,
  1436
  in order to see how far that valuable resource of the revenue may be made more available. So here, again, I feel obliged to repeat what I have said before, that the Revenue has not been an elastic one, and in no direction of all the sources of revenue which I have examined have I seen that hopeful progress which we might have wished for and expected.
  I hope and believe, at the present time, that there is a change—I will not call it considerable—for the better in the aspect of business generally. Whether it extends to agriculture is a matter upon which many hon. Members of this House are much better able to form an opinion than I am. I believe they are not sanguine as to that; but there is an impression that there will be an increase in the commercial prosperity of the country. If I might use an agricultural simile in regard to it, I should say that we may consider that the soil is in a much better condition than it has been in the commercial and industrial world, and more likely to yield a good harvest. There is a better spirit abroad, a spirit of more hopefulness, more confidence, and what business is being done is of a sounder kind than what we have sometimes known. But I do not know to what extent these better auguries may be realized in the present financial year, and it has always been laid down by the right hon. Member for Mid Lothian (Mr. W. E. Gladstone) that it takes some time before an increase in the general prosperity of the country really tells in the way of an increase of the Revenue.
  Now, having completed my story with regard to the general aspect of the Revenue and the Expenditure in its broadest features, without reference to any particular year, I turn to that which may be of more immediate interest to the Committee—namely, to the Estimates of the coming year. The Committee will bear in mind that, in framing these Estimates, I have had in my mind many of those general considerations which I have thought it right to submit to the House. If hon. Members will turn to page 3 of the printed Statement, they will find the figures I am about to give. Customs, I estimate at £20,200,000, or £45,000 more than the past year; Excise, £25,292,000; Stamps, £11,658,000; Laud Tax, £1.065,000; House Duty,

  1437
  £1,920,000; Property and Income Tax, £15,900,000, the same as the Exchequer receipts of last year—giving a total of Taxes of £76,035,000, or £80,000 less than last year. The Post Office I estimate at £8,600,000; Telegraphs, £1,950,000; Crown Lands, £370,000; Interest on Advances, £1,200,000; Miscellaneous, £3,000,000; making a total produce of Non-Tax Revenue of £15,120,000—the grand total Revenue thus being £91,155,000, as against £90,772,000 in the last year, or an increase of £383,000. The Committee will observe that there is an actual decrease in the produce of taxes in the coming year, which is, however, rather more than made up for by an increase in the Non-Tax Revenue Customs we put up £45,000 above the Exchequer Receipts of last year; I allow for an increase on tea and tobacco of £85,000 each, but for a decline in foreign spirits of £16,000, and in wine of £102,000. I must point to a curious circumstance connected with this—that in making these Estimates we have not failed to take into account the fact that the coming year is Leap Year, and, therefore, there will be one extra day on which to consume tea, tobacco, and spirits; and, considering the large number of millions over which our Revenue extends, that is not an unimportant point. It is one, however, which is duly remembered in the Estimates. Now, I do not think I need go into further detail with regard to Customs. Excise I put up £42,000, but it is chiefly owing to an increase of £130,000 in beer. I take the decrease on British spirits for the coming year at £52,000. The increase in the consumption of beer will be owing to one or two circumstances—in the first place, the extraordinarily cheap price of hops, a factor which always affects more or less the production of beer; and also to the fact that the recent prosecutions of publicans resulting in the discovery of a considerable adulteration of beer by the use of water have increased and are increasing the production of beer proper, to the exclusion of the water which is mixed with it. And thus, while the Excise officers have been rendering to the drinkers of beer a real service, giving them beer instead of beer and water, they have at the same time done a good stroke of business for the Revenue by substituting
  1438
  an article which is taxed—namely, beer, for an article which is not taxed—namely, water. It appears that there is an increase in the consumption of beer which has been noticed during the last three or four months, and also, taking into consideration the fact that there is an additional day next year, we consider ourselves justified in reckoning on this increase; but in spirits, again, we should do wrong unless we allowed for a decrease, and we put that, as I have said, at £52,000. The Income Tax we have placed at the old figure of £15,900,000—the figure which represents the Exchequer receipts of the past year; but my right hon. Friend the Member for Derby will be especially interested to know that the actual receipts of the Income Tax for 1886–7 have been £16,000,000, and a few thousands more. Now, it will be asked why, with prospects of improved business, with better hopes for the future, do you put the Income Tax as low as £15,900,000? Why do I put the tax so low? Because, under Schedule D, which contributes so great a share of this tax, and which is taken on an average of throe years, we get a worse three years on which to average the profits than in the last year. The year 1883 was a bettor year than 1886. In the past year the profits were estimated on 1883–4–5. In the present year the profits will be estimated on 1884–5–6; and, the profits of those years being less than the profits of the former three years, owing to the substitution of 1886 for l883, we are not justified in expecting a material or any increase in the Income Tax, especially if we look to the fact that Schedules D and C must make up for what may possibly be a progressive diminution under Schedule A as regards land, and under Schedule B for farming profits. Stamps I put down by £170,000, because that process of collecting arrears to which I have called attention has now almost come to its natural end; and also the effect of the exemption of lineals from the Legacy Duty will be felt in an increasing degree; and also the fall in the value of land will continue to affect Succession Duty. I have shown that the Revenue from taxes will be £80,000 less than in the year before; but the Revenue which is thus reduced in respect of taxes ia raised by the Non-Tax Revenue. In the Post

  1439
  Office, the Telegraphs, and Miscellaneous Receipts, there is an increase of £462,000, giving me a total increase of £382,000 over the Exchequer Receipts of last year.
  I have now shown what I estimate my Revenue for the coming year to be. If hon. Members will take the Expenditure for the coming year, we shall arrive at some interesting figures. I estimate the permanent charge on the Debt at £28,036,917; the interest on the Sinking Fund at £641,000; interest on Suez Canal Exchequer Bonds £200,000; and other charges on the Consolidated Fund at £1,714,000. Those charges in the Exchequer issues of the previous year were £29,701,914, which shows an increase of charge in this year of £890,000, the total for 1887–8 being £30,591,917, and the total of last year £29,701,914. This is mainly due to the revival, by law, of the two Sinking Funds which were suspended by the right hon. Member for Derby. One of these funds amounted to upwards of £600,000, and the other to upwards of £200,000. They increase the charge on the total Consolidated Fund by that sum, and I have to allow for that in my Expenditure. To come to the Supply Services, the Army is £18,393,900, as compared with £18,429,272; for the Navy, the Estimate is £12,478,800, as against £13,265,401—a decrease, I am happy to say, of £788,000. The Civil Services are estimated at £17,931,508, as against £17,826,454; Customs and Inland Revenue, £2,715,727, as against £2,676,918; Post Office, £5,420,770, as against £5,436,893; Telegraph Service, £1,950,248,as against £1,935,000; and Packet Service, £699,341, as against £724,900—the total being £59,588,294, as against £60,294,838, a decrease of £707,000 on the total Supply Services. The total Expenditure last year was £89,996,752, and the estimated Expenditure for this year is £90,180,000, being an increase of £183,000.
  I will now turn back to the Revenue. The total Revenue I estimated at £91,155,000, and the total Expenditure is £90,180,000, giving me a surplus of £975,000.
  I apologize to the Committee for the length at which I have so far detained them; but I must ask thorn still further to be good enough to lend me
  1440
  their attention, as I have yet several matters of considerable importance to deal with. In fact, I am coming now to what may be considered the most important part of my Statement. It will be asked, having this surplus, what I intend to do with it? The first thing I intend to do with it, if I can persuade the Committee to do so, is to increase it by a change in the Stamp Duties, which I will explain to them, and which will give me an additional Revenue of £100,000. It is rather an intricate subject; but I think I shall be able to make it clear. The Transfer Duty on property gene-rally is 10s. per £100, and the Transfer Duty on mortgages and debts is about 6d. per £100. The ordinary stock and shares and preference shares of railways have been properly treated as property, and they have the privilege of paying that higher Transfer Duty of 10 s. which attaches to property. It would appear as if the Legislature had intended that borrowing should be made easier than buying, because it has placed such a small duty on the borrowing process, and a heavy duty on the transfer of property. If that is so, nothing which is real and substantial property ought to escape; and if there are any marketable securities which, under the guise of loans, are really property, I maintain that they ought to be brought within the net, and pay the 10 s. per £100 which is paid by other kinds of stock. Now, Debenture Stock is an item which has hitherto escaped, as I understand, on this principle—that debentures were regarded as instruments of credit and not as capital, and, perhaps, fairly so, to a certain extent. Debentures expire after a short period, and represent the borrowing operations of a Company. But when they are funded as Debenture Stock they are as much permanent property as any other part of a Company's capital, and Debenture Stock is as good, or better, than Ordinary or Preference Stock, or any other form of marketable security, and therefore I do not see that it should escape the ordinary rate of duty on the transfer of property. It had one claim for exemption in times past, which was that instead of being taxed on transfer, like ordinary Stock, Debenture Stock paid a small initial duty of 2s. 6d. at its birth, and that initial duty emancipated it from the heavy Transfer Duties after-

  1441
  wards. But debentures, by a later Act, were charged 2s. 6d. per cent on transfer, and that is the tax which I now propose to raise to 10s., thus placing Debenture Stock on the same footing as ordinary and Preference Stock.
  A further change in the law, which I intend to ask the Committee to accept, is to apply to the Stamp Duties on transfers a principle which has been extremely valuable in most forms of taxation—namely, to tax at the fountain head, rather than lower down, and to see whether we can collect in one sum, rather than to collect in a number of small sums. I propose, therefore, that a tax of 1s. per £100 of their total capital should be annually paid by all Companies, whose ordinary Stock now pays 10s. a £100 on transfer, which tax should clear those Companies which elect to submit to it, and emancipate all their capital stock from paying any transfer duty at all. We take it from the Companies, instead of the transferors. The Companies will be able, if they chose, to recoup themselves, by charging those who come to them with transfers with the identical fee now charged, so to speak, by the Government. They could secure themselves against loss in that way; but, whether they will do so or not, I cannot tell until the experiment has been tried. But we do not propose to make this compulsory on all Companies, because the proprietors of some of the Companies may claim that the transfers in their Stocks are so few that they would suffer grievous loss by the change. But in those Companies where transfers are frequently made, it is believed that it would be extremely popular that these transfers should be entirely exempt from the Stamp Duty, and, on the whole, I believe the change will be so popular, that it will be accepted by the great bulk of the Companies. The general effect of this change upon the Revenue would be that if transfers were conducted on the same scale as at present, there would neither be much loss nor much gain on either side; but I should not be doing my duty as Chancellor of the Exchequer if I did not take care that, if there were a gain one way or the other, that gain should be on the side of the Revenue. The duty of Is. per £100 on the property of the Companies will rather exceed the total amount which
  1442
  is now derived from transfers, thus leaving a margin even if Companies, in whose Stocks there are few transfers, should not adopt it. But I have taken valuable opinions on the subject, and, though I may be mistaken, I believe that the vast majority of Companies will themselves welcome the change, and that shareholders will find it to their interest to urge the acceptance of this composition. [Mr. MUNDELLA (Sheffield, Brightside): Is it optional?] Yes. We should much prefer to make it compulsory; but there would possibly be much opposition, on the part of some of the Companies, and therefore we propose, in the first place, to make it optional; but we think the convenience will be found to be so great that all the Companies will soon see that it is to their advantage to adopt this arrangement. [Mr. ISAACSON (Tower Hamlets, Stepney): Government Stock?] For Government Stock there is already a composition. Colonial and Government Stocks all stand at present under a separate arrangement, and the change does not apply to them, I should be glad, however, to make a further statement on this important matter at a later stage. Before leaving the subject of the Stamp Duties, I must say that I expect, from the changes proposed, an increase of over £100,000, which, however, will be reduced to £100,000 by a small remission of taxation in respect of policies of Marine Insurance, to which I shall presently refer.
  I have now to ask the Committee to follow me into a subject which is considerably more intricate than any of those on which I have been engaged, and if I fail to make myself clear I trust the Committee will not think it is due to any confusion in my own mind, but to the inherent difficulty of the question. I wish the Committee to leave for a moment this balance of £975,000, increased to £1,075,000 by the £100,000 of which I have spoken, and to accompany me for a few minutes into a different branch of the subject; but I hope we may come back to our balance, and with something satisfactory in our hands. I wish now to deal with a subject which ought to engage the most earnest attention of the Committee, and that is the subject of local loans and the use of the public credit, which from

  1443
  day to day is now extending in larger and larger measure, not, I think, without some risks to the Revenue, and not without possibly impairing ultimately the credit of the State. That for which I am most anxious is that the public should know precisely how it stands; that it should know what liabilities it has incurred, and how it has raised money to meet them; what is the revenue derived from the Local Authorities to whom the State has lent money, and what is the charge resting on the Exchequer for the money which has thus been raised. There have been in the present century over £100,000,000 found by the State for local loans in the United Kingdom. I shall presently state to the Committee how much of that sum has been paid off and how much has been lost—because there have been material losses on sums which have been lent—and how much remains outstanding. But first let me point out how the money has been raised for this purpose. A portion of it has been paid out of Exchequer balances, and that has vanished in our general finance. There is no notice taken in any of our records of expenditure with reference to these advances which have been made direct from the Exchequer in past times. Another portion of the money has been raised by Exchequer Bonds and Bills, and Treasury Bills. There is a further complication caused by the fact that, again, some of these securities have been funded. Another portion still has been provided by the National Debt Commissioners out of their Savings Banks moneys with which the Public Works Loan Commissioners have been put in funds—an operation which does not enter into the national accounts at all, only the surplus of interest being paid into the Exchequer. The result of this most confused and unsatisfactory state of things is that nobody can see at a glance how much money we really have contributed towards local loans, or what the charge on the Revenue is on account of those local loans. Hon. Members who are familiar with the accounts know that there is an item of about £960,000 in the Miscellaneous Revenue derived from interest on local loans. But that does not represent the whole interest on local loans, because a further sum is paid direct by the Public Works Loan Commissioners to the National Debt Commis-
  1444
  sioners; and it is only by very great trouble that you can bring the whole of the figures together and see precisely how the case stands.
  Again, this money has been lent out by different Bodies and in different ways. Some loans have been made by the Public Works Loan Commissioners in England, and others by the Commissioners of Public Works in Ireland, and by the Land Commissioners in Ireland. Now, what I venture to think is essential, especially in view of the growing character of these demands for local loans, is that a separate account altogether should be kept with regard to this kind of expenditure and revenue, and I propose to take it entirely out of the Budget, and to establish a separate account, with separate receipts and expenditure. The Committee will see that no one can estimate what our National Debt is if we do not know against how much of it there are sets-off on the other side. For instance, if we were to add to local loans £10,000,000, we might raise them by adding £10,000,000 to Consoles. That £10,000,000 would then enter into the body of our National Debt; and it might seem that we had increased the National Debt while we had not really increased it. We had been incurring a liability, but we had an asset on the other side. Therefore, by a somewhat complicated process, I want to clear the National Budget entirely from local loans, parting with the interest which is now paid to the National Exchequer, and, at the same time, relieving ourselves of so much of the Debt as is represented by existing and solvent local loans.
  Let me point out how, under the present system, local lotus are dealt with. It has been an economical system, but it appears to me to be essentially faulty in principle. Local loans run for 25. 30, and 40 years, and even longer. They are long loans, but we have been financing these local loans partly by the issue of Treasury Bills, repayable every three or six months. On the first aspect of the matter, we have, no doubt, raised this money on very economical terms. We have been borrowing to supply the funds for local loans at a rate as low as 2½ per cent; but who can guarantee that in the course of a year, or two years hence, when we have to renew these Treasury Bills, we may not have to pay a much higher rate of interest? We might have

  1445
  to pay 4 per cent, or oven more, in troublous times; and I hold that it is bad finance to borrow on Treasury Bills for three months or six months for what I may tall a permanent purpose. Therefore, I propose to discontinue the system of borrowing on Treasury Bills for local loan purposes, although I am not opposed to borrowing by those Bills for certain other purposes.
  The plan I have to propose I will now describe. The debt we have contracted in respect of local loans that are still in force now stands as follows:—£8,000,000 was raised by Exchequer Bonds, now funded and represented by Consoles, and these 2½ per cent Exchequer and Treasury Bills are outstanding to the extent of £6,400,000, making together £15,000,000. Then the National Debt Commissioners have £1,500,000 employed in the hands of the Public Works Loan Commissioners, to whom they have lent direct. That makes a total of £24,500,000. The remainder of £12,700,000 was advanced out of Exchequer balances, and brings up the total to £37,200,000. That is the amount of local loans which is now outstanding, after deducting the sums that have been lost and remitted, Now, what I propose to do is to create £37,200,000 of Local Loan Stock, which will represent the precise sum now outstanding and owing by the localities. On that £37,200,000 there will be interest to pay at 3 par cent, which will constitute a charge on the Local Loan Fund. On the other hand, there will be transferred to that fund the £960,000 now paid direct to the Exchequer, as well as the sum which is now paid over to the National Debt Commissioners by the Public Works Loan Commissioners, so that this new account will receive the whole revenue derived from the interest on local loans, and will be charged with the whole of the interest on the Local Loans Stock of £37,200,000.
  It will be of interest to the House and the country to know that there were advanced to the localities up to the 31st of March, 1887, £106,000,000. Of that sum, £5 7,200,000 have been repaid, the total sum unpaid being £48,800,000; and, £11,000,000 having been remitted, there remains the total outstanding sum of £37,200,000. [An hon. MEMBER: Is the £11,600,000 absolute loss?] Yes; the £11,600,000 is absolute loss. Now,
  1446
  of the amount remitted which represents absolute loss, about £7,000,000 is due to the Irish Famine; and with regard to that I say nothing, because that was a loan made by the nation with its eyes open, and under very peculiar circumstances. But I call the attention of the Committee to the remainder, which has been lost, because it is often argued that there is a post in the margin between the 3 per cent at which the State can borrow, and the 3¼ or 3¼ per cent paid by the Local Authorities. But you must establish a margin which will enable you to repay any losses which may occur. It may be said that there will be no losses, but in reply to that I point to the past, and say that the losses which remain are considerably and ought to be provided for in future arrangements. [Mr. MUNDELLA.: English losses?] I would ask not to be invited to discuss particulars now. My statement includes all losses—English losses, as well as Irish losses—but it would take me too far from the present point to go into the details. I hope, however, that my right hon. Friend, who has views on the Exchequer on some important points on which I am extremely apprehensive, does not imply that, the losses being Irish losses, there is no fear of loss on advances for English purposes. I do not know whether that is the meaning of my right lion. Friend; but, at all events, I say this—that as prudent lenders, when we do lend, we should do so with the idea that there is always the possibility of a loss, whatever may be the precautions we take to prevent it; and I hope, therefore, all those who are thoroughly interested in finance will do their best to insist that there shall be a margin, from which such losses may be made good. I have said that we are going to create £37,200,000 of Stock. As against this, I cancel £9,500,000 of the Bonds of the Public Works Loan Commissioners; I cancel £15,000,000 of existing 3 per cent Stock representing the Funded and Unfunded Debt now earmarked as Local Loans Debt, and which stands outside the permanent charge; and, besides that, I cancel a further amount of existing 3 per cent Stock—namely £12,700,000, which represents money lent directly from the Exchequer balances to the borrowing Authorities. The National Debt would have been

  1447
  £12,700,000 less if we had applied the balances as they were available for the reduction of the National Debt, instead of lending them out; and I am thus restoring, as it were, the position as it would have been if that money had not been so lent, by cancelling so much Funded Debt, while I create Local Loans Stock, on the other hand, to represent it.
  I have myself had so much trouble in thoroughly mastering the details of this complicated business that I feel that I cannot ask any Member of the Committee to grasp the whole of the case, from the necessarily imperfect explanations I am able to make in my present Statement. I trust, however, the Committee will take from me this—that we establish an entirely new Local Loans Budget, and on that Budget everyone will be able to see precisely how the case stands. There will be a margin on that Budget, because the cost of paying the interest on the £37,200,000 will be less than the revenue produced by the interest of local loans. But I wish to charge this Local Loan Budget with an annuity, which I believe will amount to about £150,000, to make good the £4,000,000 which we have been obliged to write off, or to meet any new losses which may occur. I am anxious that the Committee and the public should know and remember that there has been this loss, and that it should be marked in this way by a special item in the Budget each year. Then, as fresh local loans are made, they will be made either out of repayments on the existing loans, falling in from year to year, or by the creation not of further National Debt, but of fresh Local Loans Stock. The financial effect, so far as the National Budget is concerned, is this—On the one hand, the Exchequer will no longer receive the Revenue amounting to £960,000 in respect of interest on Local Loans; on the other hand, we shall have no longer to provide for the charge amounting to about £630,000 in connection with Debt created for Local Loan purposes. There will, therefore, be an increase in the net Debt charge of about £330,000.
  I have now to take the Committee into the very interesting subject of the charge for the National Debt. The Committee is aware of the circumstances under which the late Sir Stafford North-
  1448
  cote fixed the permanent charge for that Debt at £28,000,000, which has been increased to £28,037,000 by subsequent operations. The Committee is also aware that a portion of that has been suspended several times under the stress of war operations. Even during the last year the right hon. Gentleman the Member for Derby (Sir William Harcourt) felt compelled to suspend the Sinking Fund to the extent of about £800,000. I wish to examine this matter in a comprehensive spirit; but I fear that I have nearly exhausted my time. I have had passing through my mind various circumstances which bear on the point, whether that sum of £28,000,000 has been rightly fixed; and when I say that, I do so with the full sense of the responsibility which I am incurring when I raise the question. The Committee will have noticed the enormous falling off, I will not say in one year or five years, but in a course of years, in the elasticity of the Revenue. The Committee will be aware that the growth of the Revenue which was expected has been absent, and that it does not now grow in proportion to the increase of the population. Does the Committee remember that when the charge of £28,000,000 was fixed the Income Tax stood at 2d. in the pound? It stands now at 8d. This is a notable point. At the end of the year 1874 · 5 the total charge on taxes was £62,633,000; the net Debt charge was £26,495,000; so that the total charge on taxes for the whole of the other Services, exclusive of the Debt Charge, was £36,138,000. Last year.be total charge on taxes was £75,340,000, the net Debt charge being £26,596,000, even after the Sinking Fund had been suspended, otherwise it would have been greater. The total left for other purposes than the National Debt was £48,744,000, as compared with £36,138,000. We are paying, exclusive of Debt charge, £12,600,000 more in taxes than at the time when the late Sir Stafford Northcote made this proposal. Now, the late Sir Stafford Northcote anticipated that there would be an ordinary growth of Revenue, and these are his words—
  "I have no doubt, under ordinary circumstances, with the ordinary growth of Revenue, that we shall he very easily able, without any injustice to the country, to bring up the charge for Debt to £28,000,000."

  1449
  ["Hear, hear!"] Yes; but "easily." To be able to do so, we have been obliged to increase the Income Tax to 8d. Sir Stafford Northcote went on to say—
  "But, if this should materially alter, it would he only right to take steps to remove what we now put on."
  What I want the Committee to examine is, whether the circumstances have materially altered from that time when Sir Stafford Northcote proposed his Budget. When he proposed to increase the amount to £28,000,000—which he did not do at once, but spread over two or three years—we were at the end of a period of great prosperity. There was then, in the mind of the Chancellor of the Exchequer and in the minds of us all, the knowledge that the Revenue had gone on increasing by leaps and bounds. Now, let the Committee return to the figures I supplied in the earlier portion of my Statement, when I showed how there had been, in the quinquennial period preceding the time at which the £28,000,000 was fixed, an increase in the produce of taxes other than the Income Tax, amounting to 24 per cent, and that afterwards there was a decrease amounting to 3 per cent. It appears to me that the situation now is totally different; and I say, in the interest of the steady and efficient repayment of the National Debt, that it would be unwise if we were to strain our bow too tight, and if, in endeavouring to defend the £28,000,000, we were to insist on maintaining any kind of tax permanently at an unreasonable height. What has been our course during the last few years? It has not been satisfactory. The Sinking Funds have had to be suspended, and they will be suspended again, so surely as anything occurs which strains in the slightest degree the resources of the country. I admit the plausibility of the argument, that it is better you should suspend the Sinking Fund when there is distress, rather than that you should impose additional taxation. But I am not satisfied that the argument is sound. I think it is a most wholesome restraint upon any expeditions or costly undertakings that it should be necessary to impose taxation, and that you should not be able to cut the knot simply by suspending the Sinking Fund. I admit that the Sinking Fund is an admirable institution, and I should be
  1450
  sorry to tamper with it to any great extent. But, looking to the present situation, and at the fact that, practically, the whole burden of paying off the Debt has to be borne by the payers of Income Tax, I am disposed to think that in the interests of sound finance, and with the view of keeping up steady repayments, it is advisable to reconsider our position. I have shown the Committee that there is danger in our present financial position, because, while there is an increasing temptation to Expenditure, there is no increasing Revenue to rely upon. I do not know whether new sources of Revenue are opening out to the minds of my right hon. Friends; but unless we can discover new sources of Revenue, they will see that the retention of the present Debt charge must be a matter of increasing difficulty. For my own part, I see fresh dangers threatening the payers of direct taxation in the future. It has been a question continually-argued in this House whether the contribution which is made by personal property to the rates is insufficient. I have often argued to the contrary my-self; but the majority of the House have decided over and over again that, in some form or other, personal property will have to contribute to local taxation. With this prospect before us, is it reasonable to maintain the Income Tax, in a time of peace, at four times the figure at which it stood when the Debt charge was fixed at its present amount? Or is it reasonable, to take another point, that we should so hamper ourselves with a heavy Debt charge, that we have never anything to spare for reforms of taxation, involving an immediate loss, but which may promise great ultimate advantage to the Revenue?
  I do not suggest any large or heroic measure in connection with this matter, but I do intend to submit a proposal to the Committee. I am sorry that I shall offend against the paternal affections of my right hon. Friend the Member for South Edinburgh (Mr. Childers), because the way I propose to reduce the charge from £28,000,000 is by dealing with the Rolling Annuities which he established. These Rolling Annuities are very complicated, and they do great credit to the ingenuity of my right hon. Friend. There are three Annuities, each amounting to £1,200,000; one for five, one for 10, and one for 15 years. They are

  1451
  called Rolling Annuities because, when they cease, they are re-enacted in a different form. That is to say, as each Annuity expires a further amount of Stock is to be cancelled in exchange for a new Terminable Annuity of the same amount as that then expiring. I propose to simplify these three Rolling Annuities, and to roll them up into one Annuity of the sum of £1,930,000, in lieu of the present Rolling Annuities amounting to £3,600,000. The permanent charge of Debt will be fixed at £26,000,000, as against the present permanent charge of £28,037,000. By this means the apparent relief is £2,037,000; but the Committee will remember that, under the new Local Loans Debt arrangement, the Exchequer will lose a net round receipt of £333,000. Therefore, the real relief will be £1,701,000. The provision which the proposed permanent charge of £26,000,000 contains for reducing Debt is, of course, exclusive of the operation of the old Sinking Fund. I will not trouble the Committee with any further details on that point, except to show how this will work in the future. I think the Committee will see that the amount of Debt which will still be annually redeemed will be very large indeed. It may be remembered that the right hon. Gentleman the Member for Mid Lothian (Mr. Gladstone) made a proposal in 1881, which, however, he did not proceed with, under which £60,000,000 of Stock would have been redeemed by 1904 by means of Terminable Annuities. Under my proposal we shall by that time have redeemed £70,000,000 of Stock by means of Terminable Annuities. The amount devoted to the repayment of Debt inside the charge of £26,000,000 will, in the present year, be about £5,000,000; and I have made a calculation that if the charge of £26,000,000 be steadily persevered with, we shall redeem £600.000,000 at par in about 52 years, and £700,000,000 in 56 years.
  I submit these considerations to the Committee with the observation that I have spent so much time upon the figures themselves that I have not been able sufficiently to elaborate the arguments just addressed to the House. I rest my proposal, however, upon this broad ground—that the situation is totally different from what it was when the present arrangements were made, and that Sir
  1452
  Stafford North cote himself contemplated that if the circumstances altered it would be necessary to alter his system; and I lay great stress upon the fact that, unless we put the matter into what I may call an endurable form, you will risk far larger inroads upon the Sinking Fund than that which I now propose. I remind the Committee of the great difficulty which existed when taxation had to be imposed to meet special charges not long ago. An additional 2d. was put upon the payers of Income Tax, and proposals were made to tax some consumable articles. Those proposals were rejected by the House, which had to fall back on the simple process of increasing the Income Tax by 2d., and of suspending the Sinking Fund. The Sinking Fund, I maintain, is not in a strong position; it has been proved to be in an unsafe position while it continues as heavy as it is at present.
  I now go back to the Surplus of which I have spoken—namely, £1,075,000, and to this must be added the relief given by the £1,704,000 taken from the Debt charge. I have, therefore, a sum to deal with of £2,779,000. The Committee will have anticipated, from the arguments which I have used, that a reduction in the Income Tax would naturally follow, and I propose to reduce the Income Tax by Id. in the pound, which involves a loss of £1,560,000 in the present year, because in these cases you do not have the whole loss in the first year. Before I pass from the subject of the Income Tax there is another change which I propose to make, which will not lead to much loss of Revenue, and the small probable loss from which is included in the £1,560,000. It is a relief that, to my mind, is an act of justice, and which will be given to a rather suffering portion of the community. I wish to renew a proposal which was made by the right hon. Gentleman the Member for South Edinburgh—namely, to give farmers the option of being taxed on their actual profits under Schedulde D, rather than on the arbitrary basis adopted in Schedule B. Farmers and occupiers of land, generally, are taxed on the half of their rent in England, and on one-third of their rent in Ireland and Scotland. the question is, have farmers earned half their rent during late times? I know that in many cases farmers have

  1453
  been paying Income Tax on a larger amount than they have actually earned. I judge from the fact that out of a total of upwards of 400,000 assessments, there have only been 10,000 cases of appeal against what appears, on the face of it, to be too high a charge. In many parts of England the profits have, as a rule, been a great deal less than half the rent. When the proposal was made before, it was suggested that the farmers did not keep accounts, and that they would not be able to make statements of their profits, and that they would, therefore object to be charged under Schedule D. To get over that difficulty I propose, for the present, to maintain Schedule B, so that they may still be charged under that Schedule if they prefer it; but if they wish it, they can be charged under Schedule D. The exercise of this option will obviate the necessity of a local appeal, which involves proceedings in the localities to which objection is taken, and will give the farmers an opportunity of appealing to the Special Commissioners in the same manner as other persons who are assessable under Schedule D.
  This question of the farmers reminds me of the ratepayers and of the promises which have been often held out, and the plans which have been continually entertained, with regard to large reforms in our system of local finance. The Committee is aware that the President of the Local Government Board (Mr. Ritchie) has a large measure in preparation which deals both with the subject of local authorities and that of local finances. The Government has recognized, and previous Governments have recognized, that it is their duty to go forward in this matter, and to recast local finance to a very considerable extent. But the difficulty has always been this—and it is a difficulty which remains at this moment—that you cannot begin your financial reform until you have constituted your new authorities. Nor will you be able to have half the interest taken in the Bill and half the steam-power, so to speak, necessary to carry it, if all the financial reforms are made in the first instance. Now, Her Majesty's Government stand by that doctrine as their Predecessors have stood by it, and they hope for the assistance of Parliament in order that they may have the earliest possible opportunity of pro-
  1454
  ducing their plan. Hon. Gentleman will ask, perhaps, whether something might not be done in the interval—whether the principle of handing over taxes to Local Authorities, which has been the favourite scheme of Local Government reformers, should not at least be initiated? It may be asked, for instance, whether the Carriage Tax cannot be handed over at once to the localities? Well, I am prepared to hand over an amount equivalent to the Carriage Tax to the Local Authorities. The contribution which is now made in relief of main roads and turnpikes in England and Scotland, is £280,000. I propose to double that contribution, and give them £560,000, which is about the amount of the Carriage Tax, until such time as we can hand over the Carriage Tax itself.
  Looking to the long-enduring patience of those who have been promised relief, and who, through the accidents of legislation, have had that relief delayed, and may still have it delayed for another year, I think some concession should be made at once. It should be distinctly understood that this is not a permanent arrangement, and that it is only in anticipation of the transfer of the Carriage Tax in future; and it is in view of the transference of that tax in its entirety at some early day to the Local Authorities, that I have been unable to revise the whole of it in the manner which was pressed upon me by a very influential deputation. To use a forcible expression, such deputations may "have it out" with the Local Authorities when the Carriage Tax is transferred.
  Hon. Members from Ireland will possibly be wondering whether, if England and Scotland get a been which amounts to £245,000 for England and £35,000 for Scotland, Ireland is to be forgotten entirely. Ireland contributes nothing towards the Carriage Tax, and, therefore, so far as the transfer of the tax to Local Authorities for main roads and turnpikes is concerned, Ireland would have no claim. At the same time—and we have had debates on this subject—I do not consider that Ireland is paying too little to the Imperial Revenue as it stands at the present time. I demur to the statement that Ireland is paying too little as I do to the statement that she is paying too much. In making these concessions to England and Scotland, I do not wish to change the present balance

  1455
  as between Ireland and Great Britain; and, therefore, I propose to reserve £50,000 for Ireland, for what I call purposes analogous to this contribution on account of main roads in England and Scotland. I am not disposed to think that this should be given in aid of the county cess, as the relief in England is given to the county rate; because the amount is so small that it would not be an appreciable benefit to the taxpayers. I consider that it would be a better system to give the bulk of it in aid of arterial drainage, to which so much importance is attached, and which has been inquired into by a Royal Commission, whose Report is shortly expected. [Mr. A. O'CONNOR (Donegal, E.): How much a year?] It will be £50,000 a-year, on the same terms as the temporary arrangement with regard to England and Scotland. I shall be able at a later time, when the Report of the Commission has been presented, to come to a clearer conclusion as to the best mode of applying this £50,000. I have omitted to say that the grant of £245,000 in England is given to the County Authority and not to the Highway Authority. The present system is that the County pays a half, and the Highway Authority a half, but that a half of the Highway Authority's half—that is to say, a quarter of the whole—is repaid to the Highway Authority by the State. We should propose henceforth to pay a quarter to the County Authority, besides continuing to pay the quarter to the Highway Authority. That will apply also to Scotland, and in the Metropolis, where the roads are under Local Authority. [Mr. CHILDERS (Edinburgh, S.): The whole is to be paid to the County Authority?] Yes; the whole of the additional contribution.
  I now pass on to another point—the last but one with which I shall trouble the Committee. I spoke of the desirability of making occasional changes in duties, not simply for the purpose of remitting taxation, but with the object of improving our financial system. We ought to have margin enough to rectify an error when it is made. There is one error which, I believe, all parties admit to have been made in the fiscal legislation of late years—namely, the raising of the Tobacco Duties by id. The Tobacco Duties were raised from 3s. 2d. or, more strictly, 3s. 1¾d to 3s. 6d. in 1878, and
  1456
  the fiscal result of that has been most unsatisfactory. The first year under the higher duty was expected to yield an increased revenue of £750,000; but it only yielded £500,000 additional, and in subsequent years the result has been still more unfavourable. The increase in the consumption of tobacco, which was 11 per cent during the five years between 1872 and 1876, fell to 5·8 per cent in the period between 1877 and 1881, when the new rate of duty first came into operation, and to 4·4 per cent in the period between 1882 and 1886, when it was in full force. The change checked the consumption of tobacco; what was the effect upon the quality of the tobacco I must leave to smokers to determine. It will be seen that the consumption per head has not increased in the ratio of the population. The increase in the consumption of tobacco before the duty was raised was twice as great as the increase of population; but since that time the consumption has not increased as fast as the population. The consumption per head is now less than it was. But there is this most curious fact. It is not quite so certain that people have smoked less pipes or fewer cigars than before. The same thing has occurred with tobacco as with beer. There has been an admixture of water with the tobacco to increase weight. Hon. Members will recollect that the duty is 3s. 6d., and the ordinary price which a working man pays for his tobacco is 4s. a pound. He pays 3d. per ounce for his tobacco. When the duty was increased it was supposed that he would pay 3¾d., and that, in that way, the dealers and manufacturers would be able to recoup themselves. But that is not what has happened. He still will not pay more than 3d. per ounce; and, therefore, tobacco has to be produced at 3d. How is this done? It is done by increasing the amount of water contained in the tobacco. The purchaser buys a nominal ounce as before, but he really buys less tobacco and more water; and, in that way, the Revenue loses and the smoker gets a worse article. The price of 3d. is almost too small to enable the manufacturer to produce the tobacco with the duty at 3s. 6d., and I propose to reduce the duty from 3s. &d. to 3s. 2d. 3s. 2d. precisely, not 3s. l¾d which it used to be. That, I trust, will be a con-

  1457
  siderable been to those amongst the working classes who smoke tobacco; and, although it will not affect their pockets, they will get a better article. What we have to provide against is that the purchaser shall not get precisely the same article as he did before the duty was reduced, and therefore we propose to limit, by law, the watering process by which at present the dealer recoups himself for the extra duty. At present tobacco is often sold containing 40 or 45 per cent of water. In future we propose to make it illegal to sell tobacco containing more than 35 per cent of water. In the same way as in the case of beer, when deterioration by water has been put a stop to, we shall hope for an increased yield of duty, because more tobacco will be disposed of. What we propose in this matter involves an immediate loss to the Revenue of £600,000; but if it restores the old prosperity of the tobacco trade it will be a gain in the long run.
  I come now to my last point—namely, a small charge which I propose to make upon a certain limited class of policies of marine assurance. There are policies where the premium amounts to less than ⅛ per cent, or 2s. 6d. in the £100. The present duty of '3>d. upon these constitutes a very large proportion of their total cost to the insurer; and where the premium is, for instance, only 9d., which is often the case with regard to articles transmitted from France, the duty amounts to 33 per cent of the premium; but on all premiums of 2s. 6d. it amounts to 10 per cent. The effect of this heavy charge is to drive the greater part of the insurance business to Paris and other foreign cities, the English Insurance Companies being unable to compete with the low premiums of foreign Companies. We propose to put 1d. only on all policies whore the premium amounts to 2s. 6d. or less per cent. That will involve a loss to the Revenue of about £20,000; but this I have already taken account of in putting my net gain in respect of changes in the Stamp Duties at £100,000.
  I will now, with the permission of the Committee, to whom I beg to return my most hearty thanks for the extreme kindness with which they have listened to my statement, summarize the proposals I have made. I have a surplus of about £975,000. The Debt charge is reduced by £1,704,000. There is a gain of
  1458
  £100,000 by changes in the Stamp Duties. That gives a total of £2,779,000. I propose to take £600,000 off the Tobacco Duties; \d. from the Income Tax, which represents £1,560,000; then there are grants of £280,000 in aid of local taxation, in England and Wales, and £00,000 for arterial drainage in Ireland. That makes a total of £2,490,000, which, taken from £2,779,000, leaves a balance of £289,000, or, in round numbers, £300,000. These are the proposals which I submit to the Committee.
  I have felt painfully, whilst giving my best attention to these matters in the short time I have held my present Office, that it has not been possible for me to go so exhaustively into the question of the taxation of the country as a Chancellor of the Exchequer is bound to do. I acknowledge, in submitting these partial proposals, that I leave untouched many of those tasks to which a Chancellor of the Exchequer ought to give his attention. I leave untouched the Death Duties, which require attention in the promptest manner. I have said that in the Stamp Duties there are large reforms to be made. There is the question of the currency and the coinage, with its results upon the Revenue, which is a matter for future consideration. There is the whole question of local taxation which has to be examined and probed to the bottom. With all these great subjects I have been unable to deal; but I feel that if I had been able to submit proposals with regard to them, such large questions would have been involved that it would have been impossible to find time for their discussion in the present state of business. I have left also to the future the analysis of the proportions in which the different parts and classes of the Empire contribute to Imperial taxation and the consideration whether those proportions are just. It is certainly the duty of a Chancellor of the Exchequer to review these great questions, which have, perhaps, been too long allowed to drift. It may be that the relation which is borne by the taxation of the working classes to that of other classes is too high, or it may be that, in consequence of the change, which, as I have proved, has taken place, in the comparative productiveness of different branches of the Revenue, it is not too high; but what I wish earnestly to impress upon the Com-

  1459
  mittee, both as an individual and as a Member of the Government, is, that they are not to conclude from the fact that I only submit these proposals, that we are not perfectly aware that there are much larger tasks before us—much larger tasks either for ourselves or those who may follow us.
  Motion made, and Question proposed,
  "That, towards raising the Supply granted to Her Majesty, the Duties of Customs now charge able on Tea shall continue to he levied and charged on and after the first day of August, one thousand eight hundred and eighty-seven, until the first day of August, one thousand eight hundred and eighty-eight, on the importation thereof into Great Britain or Ireland (that is to say), on
  Tea … the pound. Sixpence."—(Mr. Chancellor of the Exchequer.)
  SIR WILLIAM HARCOURT: It is quite superfluous that I should express my congratulations to the right hon. Gentleman the Chancellor of the Exchequer (Mr. Goschen) upon the ability with which he has performed his task, an ability which everyone knew he would display as the result of his experience in commercial affairs. I confess I have heard his statement with reference to the yield of the Revenue and the result of last year's finance with some satisfaction. I remember that at the time it was my duty to bring forward the Budget people were determined to take a very dismal view of the condition of the country. When I ventured to lay before the House an Estimate of the Revenue last year, I was warned in a paternal manner by the right hon. Gentleman the First Lord of the Treasury (Mr. W. H. Smith) that I was much too sanguine, and that things were so bad that it was impossible that it could come up to the Estimate which I made. I was warned with still greater authority by the hon. Member for the Kirkdale Division of Liverpool (Mr. Baden-Powell), who demonstrated by very elaborate figures that no such Revenue could possibly be looked for, owing to the condition of the country. I entirely refused to take that view of the financial situation. No doubt, there is a great loss of that elasticity which for a certain period characterized English finance; but it would be entirely wrong to form an estimate of the general condition of the finance of the country from the standard of that particular period. I was a little surprised that my right hon. Friend should have referred to that period for
  1460
  a standard by which to judge the future finance of the country. The truth is that no great falling-off has occurred, and that the resources of the country are well maintained. I contended last year—and the right hon. Gentleman the Chancellor of the Exchequer admits the fact—that there is no proof of failure in the consuming power of the people; and there is no proof of failure in their accumulating wealth. The latter is quite plain from the fact that the yield from the Death Duties has not diminished; last year it reached a point which it never reached before, and it is not much lower this year. Then, as regards the Income Tax, I am glad to hear from the right hon. Gentleman the Chancellor of the Exchequer that the yield of the penny has reached the highest point, with the exception of one or two years, that it has ever reached. That seems to me to show that, in spite of all we have heard, there is no failure of resources of Revenue, and that they are, in fact, quite unimpaired. The right hon. Gentleman the Chancellor of the Exchequer shows that there is greater distribution of the wealth of the country; but surely that is not a bad thing, because it gives greater stability to your finance, which rests not upon the few, but the many, which proves that the condition of the country, as a whole, has improved. Now, no doubt there has been a great falling-off in the spirit revenue since the year before last. The right hon. Gentleman the Chancellor of the Exchequer has explained that the variation between the Customs and the Excise upon the yield of this year is a mere transfer from one account to another. Now, as regards beer, another great test of the consuming power of the people, the revenue has been very steady since 1882. I observe that the right hon. Gentleman the Chancellor of the Exchequer estimates a considerable rise in the Beer Duty in the future year. As regards wine, I have no doubt the right hon. Gentleman will tell us what he has not already told us—namely, what is the amount of the loss on wine which is due to the Spanish Treaty. I think it was estimated at something like £80,000 or £90,000, but I do not know whether that Estimate has been reached or exceeded.
  THE CHANCELLOR OF THE EXCHEQUER (Mr. GOSCHEN): I must apologize for

  1461
  not having mentioned the point. As a matter of fact, the loss has been larger than the figures quoted by the right hon. Gentleman.
  SIR WILLIAM HARCOURT: The Wine Duty is a decreasing duty unquestionably. It is a decreasing duty from a multitude of causes). It is decreasing partly because, as we have all noticed at the tables we frequent, a great deal less wine is drunk than was formerly consumed. In future the quantity of wine consumed in this country will still further diminish, owing to the reduced quantity of good wine that is produced, and to the fact that the population of the world is rapidly increasing. The Wine Duty, therefore, which has decreased, must continue to decrease. The revenue from tea, however, is increasing in a most satisfactory manner. The duty derived from the consumption of tea is £300,000 more than it was in the previous year. It is £127,000 more than estimated, and this sum represents the increased consumption in a single year. The increase of the Tobacco Duty has been slow. Well, the remarks I have made have been with reference to the yield upon the consumption of the people as regards articles of Customs and Excise: and the right hon. Gentleman the Chancellor of the Exchequer was good enough to say something civil of the former Chancellor of the Exchequer upon the calculations of the yield of these articles. But the merit does not really belong to the Chancellor of the Exchequer at all—it belongs to those able and competent gentlemen who are at the head of the Departments of Customs and Excise, and who have shown such marvellous skill in estimating the produce of these articles, and whose advice every Chancellor of the Exchequer who is wise and prudent will always abide by. I have often heard people say—indeed, when I produced my Estimates last year, it was said—"Oh, these Estimates are a great deal too high." Sometimes people say the Estimates are too low; but the people who express these opinions have no means of judging at all. The opinions upon which the right hon. Gentleman acts are those of the people who are thoroughly competent to form a judgment. Well, now, passing from the Revenue which tests the consuming
  1462
  power of the people, just let us look at the items which relate to the wealthier classes. Now, here is the Probate Duty, which has been very steady during the last four years. It is a little over £4,000,000. Therefore, when people talk about the general ruin of all classes of the landed interest and of the commercial classes, how comes it that your Probate Duty yields practically as much as it did before these periods of assumed and asserted distress? Now, the Legacy and Succession Duty has yielded more than the Estimate, because the anticipated falling-off, which was supposed to accrue in consequence of the loss of the arrears which have been collected in former years, has not proved as great as expected. General stamps have yielded £200,000 more than estimated. This, no doubt, is duo to the greater activity of commercial enterprize in transactions of Companies like Messrs. Allsopps'. I am surprised at one observation made by the right hon. Gentleman the Chancellor of the Exchequer—namely, that the stamps were a source of revenue that did not increase I must have misapprehended what the right hon. Gentleman intended to say, because, according to my observation, stamps have very largely increased in recent years. I hold in my hands The Statistical Abstract, and if you look at the Estimate of the stamps in a succession of years you will find that the yield of the Stamp Duty is much larger than it was in former times. You will find, for instance, that in the year 1876 the revenue from stamps was much lower than it is at the present time. These circumstances do not show any failure in the Revenue and in the resources of the country. Well, now, take the Income Tax. The Income Tax has yielded £145,000 more than the Estimate; and therefore, I confess, I cannot concur altogether in the rather despondent view which the right hon. Gentleman takes of the condition of the Revenue. I have no doubt some figures connected with the alcoholic revenue will continue to fall. There is no question that the habits of the people are tending more and more to the discontinuance of the consumption of alcoholic drinks. Those were remarkable figures which were given in a letter to The Times newspaper some weeks ago as to the consumption of alcoholic; drinks by the people. It was stated that the cost

  1463
  to the consumers of alcohol in the country was £123,000,000 a-year. It occurred to me that if the people of this country would apply for six years that expenditure to the liquidation of the Debt, the Debt would be entirely discharged at the end of that period. The whole of the National Debt could be so wiped out, and the whole of the £28,000,000 of annual charge in the shape of interest would be gone at once. There is no doubt, therefore, that this question of alcoholic revenue is one which lies very much at the bottom of our system of taxation. Upon this point I would mention one circumstance which in some of our debates is occasionally referred to. It is asserted that the Irish people have increased their consumption of spirits; that there is more drinking in Ireland, and that that proves the prosperity of the country. It is not true: the consumption of drink in Ireland has largely diminished, and is diminishing; and, therefore, I hope the argument I have referred to may not be used on future occasions. Well, now, I have made these remarks on the yielded revenue in order to defend myself, after a lapse of 12 months, from the charge which was brought against me by my critics. I think The Times accused me of being influenced by a cheerful optimism, which had no foundation, in assuming that the Revenue would be as I estimated. It has, in point of fact, turned out to be £700,000 better than that estimate of cheerful optimism. I do not know whether the present Chancellor of the Exchequer will be accused in his turn of dismal pessimism, which is obviously the spirit in which he looks at matters of this description. But, however that may be, the right hon. Gentleman has a very satisfactory surplus of £700,000 as regards the past year, and a Budget surplus amounting to something like £1,000,000. Now, I had estimates of revenue furnished me by the heads of the Departments, and I thought it right to make provision for the suspension of the two Sinking Funds, amounting to £800,000. But, whichever way that power was taken, if the Revenue, in point of fact, was more than I had expected, the increased sum would go to the benefit of the Debt. You either would not have suspended the Sinking Fund, or, if you did, then the surplus you possessed would, under the action
  1464
  of law, go to the reduction of the Debt. As I understand, in the course of the present year the provision for the liquidation of the Debt will have taken effect so as to discharge Debt to the full amount which was contemplated, quite apart from the suspension of the Sinking Fund. The surplus which has accrued upon the existing year will go in liquidation of the Debt. Is that not so?
  MR. GOSCHENM: Yes; if the right hon. Gentleman had not suspended the Sinking Fund, he would have been bound to make provision for some surplus.
  SIR WILLIAM HARCOURT: I was not alluding to what I should have had to do, but to what has been the result of the financial year. As I understand, there has been no diminution in the monies contributed to the reduction of Debt. In point of fact, the yield of revenue made it unnecessary to have made that provision. It having been unnecessary to make that provision, the surplus will practically go to make up the reduction of the Debt, so that, in fact, the Debt has been reduced this year to its full amount. That is the practical result. Now, I agree very much with what the right hon. Gentleman the Chancellor of the Exchequer said upon the prospect of the Expenditure of this country. The real truth is that, though the Revenue is stagnant, the Expenditure is constantly increasing. I only hope that his appeals upon this subject may have a little more effect upon the side of the House on which he now sits than any we have been able to make on that subject. I quite agree it is not the fault so much of one Government or another, but it is the fault of the House of Commons in encouraging and pressing on an immense increase of expenditure. It is perfectly true that the Civil Service Expenditure—that is to say, the cost of the Civil Administration of the country—has not increased at all. Practically speaking, you are doing the whole work of this country, and doing a great deal more business than was done before in the Departments, for the same amount of money as formerly. There has been no increase at all. The large increase has been upon the education of the people. Well, we intended to make that increase, and it may be considered as a head apart. The other increase was one of policy on the part of hon. Gentlemen

  1465
  opposite. I will not discuss whether it was right or wrong—I refer to the aid of local taxation. Now, if it operated as it was intended to operate, it would be merely a change from one form of taxation to another. But, I am afraid it has led to a great increase of expenditure, because the system has been such as to increase the extravagance of Local Authorities. I had experience of that at the Home Office. After all, it is not in the Civil Service Expenditure that you have any prospect whatever of reduction. You are not going to reduce your expenditure on education, that is certain; Gentlemen opposite are not going to reduce Expenditure in the form of contributions to local burdens; and they cannot reduce the expenditure on the Civil Administration of the Departments, because it has not increased. There is only one way in which the Expenditure of this country can be reduced, and that is by decrease in the Naval and Military Expenditure. Everybody knows that it is upon that expenditure that the enormous growth has taken place, and it is from that expenditure, and that expenditure alone, that the financial difficulties of the country spring. You have not suffered any diminution of revenue; all you have suffered from is from the increase of your expenditure; and what prospect is there of the House of Commons being relieved in that respect? I confess I see extremely little. The right hon. Gentleman must be a very sanguine man if he thinks that the increases which have been made are temporary. Why, what has he heard from Gentlemen who sit behind him which leads him to think that the increases are temporary? He has not had the pressure put upon him where he sits that was put upon us. I remember when the present First Lord of the Admiralty (Lord George Hamilton) proposed from this Bench last year that there should be created Terminable Annuities of £2,000,000 for the purpose of Naval and Military Expenditure; and I remember that another noble and gallant Lord—the Member for Marylebone (Lord Charles Beresford)—now in the Admiralty, proposed that £5,000,000 should be raised. Nobody was found on these Benches then to object to either of these proposals. The right hon. Gentleman is relieved a little from that pressure;
  1466
  but he has a number of hon. and gallant Gentlemen behind him who approve of large expenditure upon the Navy and Army. I see that a most elaborate demand is made by an hon. and gallant Gentleman opposite, the Member for Birkenhead (Sir Edward Hamley). The hon. and gallant Gentleman demands an enormous expenditure for the defence of the country. I looked through his lecture to see where the danger was to come from. There was a whole scheme for the defence of London against an invasion of England by Russia. Russia was coming from the Baltic—Russia, which hardly has an ocean-going man-of-war, was going to conquer the British Fleet in the Baltic, and to land an enormous force upon our shores. That was the reason for the hon. and gallant Gentleman's demand for an enormous expenditure. It is quite true that the expenditure on account of which we are suffering is due to what the right hon. Gentleman the Chancellor of the Exchequer very properly and truly described as a newspaper scare. Well, so long as the House of Commons and the British public will allow itself to be made the victim of these newspaper scares, so long will the Expenditure of this country outrun the Revenue of the country. Now, I do not think it is at all a bad thing that the main pressure of this has fallen upon the payers of the Income Tax, because, as a class, the payers of the Income Tax are, if I may use a popular expression, the "Jingo class." They are the people who call for this expenditure. I do not believe that the mass of the people of this country desire this expenditure at all, but are really averse to it. There are, however, people who are demanding all sorts of other expenditure. I see day by day Members of Parliament desiring large additional expenditure. For instance, an hon. Member addresses a letter to the head of a Department, and then demands that it shall be printed as a Parliamentary Paper at the public expense. It is a most extraordinary proceeding, and why Government should consent to it, unless they are extremely desirous to be pressed into further expenditure, I cannot conceive. The hon. Member for Canterbury (Mr. Henniker Heaton), who is apparently the dry nurse of the Postmaster General (Mr. Raikes), has under-

  1467
  taken to advocate every species of expenditure in that Department. I hope the Treasury will beware of the hon. Member for Canterbury. The fact is, the Post Office is not only an useful institution, but it contributes something as a good business to the alleviation of the public taxation; but since what I may call, the period of extravagance commenced in 1881 the not profit from the Post Office has largely diminished. No doubt the receipts have increased, but the expenditure has increased in a greater ratio. In the year 1881, I think it was, the telegraphs paid their way. They did more than that—they paid within a few thousand pounds the interest upon capital expended. Now, the whole of that capital, amounting to £10,000,000 or £11,000,000 sterling, is written off as a bad debt. It does not pay a farthing, and you find that the telegraphs do not pay their way. I hope the right hon. Gentleman the Chancellor of the Exchequer will furnish us with a Return of the Expenditure and Revenue of the Post Office in recent years. You cannot afford, in the present state of your Revenue, to play ducks and drakes with the revenue of the Post Office, and I shall always support the Chancellor of the Exchequer in resisting wild and foolish demands. Now, before I say anything as to the proposals of the right hon. Gentleman the Chancellor of the Exchequer, there are one or two things I should like him to give me some information upon. First of all, I should like to know what he proposes to do with regard to the Floating Debt which was increased by the Treasury Minute? I should like to know how, according to his view, the Floating Debt is to stand in reference to the increased power of issuing Treasury Bills which has been taken? There is another matter which I desire to mention before I go to the proposals of the right hon. Gentleman, and on which I am rather sorry he has not said anything—the present state of the gold coinage. When I was in Office I was very strongly impressed with the seriousness of that matter. The state of our gold coinage is really a disgrace to the country. It has been neglected now for some 45 years, till at last its condition is shameful—I can use no other word—to a great commercial people like ourselves. I certainly had desired and intended to
  1468
  deal with the matter. I believe it would require a sum of £700,000 or £800,000 to put the gold coinage right now. I do not believe it is possible to act upon the principle which was contended for in 1843 by Sir Robert Peel, and with some modifications enforced—namely, throwing the loss upon the last holder. I do not believe that the people of this country would stand that at all. It was not done by Lord North, even under the pressure of circumstances at the time of the American War when our gold coinage was rectified. Another rectification of the gold coinage took place when Sir Isaac Newton was at the Mint, and it was also paid for by the State, and I believe you will in some form or other have to do that now. I cannot think that the present condition of the coinage can be allowed to continue much longer, and I should have been very glad if the right hon. Gentleman the Chancellor of the Exchequer had used some of his surplus in rectifying it. You may do it in several ways. You may either find all the money at once, which, after all, I think you ought to do, or if you do not do that you might spread it over by an annuity—a term of 10 or 20 years. There is a fund which ought to keep the coinage right once put straight, and that is the profits of the Mint upon seigniorage upon silver and gold. That fund is much larger now than it was before the change in the price of silver, I believe that that sum amounts to something like £30,000, and would be amply sufficient to keep the gold coinage right. I hope we are still going to be a country whose currency rests upon gold. I hope that as the Commission upon Fair Trade knocked that fallacy on the head, so the Commission on bimetallism will dispose for ever of bimetallism. That is generally the result of Commissions of this character. Of course, if you are going to have bimetallism, it is no use putting the gold coinage right; it would not be worth while spending money on a coinage which was no longer to be your own. But if, as I hope, this country is going to keep its currency upon the basis of gold, it will not consent to have its currency so greatly debased as the present currency is. Upon the bimetallism question I feel very easy, because I think everybody admits that that is a folly we cannot commit with-

  1469
  out the co-operation of the rest of the world; and as Germany and France, and, I believe, other countries, have seen the enormous advantage which England has derived from its monetary system, and have determined to imitate it, they are not likely to turn their backs upon the system. Now, connected with this question there is another point which I should very much like to have information, or, at all events, the consideration of the right hon. Gentleman the Chancellor of the Exchequer upon, and that is the employment of £1 notes. It is now a great many years since I had the advantage of ascertaining the opinion of Sir George Cornewall Lewis upon this subject. He could see no reason whatever why £1 notes should not be supplied as well as £5 notes, and why they should not be employed in England as well as in Scotland and Ireland. There has been a great deal of misconception upon this subject altogether. Some people expect enormous benefit from the circulation of £1 notes, while other people anticipate a very great danger. I think both opinions are over-stated. The advantages in a pecuniary sense to the Exchequer would not be as much as some people suppose, because the cost of putting and keeping them in circulation would be considerable, though I do not think there would be any need to go to the expensive methods adopted in the case of £5 notes. There is no question whatever that the circulation of £1 notes would save a certain amount of gold, which would be advantageous in the present condition of things; it would save a certain amount of wear and tear, which would be an advantage. But there is a much greater advantage than that—namely, the great convenience these notes would afford in the payment of wages, especially in cases where money has to be sent to distant parts, and where there is great difficulty in sending it. £1 notes would unquestionably be a great convenience under these circumstances, and what I venture to suggest to the right hon. Gentleman the Chancellor of the Exchequer is the possibility, without altering the present state of the currency, of having, instead of 1,000,000 £5 notes, 5,000,000 £1 notes, and thus ascertain what convenience would be afforded to the public. No possible harm could arise from the experiment.
  1470
  It seems to me an experiment which it would be extremely well worth trying. There is one other matter which I should like to mention to the right hon. Gentleman. I hope he will endeavour to do something in regard to the state of Public Accounts. If you endeavour now to discover, without the secret resources of the Treasury, what is the real expenditure upon a particular item, or what is the revenue derived from any particular item, you take up three or four separate accounts applying to the same matter, and you find a different figure given in each. You take up the Budget Statement to-night. That is founded upon Exchequer issues or Exchequer receipts. As my right hon. Friend the Chancellor of the Exchequer explained, Exchequer receipts from the Income Tax are totally different from the actual receipts. You take up the Finance Account and the Appropriation Account; you take up this very useful book, The Statistical Abstract, and in reference to the same subject-matter you find a different figure in all. That is a most unsatisfactory state of things; and I hope some endeavour will be made to give one adjusted account. At present, I defy any ordinary mortal to ascertain what is the real Expenditure or Revenue of the country from the accounts as furnished by the Treasury in the Budget. There is one other matter in reference to these accounts in which I have taken considerable interest, and as to which I should like to know what progress has been made. The right hon. Gentleman the Chancellor of the Exchequer has pointed out how entirely deficient we are in anything like an accurate or true account of what has been spent on local advances. But there is another matter in regard to which our information is deficient, and that is the history of what has been done in successive years in the liquidation of Debt. My right hon. Friend the Member for the University of London (Sir John Lubbock) procured a very valuable and interesting account, which goes back a certain number of years, in reference to the National Debt, and what has been done in regard to its liquidation. But that only goes back to 1874, and positively at this time we are without any authentic information as to what has been done with the Debt since 1815. I think such a Return might be made by the Treasury, so that the coun-

  1471
  try might really have an authentic account showing what was the state of the Debt in each particular year, and what has been done year by year in respect of its liquidation. Really, the country ought not to be without such a statement as that. Now, the most important matter which the right hon. Gentleman the Chancellor of the Exchequer brought before us to-night is the growth of Expenditure. The Expenditure in the year 1871, so short a time ago as that, was £68,000,000. In the year 1877 it was £77,000,000, and in the year 1887 it is £91,000,000. Now, that is really the history of the difficulty in which we find ourselves, and unless we are encouraged to do something towards decreasing this Expenditure we shall never get anything like a satisfactory reduction of taxation. The right hon. Gentleman finds himself with a surplus of £1,000,000, in spite of any increase of taxation, I would, first of all, observe that, with a surplus of £1,000,000, he could perfectly well have done all he proposed, except taking 1d. off the Income Tax. He could have reduced the Tobacco Duty; he could have made local loans to England and Scotland and Ireland; all that could have been done within the range of what I may call his natural surplus. The natural surplus is the surplus yielded by the existing taxation as compared with the proposed Expenditure. As regards the reduction of the Tobacco Duty, I think it is a very good thing. The raising of the Tobacco Duty by Sir Stafford Northcote, which, after all, was only effected for the purpose of expenditure on a policy which, we disapproved, was a scheme which we objected to at the time. We predicted that it would not be a successful measure. I believe it was very much resented, and I think it is quite time it was done away with, and I agree that what the right hon. Gentleman the Chancellor of the Exchequer proposes in this respect is a very good use to make of his natural surplus. As to the contribution towards Highway Rates, I do not desire to make any comment at the present time. But then the right hon. Gentleman, not content with disposing in this way of his natural surplus, proceeds to create an artificial surplus. Now, his first proposal is to transfer the Stamp Duty upon Railway Companies. I see no objection to that in principle;
  1472
  it was brought before me when I was Chancellor of the Exchequer, and the only reason I did not propose it was because I learned that some of the principal Railway Companies were greatly averse to it, especially the London and North Western Railway Company. I do not know whether that Company have changed their mind; but if not, and this is only a voluntary or optional scheme, it is not likely to produce a great deal of money. If the Railway Companies do not adopt the change there will not be any great result.
  MR. GOSCHENM: I look to an increase from the Debenture Stock.
  SIR WILLIAM HARCOURTM: I will reserve anything I have to say upon that subject until I have had an opportunity of inquiring a little further into it. Well, as regards local loans, the right hon. Gentleman the Chancellor of the Exchequer spoke as if he were making some new revelation to the world—that there were these local loans, which were, in point of fact, to be treated as assets in reduction of the Debt. That is a thing which everybody knows. It has been annually returned to Parliament. Now, I come to what is the right hon. Gentleman's main proposal, and upon that I must make this observation, that without treating it as a combative matter at all the proposal is an extremely simple one. It is to abandon the provision for the payment of the Debt to the extent of £2,000,000. That is what his proposal means. I remember the indignant comment of the Opposition Members of that day, when, under the pressure of peculiar circumstances, and owing to the demands of the War Office, we proposed temporarily to suspend even to the extent of £500,000 the provision for the payment of Debt. "Oh," it was said, "what bad finance this is." Well, at all events, we maintained the principle that, except under peculiar circumstances, there was to be an effort made for the liquidation of the Debt. Now, what does the right hon. Gentleman the Chancellor of the Exchequer do? He says—" No; we will permanently abandon the attempt to discharge the Debt, and instead of making the annual contribution to the discharge of Debt £7,000,000 we will make it £5,000,000." That may be a wise or an unwise operation; but it is a very serious operation, and in my opinion it is practically a

  1473
  fatal blow to any attempt to discharge Debt. Now, what is the pretence on which this is done? I wonder what would have been said if such a proposal had been made by us? Hon. Gentlemen opposite would have said—" These reckless Radicals care about nothing but diminishing taxation. They care nothing about the prudent provision that has been made for the redemption of the Debt." Well, I remember that when Sir Stafford Northcote originally made that proposal, enormous credit was taken for the provision which was to be made for the liquidation of the Debt. Here, however, we have a Conservative Chancellor of the Exchequer—I do not know whether the right hon. Gentleman will forgive the title I give him; I may say I only give it him in a financial sense—making the first serious proposal for overthrowing the provision for the liquidation of the Debt. Now, mark what the argument is upon which he founds his proposal, He simply says—" Oh, circumstances are not exactly the same as they were. The difficulties now are greater than formerly. When we proposed to pay £28,000,000 a-year times were better, and now times are worse, and we will only pay £26,000,000." Another Chancellor of the Exchequer, who may come next year or the year after, may say—"Oh, times are not so good as they were; the pressure of taxation is very great, we will only pay £24,000,000 a-year." It is an argument which can be used by anybody at any time who wants to got rid of the burden of discharging Debt; and, therefore, I say this is a blow which is, in my opinion, absolutely fatal to the provision for the liquidation of the Debt. Of course, it is always popular with the payers of the Income Tax or payers of any other tax to say—" Oh, come what may, let us do something in relief of taxation." I only point out that there is nothing peculiar in this argument to the present situation. It is one which may be applied at any future time; and it is the greatest encouragement which any Chancellor of the Exchequer could possibly have given to that reckless expenditure of which the right hon. Gentleman has complained. It is the way to encourage and to find the means for this extravagant expenditure. The only check there is upon this expenditure is to make it felt in taxation. If you choose
  1474
  to make expenditure easy by this method, you may go on first of all by taking off £2,000,000 one year from the effort you are making to discharge Debt; you may take off £2,000,000 the next year, £2,000,000 the next, and so on, until you come to the point where you are only paying what you are obliged to pay. Then, when it seems you have got to the end of your resources, you may borrow, and so you may go on, having broken down the provision for the liquidation of the Debt which I consider one of the fundamental provisions of sound finance. I do not know what else is to be said beyond what the right hon. Gentleman the Chancellor of the Exchequer has told us in defence of his proposal to-night. I do not desire to enter at full length into this discussion. It is thoroughly well understood that on the first night of the Budget one only makes cursory remarks upon the statement of the Chancellor of the Exchequer; but I hope that when this question comes to be thoroughly debated in the House the full seriousness of this proposal and of its consequences will be understood. It is a totally different thing from a mere temporary suspension. You may describe it in this way—it is a permanent suspension of the Sinking Fund or the Fund for the discharge of Debt to the amount of £2,000,000, for the purpose of removing 1d. from the Income Tax. I should like [to have seen 1d. or 1d. removed from the Income Tax by a very different process; not by giving up the efforts to discharge Debt, but by reducing the foolish and reckless extravagance of the country. I believe that if only people would come back to the principles of common sense, by which we were governed a few years ago, before the newspaper scares, we might reduce the Expenditure of this country, with perfect safety and with great advantage, by at least £4,000,000, and you might get rid of 2d. in the Income Tax by a process of that kind which would be quite satisfactory. But what is the course the right hon. Gentleman the Chancellor of the Exchequer recommends? That you should go on with this Expenditure, and that you should find the means for it by abandoning the efforts made for the discharge of Debt. Well, I am afraid that is a course which may have very serious

  1475
  consequences in the future, and I hope it may receive the careful attention of the House. I only rose for the purpose of making a few occasional remarks, if I may so call them, upon the Budget of the right hon. Gentleman the Chancellor of the Exchequer, and I have now only to congratulate him upon having so good a natural increment. But I wish he could have done what he proposes without sacrificing the provisions for the discharge of Debt.
  MR. BADEN-POWELL: The right hon. Gentleman the Member for Derby (Sir William Harcourt) has done me the honour of referring to the remarks I made on the Budget Statement of last year. The right hon. Gentleman spoke of the cheerful optimism by which it was said he was influenced; but I venture to say that he had not in his mind when he made his Budget Statement last year one great fact, and that was that there would be a change of Government. Now, Sir, if we look to figures, we notice that there is a dismal history of a gradually declining Revenue, quarter by quarter, for two years past, until the Conservative Government came into power, and then the minus quantity was changed into a plus quantity. [Laughter,] Right hon. Gentlemen opposite may laugh; but these are facts, and facts are, after all, what we are dealing with. The right hon. Gentleman the Chancellor of the Exchequer (Mr. Goschen) has given us a Statement which, I am sure must command the admiration of everybody. He has, on several points, introduced the germs of reform, which I hope he will carry much further when opportunity offers. The right hon. Gentleman has spoken of the system of redistribution of profits, and that system—I take it—is at the bottom of much of the present return to prosperity. Owners of a large quantity of capital have certainly suffered more than others; at the same time, there has been a great redistribution of that capital throughout the country. I do not think the right hon. Gentleman will find the principle of limited liability so successful as he expects, because I do not know that the profits of Companies always come to the shareholders. I think that, in many cases, it is the managers and others connected with Companies who get most of the profits. The right hon. Gentleman
  1476
  has struck a right chord when he speaks of the enormous evasion there is of taxation. It is in the methods of assessment, and in other matters obviating evasion, that I think there is a great deal to be done. Then, Sir, in regard to the Stamp reform, I think the right hon. Gentleman struck upon the right key; and I would point out that the right hon. Gentleman the Member for Derby (Sir William Harcourt) said that the estimated yield from the Stamp Duty was not sanguine enough. But, for the last three years, the result of the Stamp Duty has not been such as to create any great hopes in that direction. If we could find means of preventing evasion, I think the result might be better. I only regret that the right hon. Gentleman the Chancellor of the Exchequer did not refer more to the reduction of Expenditure; but I hope that as the present Government feels its way, and feels confident of many years of power, it will effect that reduction of Expenditure which I understand is one of the main objects. The right hon. Gentleman the Member for Derby spoke of foolish extravagance, and longed for the time when the country would come back to the rule of common sense. But he also let slip a remark that a great deal of the Expenditure began so recently as 1881, and we know what Government was in power at that time, and what Government, therefore—in the words of the right hon. Gentleman—was guilty of foolish extravagance, and what Government departed from the rule of common sense. I also desire to point out to the right hon. Gentleman that you cannot judge of the Expenditure by the absolute amounts. It must be taken relatively to the population and the needs of the country. It is a curious fact that the expenditure per head of the population is, I believe, the same to 1d. in this year as it was in the year 1861—namely, £2 9s. 11 d. In respect to the expenditure on Naval and Military affairs, we must remember that our responsibilities have enormously increased, especially in regard to the over-sea trade. The right hon. Gentleman the Chancellor of the Exchequer has made a Statement which I am sure will be very gratifying and satisfactory to the country. To take off 1d. of the Income Tax is a great triumph for any Chancellor of the Exchequer. The far-

  1477
  mers will readily approve of his measure for modifying the Income Tax on their behalf. I could have wished the right hon. Gentleman, in dealing with the Tobacco Duty, had provided some definite scheme for allowing the Excise Duty on tobacco to be levied so that agriculturists, if they thought they could with advantage, might attempt to grow tobacco. But, Sir, I think the country will be satisfied, and more than satisfied, with the Statement which we have just heard. Many salutary reforms have been suggested; the Estimates are of a sober and safe character; but, above all, I am sure the country will see in this Statement a proof that it may thoroughly trust the capacity of the present Administration in all financial matters.
  MR. F. S. POWELL: I hope the Committee will allow me to make a few observations on the Budget of the right hon. Gentleman. His Statement has been criticized by the right hon. Gentleman the Member for Derby (Sir William Harcourt); but I do not think that his criticism will commend itself to the judgment of the country when the whole case is laid before the constituencies. I think this Budget must be described as one that, as much as any Budget in recent times, does justice to all classes of the community, and especially to those classes which are now suffering from the depression in trade and agriculture which afflicts all parts of the country. There is relief to be given to the payers of Income Tax; there is also some relief to the tenant farmers; and there is also that which every Member on this side of the House desires to afford—some protection for the working classes against the adulteration of what, to them, have been undoubtedly some of their most ordinary articles of consumption. It has been clearly proved by the Chancellor of the Exchequer that the working classes are injured by the adulteration of beer and tobacco; and I feel certain that when the proposals of the Government are known, it will be seen that the Government has been fully alive to the interests of the working classes in the country. But the reason why I rise is to call the attention of the Committee to the prominence given in the Statement of the right hon. Gentleman to local loans and the local Budgets of our towns. The question of local indebtedness has gradually
  1478
  forced itself upon the public attention; 20 years ago the subject received no attention whatever; but it is now becoming one of importance, and I am rejoiced to find that it occupies a commanding position in the Statement of the right hon. Gentleman. It has always appeared to me that local loans were as much a part of the indebtedness of the country as any of the obligations sanctioned by this House. There has been a tendency to increase the debts; and, although many local debts have been prudently incurred for purposes which are beneficial, still precautions ought to be taken with regard to the powers given to Local Authorities for the incurring of those debts. There is a just tendency in some respects among the residents in all localities to feel a pride in their own district, and perhaps to form an exaggerated idea of their importance. They look forward to the growth of population, which I am afraid, in many cases, experience will not justify. These debts are incurred for works the duration of which is often shorter than the time in which payment has to be made, and the result is that they become obsolete before the debt is paid off. Unless care is taken with reference to the powers given to Local Authorities to borrow money, I fear there will be other cases in which the money lent will be entirely lost. I do not wish to mention places by name, because the mention might give pain and prove injurious to the prosperity of the localities. My attention has been drawn to the subject, because I have the honour this year of serving on the Police and Sanitary Committee. It is our duty to examine all Bills laid upon the Table of the House for improvement of localities, and the short experience I have gained this year, in addition to what I formerly had, has confirmed me in the opinion that great care should be exercised in giving power to Local Authorities to incur debts, and that there should be supervision over the action of the Authorities in exercising the powers conferred upon them. I venture to say that if hon. Members will compare the Bills laid before our Committee with those laid before the House of Commons, as the result of our deliberations, they will find that the whole question of local indebtedness should be brought before the House, and it is on that ground that I rejoice to find that the Chancellor of the Exche-

  1479
  quer baa adopted the course he has indicated with regard to local loans. I do not mean to say that there are many cases where these debts are not most wisely incurred. It would be entirely impossible for our great towns, such as Liverpool, Leeds, Birmingham, and Bradford, to supply water, gas, and the other necessities of life to their vast populations without borrowing. Their borrowing powers have been exercised by these great towns with wisdom and prudence; and we have several proofs of the justice of what I venture to submit in the market prices of their securities. I beg to thank the Chancellor of the Exchequer for the action he has taken in giving prominence to the question of local loans, and drawing attention to the subject; and I venture to say that the result of this discussion, and of the Bill which will be laid before Parliament, will be that the eye of the country will be brought to bear upon these local debts in a way which I believe will tend to future benefit. I am sorry that the Chancellor of the Exchequer is not here at the moment. The right hon. Gentleman mentioned £4,000,000 as the amount of loss on these loans, and I hope he will be able to place on the Table of the House a list of those losses, and the reason why they have been incurred. Such a document would be of interest as a record, and also as a warning to Local Authorities as to how their borrowing powers should be exercised. There is one more remark I wish to make, and that is with reference to the payment to the Local Authorities of the proceeds of the Carriage Duties in aid of the rates. I am connected with the County Authorities in the West Hiding of Yorkshire, in which, as hon. Gentlemen are aware, there are densely populated urban as well as rural districts. The country district is largely taxed in order to pay for the roads in towns; but the operation of this reform will be that the contribution will be made out of the Consolidated Fund of the country, to which all contribute, and that the inequality which is now so severely felt will no longer exist. I have one other remark to make, and that is with reference to the suspension or modification of the Sinking Fund. I believe myself that the proposal of the right hon. Gentleman will not tend in any degree to destroy that Fund, but that, on the contrary, it
  1480
  will have additional firmness and efficiency. This is a time of exceptional character in our finance. We have a high rate of Income Tax; we have a large Expenditure; and we have, at the same time, a condition of unexampled depression. I am one of those who desire to see the continuance of the Sinking Fund for many years to come; and I believe that the way to secure that continuance is by modifying it in a time of pressure, the like of which, I believe, has not been known within the recent history of the country. I believe that, if you continue the Sinking Fund on its present scale during such a period, there will be a reaction of public feeling against the Fund which will weaken, and, perhaps, destroy it. On the contrary, by reducing the pressure at this exceptional period, I believe there will be a feeling in favour of the Fund which will lead to its having a permanent place in our financial arrangements, and that by its means, before long, a great impression will be made on the enormous Debt of the country. It is not a small matter, I think, in such times as these, that we should he paying off Debts to the extent of £5,000,000 a-year; and the opinions given by the Chancellor of the Exchequer are of such a character as to show that, if we persevere during the next quarter or half of the century in maintaining the Sinking Fund at the level which he suggests, there will be a great reduction in the National Debt, and we shall no longer stand before the world with a burden upon us which, in time of difficulty with other Powers, may be a great impediment to our progress, and greatly weaken our influence and authority amongst the nations of the world. I have no further observations to make with respect to the Financial Statement of the Government, except to repeat the expression of my opinion that the action which the right hon. Gentleman has taken will tend to check the increase of local indebtedness, and thus render a valuable service to the country.
  MR. MONTAGU: Sir, I would urge upon the Chancellor of the Exchequer the necessity of dealing with the gold coinage, which is admitted on all sides to be in a most unsatisfactory state. It is estimated that out of the£100,000,000 of gold in circulation in this country, at least £50,000,000 ought not to circulate

  1481
  at all, owing to the worn condition of the coins, which, according to the existing law, should be withdrawn from circulation, an operation that would inflict a loss of £150,000 on the last holders. The consequence of this condition of the coinage is that £10,000,000 sterling are lying idle in the hands of people in excess of their current requirements. This information is the result of an inquiry instituted two or throe years ago by Mr. Martin, who sent circulars to bankers, asking what amount of gold they held in excess of current requirements. The highest figures came from Ireland, which is especially afflicted with light gold. There are several causes of the present condition of the gold coinage. There is the softness of the metal, to which I referred last year. Every important country but England uses a more durable form of gold—that is to say, 9–10ths fine, instead of our ll–12ths. The only country which used our standard—Russia—has abandoned it, and has adopted that of 9–10ths fine. I may mention that, under the late Government, the Chancellor of the Exchequer promised to do what he could to restore the gold currency, and I should hope that the present Chancellor of the Exchequer would move in the same direction. When the restoration is effected, I believe that a good portion of the £10,000,000 I have referred to would find its way into the Bank of England, and that institution would be then able to discount at such a rate as would afford the necessary encouragement to our slightly reviving trade. Experiments have proved that coins of the standard of 9–10ths fine are much more durable than those of our standard of ll–12ths. The Master of the Mint expressed a hope, some time since, that he would be able to render the coinage more durable by coining under great pressure; but I have not heard what was the result of his endeavours, and I believe that the fact remains that our gold coins wear away to a greater extent than those of any other country. I believe the only use of 22-carat gold is to make wedding rings; but I believe that married women will tell us that those rings wear away quickly by reason of their being made of soft metal. Another cause of wear is the milled edge of the sovereign, which acts not only as a file upon the coins with
  1482
  which it comes in contact, but in that way contributes to its own destruction. Then there is the practice of bankers of shovelling up gold with steel-edged scoops, from which, as also from being brought into contact with the harder metal, copper, the coins suffer deterioration. Another, and, as I think, the chief cause of this deterioration, is our absurd system of coining free of charge. The object of that was to throw on the public the loss arising from the wear of the gold; but as that is no longer the practice, I do not see why a small charge should not be exacted. All other countries charge a seigniorage, and I am at a loss to understand why we should not do so also. The Gorman Government have given every facility to their own people; they have introduced the French metrical system of weights and measures. They have imitated us by adopting a gold currency; but they have avoided our errors, and they have a coinage of harder metal, and without a milled edge. They also charge a percentage for seigniorage. The great advantage of charging a seigniorage of 2d. would be that our sovereigns would not be melted down to the extent they are at present. The goldsmiths would prefer to use bar-gold, rather than sovereigns, which cost them at the rate of £3 17 s. l0½d. per ounce. Again, it is also known that travellers take many sovereigns out of the country, only the light portion of which is returned, because the sovereigns being worth the current price, they are melted down; and, further, we export large quantities to South America and the East, of which, although many are returned, a great number are recoined by foreign mints, those which are refused being used as a circulating medium at our expense. It is only full-weight sovereigns that are sent abroad, or are melted down; and the consequence is that our coinage continually depreciates, because of the survival not of the fittest, but of the most unfit. It is the heavy coins that are melted down, and the light ones that survive. It is a fact that, owing to our absurd system of gratuitous coinage of gold, that our coins are melted down to a greater extent than those of any other country. In the last report of the United States Mint there is a statement to the effect that over 2,000,000 of our sovereigns have been melted down in the

  1483
  American Mints alone. I might also say that the United States Mint have a circulation of gold coins which have not lost, by fair wear and tear, more than one-half per cent in 20 years. I think if we were to adopt their system, and change the percentage of gold in our coins, making it 9–10ths fine gold, the coins would wear for 20 years, and by that means, allowing the advantage which we should derive to accumulate at compound interest, we should provide for our gold currency for 40 years. But in order to put our gold coinage into a proper position it would be necessary to incur an expenditure of from £600,000 to £800,000; and I am afraid that, in spite of the appeal of the right lion. Gentleman the Member for Derby (Sir William Harcourt)—although he has advocated some of the matters which I pressed upon him last year—I do not think: the present Chancellor of the Exchequer would like to find that £800,000 out of his surplus. Therefore, I would suggest that the money should be raised in a special way—that is to say, that the Treasury should issue against the Government balances at the Bank of England, £2,000,000 in £l notes. We need not hold any gold against these notes, and they need not be a legal tender; but they could be received for taxes and stamps. They could be made payable at the Bank of England, and if they were not taken into the Bank—and I think they would only be a very few—the Bank could return them to the Mint or the Treasury—I think the Mint would be the best, as being more central. The notes could be accepted like cheques, and could be reissued. Two objections have been made to the issue of £1 notes. One objection is, that the expense would be very great. It has even been said that £1 notes would cost 6d. each; and it is also said that these notes, if largely availed of in this country, would give rise to a considerable amount of forgery. Now, I think I can dispose of these objections very shortly. Almost every country except ours have notes equivalent to £1, and even less. I have made a collection of 46 varieties of these notes, comprising Irish and Scotch, Canadian, Indian, and all well-made foreign notes; I have also read most detailed and reliable information with regard to the issue of these notes; and I may say that all this
  1484
  information is quite at the disposal of the right hon. Gentleman the Chancellor of the Exchequer. I will quote a few extracts from the information I have, which will show how inexpensive and safe is the issue of these £1 notes. In Austria, the small notes cost about 1d. each, and forgery has been very rare. In Belgium, the cost is ½d a-piece, and forgery is quite insignificant. In Canada, the cost is 1d. each, and forgeries have been few; in fact, there has been no difficulty on that score. In Denmark, the cost is ½d. a-piece, and forgeries are rare. In Germany, since the issue of small notes five years ago, there have been no forgeries. In Holland, the cost of the notes is 1¼d., and forgeries are excessively rare. In India, the cost is two-thirds of a 1d., and the loss from forgeries, which are very rare, is infinitesimal. In Ireland, one bank says—"No forgery for the last 20 years." In Norway, the cost is 1d. a-piece, the life of a note is five years, and there have been, no forgeries. In Portugal, there was one attempted forgery eight years ago; but it was easily discovered. In Scotland, the notes cost 1d., the life of the note is four years, and forgeries are rare. In Spain, the cost is 1d. per note, and forgeries are rare. In Switzerland, the notes cost a little more than 1d. each, their life is about eight years, and there are no forgeries. In the United States, the notes cost about ½d., the life of the note is four years, and there are few forgeries. Therefore, taking the average, the cost of £1 notes ought not to exceed 1d., and the life of a note ought to be about five years. What would be the result of the issue of these £1 notes? By the issue of these notes the Mint would receive probably £2,000,000 sterling in gold, of which £800,000 could be devoted to restoring our gold currency and placing it in a proper position, and £1,200,000 could be invested in Consols, which would yield £36,000 a-year. The cost would not amount to more than £2,000 for supplying the place of worn-out notes and for an extra clerk or two to count the numbers. In that way you would have £34,000 left, which would be considerably more than would be necessary to enable you to keep up the gold coinage for all time. I should also like to say a few words about our silver currency, which is in a most wretched condition.

  1485
  Our silver coins circulate at 50 per cent over their intrinsic value, because we issue the coin at 66 d.per ounce, while the market price is from 41¾d. to 44 d. I do not think it is fair for a country like this to ask the public to take what is worth intrinsically only about 13 s. for £1. Moreover, I would point out that those who are in possession of a largo quantity of silver coins always stand in some danger of loss from fire; because, if a serious fire occurred, although these people might recover the melted mass of silver, they would suffer a loss of about one-third of the value of the coins which would be melted down. Then there is also the certainty that if any action is taken by our Government to bring about an International Convention amongst the Great Powers to fix a ratio between gold and silver, we shall have to recast our entire circulation of silver. I do not recognize, in the right hon. Gentleman the Member for Derby, an authority upon bimetallism. His observations upon this matter show that, to some degree, he has got out of his depth; because, if we have a Convention with all the Great Powers to fix the ratio between silver and gold, our gold would not disappear, for there would be no place for it to go to; and I should think that, in spite of what has been said by the Marquess of Salisbury, that it would be unlikely that the Great Powers would consent. All that those who are in favour of bimetallism ask, is that we should make the attempt to bring about such a Convention. We, who favour this system, firmly believe that if a Convention were held, every Great Power would be found willing to join in fixing a ratio; and all we want is, that they should fix three cardinal points—that it should be decided that each Power should be responsible for the coin it issues; that the Mint regulations should be identical with all those Powers; and that there should be an extra seignior age of about 1d.per cent charged on silver. The public would not receive in this country any more silver than they required in the currency; and no one would necessarily know, if this system were carried out, that bimetallism had been adopted. If we do not invite other Powers to join with us, we are likely to be prejudiced by the march of events elsewhere; because I believe that within a very short period—within the next 20
  1486
  years—we shall find the great bulk of Foreign Powers on the Continent adopting bimetallism. It was only through very exceptional circumstances that that system was altered. There is also this danger, that if silver, through our inaction, should fall to a much lower price than the present, and if our half-crown, which is now worth less than Is. 8d., should fall still further, I do not see what is to prevent imitations of our silver currency being made of good sterling silver. If these imitations were made, I would defy anybody in this House, or perhaps anybody out of it, to be able to detect the imitation coins and separate them from the coins issued by the Mint. Therefore, it is a desirable thing that we should consider, at any rate, the necessity of attending to our silver coin. I do not think I need speak further about silver; but I should like to say a few words now about our bronze currency—our copper. The right hon. Gentleman the Chancellor of the Exchequer has rendered it almost unnecessary for me to say much, because he has given effect to the intention of the late Government, at my instance, which was to prohibit the importation of foreign copper coins into this country; but I regret very much that he has imposed such a heavy loss on the working classes in the Regulation which he has just issued. I think there was no necessity for it. There should be a possibility of arranging the matter differently, for the evil is very widespread, owing to the delay which has taken place in adopting measures for dealing with this importation of foreign copper coins. A very large amount of this foreign copper has been circulated in this country in consequence of the neglect on the part of Her Majesty's Government. I mentioned, in a Question which I put to the Chancellor of the Exchequer a few weeks ago, that 20 per cent of the copper currency in the East of London was composed of foreign copper coin. The Chancellor of the Exchequer, in answer to my Question, seemed to throw some doubt on the correctness of these figures. I may tell him that I received that information from two most reliable sources—namely, the Secretary to the Hospital Saturday Fund, and the Secretary to the North London Tramways Company. The Secretary of the Hospital Saturday Fund, informed me that he received

  1487
  £2,000 in copper, of which £400 was in foreign coin, and the Secretary of the North London Tramways Company has informed me that the Company receives £400 a-week in copper, of which £80 is in foreign coin. That was just the 20 per cent to which I alluded in my Question. from these two sources of information we get identical results; therefore we may take it for granted, I think, that my estimate is right—namely, that 20 per cent of the copper currency in the East of London is in foreign coin. To my mind, the best mode of dealing with that state of things would be this. It is not so much the loss that is caused by calling in the coins at 13 pence for the Is., but it is that a great deal of our own copper coins could be circulated in the room of those foreign coins, and that it would be to the advantage of the State to increase such currency, because it yields a very large profit. I should think that during the past 20 years £1,750,000 in copper coins have been issued from the Mint. If 20 per cent of that copper currency is foreign, and we supply the place of that foreign coin by copper, turned out of our own Mint, the gain to the State will be £30,000. I think that if steps are not taken to absolutely prohibit the circulation of these coins, that this scare will pass over and foreign copper will still be received and circulated as before. I would suggest that the Mint should be empowered to exchange English copper coins for French copper to the amount of £5 at a discount of 5 per cent. The loss then would be very small, and in that way, in the course of a short time, our copper coin would take the place of foreign coin. And there would be a much better plan than that. If the Government were to appoint a Select Committee to inquire into the subject of our currency, I am quite sure that they would find a sufficient number of bankers and merchants in the House who would interest themselves in the matter, and would give a very prompt decision upon it. To that Select Committee could be referred the question of decimal coinage, and the question of protecting our currency altogether. Perhaps, the Committee will be surprised to hear that there is not a single foreign country existing which has not a decimal coinage. We are left completely high and dry on this matter, and most of our
  1488
  Colonies with us. Some of our Colonies, such as Canada and Ceylon, have a decimal coinage; but this country remains in the singular position of not having introduced a system which prevails almost universally. This is not a new question; it was agitated over 20 years ago, and I took part in the agitation at that time.
  THE CHAIRMAN: I am sorry to interrupt the hon. Member; but I must point out to him that he is now travelling altogether wide of the subject before the Committee in entering into the question of the decimal coinage.
  MR. S. MONTAGU: I bow to your ruling, Sir; I will therefore only urge upon the Government the desirability of appointing a Select Committee to consider this question, and to endeavour to procure as perfect a currency as any other country existing; and I think the result of the appointment of such a Committee would be to facilitate commerce. As we are gradually losing our pre-eminence in commerce, I think it would be a desirable thing to encourage a sounder system through the Report of such a Select Committee, which would, I think, be favourable to a restored gold and silver currency.
  LORD RANDOLPH CHURCHILL: The hon. Gentleman who has just sat down (Mr. Montague) has occupied a considerable portion of the valuable time of the Committee in discussing measures, which, though important in themselves, are not germane to the proposal of the right hon. Gentleman the Chancellor of the Exchequer; therefore, he will not think I am guilty of any want of respect if I do not follow him into those elaborate calculations as to the gold and silver and copper coinage of the country, which he has thought proper to make this evening. I would merely state this—that in common with the right hon. Gentleman opposite the late Chancellor of the Exchequer. [Laughter,] No, no, I mean the late Liberal Chancellor of the Exchequer, I deeply regret that the right hon. Gentleman the present Chancellor of the Exchequer has not found himself in a position to make some proposal to us with regard to the very dangerous quantity of light gold in the British currency. The matter has now reached such a pitch that I think delay in dealing with it will be positively

  1489
  dangerous. I had hoped that the right hon. Gentleman would have found himself in a position to make some proposal on the question. It is a matter that was carefully examined whilst I was at the Treasury, with the help of the officials; and I made certain that he would have found projects practically brought to a conclusion—that he would have found proposals drawn up in a definite form, and that he would have been able to bring them before the House. On that point, I may say that there are only two modes of dealing with our light gold currency in this country. There are only two ways in which you can deal with the light gold currency without putting an undue burden either upon the public generally, or penalizing the last holder. In the first place, we might abolish half-sovereigns, and re-place them by silver, the profit upon which would enable us to meet the deficiency caused by the light gold coinage. A far better way, however, would be by re-arranging the note issue by the Bank of England. The issue of notes by the Bank of England though, perhaps, a very safe one, is highly extravagant, and I think it would be possible, without running undue risk, to reduce the cost of the issue of these notes in such a way as to leave you a considerable balance—a balance which being funded would altogether meet the loss you might suffer by calling in the light gold. These are the only two methods by which you can call in the light gold coinage without throwing a burden upon the taxpayers, and without penalizing the last holder. I will, however, only reiterate my regret that the right hon. Gentleman the Chancellor of the Exchequer has not been able to deal with this subject. I turn now to the proposals of the right hon. Gentleman. If I were to say what the impression left upon my mind after listening to the most interesting, most learned, and most exhaustive statement of the right hon. Gentleman is, I should say how great is the worldly worth of a reputation. I am perfectly certain if I had made a proposal of that kind—if I had had the misfortune to occupy the position he occupies, and had made such a proposal as that with which he has favoured us, I should have raised the indignation of every person in the country who considered himself sound and orthodox in
  1490
  all the doctrines of finance, and that such an amount of agitation would have been excited by learned persons, that the proposals I made would, in all probability, have been rejected by the House of Commons. I do not wish the Committee to understand, for one moment, that I am arguing that the proposals of the right hon. Gentleman the Chancellor of the Exchequer are in themselves bad, I am sure they are good; but I am only saying that they are not proposals which would have been accepted from me, and for several reasons which I will endeavour to show. But before I examine these proposals, I may allude to a remark which the right hon. Gentleman the Chancellor of the Exchequer made with regard to the Surplus of Revenue over Expenditure in the last year's accounts and the Surplus of Revenue over Expenditure as estimated in this year's accounts. As the Surplus of Revenue over Expenditure in this year's accounts, the right hon. Gentleman the Chancellor of the Exchequer was good enough to contribute some credit to myself; but I cannot accept that credit from him; because I consider that the whole Surplus of Revenue over Expenditure in this year's accounts is entirely due to his own action with regard to the claim of the Egyptian Government against this Government in respect of the expenses connected with the defence of the Egyptian Frontier. The right hon. Gentleman was able, practically, to save this country some £500,000 by the attitude he took up as to these claims, and that £500,000 absorbs nearly the whole £700,000 which is the whole of the Surplus of Revenue over Expenditure in this year's accounts. Therefore, I must attribute to him all the credit for this saving, and as a member of the taxpaying public I congratulate him upon having been able to overcome the prejudices of the Foreign Office, which I found absolutely insuperable upon that point. I now turn to the Estimate of the Surplus of Revenue over Expenditure for the coming year, which is something like £700,000 as the right hon. Gentleman has stated it. That, I think, is greatly duo to the reductions which we made in the Estimates of the Navy Expenditure before I loft the Government, and in those of the Army Expenditure since I left the Government. A sum of £180,000 is charged

  1491
  off the Army Expenditure since I left the Government, and £500,000 were charged off the Navy Estimates before I left the Government, which almost exactly accounts for the Surplus of Revenue over Expenditure as estimated for the coming year. If the right hon. Gentleman the Chancellor of the Exchequer desires to repeat the compliment he paid me with regard to the amount of reduction effected in the Expenditure before I left the Government. I shall not repudiate the compliment as I did the other to which I referred, to which I did not consider myself entitled. With regard to the Estimate for the coming year, there is one point which strikes me as remarkable, and upon which I should like to ask the right hon. Gentleman the Chancellor of the Exchequer for some future information. The right hon. Gentleman took the Customs for the coming year at £20,200,000, which is an increase of £45,000 on the past year. The increase under that head on the Estimate in the past year amounted to something like £250,000; and I do not understand why the Customs should be estimated this year to produce so small an increase as £45,000. I thought that, as far as foreign spirits were concerned, it was a rising revenue. I should be surprised to think that the right hon. Gentleman has underestimated the Customs to a considerable extent. That is not an important matter;, but I now come to the question of the Excise. The right hon. Gentleman the Chancellor of the Exchequer estimates the Excise revenue at £29,292,000, which is an increase of £40,000 over last year. I do not know where he hopes to got it. The Excise last year fell off by over £400,000, and fell off the year before over £300,000. The Excise revenue is largely and steadily decreasing; and I do not know to what cause to attribute it. Personally, I believe it to be due to the cause of temperance.
  MR. GOSCHEN: I do not wish to interrupt the noble Lord the Member for South Paddington; but I desire to say that the estimated increase under the head of Excise is entirely due to an estimated increase in the consumption of beer.
  LORD RANDOLPH CHUCHILL: I heard that, and I was going to allude to it. It is quite true that the right
  1492
  hon. Gentleman expects to got £130,000, owing to a certain action which is about to be taken with regard to the adulteration of beer; but I want to point out that the Excise last year lost £400,000, and that this year it has lost an almost equal amount of money. That is a very large decrease, and this £130,000 increase which he anticipates does not seem to me to be justified. I wish to know upon what the right hon. Gentleman relies to justify the anticipated increase in the Revenue under the head of Excise. I only allude to this point for the purpose of getting information, and not for the purpose of throwing doubt upon the Estimate of the right hon. Gentleman the Chancellor of the Exchequer. Generally speaking, I believe I am right in saying that Chancellors of the Exchequer are very apt to put an immense pressure upon the permanent officials to crack up their Estimates. I know that these officials feel that the Chancellor of the Exchequer, in his great anxiety to show a satisfactory balance, puts on them greater responsibility than they ought to bear, and is very much indisposed to accept from those officials their view of the Estimates of Revenue which they think suitable to the occasion. The general effect of the pressure put upon the officials is to induce them to add a little to their Estimate, so as to produce a result which is very often not realized. I do not believe for a moment that the present Chancellor of the Exchequer has taken that course; but it is one of which I think Parliament ought to be reminded, and against which Chancellors of the Exchequer ought to bring their influence to bear. I now come to a matter which interests me more than anything else at this moment, but which, unfortunately, I am not able to take as strong a line of action with regard to as I should like, on account of the very grave political issues that are before Parliament and the country. Any strong action upon the points to which I refer might possibly interfere with those vital issues. It was with the utmost regret that, after listening to the statement of the right hon. Gentleman the Chancellor of the Exchequer tonight for nearly three hours, that I came to the conclusion that he has not said one word on the subject of economy and retrenchment. I can-

  1493
  not say how much I regret that. I may say that never did a Chancellor of the Exchequer more capable, more qualified, or possessing more power to deal with such a question, join any Government with a more justly earned and overwhelming financial reputation, and the right hon. Gentleman had only to say—"sic volo, sic jubeo," for Her Majesty's Government could not afford to quarrel with another Chancellor of the Exchequer. But what, in point of fact, is the real state of the case? The right hon. Gentleman, in the course of the Financial Statement he has just made to the House, seemed to review with much greater care the Civil Service Estimates than those of the Army and Navy; and he seemed also to suggest that a reduction might be made in that quarter much more effectually than in the case of the Army and Navy. Now, Sir, I entirely disagree with that view. I believe there are reductions that could possibly be effected in the Civil Service; but I should not put the amount of that reduction at more than £100,000. I am afraid that, in what I am about to say, I may give offence to the right hon. Gentleman the Member for the Brightside Division of Sheffield (Mr. Mundella); but I am, at the same time, bound to say that I look with great suspicion on the Education Vote. And why? The reason is this—the Chancellor of the Exchequer comes down to this House year after year and deplores the increase of expenditure on first one subject and then another; but he invariably congratulates the House and the country on the increase that has taken place in the Education Vote. Now, Sir, I think there is a great danger in this. The mere fact that the House and the Chancellor of the Exchequer are always disposed to take what I may call a gushing position over any increase in the expenditure on Education is, I hold, an encouragement to that Department not to exercise so rigid an economy as would otherwise be the case. All I want upon this, as well as on other matters, is that the country should get full value for the amount it is called upon to pay; and I now propose to tell the House of one Department which requires to be overhauled, because it is spending a good deal too much money, without affording any adequate return in the shape of value—and that is the Depart-
  1494
  ment of Science and Art. I now come to speak of the Army and Navy; and with regard to those Services, I regret to say that the view I took of the expenditure to be made upon them is not that which has been adopted by the Chancellor of the Exchequer. What I found was this—that between the years 1883 and 1885, there had been a total gross increase in the average annual expenditure on the Army and Navy of no less than £6,000,000 sterling. Now, the right hon. Gentleman the Chancellor of the Exchequer never alluded to the growth of this increase; all he referred to was that increase in Army and Navy Expenditure, which was due to what he called the "naval scare" of 1884; but I assert that the increase duo to that scare does not account for the large annual increase of £6,000,000, nor for one half of it. The fact is, that the naval scare accounted for an increase last year, and this year, of about £2,700,000—you cannot put it higher than that—leaving as much as £3,000,000 unaccounted for. This, Sir, is a point to which I desire to direct attention. I should like to know what are the circumstances—domestic or foreign—which have caused an increase in the cost of the Army and Navy since the year 1883 to the extent of £3,000,000 of money? That is a matter on which I should live to have the opinion of the right hon. Gentleman the Chancellor of the Exchequer. It is of no use for the right hon. Gentleman to lecture the House about the expenditure on the Civil Service Department, and on the tendency of hon. Members to make proposals, the effect of which will be to increase in various ways the cost of the Public Service. What he has to do is this—if he believes an increase to be necessary in a great Public Department, he ought to place that on the taxes of the country. If the right hon. Gentleman does that, and convinces the country that it is necessary, and the taxes are raised for the purpose, then the great body of the taxpayers will begin to feel the pinch, and will put pressure on their Representatives that they may endeavour to obtain a reduction of expenditure; and the moment they begin to feel and to assert the necessity of being economic, Parliament will cease making proposals to the Chancellor of the Exchequer whereby the ex-

  1495
  penditure is increased. But so long as the Chancellor of the Exchequer does not put this extra expenditure on the taxation of the country, but contrives, by one financial method or another, to conceal it from the country, so long will he be enabled to accuse Parliament of increasing the cost of the Public Service. It is from the Chancellor of the Exchequer that the reduction must really come. That is the only way in which we can make sure of obtaining retrenchment. But we are told that economy is very unpopular—that the people of this country like to know they have a strong Army and a large Navy, with all the requisite coaling stations and fortifications. If this be said, all I say is, test it. Place the cost of these things on the taxation of the country. There is, as I have explained, a large gross annual increase in the expenditure for the Army and Navy. Has the Chancellor of the Exchequer placed that upon the taxes? No; he has not. What he has done is this—he has manufactured a surplus by reducing the repayment of the capital of the National Debt. I, for one, do not believe that his proposals will do much good. Indeed, I do not believe it is his Budget; nothing will induce me to believe it. It is a Budget that has been made for him, partly by general political circumstances and partly by the persuasions—I will not call them the prejudices—of the Colleagues with whom he has to deal. In not having placed the cost of the increase in our armaments on the general taxes of the country, I say the right hon. Gentleman has done an injury to the cause of economy and retrenchment. The right hon. Gentleman has, as I have stated, dealt with the National Debt; and upon that subject what I have to say is this—I believe that large operations are not only possible, but desirable, with regard to our arrangements for the repayment of the National Debt; but I wish also to point out that the £6,000,000 which are annually devoted to the repayment of that Debt constitute a tremendous financial reserve, and may be said to be a powerful weapon which every Chancellor of the Exchequer ought to guard, as if it were the apple of his eye, in order that it may only be resorted to in real cases of emergency. What I protest against is the proposal of the right hon. Gentleman to take the £2,000,000 he has fixed
  1496
  upon from the repayment of the National Debt, and applying the amount so taken in order to meet the increased expenditure on armaments, which, supposing them to be justified or desired by the country, ought to have been placed on the taxes of the country. This, Sir, is a point on which I feel most strongly. To me it seems that the right hon. Gentleman the Chancellor of the Exchequer had three possible Budgets before him. In the first place, he might have left matters exactly where they were, in which case he would have had a surplus of £900,000—a surplus by no means too large for the Public Service of the country—or he might, in the next place, have suspended the little Sinking Fund of £800,000, in which case he would have been left with a surplus of £1,700,000; and with a little alteration in the taxes he would have had a surplus of £1,800,000 or £1,900,000, and then, with the aid of that, he could have taken Id. off the Income Tax. But the Budget the right hon. Gentleman has selected—and here I venture to tell him what is my firm opinion—is a most unfortunate one. Really, if I were to choose between the two—and I am sure that no one will suspect me of admiration, political or otherwise, for the right hon. Gentleman the Member for Derby (Sir William Harcourt)—I must say that I should greatly prefer the right hon. Gentleman's Budget of last year to the Budget that has been brought forward by the present Chancellor of the Exchequer. I regret—more than I can express—that the great principle of the repayment of the National Debt has been interfered with for so light, so trivial, and so unsound a cause. I regret that a great weapon has been tampered with, blunted, and spoiled for future use in a period of emergency. I do not know whether it would be possible for the right hon. Gentleman at the present moment to reconsider his Budget; but whether that be so or not, I am quite certain of this—that he has put out of court all the financial principles in which he has been trained, which he has heretofore proclaimed, and which he hoped, when he acceded to Office, he would be able to impress upon Parliament and the country. There is one more point on which I ought to make a remark. I protest very strongly against any further relief, such as is now

  1497
  proposed in the shape of dole and contribution on the part of the right hon. Gentleman, towards the local rates. I consider that that principle of contribution to the local rates in the form in which it is at present carried out to be destructive of economy in every shape. And besides that, it is very objectionable from another point of view. There is at the present moment a strong Party in the country, by no means confined to this side of the House, who are, if not averse to, at any rate not very anxious for, a large reform of local government. Their reluctance on that point I can understand; but it is a reluctance which must be got over. This question will have to be dealt with, and a large and genuinely-popular system of local government must be made to take the place of that which now exists. The only hope on the part of the Government and of the Chancellor of the Exchequer is to overcome the reluctance which, as I have said, exists so strongly in regard to this matter among certain classes in the country. The right hon. Gentleman has, I think, materially weakened the position the Government occupy directly by giving the proposed dole of 1250,000, and indirectly because the class to which I have referred will be thereby encouraged in their resistance to local government reform. They will say—"If you will only put it off; if you will stubbornly oppose all reforms of local government, year after year, the Chancellor of the Exchequer will be obliged to give us something more from the Imperial funds. "I hold that the large contribution proposed to be made in aid of the local rates is not only most unfortunate, from an economical point of view, but has also added to the great difficulties the Government must necessarily have to encounter in dealing with the question of the reform of local government in this country. I trust that the right hon. Gentleman the Chancellor of the Exchequer will believe that in making these remarks I have been actuated by no feeling of hostility or animosity towards him or the Government. What I say is, that I consider finance as a question which ought to be removed above all mere matters of a Party kind. I have no doubt the right hon. Gentleman will receive from hon. Members who represent the counties, and from the right
  1498
  hon. Gentleman the Member for the Sleaford Division of Lincolnshire (Mr. Chaplin), the most profuse thanks for the proposal he has made. Hut, at the same time, I cannot but think that these are not the only quarters to which the right hon. Gentleman ought to look for applause in financial matters. I should have thought the right hon. Gentleman would have preferred to have taught a better lesson in finance to the Party he has so gallantly and so disinterestedly come forward to aid than that which he has put before them this evening. I will not, on this occasion, trust myself to say more. I do not desire to be dragged into a position of acute animosity or hostility to the Government; but I must own that I was so much disappointed with the Financial Statement of the right hon. Gentleman that I could not refrain from expressing to the House the view I entertain that the cause of economy has not been strengthened, but rather that the cause of retrenchment has been put back by the financial policy which the Chancellor of the Exchequer has just announced.
  MR. CHAPLIN: The Committee has enjoyed the exceptional advantage during this discussion of the presence of no fewer than four Gentlemen, each of whom has been, or is at the present moment, Chancellor of the Exchequer. Three of those Gentlemen have addressed the Committee on this occasion, and it is only natural that they should entertain considerable differences of opinion. The noble Lord (Lord Randolph Churchill) who has just spoken, and who has told us he has been actuated by no feeling of hostility to the Government or my right hon. Friend (Mr. Goschen), has addressed to the Committee a speech which has evoked the plaudits of hon. and right hon. Gentlemen opposite. Whatever his desire, the noble Lord has certainly succeeded in criticizing the proposals of my right hon. Friend with great severity; but, so far as my humble and uninstructed judgment enables me to see, I believe that the Budget proposals that have been put forward by my right hon. Friend the Chancellor of the Exchequer this evening are such as well be found fairly acceptable and popular—both in this House and in the country. The right hon. Gentleman the Member for Derby (Sir William Harcourt) has ques-

  1499
  tioned the fact of the existing depression throughout the country, and has spoken of it as an assumed or assorted depression. I cannot say anything with regard to what may be the case in commercial circles; but, with regard to the condition of agriculture, I am in a position to speak positively, and I can assure the right hon. Gentleman that if he believes the existing agricultural depression to be either assumed or asserted, he is labouring under a complete delusion. There is no question at all about it. At the present moment, agricultural depression is a very real, a very palpable, and a very lamentable fact, and is producing great loss and suffering among the classes who are directly concerned.. It was for this reason that I heard with great pleasure and satisfaction the speech of the right hon. Gentleman the Chancellor of the Exchequer to-night, because it gives evidence of a friendly recognition of the extreme difficulty of the situation in which those classes are placed who are suffering from this depression at the present time. The proposal of my right hon. Friend with regard to the payment of Income Tax by the tenant farmers is, I think, a very desirable and very useful one, and will be regarded by the farmers of the country as a been for which they will be grateful. For some years past—and particularly during the last year—the profits of the farmers have amounted to nothing at all. I venture to differ from my noble Friend in regard to the contribution the Chancellor of the Exchequer proposes to give in aid of the local rates. The tendency of the noble Lord's remarks has been, I think, to convey an impression which I do not think exists in the mind of the noble Lord, that he is altogether wanting in that sympathy for the agricultural interest which has been so much manifested by my right hon. Friend the Chancellor of the Exchequer to-night. With regard to the objection put forward by the noble Lord as to this proposal impeding in any way the local government reforms contemplated by Her Majesty's Government, I must say that I do not think there was much force in that objection. After all, what is the amount of relief it is proposed to concede? Speaking as a Representative of the agricultural interest, I may say that, although the amount of that relief is of no value in itself, I value it for this rea-
  1500
  son—that it is evidence of the good intentions of the right hon. Gentleman the Chancellor of the Exchequer, and of the Government which he represents. I deny that the effect of this contribution on the part of the right hon. Gentleman will be likely, as the noble Lord has stated, seriously to impede or interfere with the great reform in local government, which I believe to be so much desired both by Her Majesty's Government and by the country at large. Sir, I wish to refer to one other matter which was mentioned by the right hon. Gentleman the Member for Derby. The right hon. Gentleman referred to the Currency Commission and to the question of bimetallism, and he spoke in somewhat strong terms. I never had the slightest suspicion until to-night that the right hon. Gentleman was what would be termed in America such an out-and-out gold bug as he is. After the observations he has addressed to the Committee, I have no doubt upon that head. I do not wish, on this occasion, to enter into any of the details of the most complicated and intricate question of bimetallism; but I do desire to say this—that when the right hon. Gentleman speaks, as he did speak to-night, of other countries in Europe, and I think also of the United States—
  SIR WILLIAM HAECOUET: I did not mention the United States.
  MR. CHAPLIN: Anyhow, he spoke of Germany and France, and he pronounced the opinion that both of those countries were absolutely opposed to any change in the direction of bimetallism. I do not care to express a positive opinion; but I think it is very probable, indeed, that in making that assertion the right hon. Gentleman was quite as much mistaken as he is very often on other matters. Sir, I have only to say further, that after criticizing, as I say with great severity, the actual Budget laid before the House, the noble Lord the Member for South Paddington (Lord Randolph Churchill) spoke of three Budgets, any one of which, might have been introduced by the right hon. Gentleman the Chancellor of the Exchequer. I can only regret that, with all the advantages he had, and with all the opportunities he had before him, the noble Lord did not think it right to introduce a Budget of his own. If he had done that, he would have had an

  1501
  opportunity of correcting all the great errors of which he complains, and of submitting to the House a project and policy he evidently approves of so much, and which, according to his view, would have conferred so much benefit upon the country. Before I conclude, I desire, in spite of the sneers which were directed at me by those who represent the agricultural interest, to tender, on behalf of that interest, my cordial and grateful acknowledgments to the right hon. Gentleman the Chancellor of the Exchequer for the proposals he has made and for the sympathy he has shown towards that interest, which I believe is, at the present time, more suffering than any other interest in the country.
  MR. HENRY H. FOWLER: Mr. Courtney, I congratulate hon. Gentlemen opposite in having two distinct financial policies, advocated by two prominent Leaders of their Party. Whatever views hon. Gentleman opposite may take of this Budget, or of finance generally, they will have no severance of Party ties in expressing their views. But the real difference of opinion between the noble Lord the Member for South Paddington (Lord Randolph Churchill) and the right hon. Gentleman the Chancellor of the Exchequer (Mr. Goschen), may be summed up in one sentence. The right hon. Gentleman the Chancellor of the Exchequer recognizes, that in the present state of depression of agriculture and of commerce, and in face of the present want of elasticity in the ordinary Revenue, he is not justified in imposing an 8d. Income Tax. The noble Lord is clearly of the same opinion; but he thinks that the difference between a 7d. and an 8d. Income Tax should be met by a reduction in Expenditure. The right hon. Gentleman the Chancellor of the Exchequer thinks the difference should be provided for by ceasing to pay off the National Debt. Now, I very cordially sympathize with the view of the noble Lord. I believe that the crux of this question—we may go round and round the question as much as we like—but the real crux of this question is in the National Expenditure. I think the right hon. Gentleman the Chancellor of the Exchequer did not put the case at all too strongly, when he pointed out the very unsatisfactory
  1502
  state of the ordinary Revenue. The Economist showed, last week, that in the two periods of five years, from 1877 to 1882 and from 1882 to 1887, there was not a difference of £50,000 in the Revenue from Customs and Excise. This practically shows that the Customs and Excise are a decreasing source of Revenue, and that extra expenditure, whatever it may be, that this House determines to indulge in, has been found, and will have to be found by means of the Income Tax. I am going to trouble the Committee with two or three figures. I do apologize for doing so, because I think the noble Lord the Member for South Paddington has opened up the question; and it is a question upon which we must continue to discuss, till we make some impression upon the minds of the public—I mean the question of the Army and Navy Expenditure We get very much confused by mixing up extraordinary Expenditure, Votes of Credit, and other War Expenditure from time to time, without watching as the noble Lord has done the regular increase of the normal Peace Expenditure. Now I got a Return laid before the House last year which actually shows the normal Naval and Military Expenditure for the last 10 years. If the House will bear with me I should like to give in round figures what the Expenditure has been. In 1876 it was £24,800,000; in 1877, £25,400,000; in 1878, £25,000,000; in 1879, £25,700.000; in 1880, £25,200,000; in 1881, £24,600,000; in 1882, £25,000,000; in 1883, £25,300,000; in 1884, £26,400,000; in 1885, £26,600,000; and, for the first time, I suppose, in the history of this country, in a time of peace, in 1886 it reached £."0,120,000; and, according to the statement of the right hon. Gentleman the Chancellor of the Exchequer, the expenditure upon the Army and Navy Services during the last year (1887) was about £31,000,000; and the Estimate of the expenditure in the forthcoming year is again £31,000,000. So practically what we have got, as the noble Lord the Member for South Paddington very correctly stated, is a normal increase of expenditure of between £3,000,000 and £4,000,000, and that totally irrespective of extra expenditure. Well, now, it is not only the amount of this expenditure, but the nature of the

  1503
  items of which it is made up, that objection is taken. We know what the noble Lord the First Lord of the Admiralty (Lord George Hamilton) and the right hon. Gentleman the Secretary of State for War (Mr. E. Stanhope) will say. They will say this expenditure is absolutely necessary in order that the country may be in a proper state of defence. [Cheers.] Hon. Gentlemen opposite cheer that. I have no doubt that if the expenditure were £40,000,000 or £50,000,000 hon. Gentlemen would cheer. But one point I wish to bring before the Committee is this—not only is this expenditure steadily increasing, but we are not getting money's worth for our money. We are paying 30s. in the pound. We have a large amount of useless expenditure. Take one point alone—the Non-Effective Services. I shall be very surprised if before long the public does not take a serious and perhaps unpleasant view of the expenditure on this particular head. The expenditure on the Non-Effective Services of the Army has reached £3,500,000, that on the Non-Effective Services of the Navy has reached £1,750,000, and that on the Non-Effective Civil Services has reached £1,500,000. We are practically paying £6,750,000 a-year in pensions, and of that sum more than £5,000,000 is paid out of the £30,000,000 spent on the Army and Navy. I am not going to say that men who have spent their lives in the service of the Crown, either in the Navy or Army, should not be properly pensioned; but I maintain that you are establishing and carrying out a system now whereby you are pensioning a large number of men under 50 years of age. A Return was placed on the Table of the House the other day of the total cost of pensions for officers in the Army alone. In 1855 it was £504,000; in 1870, £567,000; in 1880, £1,110,000; in 1885, £1,300,000. We have had a succession of Royal Warrants. I tried the other day to extract from the right hon. Gentleman the Secretary of State for War what was the financial effect of the last Royal Warrant with reference to Army promotion. I asked him to lay a Paper on the Table showing what the result would be. He has not done so, and I have very little doubt that there is practically no financial saving effected by that operation. The House and the
  1504
  country ought to understand what they are getting for their money—what it has cost to create this flow of promotion. What would be said if the Chancellor of the Exchequer were to come down to the House and say—"There are a number of distinguished Gentlemen at the Bar who are in possession of all the patronage and income of the Bar. Seeing there is a large number of Gentlemen behind them who wish to step into the shoes of these distinguished gentlemen, it is most desirable the latter should be pensioned off in order to create a flow of promotion in the Legal Profession?" We have heard complaints over and over again that men in the Army are set aside at the very time of life when they have the greatest experience. There is no such military Non-Effective Service in the world as ours. The noble Lord the Member for South Paddington has alluded to the Royal Commission which is sitting on Expenditure. I think the country is greatly indebted to him for issuing the Commission; but I deplore the terms in which the reference to the Commission was couched. The Commission will be absolutely powerless to deal with the real spending Departments of the Army and Navy. It may effect reductions in the clerks at the War Office and the Admiralty; but it cannot deal with the really large expenditure, the expenditure of administration. I draw a distinction between policy and administration. Policy is a question for the responsible Government of the day. It is their business to say whether there should be an army of 150,000 men or of 130,000 men. But what I should like the Commission to inquire into is, whether the Army, whatever it is, is costing more than it ought to cost. I am a Member of the Commission, and I was astonished to learn that the medical staff of our Army in time of peace is costing nearly £350,000 per annum. I wished to inquire into this expenditure, but I was entirely precluded from doing so by the terms of the Reference. If the Royal Commission had been able to go into such points as this, it would have shown that our Army is the most expensive army in the world, though we have comparatively few men. So much for that branch of the question. I quite agree with the right hon. Gentleman the Chancellor of the Exchequer that the

  1505
  Civil Service is exceedingly well managed, and I think it cannot be carried on at much less cost. I differ from the noble Lord the Member for South Paddington so far as the expenditure on Education is concerned. I am delighted to see it increased, though I share his view as to whether we are getting the money's worth in the case of all the items. At the same time, we must rejoice in the fact that our net expenditure for Education is steadily increasing, and that the expenditure for our Civil Administration is stationary. The real increase is in the Army and Navy, and also in those grants in aid of local taxation as to which I desire to say a word or two directly. I should like to allude to one or two proposals of the right hon. Gentleman the Chancellor of the Exchequer. I quite approve of the alteration he proposes to make with reference to increasing the duty upon the transfer of the Railway Debenture Stock; but I would ask him whether he does not think there is a very largo amount of property, dealt with on the Stock Exchange, which never pays any duty at all; whether it would not be possible to make time bargains, contracts for stocks which are never delivered, but which are re-sold on and on—a source of an effective contribution to the Revenue. "With reference to the initial duty of 1s. per £100, I doubt whether the great Companies will consent to the change proposed. I understand the change to be entirely optional; that if the Companies do not choose to avail themselves of it the right hon. Gentleman the Chancellor of the Exchequer will take no action. But there are two main features of the Budget. By the local Budget the money of the Public Works Loan Commission is dealt with, and I regret that the country is to sustain a loss by what is proposed.
  MR. GOSOHEN: There is no loss.
  MR. HENRY H. FOWLER: I understood the right hon. Gentleman to say that there would be an apparent loss of £300,000; that instead of receiving £900,000 and paying away £600,000—
  MR. GOSOHEN: There is an apparent loss. The matter is rather complicated; but I assure the right hon. Gentleman we do not forego one shilling of advantage by our proposal.
  MR. HENRY H. FOWLER: I am exceedingly glad to hear that; but I may throw out the suggestion. Does the right hon. Gentleman not think this ought to have been an occasion of making a profit—I mean a large and considerable profit? I think that if Local Authorities are enabled to borrow on the security of the State they ought to pay for the accommodation—if £30,000,000, £40,000,000, or £50,000,000 sterling is funded in a Public Works Budget, the State ought to have some margin of profit.
  MR. GOSCHEN: It is impossible to alter bargains which have already been made. You cannot, in constituting a Local Loans Budget, increase the amount of interest which is to be paid by Local Authorities. If the right hon. Gentleman will assist us in future in insisting upon reasonably profitable terms, I shall be extremely obliged to him; but I could not, in framing a Local Budget, increase the charges so as to secure an additional Revenue.
  MR. HENRY H. FOWLER: It is only within very recent times that the principle of lending at low rates has been introduced. I will cordially support him in every attempt to prevent any advantage being taken of the State. Now, Sir, with reference to the appropriation of the surplus. I want to say a word or two about the contributions in aid of local rates. The right hon. Gentleman the Chancellor of the Exchequer has thrown this been apparently and really to the agricultural interest, and as such the right hon. Gentleman the Member for the Sleaford Division of Lincolnshire (Mr. Chaplin) has just accepted it. But I must point out to the right hon. Gentleman that the great increase of local taxation, about which so much complaint is now made, is an increase in the urban and Metropolitan districts. During the last 10 years there has been hardly any increase in local taxation in rural districts, notwithstanding all the complaints we hear about the amount of this taxation. The last Report of the Local Government Board puts the increase in 10 years, in the Metropolis at 59 per cent, in the urban districts at 52 per cent, and in the exclusively rural districts at £188,000, or something like 11 per cent. The whole of the £250,000 which the right hon.

  1507
  Gentleman is proposing to vote towards the repair of roads, will go into the hands of the Rural Authorities. The towns will benefit to a very small extent. The entire amount which was given last year to boroughs having separate Courts of Quarter Sessions was only £5,800, and the entire amount given to the Metropolis was £1,731. If you are to have any contribution towards local taxation, you ought to share it fairly amongst all locally taxed bodies. The amount of rates levied in the pound constitutes a fair claim on the right hon. Gentleman the Chancellor of the Exchequer, if he will adopt—I am sorry he has adopted it—this extravagant mode of subvention of local rates. I maintain that the people who have a right to complain of the gross injustice of the present mode of levying local taxation, levying it on one description of property, and one description of property alone, are the residents in the towns. The average rate in rural districts is little over 2s. in the pound, whereas in towns it is 5s., 6s., 7s., and 8s. in the pound; and the residents in towns are subjected to this heavy taxation levied on one description of property only. It has suggested itself to my mind that the Committee should remember, in dealing with the financial condition of the country, that the right hon. Gentleman the Chancellor of the Exchequer is asking for an Imperial taxation of £76,000,000; and that in addition to that there is a local taxation. of £25,000,000—practically the amount annually raised by taxation in this country is over £100,000,000. Now, with reference to the proposal for stopping the payment of the National Debt. I am not going to follow in the footsteps of the noble Lord the Member for South Paddington, who has put the case very clearly before the Committee and the country. The proposition is one on which, no doubt, a great deal of discussion will take place; and the only remark I have to make will be in reference to the criticism the right hon. Gentleman made in contrasting two periods—that of Sir Stafford Northcote in 1874–5, and that of his own Chancellorship in 1876–7. No doubt the periods are essentially different. If the prosperity of 1874–5 has passed away, that, surely, is no reason for increasing
  1508
  our Expenditure so many millions beyond what it was at that time. I should like to strengthen the hands of the right hon. Gentleman with reference to the application made to him with regard to the Post Office. My right hon. Friend the Member for Derby has shown that the Post Office revenue is a steadily decreasing revenue. In 1883, the Post Office revenue amounted to £3,200,000. It has now got considerably under £3,000,000, and I think the Budget of to-day shows a still greater reduction. When propositions are made for increased expenditure in the Post Office, the House and the country should understand that they amount to propositions for increased taxation. There is only one other subject to which I wish to allude, and that is the subject of the Death Duties. I very much regret the right hon. Gentleman has not taken the opportunity of dealing with these duties. Two years ago, my right hon. Friend the Member for South Edinburgh (Mr. Childers) proposed to deal with the Death Duties; to put them upon a just and equitable basis affecting all descriptions of property. That question was fairly thrashed out, all the machinery and all the figures are available, and I think it would have been quite as easy to have dealt with the Death Duties as to have dealt with the arrangements in respect to the repayment of the National Debt. Now that the right hon. Gentleman has postponed the consideration of the Death Duties for another year, I de-sire to ask him to consider whether he does not think the time has arrived when there might not only be an extension of the area over which the Death Duties are levied, but also a simplification of the principle on which they are levied; and I think it would be far better if we could have one uniform rate levied upon property at death. We should thus get rid of the difficulty of long reversions, and we should get rid of the distinctions or differences of rates. Now that we have seen a Chancellor of the Exchequer bold enough to suspend the repayment of the National Debt, I think we need not despair of having a Chancellor of the Exchequer who will have the courage to deal with the Death Duties upon a broad principle. A Chancellor of the Exchequer who does this will, I think, find resources which, will

  1509
  enable him to carry out many of those reforms which we all desire to see accomplished. I have only to say, in conclusion, that although I have been compelled to differ from the right hon. Gentleman, perhaps he will allow me to express my unfeigned admiration of the great ability and masterly power with which for three hours he engaged the attention of the Committee. Whether we agree with him or not, we cannot withhold the expression of our admiration of the financial ability and genius which he displayed in his lucid and eloquent Statement.
  MR. GOSCHENM: Mr. Courtney, I have no wish to curtail the discussion; but I rise now to deal with the questions which have been put to me, lest, if I delayed my answer any longer I should be accused of want of courtesy to hon. and right hon. Gentlemen. I will deal, in the first instance, with the speech of the right hon. Gentleman the Member for East Wolverhampton (Mr. Henry H. Fowler); but I desire to make this preliminary remark—that several other right hon. Gentlemen, and the noble Lord the Member for South Paddington (Lord Randolph Churchill), have spoken with regard to what I ought to have proposed—of my omission to deal in my Budget with most important matters. I must once more throw myself upon the indulgence of the Committee and the public, and beg them to remember the very short time that I have been in Office, and, at the same time, the very great problems with which I—in common with my Colleagues—have had to deal. It has been my wish to pay considerable attention to ail legislative proposals, especially as regards finance, and I assure the Committee that it is from no want of appreciation of the greatness of the subjects with which I have not been able to deal, that they, unfortunately, have not been included in the proposals I have made to the Committee. For instance, I admit the immense importance of the subject of gold coinage; but it is a subject with which it would be extremely wrong to deal without going thoroughly into the matter, and the very variety of the suggestions that have been made to the Committee as to the methods in which they might deal with this complicated problem shows that I should be scarcely
  1510
  justified in accepting any particular scheme without having examined the question from every side. The noble Lord the Member for South Paddington is perfectly right in saying that the ground had been carefully prepared; but it is not only the question of the gold coinage that has to be taken into consideration. The very discussion to-night has shown that it is no use thinking of that alone. There is the question of the £1 note; there is the question of the country bank issues; and there is also the question of the profit made by the Bank of England, and of the profit made by the Mint; and I am bound to say that all these questions taken together form a congeries of problems with which it would not have been possible for me to deal hastily, and which I could not take up unless I had at least a couple of months in which to devote my best attention to them. The matter is one I am most anxious to take in hand, and I can assure the noble Lord I propose to pay immediate attention to it; and I only hope the right hon. Gentleman the Member for Derby (Sir William Harcourt) will be able to use his influence with his Friends to secure proper time and opportunity for the discussion of any measure dealing with the coinage which the Chancellor of the Exchequer may still be able to submit to the House in the present Session. I do not despair in the least of being able to produce a measure; but these are questions which require a certain amount of time for their discussion, and I am not sanguine that we shall in this Session of Parliament be able to find the necessary amount of time to deal with them. I wish, however, to endorse every word said by the noble Lord the Member for South Paddington, the right hon. Gentleman the Member for Derby, and the hon. Gentleman opposite, who pointed out that we have not only to deal with the difficulty of making arrangements concerning the gold coinage and the paper circulation, but that there is a question also with regard to the silver circulation and the bronze circulation. They wish these matters to be taken up, and I endorse their views very cordially. With regard to the bronze circulation, the hon. Gentleman the Member for the White-chapel Division of the Tower Hamlets

  1511
  (Mr. Montagu) suggested that more liberal terms should have been granted with regard to the exchange. In the decision I took on the subject I was not guided by any anxiety on account of the Exchequer, because the interest of the Exchequer in this matter seemed to me not to compare in importance with that of the people, especially the poor people amongst whom the bronze coin circulates. But I was anxious, once for all, to strike a blow at the foreign coin circulating here, so that there might be no temptation again to promote the free introduction of such coins into Great Britain and Ireland. It was necessary to strike foreign coins—if I may say so—with a serious disability. The right hon. Gentleman the Member for East Wolverhampton made some remarks to which I would here call attention. I thank him for the cordial and complimentary terms in which he spoke of myself. He said, in the course of his speech, that urban districts would receive no relief under the present scheme, and I admit the justice of his criticism so far as it goes. But I regret, in connection with that, that in my Statement I did not sufficiently dwell on the great increase in value that there has been in house property during recent years as compared with landed property. The fact is, that the agricultural depression has fallen with extreme weight upon that margin of rent and that margin of profit which is left over to the landowner and the farmer after meeting the charges falling upon them. My right hon. Friend the Member for East Wolverhampton is familiar enough with the subject to be able to follow me. The increase of rates in the country districts falls not on the total assessment, but on that portion of the revenue which is left to the landowner after meeting the charge for in-cumbrances, and which is frequently only a half or a third of the whole; and, consequently, there has been an. extreme pressure on the agricultural ratepayers, because the margin of profits on which they have paid their rents has been reduced much more in proportion than has been the case in the urban districts. The argument may not carry conviction to my right hon. Friend; but, at all events, he will see that I have reasons for regarding the case of the agricultural and the urban, ratepayer as dis-
  1512
  similar. Moreover, £74,000 under this proposal will go to urban districts; but, at the same time, I accept my right hon. Friend's criticism to a certain extent. This is a matter which I think we need not make a Party question at all. In fact, I have received quite as many representations from Liberal Members as from Conservative Members on this side of the House with regard to it. There is no doubt that, owing to the particular circumstances of the last three years, there has been great pressure upon the ratepayers of the poorest of the agricultural districts, much greater than has been felt in the towns. I have further to remark, that this concession is not in any way to be considered as prejudicing the great question of the reform of local taxation. It is most distinctly temporary; and I think, although it is a large concession in one sense, it is not sufficiently large to induce any Conservative reactionary to resist the considerable convenience which will arise from a reform of local government. I do not think that that argument would have sufficient weight. Now, Mr. Courtney, the main objection which has been made to my proposals, and one the force of which I am quite prepared to acknowledge, is with regard to the diminution of the payment on account of Debt from £28,000,000 to £26,000,000. I hope I may deal shortly with this question in replying to the criticisms which have come from the noble Lord the Member for South Paddington, and the right hon. Gentleman the Member for Derby, and from other hon. Members. I think the right hon. Gentleman the Member for East Wolverhampton has stated the case in this way. He said the noble Lord the Member for South Paddington and I would both agree in this, that the Income Tax, under the altered circumstances of the present time as compared with the prosperity of former years, could scarcely be left at 8d. in the pound, but that the noble Lord was for diminishing the taxation by curtailment of Expenditure, whilst I was in favour of relieving the taxpayers by diminishing the payment of the National Debt. The noble Lord the Member for South Paddington, although extremely friendly and complimentary to me in some respects,

  1513
  passed a very severe criticism upon j the proposal I submitted to the House. He begun by alluding to a compliment which I had paid to him—
  LORD RANDOLPH CHURCHILLM: I repudiated the first.
  MR. GOSCHENM: He repudiated the first compliment which I paid him, but which I think he certainly deserves—namely, that he did contribute to so-curing a surplus in the past year. The noble Lord was a vigilant and severe guardian of the public purse; and he succeeded in averting many a claim upon it which, but for the ferocity he displayed, would probably have reduced the very creditable surplus at the end of the year to a much smaller figure. Therefore, I hope the noble Lord will not repudiate the compliment I paid him. I will pay him a compliment also as to the Estimates for the coming year. In this direction he exercised his whole influence to diminish the Estimates of all the Departments; but I should be committing an error of taste if I were to attempt to distinguish how much was due to the noble Lord the Member for South Paddington, and how much to the noble Lord who presides over the Admiralty, and the right hon. Gentleman who is responsible for the War Department (Mr. E. Stanhope). I am aware that the noble Lord put every pressure in his power on the Departments in order to induce them to reduce expenditure; but how far the reductions were due to exertions on their part, or to the pressure brought to bear upon them by the noble Lord, will never be cleared up, but remains in the confidence of the noble Lord and his Colleagues. All I can say is, that when I came into Office I found a great disposition on the part of Heads of Departments to do their utmost to cut down expenditure and meet the views of the Chancellor of the Exchequer. The noble Lord was scarcely justified in saying that I did not mention economy from the beginning of my speech to the end. I spoke, as he acknowledged, upon the necessity of economy with regard to the Civil Service Estimates, and I also spoke of great economy that was being exercised on the part of Heads of the Army and Navy; and I pointed out how I trusted and believed that a large portion of the present expenditure for defensive pur-
  1514
  poses was exceptional and temporary. I also expressed confidence that in the coming year there would be considerable decrease in the expenditure; and it must not be forgotten, and the country must not forget, that the Estimates for the Supply Services this year show a reduction of between £700,000 and £800,000, as compared with last year. I regret that right hon. Gentlemen and hon. Gentlemen should put me—who am responsible for the public purse—into the position of having to defend expenditure upon the Army and Navy; but, at the same time, it would be unjust on my part if I wore to overlook the difficulties that have been placed on the great Departments by the exceptional measures which the noble Lord distinctly recognized, but which he said did not sufficiently account for the whole increase that had taken place. Now I wish there could be an opportunity, once for all, for the House in its corporate capacity to make up its mind what it wishes with regard to the Army and Navy, instead of from year to year, according to changes of Government, bandying to and fro charges of extravagant Expenditure. I wish that the House of Commons, or the country as represented by the House of Commons, would make up its mind, once for all, as to the amount it is right to spend, and that having made so up its mind, it would accept the sacrifices involved cheerfully, so as to enable the Chancellor of the Exchequer to frame his Budgets accordingly. We are most anxious to devise some plan by which we could so present the Estimates to the House as to enable them to define a policy not for one particular year, but for a series of years. I hope the Committee will think I am justified, after the speech of the noble Lord, in saying a word or two on this question of Naval and Military Expenditure. The point is this. If this expenditure is not necessary—if it is not absolutely essential for the security of the country—let it be reduced by all means, and let us insist that it shall be brought down to what is absolutely indispensable for the security of the country. But if it is necessary, then let us consider how the taxation requisite to meet it can be imposed in the most bearable form. To seek to persuade the country to reduce expenditure by putting taxation on in

  1515
  so disagreeable a form that the tax- payers refuse to vote what is demanded would be a course against which. I, for one, would seriously protest. Yet that is a doctrine which is almost avowed by some right hon. Gentlemen on the Front Opposition Bench. They say the only means of convincing the country not to undertake extra expenditure on the great Services is by making the taxation so uncomfortable that it will not be be submitted to. [Cries of "No, no!"] Well, that is not exactly the argument of the noble Lord the Member for South Paddington, but it is the variation of the noble Lord's argument adopted by the right hon. Gentleman opposite. He put it in that form. The noble Lord was very strenuous upon the point that any increase in our armaments ought to be borne by additional taxation. This was to make the country feel a great inducement to cut down expenditure by reducing armaments. The noble Lord says the sums now expended are much too large, and if the noble Lord thinks this expenditure too large he is right in using every effort to diminish it; and he is not far wrong, from the point of view which I alluded to just now, in desiring to put the screw on the country by means of stringent taxation. But I want the House of Commons, which I presume has some common sense, to decide for itself without the screw whether the present expenditure on the Army and Navy is too high or is not. I do not wish to be put in the position of defending the present scale of Army Expenditure, still it is right that the Committee and the public should remember that a great portion of that expenditure is due to the talent of inventors in constantly discovering new guns, new shells, new ammunition, and new engines of destruction of every kind; and that if these new inventions were not adopted, the Government would be blamed for not providing the Nation with the best weapons, just as when they are adopted, it is blamed for what is called extravagant expenditure. Now, what is the cause of the present exceptional Expenditure in the Army? Is it not in a great part due to the new small arm? Very well, if the House of Commons wishes the country not to vote these sums, and to put the screw on the taxpayers of the
  1516
  country by heavy taxes to induce them not to vote these increased sums, then do not lot us at the same time insist that it is necessary to arm our soldiers with the best weapon which is available at the moment? Are we or are we not to go into action with worse guns than those of our neighbours? It is not enough to point to increased expenditure; it is necessary to say in what respect the expenditure has been wrong, but neither the noble Lord the Member for South Paddington, nor the right hon. Gentleman the Member for Derby, nor the right hon. Gentleman the Member for East Wolverhampton, could place their finger upon any particular point such as the expenditure for securing new arms, and could say that that particular expenditure ought not to have been incurred. They say, generally, that there has been waste and maladministration, and, so far as that is the case, let us deal with it; but, at the same time, lot us also make up our minds whether we want less defence than we have at present. I, as Chancellor of the Exchequer, would be extremely glad to see a reduction in the Army and Navy Estimates of £3,000,000 or £4,000,000; but I say this with one reservation. If that reduction should lead to panics by which trade would be interrupted, by which credit would be affected, and consequently by which a great injury would be inflicted on the Revenue; and if these panics should lead in the future as they have led over and over again in the past, to reckless expenditure of public money the moment that the slightest danger arises, then I say that it is a dangerous and a wasteful policy in time of peace—such as we are now enjoying—and which we wish to continue to enjoy, to insist on an excessive reduction. Reductions on a large scale have frequently been made; but they have almost always been followed by a spasmodic increase afterwards, and by Votes of Credit, out of which an opportunity has been taken to fill up the stores that had been depleted in these seasons of economy. Such panics, have I may almost say, come to the rescue of the Departments after they had been unduly weakened by great fits of economy. Now, I trust that neither

  1517
  the noble Lord, nor any Gentleman opposite, will say that this language of mine points in the slightest degree to any inclination on my part to be less anxious with regard to economy than any other Member of the Committee. Of course, everyone in my position, if he has any ambition to deal with the important financial problems that are before the country, hopes not to be merely one year in Office, but to have more than an opportunity of proposing financial reforms. Therefore, no one is more deeply interested than the Chancellor of the Exchequer in seeing that there should be a large and progressive de-crease in the Army and Navy Estimates; and I shall use my utmost endeavours, with my noble and right hon. Friends at the Admiralty and the War Office, and with the rest of my Colleagues, to bring about a diminution in these directions. But I do not think, if the Government, as a whole, is convinced that a certain expenditure is necessary for the defence of the country, that it would be fair for the Chancellor of the Exchequer to endeavour to counteract that policy by making the burden for the discharge of this expenditure so disagreeable to the taxpayers that they would revolt against it. One word I am bound to say in reply to the right hon. Gentleman the Member for East Wolverhampton, when he says that our Army is the most costly Army in the world, and that we get the least amount of value out of it. I would ask, has the right hon. Gentleman added to the cost of foreign armies the cost to the population of forced conscription? I am continually seeing these comparisons made, and on paper they are extremely plausible; but when I see them I cannot but remember that in this country we are happily free from that blood-tax imposed on the rest of Europe, by which men are taken away in the prime of life, and at that period when it is most important for them to become bread winners, and are forced into the Army. Let the right hon. Gentleman add to the pay of Continental Armies the loss to those who are forced to enter them, and the loss to their families by their being taken away from remunerative employment, and he will find a totally different bill from what he appears
  1518
  to imagine. There is another point raised by the right hon. Gentleman the Member for East Wolverhampton, which I would refer, and that is a question which has as deep an interest for myself as it has for the right hon. Gentleman. I allude to the question of the Non-Effective Service. That is a source of expenditure which requires watching at every point. It is no use dealing with existing rights, because the right hon. Gentleman knows as well as I do that it is impossible to cut down the pensions of those who are now entitled to them. The proper course is to make different terms with those who may hereafter enter the Service, and that is a matter to which I agree the greatest attention should be paid. I think that, if possible, in our arrangements both for men and for officers in each of the great Services, we rely too much on pensions and too little on actual wages; but, of course, the claims of those who enter the Service to pensions enables us to secure them at a much lower rate of pay than we should be otherwise able to do. If this Non-Effective Vote did not exist, we should have to face a czrtain increase in the Effective Vote. And there is another point with regard to the Non -Effective Vote, at the present time, which should be borne in mind. No one who is sitting opposite to me will deny that some of the greatest reforms in the Army and Navy for which—and I associate myself with the right hon. Gentleman opposite—we have taken credit in the past, have consisted in the reorganization of those Services which we believe has added very greatly to their efficiency, but which has also added very largely to the Pension List. I do not know what effect was produced by the speech of the right hon. Gentleman the Member for East Wolverhampton on the right hon. Gentleman the Member for South Edinburgh, when he spoke of the large number of men who, having been underpaid for years, enjoy pensions without rendering any further service to the State. But there was no one who was more convinced of the necessity of creating that flow of promotion in the Services which now exists—and with reference to which the right hon. Gentleman the Member for East Wolverhampton drew a not very convincing analogy from the case of the Bar—than my right hon.

  1519
  Friend the Member for South Edinburgh. I regret the growth of the Non-Effective Service. It is a matter that must be watched; but it is not a matter for which either Party in the State can be considered particularly responsible. It is a matter in which the whole House of Commons should take an interest. But lot me return once more to the question of Expenditure in general. What I protest against is the view that the whole of the increase in expenditure for new weapons ought to be put on one class of taxpayers in order to create a rebellion amongst them against that expenditure which the House of Commons, in its wisdom, considers to be necessary. It seems to me a most objectionable policy that the House of Commons should vote these increased Estimates, and then should endeavour to disgust the country with the work which it has itself undertaken, by imposing taxation in a disagreeable form which will prevent the country from doing that which the House thinks it necessary that it should do. Now I do not know to what extent I have to defend myself against the proposition—apart from any question of Expenditure—that the reduction in the amount applicable to the Sinking Fund of the National Debt from £28,000,000 to £26,000,000 is a change that ought never to have been proposed. The noble Lord the Member for South Paddington says he doubts whether this is my own Budget. I am afraid I must tell him—though I fear, after what he has said, that it will lower me very much in his financial, if not in his personal estimation—that this is my own Budget. I am not only purely responsible for it, but I have proposed it upon my own initiative; and, as I am responsible for it, I must take blame for it, even though it increase the censure of the noble Lord. But the noble Lord did not object, as I understand, to the reduction from £28,000,000 to £26,000,000 in itself. I think he said the proposal was a good one. He did not object to tampering with the National Debt; but he objected to tampering with it in the particular mode I have proposed.
  LORD RANDOLPH CHURCHILL M: I tried to characterize the £6,000,000 which the country pays annually at present in reduction of the Capital of the
  1520
  National Debt as a great financial reserve weapon in the hands of a Chancellor of the Exchequer, which ought only to be resorted to in cases of emergency, such as war, or when the Chancellor of the Exchequer wishes to carry through some great financial operation with regard to the taxation of the country.
  MR. GOSCHEN: That is just the sentence of the noble Lord's on which I had fastened. This Debt-charge, he says, is not only a great financial weapon to be used in case of emergency; but it is also a great reserve for au enterprising Chancellor of the Exchequer who may want to carry out some large scheme of financial reform. It was precisely because it was to a certain degree in my mind, that it would be possible for a Chancellor of the Exchequer for the purpose of a great financial reform to seize not only on part of this £6,000,000, but on the whole of it—it was because I saw what a temptation this great reserve would be that I thought it safer to place the matter on a basis which could be defended, rather than to leave it on the basis on which it stands now. I saw that this £6,000,000 was a formidable and enticing sum to have at the disposal of a bold and enterprising Chancellor of the Exchequer. I could not guarantee the existence of the Sinking Fund for very many years if it were not placed on a footing more conformable to the financial condition of the time. I am sorry to have impaired this reserve of future Chancellors of the Exchequer by diminishing the amount which will be at the disposal of bold and adventurous spirits in the future. But it seemed to me that there were strong and immediate reasons why some relief should be given in certain quarters where taxation has failed to be remunerative, as in the Tobacco Duty, or where it has been raised temporarily and exceptionally, as in the case of the payers of Income Tax. For these purposes it seemed to me a legitimate operation to reduce the Debt-charge from £28,000,000 to £20,000,000. The noble Lord will remember that he was a Member of the Government that imposed the 2d. additional Income Tax—it was imposed, I think, by the right hon. Gentleman the Member for West Bristol (Sir Michael

  1521
  Hicks-Beach), when he succeeded the right hon. Gentleman, the Member for Edinburgh, and that at the same time suspended almost the whole of the Sinking Fund. This sacred sum which is to remain at the disposal of Chancellors of the Exchequer for great reforms, was again trenched upon in the following year to the extent of £800,000 by the right hon. Gentleman the Member for Derby. I do not want to enter into a controversy on this question with the noble Lord the Member for South Paddington, or with the right hon. Gentleman the Member for Derby, or any Member of this House, in any bitter spirit. I am glad that there is a considerable feeling in the House that the Debt should continue to be paid off in largo sums. I appreciate fully the spirit that animates the Committee with regard to that point; and it is a question for them to determine whether they think it is safer—looking to the future—and whether it is juster—looking to the present—whether it is fairer—looking to the incidence of taxation—that the whole burden of paying off Debt should be placed on one class of taxpayers; or whether I am justified in relieving that class and placing the Debt-charge, as I believe, on a safer footing in the future, by reducing the annual amount to £26,000,000. I have endeavoured to deal with the principal objections which have been raised against my proposals. I will now touch on some point of detail. A question was asked me by the right hon. Gentleman the Member for Derby with regard to Treasury Bills. The Treasury Bills which already exist, to my mind, are on too large a scale, the total Floating Debt being £15,000,000 or £16,000,000. It is extremely cheap, I will admit, and there is a temptation to keep the whole afloat; but I should not consider it to be regular finance permanently to rely on Treasury Bills to that extent. The noble Lord the Member for South Paddington asked a question with regard to the Customs and Excise; he asked whether the Estimate for Excise was not somewhat too high. I have explained to the Committee that there would have been a fall in Excise, had it not been for the anticipated increase of £130,000 on beer. This has more than compensated for the de-
  1522
  crease—not a largo decrease—on spirits. That decrease, as I stated, would have been larger but that there is an additional day for consumption in the year. With regard to other duties, we have allowed for a decrease in the Legacy Duty and Succession Duty; but a certain amount of increase has been set down in regard to stamps. The noble Lord was perfectly correct in saying—and I think this was also said by the right hon. Gentleman the Member for Derby—that it is the duty of a Chancellor of the Exchequer to accept in the main the views of his most able advisers in the Customs and Inland Revenue Departments; but it is also the duty of a Chancellor of the Exchequer to subject them to what may be called cross-examination. I have endeavoured to argue the matter with thorn, so as to elicit the whole of the facts, and I have come to the conclusion that, whatever the Estimates may be, they have not been placed at too high a figure. The Estimates with regard to spirits were framed very carefully, and the Estimates with regard to beer have been arrived at after taking into account the effect of the low price of hops and the extra day for consumption; and, on the whole, relying upon the ability of my advisers, I shall be very much disappointed if, at the end of the present financial year—if should it be my fortune still to preside over the finances of the country—I shall not be able to show at least the surplus estimated. I should hope it would be exceeded.
  SIR JOHN LUBBOCK: Like other Members of the Committee, I have listened with great interest to the very able Statement of my right hon. Friend the Chancellor of the Exchequer (Mr. Goschen). the proposal to keep a clear and separate record of local loan transactions is very important. As regards the Income Tax on farmers, I presume that under the proposals of the right hon. Gentleman the difference between English farmers on the one hand, and Irish and Scotch on the other, will be removed. Whatever reasons there might have been originally, I know none now why English farmers should pay more than those of Scotland and Ireland. I presume that it is not proposed to transfer the payments of those who avail themselves of his offer

  1523
  to Schedule D, but only that the calculation should be made on that basis. It is certainly desirable to keep the profits of farming in a special Schedule; and though it may be levied on the same principles as under Schedule D, I presume it will still be returned under Schedule B. Considering the great demands on the time and attention of the right hon. Gentleman the Chancellor of the Exchequer since his accession to Office, I do not wonder that he has not been able to mature any proposals with reference to the state of the gold coinage. At the same time, it is most unsatisfactory, and demands the early attention of the right hon. Gentleman. I may say confidently that, at the present time, more than 60 per cent is so light as to be no longer legal tender. Mr. Martin and Mr. Palgrave estimated it some years ago at 65 per cent, and Mr. Agar, the able secretary of the Institute of Bankers, confirmed me when I say that at present, certainly as much as 60 per cent is so much worn as to be no longer legal tender, and, of course, it becomes worse every year. To place the gold circulation in a proper condition would now cost, in round numbers, £1,000,000, and the wear and tear amounts to about £60,000 a-year. In round numbers, therefore, about £100,000 a-year is required to replace and keep the gold circulation in a satisfactory condition. I think, however, that we have a fair right to call on the right hon. Gentle-man the Chancellor of the Exchequer to provide this amount. At present he makes a profit of over £180,000 out of the English circulation, which is more than double as much as is required to keep the gold currency in a satisfactory condition. On account of the Bank of England notes he received last year over £153,000; for Stamp Duty, £60,000; and from the Mint £74,000. The hon. Gentleman the Member for the Whitechapel Division of the Tower Hamlets (Mr. Montagu) suggests that we should deal with the difficulty of light gold by the issue of £1 notes, and seems to think that there would be no danger from forgery in this country if that plan were adopted. He bases his statement upon Reports from foreign countries; but I would point out to him that the whole system of transacting financial business in
  1524
  foreign countries is so different from ours at home that I think it would be unsafe to rely upon those Reports the case of Scotland is, of course, one nearer in point; but we have this remarkable circumstance to remember—that in the old days when we had £1 notes in England, and they had £1 notes in Scotland as they have now, there were no forgeries of those notes in Scotland, whilst there were an immense number in this country the right hon. Gentleman the Member for Derby (Sir William Harcourt) said he never could see any reason for that. Well, I would suggest that the reason for that was that as in Scotland all the banks issued their own notes, the notes returned to the issuing bank in a few days; whereas in England, being issued by one central bank, they remained out for weeks, even for months. The consequence was that anyone who was inclined to forge knew that in Scotland the police would come down on them in seven or eight days, whereas in England they would, perhaps, have months to escape in. I think, therefore, this question should be carefully looked into before we return again to the old system of £1 notes the noble Lord the Member for South Paddington (Lord Randolph Churchill) proposed to raise the funds necessary either by doing away with the half-sovereign or by increased economy in management. With regard to doing away with the half- sovereign, I think he will find that the general opinion in mercantile quarters is that the half-sovereign is a very convenient coin; and, as regards economy, I doubt if any large sum could be secured in that way. Then there is the suggestion of the right hon. Gentleman the Member for South Edinburgh (Mr. Childers). when Chancellor of the Exchequer, that we should keep the half-sovereign, but should make it a token coin and reduce the amount of gold in it from 10 s. to 9s. I never shared the apprehension which was felt with reference to that change; but I think the right hon. Gentleman will agree with me that bankers at that time were very unwilling to agree to the proposal, and that it was not favourably received. The bankers, so far as their views could be ascertained, were ready to give an assent—but it was a reluctant assent—to this proposal in view of the

  1525
  great importance of having the question settled. I have shown, however, that the country derives a sum from the currency ample, and more than ample, to keep it in a satisfactory condition. Moreover, as more is required, I think it is worthy of consideration whether we might not make a moderate increase in the amount of notes issued against security. At present the total issue of Bank of England notes issued against securities is £15,750,000. The question arises whether some moderate addition to the issue against securities might not safely be permitted. The presumption, of course, is strongly in favour of such a conclusion. The amount issued otherwise than against gold is absolutely less now than it was 40 years ago, while, in the meantime, the population and commerce has immensely increased. No doubt the amount issued by the Bank of England itself has been raised from £14,000,000 to £15,750,000; £475,000 was added in 1855, £175,000 in 1861, £350,000 in 1866, and £750,000 in 1881; but this has been to replace other lapsed issues to a still larger amount—over £3,000,000. Now let us consider what has been the actual amount of Bank of England notes in circulation. Last year the lowest sum in circulation was £33,400,000 on December 29; in 1881 it was £35,000,000 at the same period. Since 1870 the amount has never once fallen to £33,000,000. In the last 20 years it has never fallen as low as £30,000,000. Since the original passage of the Bank Act it has never fallen below £21,000,000, or, on the present basis, £24,000,000. Under these circumstances, it might be worthy of consideration whether the amount could not be raised somewhat without risk. Even if the amount were kept exactly where it stood when the Bank Act was passed, and we were to do no more than re-issue the amounts of country bank circulation which have lapsed, the interest thus accruing would be sufficient not only to make good the annual loss from wear and tear, but also to provide a fund which would go far to replace the present light gold without additional loss to the country. The longer this question is deferred the more serious and difficult it will become; and I earnestly commend it to the early attention of the
  1526
  right hon. Gentleman. I also greatly regret the proposal to reduce the Tobacco Duties under existing circumstances. As to Marine Insurance, I think it only right that I should express my thanks to the right hon. Gentleman for his statement, having on several occasions urged successive Chancellors of the Exchequer to reduce the stamps on certain classes of Marine Insurance. He says, truly, that the effect of the present system has been to drive a certain class of insurance almost entirely out of the country. I am glad that he has seen fit to lower the duty, and I am disposed to think that he may receive a larger revenue from the small duty than he received from the higher duty. But I cannot say how much I regret some of the other proposals of the right hon. Gentleman. In the first place, the increased subvention to Local Authorities appears to me to be a step in the wrong direction, and one I never expected to hoar the right hon. Gentleman himself propose. With regard to the contribution to Ireland, I would suggest that if he is going to make it at all, it would be better to do it by way of increasing the stipends of the under-paid schoolmasters rather than in any other way. But the cardinal feature of the Budget really is the reduction of the amount set apart for repayment of capital of the National Debt. The right hon. Gentleman, in support of his scheme, says he puts this sum in a position in which it can be defended. Why will it be more defensible in the future than it has been before? It seems to me that his proposal will make it more difficult to defend it. The plan proposed by Sir Stafford Northcote, if it had been carried out, would have enabled us to reduce the National Debt by a substantial figure, and would, in the course of a few years, have enabled us to effect a reduction of the interest on Debt to the advantage of the taxpayers of the country. Sir Stafford Northcote's Sinking Fund, however, was never put in force on the lines he proposed; but I did hope that now his old Colleagues are on the Treasury Bench they would, in the present time of peace, have mentioned the Sinking Fund upon which he laid so much stress. The Chancellor of the Exchequer is re-

  1527
  ducing the amount of payment in extinction of Debt, and is doing this in a time of profound peace. I cannot help feeling great regret that he is taking this course. I think it shows a want of firm policy. There would be much greater confidence felt in the statements made with regard to reduction of interest on Debt if people could feel that successive Chancellors of the Exchequer have made up their minds what course they intend to pursue with regard to this great question. The noble Lord the Member for South Paddington rather threw out a hope that the right hon. Gentleman might probably reconsider the course he is proposing in this matter. I do not know if it is too late for the right hon. Gentleman to do so. In the remarks he made just now he seemed to be glad that his proposal had been freely criticized by the Committee. I think he will see that it is the desire of the Committee to continue the payments in reduction of the National Debt. Though it is true, as he says, that if we continue the reduction at £5,000,000 a-year we shall pay off the Debt in 70 years, that is assuming that we are so fortunate as to remain at peace and suffer no great national disaster. That, I think, is too much to hope. Under the circumstances, we were not doing too much for reduction of Debt; and I regret, moreover, that the right hon. Gentleman has, to some extent, committed himself to the future, because, though he only gives up £1,500,000 of Income Tax this year by the process I have referred to, the remission next year will be £2,000,000. I certainly concur with what has been said by other speakers who have expressed regret that the right hon. Gentleman has not reduced the Naval and Military Expenditure, instead of interfering with the repayment of Debt.
  MR. C. W. GRAY: My reason for venturing to take part in this discussion is that I was sent here to watch those questions which affect agriculture, and I do not like this opportunity to pass without thanking the right hon. Gentleman for, at any rate, remembering agriculture in the Budget he has just placed before us. I was very much surprised to find that the right hon. Gentleman the Member for Derby (Sir "William Harcourt) seemed to demur
  1528
  to agriculture and trade being described as being in a state of great depression.
  SIR WILLIAM HARCOURTM: I did not speak specifically of agriculture; I was speaking generally.
  MR. C. W. GRAYM: I am very glad I have elicited that explanation from the right hon. Gentleman. I must say I fail to see how agriculture can be de-pressed—and "ruin" is a bettor term for its present condition—without breaking down with it all other trades and industries in the country, For that reason I should say that everyone interested in either trade or agriculture must be indebted to the right hon. Gentleman the Chancellor of the Exchequer for doing a little for us, if not very much. I feel sure it is to future Chancellors of the Exchequer, and to future Budgets, that agriculture will have to look for some relief and for restoration to that proud position which it used to occupy. We heard a good deal about land tenure yesterday; but I believe it will be fiscal reform that will bring back agricultural prosperity more than anything that can be done in the direction of a Land Bill. The right hon. Gentleman the Member for East Wolverhampton (Mr. Henry H. Fowler) appeared to me to prejudge the small subvention which the right hon. Gentleman the Chancellor of the Exchequer is about to give to the agricultural interest. I am very much surprised indeed to find that any hon. Member of this House should judge so small a subvention as this. I think I understood the right hon. Gentleman to say that rating had not increased in the rural districts? [Mr. HENRY H. FOWLER assented.] I see he assents to that. Well, if rating has not increased, certainly the power of paying rates has greatly decreased. It was not long since a fresh impost was placed on the shoulders—the already galled shoulders—of the farmers, I mean the School Tax. I agree that national education is a great thing, and I shall certainly uphold it; but the farmer is not in a position to pay increased taxes, and anyone who has his interest at heart will not grudge him the small subvention which has been granted to him. by the Chancellor of the Exchequer. A great deal has been said in connection with the Army and Navy. I should be getting out of my depth if I were to do

  1529
  more than touch on that point; but I must remind hon. Gentlemen who seem to grudge money for the maintenance of the Army and Navy that so long as they insist that foreign productions shall be admitted into this country without paying duty—I am now alluding to food—they must remember that the position of England may be jeopardized one day by the fact that we are only able to grow a very small proportion of the food required for the subsistence of the nation. Please to remember that. And if you will not allow one word in connection with fiscal reform to be dropped in this House as applied to food, remember that you must take the consequences, and you must be willing to find the money to keep your ports perfectly open, and to protect the seas by which your food comes in, or else you will find one day that the cheap loaf of which we had heard so much will turn into a dear one. You will find that the land you have allowed to go out of cultivation will not become covered with grain by the magical wave of a wand. Before the land you are allowing to go out of cultivation, and in aid of which you begrudge this small subvention, could be made to produce the food we want, we might be at the mercy of some Foreign Power. There are many other matters mentioned in the Budget which might give relief to agriculture; but it would not be fair, at this hour of the morning, to touch upon them. All I can say is that if hon. Gentlemen opposite care one rap for the position of England's agriculture, they must show more sympathy with us in the future than they have done in the past. English farmers, I am proud to say, have kept quiet, under the greatest temptation, to go in for agitation. But there may be an end even to the patience of an English farmer. I hope, however, it will be shown that it is not the case that the House of Commons only listened to grievances which had been brought to its attention by turbulent agitation. I thank the House for having listened to these remarks; and I most sincerely hope that no one will suffer from the little attention which has been given to my industry by the Chancellor of the Exchequer to-night.
  MR. CHILDERS: Mr. Courtney, I propose to-night to
  1530
  adhere to the old rule, which was that the debate, on the first night when the Chancellor of the Exchequer has opened his Budget, should be confined as much as possible to asking questions arising out of his Statement, and to obtaining further information upon points of doubt. Therefore, all I wish to say on the general question, I think I can say in a very few words. The Chancellor of the Exchequer appears to me to have placed before the House, extremely clearly, questions which are really of great complication, and however some of them may involve difficulty, he, at any rate, has done his utmost to make them clear to all of us. I thank him very much for the great length at which he explained to the House some points—points which, perhaps, might seem to be of less importance, but which, in reality, form most valuable portions of his Budget, and which will be very much better debated on future occasions, in consequence of the very great clearness, and oven the great length, at which he stated some of them. But I rise particularly to ask the Chancellor of the Exchequer one or two questions which we shall have to discuss on the day to which the present debate is adjourned, and which must form part of the most important section of that discussion. I wish to allude, in the first place, to the proposal with respect to the National Debt. the Chancellor of the Exchequer has stated very plainly what he proposes to do; but what I think he will have very clearly to put to us when we on the next occasion are discussing the Budget—with respect to the diminution of the amount set aside for reducing the National Debt, is why he thinks it would be easier to stand by £26,000,000 than by £28,000,000. At first sight, of course, it was very much bettor to stand by what is and has been the law now for some years, which all Chancellors of the Exchequer following the late Sir Stafford Northcote have adhered to. It was necessary, on one occasion, in a great emergency, to abandon for a year the reduction of the Sinking Fund; but I think it will be necessary for the Chancellor of the Exchequer to show, very categorically, how it is easier to defend 26,000,000 than to defend £28,000,000, and how, if he is Chancellor of the Exchequer for another

  1531
  year or two, he will be able to repel demands for the reduction from £26,000,000 to £24,000,000, for instance, on the ground he has stated tonight. But I wish to put two other points to him for his consideration. He has said that this is the third year of the great Naval Expenditure initiated by Lord Northbrook; that Lord North-brook proposed to spread the expenditure over five years, and that the skill and the energy of the present Government and the First Lord of the Admiralty and the Secretary of State for War have had the result of reducing those five years to three years, so that, at the end of the present year, that expenditure of about £6,000,000 will come to an end, £6,000,000 being, on an average, £2,000,000 a-year. The question I should like the Chancellor of the Exchequer to answer is this—if, therefore, we may look forward to a considerable reduction of this expenditure next year, why in this year make an alteration in the sum applied to the reduction of the National Debt? If you tide over the present year, you find the expenditure of the Army and Navy diminished by £2,000,000, and then there will be no excuse for reducing the Sinking Fund; and I should like the Chancellor of the Exchequer to deal with that question. Then I wish to put this question. He gave reasons which were very intelligible why £28,000,000 was the amount set aside in prosperous times, when Sir Stafford Northcote fixed the amount of the Sinking Fund. But I want him to answer this—has he considered what proportion that bore to the entire amount of Revenue, or the entire amount of Expenditure? Because, I think he will find that when the Revenue was £72,000,000 a-year, Sir Stafford Northcote was of opinion that £28,000.000 was a fail-amount to be attributed to the reduction of the National Debt. Now the Revenue has increased to £90,000,000, and the primâ facie argument will arise—if you have £90,000,000 of Revenue now, where you had only £72,000,000 before, and if out of that £72,000,000 £28,000,000 was to be sot aside for the reduction of the National Debt, you ought now to set aside not a smaller but a larger sum. Instead of that, the Chancellor of the Exchequer is proposing to set aside a
  1532
  smaller sum. I think that argument will require to be met. It is an argument which must occur to anyone considering the subject, and it was an argument which was very strongly put forward by Sir Stafford North cote himself, and also by my right hon. Friend the Member for Mid Lothian (Mr. W. E. Gladstone) when he supported, some years before, a large amount to be attributed to the Sinking Fund only in the shape of Terminable Annuities, in anticipation and to operate in lieu of the Sinking Fund settled by Sir Stafford Northcote. These three questions are, I think, worth the attention, of the Chancellor of the Exchequer. I said, I am not going to discuss the matter further, but to reserve the question to a future day, and I do not think it necessary to do more than ask these questions. All I have to do now is to say, in his presence, what I said said when he was not in the House, that I think he gave us very clearly an extremely difficult Statement—a Statement as difficult as any I have ever heard announced by a Chancellor of the Exchequer in this House; and that we own him very much in the shape of relief from the necessity of inquiring into points of detail; because, as I presume, we shall have, in a few days, his speech in our hands, so that we can refer to it. But I would ask him to expedite the printing of his speech, so that we may have the terms of the Statement he has made to us to-night in an official and formal shape; and also I hope he will, in some way, let us sooner have the figures of the computations of some of which he has only given the results. I have said I will not argue any point, and I will only conclude by asking the Chancellor of the Exchequer to what date he proposes to adjourn the Committee. We shall, I presume, pass the Tea Resolution as customary. [An hon. MEMBER: And Income Tax.] No, Sir; the Income Tax Resolution involves a change. There is no hurry, for I have known the Income Tax Resolution passed in the month of May. It would be very inconvenient to take a Resolution effecting change as a mere matter of form. Where there is no change there can be no objection to it.
  Mr. GOSCHEN: I would ask the right hon. Gentleman opposite, whether he will consider whether we might not take at

  1533
  all events, the reduction of the Tobacco Duty now? The trade is disturbed for a considerable time when a Resolution of that kind is hanging over its hea d. The Income Tax is of course extremely inconvenient. I acknowledge the force of the right hon. Gentleman's remark. I do not propose to press it; but with regard to the Tobacco Duty, if right hon. Gentleman opposite saw their way to assent to that Resolution, it would certainly further what we nearly all agree would be a desirable reform.
  MR. CHILDERS: I look upon the proposal as to the Tobacco Duty as in all probability a good one; although I ought not to commit myself to more than that. But let me remind my right hon. Friend that the reduction of the Tobacco Duty cannot take place for some time, as there are large stock s. Therefore there can be no hurry about the matter. From what time does my right hon. Friend propose that it should take effect?
  MR. GOSCHEN: I was going to say I propose to fix this day month, the 21st of May, for the reduction of the Tobacco Duty; and the new drawback, which will be 3s. 3d. instead of 3s. 7d., may well come into operation on the 31st of May.
  MR. CHILDERS: I think those are very reasonable dates; and if these dates are adopted, we might well pass the Resolution next week.
  SIR ROBERT FOWLER: I have to ask the attention of my right hon. Friend the Chancellor of the Exchequer to what fell from my hon. Friend the Member for the University of London (Sir John Lubbock) with regard to the half-sovereign. I hope the Chancellor of the Exchequer will give his best attention to it. I have listened to the speech of the Chancellor of the Exchequer, and I listened to one part with great satisfaction, and to another portion with great regret. What I listened to with great satisfaction was the proposition with regard to the local Budget. The right hon. Gentleman, being not only a statesman but a man of business, sees the great advantage of the alteration he has proposed. I believe it will be of the very greatest advantage. The part of his speech that I listened to with regret, was that which has been alluded to by the noble Lord the Member for South Paddington (Lord Randolph Churchill), by the hon. Member for the
  1534
  University of London, by the right hon. Gentleman the Member for South Edinburgh (Mr. Childers), and others, in regard to the reduction of the £28,000,000 to £26,000,000. The late Sir Stafford Northcote made a great effort to reduce the Debt. I think it is a matter we should always bear strongly in mind to endeavour to effect a reduction of the Debt. I am very sorry to see a Government, and especially a Chancellor of the Exchequer in whom I have such confidence, lending themselves to such a course as this proposed reduction of the Sinking Fund. I may stand rather alone in the House, but of the three Budgets which the noble Lord the Member for South Paddington sketched out, it seemed to me that the first Budget was that which the Chancellor of the Exchequer might have adopted, when my right hon. Friend might have kept his surplus, not made any reduction in taxation, and taken the surplus of £800,000 or £900,000 which he would have in the Budget as it originally stood. It does not seem to me that £800,000 is too large a surplus for a Chancellor of the Exchequer to have. I know that his surplus, as far as my memory serves me, is some £100,000 larger than was last year returned by the right hon. Gentleman the Member for Derby (Sir William Harcourt). But I think both the right hon. Gentleman the Member for Derby and my right hon. Friend are sailing too near the wind. I think it would be desirable that any Chancellor of the Exchequer, bringing his Budget into the House, should have a surplus of something like £1,000,000. I do not think that is at all too large a surplus It would leave a margin for contingencies. At this hour of the evening I do not wish to detain the Committee; but there are these two points upon which I wished to express my opinion. I wished to express my satisfaction with the proposition with reference to the local Budget, but I greatly regret the proposition which has been made that we should not retain the principle laid down by Sir Stafford Northcote as regards the reduction of the National Debt.
  SIR JOSEPH PEASE: I do not wish to detain the Committee more than a few minutes. There are one or two points on. which I wish to say a word. I

  1535
  listened, with great attention, to the very excellent and very practical statement of the Chancellor of the Exchequer. It was certainly an essay in finance which ought to be a good lesson to this House; but, at the same time, there were several points to which I felt I must take exception. With regard to the point mentioned by the hon. Member for the Mal-don Division of Essex (Mr. C. W. Gray), the subsidy of £245,000 in aid of local rates, I look upon all those subsidies to local rates as only postponing a much larger and greater question which will have to be solved in connection with the agricultural interests of this country. This £245,000 will make no appreciable impression whatever on the rates paid by the agricultural interests of this country. It is like the case of the woman throwing her youngest child to the wolf, and then another child, and so on, but still the wolf follows on. The question raised by my right hon. Friend is a much larger question than will be solved in this way. It will only stand to the very much distressed farmer at the present time, as the child to the wolf. I think if farmers receive this with open arms, they are thankful for small mercies. Certainly, the farmers in my district will not thank them for these mercies. They complain that school rates, highway rates, and Union assessment rates, often amounting to 5s. to 7s. in the pound, all fell upon their shoulders. With regard to the transfer fee for railway and other stocks, I hardly like to give an opinion upon it, until I see the proposition more distinctly; but I cannot imagine that the Railway Companies of this country, with their £800,000,000 of capital, will care to pay a tax of £400,000 a-year, in order that they may free their shareholders from the cost of transfer, if this is the proposal. It seems almost too ridiculous, to put it in that broad way; and, therefore, I think the Chancellor of the Exchequer will have to be content with the present amount of stamps which he already gets upon transfers. But, whilst I regret very much the position of the agricultural interest in this Budget, I also very much regret that the question of the Carriage Duty has not been dealt with. I believed the abolition of the Carriage Duty would do more for the agricultural interest than all the
  1536
  grants of £245,000 they receive, in this way—that it would enable many men farming near railways to keep carriages, and in the summer time they would be able to do passenger and other work. I believe the agricultural interest would be much more served by the abolition of the Carriage Duty, which would affect the middle class much more than the upper class. With regard to the Civil Service Estimates, I have always rejoiced, although there may be some little waste at South Kensington, in the much larger Estimates for the Education Votes of this country. They are showing their effects in the well-ordered population of the country in times of great depression, and, in many cases, great want. In the meantime, our pauperism has not increased to any appreciable extent in these bad times; whilst our prisoners and convicts have very much decreased under the beneficial influence of the education of this country. Therefore, I say it is not lost money to begin with, and I think that these Educational Grants will have still to be very much further extended, in order that we might get to that technical education which is so much required in this country, so that we may keep our manufactures and our agriculture up to the mark in the great competition which they have to undergo with all the nations of the world. But, after all, we come back to the great question of the Army and Navy, which has been so ably touched upon to-night. When I came into this House I seconded Motions for a reduction of the Budget by £5,000,000 or £6,000,000. We have a great example at the other side of the Atlantic, where they have 25,000 troops of all arms spread all over the country, and are repaying their Debt. We have now a Budget of £31,000,000 for our Army and Navy, when we could content ourselves with £6,000,000 or £8,000,000 less. If technical education is to go on—if this country is to march with other nations—it will either have to tax itself much more heavily on the necessaries and luxuries of life, or it will have to reduce the Army and Navy appreciably and sensibly. Although the announcements of the Chancellor of the Exchequer were of a very satisfactory flavour, as they came out, yet it seems to me they come to very little. We are

  1537
  going to get 1d. off the Income Tax, and the sum for the reduction of the National Debt is going to be reduced from £28,000,000 to £26,000,000. It is merely a play upon finance. It seems to me we have got exactly back to where we started with the Sinking Fund, when the right hon. Gentleman the Member for Mid Lothian (Mr. W. E. Gladstone) said that, whilst he approved of paying off the National Debt, the amount at which the National Debt would be discharged would be entirely dependent on the exigencies of the country. This question will be further discussed; but it seems to me that these points I have mentioned are points upon which my right hon. Friend's Budget has failed.
  MAJOR RASCH: I will not occupy the time of the Committee more than five minutes, and I only rise because I represent a large agricultural constituency which grows, possibly, a greater breadth of wheat than almost any district in England, and which is unquestionably hard hit by the existence of agricultural distress. We did not expect a very brilliant Budget from the Chancellor of the Exchequer, nor any heroic reforms, because we know perfectly well that any legislation must come from below and not from above. It must come from the agricultural labourer. We know, Sir, that we have the sympathy of the Chancellor of the Exchequer, because he said the other day that, in his opinion, taxation ought to be borne by real property and personalty in proper proportion, and also because we know that he thinks that burdens on land have increased and are increasing, whereas they ought to diminish. But our agricultural constituents will think that the concession he has made in reference to Schedule D is rather like a paper concession, and is really only a drop in the ocean of agricultural distress. What we want is a remission, or rather a redistribution, of local taxation. I say a redistribution rather than a remission, because I know that if local taxation is remitted, it must be redistributed so as to fall on some other shoulders; and I think that the shoulders of the farmer are those least able to bear any extra charges beyond those which fall upon them already. I think that the agricultural distress now existing is not un-
  1538
  worthy of the attention of the Chancellor of the Exchequer. Lund is going out of tillage all over England, and in Ireland to the extent of thousands of acres, and when land is out of tillage employment for the agricultural labourer ceases, and when his employment ceases of course his wages cease. The problem, therefore, that the Chancellor of the Exchequer of the future will have to face is how the labourers are to be kept when there is no work for them to do. At the same time, on the principle that half a loaf is better than no bread, we, in the agricultural districts, shall gratefully accept the concession which the right hon. Gentleman has offered us.
  MR. FINCH-HATTON: Mr. Courtney, as a Representative of an agricultural district, I must offer to the Chancellor of the Exchequer far warmer thanks for his concession respecting Schedule D than the hon. and gallant Gentleman who has just sat down. I think the right hon. Gentleman, from what he stated in his speech, sympathizes far more widely and deeply in the depressed condition of the agricultural interest than even that concession would lead us to suppose; because he announced that the time had come, or was shortly coming, when the whole question of the taxation of agricultural property would have to be considered by the Chancellor of the Exchequer, and that under their Local Government scheme personal property would have to bear its fair share of local taxation. I think that everyone in this House will congratulate the right hon. Gentleman upon the fact that he has been able, by an ingenuity which is, I think, unparalleled, to lay under contribution in this Budget an element which I believe has escaped the vigilance of all other Chancellors of the Exchequer—I mean the element of water. The right hon. Gentleman has thus been able to offer a great been to the working classes of the country, and one which I know they will appreciate. He has been able to provide them with a stronger glass of beer, and also with better tobacco to smoke. At the same time he will reconcile two interests which have never before been harmonized, because, by a curious coincidence, the teetotallers, who will probably disapprove of both results

  1539
  will thank the Chancellor of the Exchequer for having made choice of the element they favour in order to bring those results about. The right ton. Gentleman the Member for East Wolverhampton (Mr. Henry H. Fowler), in dealing with the question of rates, made a statement which I rose immediately to reply to, but which I was glad the Chancellor of the Exchequer rose at the same time to answer, because he was able to do so much better than I could have done. But I may supplement what my right hon. Friend said by a remark which I think is called for—namely, that although it may, perhaps, be true, as the right hon. Gentleman opposite said, that county rates have only increased by 11 per cent, whilst rates in towns have increased by a much larger percentage, the ratio at which the value of property has increased is very much greater in towns than in the country. In fact, the great difficulty and danger of the agricultural problem is that, while other property has increased in value, agricultural property has actually decreased in value. The great question arising on this Budget is, I think, whether or not the Chancellor of the Exchequer was justified in partly suspending that fund which we have allocated, hitherto with praiseworthy regularity, to the reduction of the National Debt? I understand the argument of the Chancellor of the Exchequer to be that there are times when it is necessary, in the interests of the community, to remit taxation, in order to produce what I may call that elasticity with regard to Revenue which will bring us back to the point at which the normal repayment of Debt can be resumed. In the same way, a prudent landowner might make a practice of devoting part of the revenues of his estate to the gradual extinction of the mortgages with which it was burdened; but when it came to a question of whether he should, in a particular year, adhere to that practice, or spend a sufficient amount of money to keep the estate going, he would say—"I will keep the estate going, so that I may be in a better position in future years to pay off the mortgages." That is the position, I think, which the right hon. Gentleman takes upon this question. I should like to ask the right
  1540
  hon. Gentleman one question with regard to the very interesting proposal he made—that Companies should pay 1s. for each £100 of Stock, in lieu of the transfer money now exacted from their shareholders. I would ask the right hon. Gentleman whether, in view of the fact that a great many Companies do not call up the whole of their share capital, he means that the 1s. shall apply to the whole of the share capital of a Company, or only to so much of it as is called up? I think that the Chancellor of the Exchequer's answer on this subject will make a great difference as to the point of view from which his proposals will be reviewed. With regard to the question of the profits calculated under Schedules D and B, the Chancellor of the Exchequer mentioned a fact which is within my own knowledge—namely, that it is very seldom that farmers keep good enough accounts to satisfy the Revenue as to whether or not they are making the profits which they are alleged to make. I think it would assist farmers very considerably if the Chancellor of the Exchequer, or some other Gentleman on the Treasury Bench, would shortly state under what main headings the Government would like farmers to show the accounts of their revenue. The question is a difficult one, but I think they should know that, in order that they may obtain the full benefit of the remission which the Chancellor of the Exchequer wishes they should have. I am not quite certain whether the right hon. Gentleman gave us in his Estimate the amount which he expects the Revenue to lose from this change, or, in other words, whether he stated the amount which the farmers would gain. I would ask him whether he can let us know what the amount will be? These, then, are two practical questions which I wish to put to the Chancellor of the Exchequer. I think there is some further credit due to the right hon. Gentleman with regard to the separation of the local loans from other accounts. This is a point which I do not think has yet been mentioned in the discussion. It appears to me to be a most apposite proposal, at this particular time, when we are about to entrust greatly enlarged powers to local authorities, that the country should be able to draw a distinction between local

  1541
  and Imperial funds. Unless some such proposal be adopted we should very soon get into a complication of accounts compared with which the facts stated by the right hon. Gentleman would be of small magnitude indeed. I think, therefore, the Chancellor of the Exchequer has done a real service to the country in separating those funds. I should like to say one word, as an independent Member, on the question of economy in the Naval and Military Services. It appears to me that, in the speech which the noble Lord the Member for South Paddington (Lord Randolph Churchill) delivered in this House, he stated the undoubted truth when he said that economy ought to be combined with efficiency; but he did not indicate one single item in which the Estimates could be reduced without sacrificing efficiency to economy. The only point in which, as far as I could gather, the noble Lord desired that the Estimates should be reduced was in regard to coaling stations. Now, Sir, I do protest against anything being done by this House which would have the effect of rendering less secure the coaling stations, which are, as it were, the only stepping-stones upon which your war vessels can cross the ocean to the help of your Colonies in times of war. I should like to see some part of the surplus asked for by the Admiralty in order to strengthen the coaling stations. Although we all agree that economy and efficiency are admirable things, I do hope that those Gentlemen who criticize the Estimates in this House will show us how we can have the one without sacrificing the other. One suggestion was made by the right hon. Gentleman the Member for East Wolverhampton (Mr. Henry H. Fowler) as to an economy which might be practised in regard to the £5,000,000 a-year we are now spending on Non-Effective Services in connection with the Army. But I would point out that the arrangement under which this £5,000,000 has grown up proceeded from right hon. Gentlemen on the Front Opposition Bench; and, therefore, we must leave them to settle among themselves the policy which dictated it. If I remember aright, it is the short-service system that has retired so many officers whilst in the prime of life, and has left upon the country the pensions
  1542
  which hon. Gentlemen opposite so much object to. Except on these points, there has not been a single direction pointed out in which these Estimates can be reduced.
  MR. GOSCHEN: I will just reply to the question which the hon. Member has put to me. The 1s. will be levied upon the paid-up capital of Companies. I must apologize to the right hon. Gentleman the Member for Derby (Sir William Harcourt) for not having answered the question he put to me with regard to the simplification of the accounts. That is a matter to which I will give my closest attention. I admit that the accounts are not as well understood as they ought to be, and if I can simplify them I shall be very willing to do so. As to the question that has been asked respecting the proposal made with regard to Schedule D, it appears to me that Chambers of Agriculture and those who are conversant with these subjects will be able to render considerable assistance in that matter.
  SIR RICHARD TEMPLE: In deference to the interests of the people of India, I have to ask the Chancellor of the Exchequer whether he will be pleased to consider favourably the remiss-ion of the duty on the silver work imported from India to England? I am aware that this matter has been, in former discussions, mixed up with the question of hall-marking. But I do not wish so to mix it up. Personally, I am in favour of the system of hall-marking, as insuring public confidence in the articles so marked. But if this process is found to be too rough for the delicate silver fabrics of India, then some other mechanism can be found for assaying the purity and quality of these fabrics. Sir, the remission of this duty was proposed by a Committee of this House in 1879. It was mentioned in the Budget Speech of 1881. A more recent discussion took place in this House in May, 1884. On that occasion the hon. and learned Member for Chatham (Sir John Gorst) spoke as follows:—
  "He wished to bring a little friendly pressure to bear upon the Chancellor of the Exchequer with regard to this subject…It Was admitted on all hands that this tax ought to he abolished. The Government themselves had in three successive years proposed to abolish it. The only reason that it existed appeared to be

  1543
  the difficulty of dealing with the question of drawback. If, as the hon. Gentleman (Mr. Slagg) stated, £100,000 could settle this matter, the Chancellor of the Exchequer would, he thought, be delighted to settle it on those terms."—(3 Hansard, [288] 463–4,)
  Now, Sir, the hon. and learned Gentleman has become Under Secretary of State for India. I hope he will exercise his benign influence in the direction indicated by him in 1834. I know that £100,000 may not cover, perhaps, the whole amount of drawback that would have to be allowed. This drawback is, in fact, a refund of the duty which would have to be allowed in the event of the duty being remitted. Otherwise, the unsold silver which had paid duty would be placed at a disadvantage in competition with the silver which, by the remission of duty, would be excused from payment. Still, the drawback would not be allowed to every holder, nor to all silver; but only to silver duty-paid and unsold at the time in the stores of the silver merchants. On this point, in May, 1884, the hon. Member for Bodmin (Mr. Courtney)—of whom I desire to speak with special respect in your presence, and who was then Secretary to the Treasury—made a useful suggestion which I will quote, to the effect—
  "That some understanding should he arrived at with the big dealers in gold and silver plate as to the terms on which their claims for drawback could reasonably be mot."—(Ibid. 470.)
  Sir, I am sure that in that way the question may be arranged with great satisfaction to the importers, and with justice to the claims of India, for which four main reasons may, in brief, be adduced. First, this silver work is a manufacture of extraordinary beauty, which, if unfettered, may attain great popularity in England. Secondly, the trade between India and England has, on the one hand, stimulated the exportation of raw produce, but has extinguished many of the ancient Indian manufactures. I cannot complain of this process of trade and industry; but I urge it as a reason why we should maintain, so far as we fairly can, those characteristic and interesting manufactures which still remain. Thirdly, India has been generous to British interests in remitting all duties on the importation of British manufactures. And, fourthly, this Indian silver work does not compete with any articles
  1544
  manufactured in England; but if allowed a fair field, without any fiscal burden, it will make its way in England and hold its own there.
  SIR WILLIAM HARCOURT: I think that as it is getting late it will be a great convenience to the Committee if some Member of the Government will tell us on what day the debate will be resumed, as the Committee will be anxious to make their arrangements. Will it be taken on Monday; and, if not, what Business will be taken on that day?
  THE FIRST LORD OF THE TREASURY (Mr. W. H. SMITH): I think, Sir, it will be more convenient if I state to-morrow afternoon, at half-past 4, what Business will be taken on Monday. It had been intended to take Supply on Monday; but if it should be more convenient to the Committee generally that the Budget Resolutions should be agreed to on Monday I should wish to meet those views.
  MR. GOSOHEN: In reply to my hon. Friend behind me (Sir Richard Temple), I may say that two days ago, if he had raised this question, I should have told him that I was going to deal with the matter in my Budget, and that I was going to make a proposal which I thought was favourable to the introduction of Indian silver into this country. At the last moment, however, a difficulty arose which prevented me from doing so. If I should see my way to deal with the subject I will certainly do so.
  COLONEL BLUNDELL: I am sorry, Mr. Courtney, to detain the Committee at this late hour; but I think that the statement which has been made by the right hon. Gentleman the Member for Wolverhampton (Mr. Henry H. Fowler) as to the increase of the normal expenditure on the Army and Navy should not pass unchallenged. I consider that when this subject is dealt with the Committee ought to be furnished with the normal expenditure per head of the population, instead of being referred, as we always are, to bygone days, when the population was far less than it is now, and when the needs of the country were also far less. The reason why I ask whether the normal expenditure has increased is this—it is very difficult for anyone to find out exactly what is the normal ex-

  1545
  penditure. But, at the end of 1883, the right hon. Gentleman the Member for South Edinburgh (Mr. Childers), in a speech he made at Pontefract, boasted that he had saved '2s. l1 d. per head of the population in that expenditure since 1870. The right hon. Gentleman's contention, therefore, amounted to this—that between 1870 and 1883 the normal expenditure of the country upon the Naval and Military Forces had declined by that amount. Various circumstances have occurred since 1883. The Forces in India have had to be increased by 10,000 men, on account of a changed state of conditions on the frontier, and there has been considerable expenditure in Egypt. I contend, however, that it has yet to be proved that the really normal expenditure of the Army and Navy—estimated as I have contended it ought to be estimated—has increased, and I would ask the Chancellor of the Exchequer whether he will state, in the next debate on the subject of Army and Navy expenditure, if that is the case or not?
  Question put, and agreed to.
  Resolved, That, towards raising the Supply granted to Her Majesty, the Duties of Customs now chargeable on Tea shall continue to be levied and charged on and after the first day of August, one thousand eight hundred and eighty-seven, until the first day of August, one thousand eight hundred and eighty-eight, on the importation thereof into Great Britain or Ireland (that is to say): on
  Tea.. the pound. Sixpence.
  MR. HENEY H. FOWLER: I should like to ask the right hon. Gentleman the Chancellor of the Exchequer whether he will print a statement respecting his Budget scheme.
  MR. GOSCHEN: Yes; I will print it as soon as possible.
  Resolution to be reported To-morrow.
  Committee to sit again To-morrow.

  CRIMINAL LAW (SCOTLAND) PROCEDURE (No. 2) BILL.
  (The Lord Advocate, Mr. Secretary Matthews, Mr. Solicitor General for Scotland.)
  [BILL 196.] SECOND READING.
  Order for Second Reading read.
  THE LORD ADVOCATE (Mr. J. H. A. MACDONALD): I beg to move
  1546
  that the Bill be now read a second time. Sir, I shall not detain the House with many observations, for I understand there is a general feeling among the Scotch Members, in relation to the Bill, that any Amendment can be readily made in Committee, and that the general principles of the Bill are satisfactory. I will, however, just state, in two or three words, what is the object of the Bill. It is, with one small exception, a Bill for simplifying and amending procedure, by making indictments less complex. Another general object of the Bill is to extend in Scotland a system which has worked well for many years. In the Sheriffs' Courts, in jury cases, there are two diets; and in the first, where the prisoner pleads guilty, the cases are at once disposed of, thus saving the considerable expense of the attendance of witnesses. The introduction of this plan has saved the country £1,800 a-year, and there will be practically as great, if not a greater, saving by the extension of the system to the other Courts. Then, Sir, we propose to make some arrangements by which the trials of cases of importance may take place in the localities in which the alleged offences have taken place. That is carrying out what is really the ancient law of Scotland. Such trials will be conducted by one of the Judges of the Supreme Court; and, in order to carry out this proposal, all the Judges of the Court of Session will conduct criminal cases as well as civil. In return, it is proposed to make a small addition to the salaries of the Judges, and to take away all allowances for Circuit expenses, requiring the Judges to meet these charges out of salary; but I may mention, in regard to that, that it will not cause any extra expense, as the saving made by the other simplifying provisions of the Bill would far more than cover this small addition to the salaries of the Judges. There is another matter I think I ought to refer to. It is our intention, by this Bill, to remove an anomaly which is felt seriously in Scotland. It is that, in the case of crimes committed by persons who have been previously convicted, previous convictions cannot be used to show aggravation, because, although the crimes are similar in character, they are not exactly the same. The result is that persons who have been previously convicted, and have again committed a

  1547
  heinous offence, are treated in the same way as first offenders, and receive short sentences; whereas, for the good of the State, they ought, in consequence of their previous convictions, to receive much longer sentences, and sentences adequate to the gravity of the offence. These are the general provisions of the Bill, and I have now to move its second reading.
  Motion made, and Question, "That the Bill be now read a second time,"—(The Lord Advocate)—put, and agreed to.
  Bill read a second time, and committed for Thursday 5th May.

  METROPOLITAN OPEN SPACES ACT (1881) EXTENSION BILL.— [BILL 214.]
  (Sir John Lubbock, Mr. Dalrymple, Sir Charles Forster, Mr. Houldsworth, Mr. Reid, Sir Albert Rollit, and Mr. Salt.)

  CONSIDERATION.
  Bill, as amended, considered.
  THE PARLIAMENTAEY UNDER SECRETARY FOR IRELAND (Colonel KING-HAKMAN): I rise, Sir, to move the clause which stands in my name, and which, I believe, practically meets the views of hon. Members. It is desired to extend this Bill to Ireland, and this clause is thereby rendered necessary.
  Clause (Saving for Crown Lands and other lands,)—(Colonel King-Harman,)—brought up, and read the first time.
  Motion made, and Question proposed, "That the Clause be read a second time."
  MR. MURPHY: I wish to say I entirely assent to this clause.
  Question put, and agreed to.
  Clause read a second time, and added to the Bill.
  SIR JOHN LUBBOCK: I believe it would be very desirable that the clause standing in the name of the hon. Member for Gateshead (Mr. W. H. James) should be inserted, as the Bill will apply to a number of these cases. I beg therefore, to move it.
  MR. SPEAKER: I must remind the hon. Baronet that this clause ought properly to be moved by the hon. Gentleman in whose name it stands; and I
  1548
  must point out to the House that, in his absence, I do not think it can be moved.
  MR. CHANCE: Can it not be done by the general consent of the House?
  MR. SPEAKER: It would introduce an inconvenient precedent.
  Clause (Application of Acts,)—Mr. Murphy,)—brought up, and read the first and second time, amended, and added.
  Clause,—
  (Power over open spaces already vested in sanitary authority.)
  "The Metropolitan Board or the sanitary authority may exercise all the powers given to them by the said Act or this Act respecting open spaces, churchyards, cemeteries, and burial grounds transferred to them in pursuance of the said Act or of this Act in respect of any open spaces, churchyards, cemeteries, and burial grounds of a similar nature which are or shall be vested in them in pursuance of any other statute or of which they are otherwise the owners.
  "The Metropolitan Board of Works or the sanitary authority may purchase or take on lease, lay out, plant, improve, and maintain lands for the purpose of being used as public walks or pleasure grounds, and may support or contribute to the support of public walks or pleasure grounds provided by any person whomsoever.
  "It shall and may be lawful for the Metropolitan Board of Works or the sanitary authority, for the purposes of this Act, to narrow such roads as the borough surveyor may report to be unnecessarily wide, and to stop up any roads which may appear to them to be useless,—(Mr. Murphy,)
  —brought up, and road the first and second time.
  Amendment made.
  Amendment proposed, in line 8, to leave out the words "or the sanitary authority."—(Mr. Ritchie.)
  Question proposed, "That the words proposed to be left out stand part of the Clause."
  MR. MURPHY: I think there is some doubt about the advisability of omitting these words. The omission may lead to some difficulty, and it cannot do any harm, even if they prove a surplusage.
  MR. CHANCE: I think it will be found that in Ireland the Sanitary Authorities have not the same powers as those in England. It would be better to allow them to remain.
  THE PRESIDENT OF THE LOCAL GOVERNMENT BOARD (Mr. RITCHIE): The

  1549
  words are exactly copied from the Act. I think there would be great objection to retaining them. This is one of the inconveniences of the course of attempting to apply to Ireland a Bill drawn for England.
  MR. CHANCE: Suppose we add the words "in Ireland."
  MR. ISAACS: Or "any sanitary authority."
  MR. BITCHIE: I will agree to that, and will withdraw my Amendment.
  Amendment, by leave, withdrawn.
  Amendment made.
  Clause, as amended, agreed to, and added to the Bill.
  Clause (Power to Corporation to make free gift of land for open space),—(Mr. Houldsworth,)—brought up, and read the first and second time.
  MR. HOULDSWORTH: Perhaps I ought to give a short explanation in regard to this clause. A similar clause was proposed in Committee, but exception was taken to the unlimited power it proposed to give. That has now been guarded against by inserting words which provide that a Corporation can only put its powers in force under this clause with the consent of other superior corporate bodies. I think there can be now no objection to the clause, and I am sure it will prove of great value in carrying out the intentions of the Act of Parliament.
  MR. CHANCE: I understand very great objection was taken to the clause in Committee, and as it was then considered undesirable to pass it, I shall, therefore, resist it now.
  MR. WHITLEY: I took objection to this clause in Committee. Now, as it provides that no Corporation can act without getting the consent of the Lords of the Treasury, I hope the objection to it will not be persisted in.
  Clause agreed to, and added to the Bill.
  Further Amendments made.
  Bill to be read the third time Tomorrow.
  House adjourned at a quarter before Two o'clock.

MINUTES.
SAT FIRST IN PARLIMENT-The Lord Churchill, after the death of his father.
PUBLIC BILLS—Second Reading—Irish Land Law (58), debate adjourned.
Third Reading—County Courts (Expenses)* (48); Merchant Shipping- (Fishing Boats) Acts Amendment* (51); Isle of Man (Customs)* (56), and passed.
PROVISIONAL ORDER BILL—Committee—Report—Local Government (Ireland) (Limerick Water)* (42).

IRISH LAND LAW BILL.—(No. 68.)
( The Lord Privy Seal, Earl Cadogan.)

SECOND READING.
Order of the Day for the Second Beading, read.
Moved, "That the Bill be now read 2a"—(The Lord Privy Seal)
LORD DENMAN, in moving the rejection of the Bill, said, he opposed it, as he had opposed the Act of 1870, when he was told, at a private meeting of Conservative Peers, that he must not speak against the second reading, on which he ceased speaking and left the room. He opposed the second reading now, on the ground that it tended to make the State the proprietor of the whole of the land in Ireland, with a first claim upon all land that was forfeited. So far from being a message of peace to the Irish tenants, the Bill would constantly lead to all sorts of differences between them and their landlords, by costly, vexatious, and tedious litigation. He was reminded of Tennyson's words—
"Should banded unions persecute
Opinion, and induce a time
When single thought is civil crime,
And individual freedom mute."
Yet the poet wished to leave the region. He did not even now despair; and, when dividing the House in 1856, only throe Irish Peers voted with him—Lords

1355
Clanricarde, Clancarty, and another Peer. In "another place" the Bill was thrown out. He was asked by the Leaders on both sides not to divide the House; and there was a party at the Duchess of Gloucester's, which many of their Lordships were anxious to attend. On the Wine Licences Bill for Ireland he divided the House, contrary to the earnest request of the late Earl of Derby; but the whole country had come round to the opinion that magistrates, and not the Excise, ought to control the licensing of all houses for the sale of intoxicating liquors. He might not be able to find a Teller, but could never agree to the Bill, however altered in Committee. He, therefore, moved that it be read a second time that day six months.
Amendment moved, to leave out ("now") and add at the end of the Motion (" this day six months.")—(The Lord Denman.)
EARL SPENCER: I sincerely trust the noble Lord who has just sat down will not carry his Amendment to a Division. I shall certainly do all I can to forward the second reading, and I trust the noble Lord will, with his usual regard to the opinion of the House, not divide on this occasion. I do not think I owe any apology to the House for coming forward at this early moment to discuss this important Bill. I have, both in this House and outside this House, frequently discussed this subject. I have always considered that the settlement of the Land Question in Ireland was of the utmost importance, and that, without a final settlement of this question, we cannot expect to have peace and order in that country. Now, my Lords, I regret that the Government have not been able to offer their whole plan on the subject of Irish land. It would have been very convenient and instructive to your Lordships for the purpose of considering the present Bill and estimating its worth if you had known the whole policy of the Government with regard to this important matter. But, while I say this, I am also bound to admit that there must be a long interval after the passing of a large measure for the settlement of the Irish Land Question before all the provisions of that measure can be carried out. I am, therefore, not altogether surprised that the Government propose to deal with
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this question in two Bills. I shall think it my duty to refer to some of the Acts which have already been passed on this subject. I shall not criticize the remarks of the Lord Privy Seal on previous Irish land legislation in his opening speech, or touch upon the many thorny points which are now before the country with regard to Ireland. But I wish to refer to one particular point in the land legislation of 1881—I mean that part of the Act which referred to the reductions of rent. I can freely and at once admit that, in theory, I agree very much with what has been said by the noble Duke behind me (the Duke of Argyll) against the principle of the State interfering between landlord and tenant with respect to rents. There are manifest objections to such a course, and we see some of these objections coming up now when we find these difficulties arising with regard to judicial rents. They involve fresh interference by legislation. I fear that is absolutely essential. But, though I say that, I cannot admit that we could have avoided, in dealing with the Irish Land Question, interfering with this question of rent. It was indispensable that some means should be arrived at for solving this question. My Lords, I base my justification on the Report of the Royal Commission presided over by my noble Friend behind me (Earl Cowper). I find in this Report the following statement:—
"In all, by the operation of the Act, including arbitrations, a rental of £3,227,021 has been reduced to £2,638,549, a percentage reduction of 18·2 … the number of tenants who have had judicial rents fixed up to last August were 170,800 on a rental of £3,227,021, and they hold consequently at an average rent of about £18 each."
That is the answer to those who say we ought not to interfere with rents. I believe it can be conclusively proved that it was necessary to interfere with these rents. It was the only means of obtaining justice for those tenants who objected to their unreasonable rents. I need not go further into the evidence before that Commission, though I could quote many specific cases of injustice. I now come to the occurrences of the last few years which have so much affected the question. I allude to the great fall in prices of agricultural produce. I remember, when I was still in Ireland in 1884, that distinguished man (Sir Robert Hamilton) now Governor

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of Tasmania, whose services, I regret, are now lost to Ireland, discussing with me some of the questions regarding land legislation. He pointed out that very shortly this question of judicial rents would come before us. He said we could not avoid it, because with the fall of prices it would be impossible to maintain these rents. My Lords, the contention of my friend Sir Robert Hamilton was only too soon justified. The crisis occurred last year, and your Lordships will recollect that after the Government of the noble Marquess opposite came into Office Mr. Parnell introduced a measure to deal, at all events temporarily, with the difficulties which had arisen on account of this fall in prices. I, for one, could not have supported all the provisions of that Bill; but, in my opinion, the general principle of it was absolutely right. The Government, however, took a different view, and appointed a Royal Commission to look into the whole matter. The noble Marquess (the Marquess of Salisbury) made an important speech on the supposed fall in prices from which I will give one or two short extracts—
"But though that is the case, I am not at all sure that the judicial rents were not fixed with a perfect consciousness on the part of the Judges that a fall in the price was going on. That fall has been going on now for several years, and it is highly improbable that the Courts, in assigning judicial rents, have not taken that into consideration … But if it should turn out that the Courts have made blunders, and that there is that impossibility in any case of paying rent, I think it is not the landlords who should bear the loss. I think this would be one of the cases for the application of the principle of purchase by the State, and that the State, and cot the landlords, must suffer for the errors that have been made."—(3 Hansard, [308] 68–9.)
I cannot go into the Purchase Question now; but I hardly think that the noble Marquess will be able to carry that part of his plan into effect. But he does admit that, in certain contingencies, it would be necessary in some way to deal with these judicial rents. What was the Report of my noble Friend's Commission as regards this fall in prices?—
"The fall in the price of produce of all kinds and in all parts of the country has much impaired the ability of the farmers to pay the full rent. And this, following on a previous general restriction of credit by the banks and other lenders of money, as well as by the shopkeepers, has very greatly increased their financial difficulties. Much evidence in proof of this has been laid before the Commission … Although it is most undesirable to disturb an arrangement
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which was understood to be a permanent settlement, we cannot put aside the pressing necessities of the Irish tillage farmers, many of whom have lost much of their means, and are besides much indebted to banks, local merchants, and other creditors. The Purchase Act, as we have said, must necessarily be slow in its operation. Tenant right, on which the Bessborough Commission relied as a remedy, is, under existing circumstances, frequently of little value. To force such tenants to sell their working stock in order to pay full rent would be fatal to their future prosperity. The just remedy is to abide by the principle of termly revision already established, but to shorten the period to a term (luring which no serious error is likely to result. We, therefore, recommend that the term of revision should be shortened from 15 to five years."
That appears to me to be a very remarkable, a very clear, and a well-supported reply given by the Government's own Commission. But it may be said, on the other hand, that when judicial rents are once fixed they ought to be allowed to continue, and nothing should then be allowed to interfere with the direct relations of landlords and tenants with each other. In the great bulk of cases I believe that would be a safe course. I believe the great majority of Irish landlords, as of Scotch and English landlords, have been generous and considerate to their tenants. The real offenders are not these men; but, unfortunately, the good landlords are affected by the law which we are obliged to pass for landlords who are deaf to all reason, who will not listen to the just demands of their tenants, who are not touched by what has been styled the humane but irregular pressure of the Government, and who are deaf to the voice of public opinion. It is against those landlords that you have to move, one or two of whom may set the whole country in a blaze. I should myself distinctly lay down this proposition—that we must in this Bill, if possible, find some method of dealing with judicial rents which are now unreasonable on account of fall in prices. The Marquess of Hartington, in a speech describing what the Government might do, said—
"I cannot hope that it will satisfy public opinion in Ireland; but it would go far to satisfy the public opinion and the conscience of the United Kingdom."
These are the two propositions we must look for in this Bill. We must see that it deals with tenants whose judicial rents are unjust, and that it deals with those other cases of eviction that have

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created such a sensation in this country. I shall now proceed to see how the Bill of Her Majesty's Government will deal with those subjects. That Bill may roughly be divided into four parts. The first deals with the procedure of the Land Commission and with certain of the tenants excluded from the benefit of the Land Act of 1881. The second deals with the Purchase Clauses now in force. The third deals with, the present process and method of ejectment, and also with the rates; and the fourth deals with the new equitable jurisdiction to be conferred upon the County Court Judges. I shall not trouble the House at any length on the first three divisions. First of all, as to the procedure, that does not, in my opinion, raise any question of principle. I now come to what I consider one of the most important provisions contained in the Bill—in fact, I should call it the principle of the policy which is involved in this measure; I mean the admission of the leaseholders to the benefits of the Land Act of 1881. My Lords, I heartily rejoice that there is no Party difference in regard to this question. But I reserve my criticism on the mode in which it is intended to be carried out. I understand, from those best qualified to judge, that, in their opinion, those leasehold clauses are very defectively drawn. This is a matter for discussion in Committee. The leaseholders who, before the Land Act of 1881, considered their position very favourable in comparison with the other tenants, were, by the operation of the Land Act, placed at a considerable disadvantage. Those tenants are, as a class, the most influential in Ireland, and they are very discontented with their present position. It is important, therefore, that they should be reconciled by a revision of the law. I desire to congratulate Her Majesty's Government on including the town parks in the provisions of their Bill. That I also consider to be a matter of great importance. I observe the Bill says nothing about another class of tenants—namely, small dairy and grazing farmers. Men who know the country have often said to me that if tillage farmers require their rents revised by the Land Courts, small dairy and grazing farmers ought also to be brought under the operation of the Act. In the Report of the Cowper Commis-
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sion are some recommendations with respect to dairy farmers; but in this Bill there are no provisions dealing with them. I will not deal with the Purchase Clauses of the Bill. All that I will say is that it is very singular that they should have been introduced in such a Bill as this, and that their introduction looks very much as if the Government did not intend, or had very little hope, of carrying a large Purchase Bill this Session. As to the third division, I cannot say that I view with entire satisfaction the very great alteration those clauses make in the process of ejectment. It is proposed that the moment judgment has been given in the Court, a tenant can be converted by a written document into a caretaker. This is a change that ought to be watched with great attention. The present law as to the method of ejectment was deliberately adopted in the Act of 1860. One of its objects was to check needless evictions, and there are many who think that if the clause now proposed is carried it would increase the power of an unjust landlord to bring pressure on his tenants. It is said that the change will prevent a largo number of ejectments. I fear, however, that the very contrary may possibly happen, and that the change will only postpone the moment of difficulty when whole armies of soldiers and police have to be sent to support the Sheriff in carrying out evictions. In my opinion we must very fully weigh the arguments connected with this important matter before we attempt to change the law as it is here proposed. Then there is the question of the remission of rates in cases where landlords can prove, to the satisfaction of County Court Judges, that on account of intimidation they are unable to let their farms, or—and in this case it is without intimidation—to collect their rents. That is a serious change. At first sight it seems just that a man who cannot make profitable use of his land should be exempt from the payment of rates. But what will happen? The rates will be thrown upon other landlords and ratepayers. The change, I think, would work great injustice, and would offer a premium on disputes between landlord and tenant. Moreover, there are parts of the country where poverty is so great that the Unions are almost bankrupt, and in one or two

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cases since I left Ireland have been actually unable to pay their debts. In these Unions the increased rates caused by this provision would bring actual ruin on poor and struggling men. My Lords, I will now come to the fourth division—the equitable jurisdiction which is proposed to be given to the County Court Judges. I cannot welcome this part of the Bill, although, it is, no doubt, intended to meet some of the difficulties I have called attention to. I have seen this part of the Bill described as a "joy to country attorneys and an injury to everyone else." You are applying a law of bankruptcy, originally intended, for a mercantile community, to small holders of agricultural property. The machinery was never intended to be so applied. In dealing with this extremely technical subject, I wish your Lordships to understand that, although I fully accept responsibility for what I say, I do not pretend to give my own opinion only, but that I have consulted gentlemen who, I am confident, are the most capable of advising in such a matter. The Bankruptcy Law in Ireland is, I am informed, extremely complex. It involves petitions to a Court; the vesting of the estate in a creditor's assignee; the filing of a schedule of the transactions of the bankrupt for many years past; the personal examination of the bankrupt, and motions without end relating to matters arising out of the proceedings. I am told that the costs of bankruptcy, in proportion to the interests involved, are already exorbitant in Ireland on large estates, and when you apply it to the smaller estates it will be absolute ruin. Let us consider for a moment the condition of these small holders. They are often very ignorant, and they do not always speak the English language. They do not keep accounts, and they have no books to refer to. They often live in small, miserable hovels, and too often their assets are confined to the miserable furniture of those hovels, and amount to only a few shillings, or, perhaps, £2, which may come from the sale of their pigs. It is to such a person that you are going to apply the extravagant, costly, and complex method of bankruptcy. It is said that the Bills of 1870 and 1881 tended, to a great extent, to demoralize the Irish people. I deny that that has been proved; but I will venture to say that the utter demoraliza-
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tion of the Irish tenants will be effected by the Bankruptcy Clauses of this Bill. On this point I will venture to read to your Lordships an extract from what is generally allowed to be the organ of the Irish landlords. The Dublin Express of April 8 describes this Bill in the following terms:—
" This portion of the Bill invites, we might almost say, the whole of the peasantry of Ireland to become!bankrupt—to have their debts wiped away, arrears of rent included. To meet the inrush of candidate bankrupts coming by tens of thousands, and in the meantime declining to pay any rent, hastily improvised tribunals must be set on foot, with directions to finish off as many cases per diem as they can. This is inevitable; there will be no there ugh sifting inquiry into each man's case. The crush of business will break down every safeguard, exactly as it broke down every safeguard when the Arrears Act was in operation."
And here I beg leave to remark to your Lordships that I was in Ireland during the operation of the Arrears Act, and I do not admit that there was any such break-down as is described by The Dublin Express. the article there goes on as follows:—
" The peasantry, en masse, will go into bankruptcy and prove well enough that they are bonâ fide bankrupts. In fact, to this bankrupt business there is no bottom at all. It seems a sort of bottomless gulf, into which all Irish interests are to be hurled pell-mell."
Many persons will, no doubt, get reductions of rent because of bankruptcy; but I want to know how long those reductions will be continued? As far as I understand, it will only last so long as, in the opinion of the County Court Judge, the poverty of the land remains. After that, apparently, the Irish tenants will fall back upon their original rents, unless, indeed, they repeat the operation, and hereafter hold their farms on a tenure of bankruptcy renewable for ever. I have hitherto dealt only with tenants in reference to the matter of bankruptcy; but what, may I ask, will be the effect on the landlords? In other cases of bankruptcy, the connection between creditor and debtor is at an end on the payment of a composition; but, so far as I can understand, the Irish landlord will be bound hand and foot to his debtor for as long as the Judge thinks that the farm can be worked profitably for the creditors; and not only that—he will not receive the rent due to him, which

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will be kept for the benefit of the creditors other than the landlord. That is perfectly unfair. I now come to the County Court Judges. The duties which they will have to perform will be extremely difficult. They will have to administer estates, and often hundreds of acres of bog-land will come under the management of the Judge and his officers. That seems to me to be a matter which no County Court Judge in Ireland would be able to grapple with. There is also another matter of moment which seems to show that the measure will in some way prove a snare. A landlord in Ireland may proceed to get rid of a tenant in various ways. He may proceed by ejectment, and in that event the tenant can bring himself under the operation of this clause. The landlord may also proceed to recover his debt like any ordinary creditor; he can go to the superior Court, and the superior Court will issue judgment. When the fi. fa. has been issued, the sheriff, armed with it, can proceed to seize and sell the property of the tenant. If a tenant wishes to buy the property in, and bids a sufficient sum to pay off the debt and costs, then the Sheriff hands the land back. But if, on the other hand, he does not do so, the landlord can buy it, and then the tenant becomes a mere trespasser if he remains. In that way the landlords would be enabled entirely to evade this Act. My Lords, I have dealt with the tenants who are in difficulties, who, from non-payment of rent, are liable to ejectment. I have shown how disastrous and inapplicable these clauses are to them and to their landlords. But I have even a stronger objection. These clauses exclude wholly that class of honest and industrious tenants who are struggling with an excessive rent. This is the class which deserves most consideration. The noble Marquess at the head of the Government himself pointed out that if it were shown that judicial rents had been fixed at too high a figure they would have to be dealt with by purchase. The Commission has declared that judicial rents are too high, and proposes a plan for dealing with them. This large class is wholly forgotten in this Bill, unless, indeed, they go under the yoke of bankruptcy by not paying a year's rent. Can anything be more
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absurd or more unjust? You will say that you cannot break the 15 year lease, but you do break the leases of 150,000 leaseholders. You repeat the error made by us in 1881. We put the leaseholders at a disadvantage in comparison with the tenants at a judicial rent. You now reverse the process, and put the tenants under judicial rents in an unfair position in comparison with leaseholders. I trust that your Lordships will seriously consider, before this Bill leaves your House, the objections which I have mentioned; and I sincerely trust that you will be able to amend it in such a way that those acts of injustice which we know now arise from time to time may be avoided. There is one other matter on which I would say a few words. It has been already referred to in "another place," but the answer on that occasion was so unsatisfactory that I repeat the question. I wish to know from Her Majesty's Government whether they consider that this Bill is of vital importance, and whether they mean to stand or fall by it? If they do not stand or fall by this Bill, then the policy which they have put before the country is simply one of repressive criminal legislation.
THE EARL OF CARNARVON: My Lords, I hope that it may be possible to consider a measure of this nature with that calm and quiet consideration which it is the practice of this House to employ in such cases, contrasting, perhaps, favourably with the case of other kinds of legislation. The noble Earl spoke at considerable length upon many parts of this Bill; I am, for physical reasons, unable to-night to do anything more than deal briefly with its general outlines; but I am anxious in a few words to place before your Lordships the reasons that will induce me to give a cordial support to this Bill; and, at the same time, to point out to Her Majesty's Government one or two matters which I think deserve their careful consideration. I was prevented from being present in the House while my noble Friend the Lord Privy Seal made what I judge, from the report of it, to have been an admirably lucid statement of the objects of this measure; but I observe that he divided his observations into two parts. In the first he dealt with the case of leaseholders, and evictions, and appeals;

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and, secondly, with the question of the equitable jurisdiction in bankruptcy. I would say a few words on each of these points. As regards the first of these questions, I had myself, before I left Ireland, come to the clear conclusion that the change proposed in this Bill was one which was required by both justice and expediency. The noble Earl entered upon a defence of the Land Act of 1881. I disapproved that measure at the time and I disapprove it now, and when I look back it seems to me to have been the fountain head from which a great deal of the misfortune and trouble in Ireland has arisen. But once that Land Act of 1881 became law, I cannot see that there was either logic or fairness in continuing to exclude men from its benefits who were entitled to quite as much consideration as those who benefited from it. On the contrary, I came to the conclusion that there were many cases of hardship in connection with the question of leaseholders, and I desired to see the change effected which this Bill proposes. The noble Earl opposite dwelt with terms of approval upon the proposal for a quinquennial revision, made in the Report of the Commission of my noble Friend opposite. I quite admit that there is a great deal to be said in favour of such a periodical revision, and the method by which my noble Friend proposed to obtain that revision was ingenious and—to use the word in no evilse nse—plausible. But, at the same time, there was one grave objection—namely, that every five years, and even before those five years came to an expiry, you will have a disturbance of everybody's mind with regard to this matter, and I can conceive nothing more unfortunate than that there should be anything of this nature. If there is one thing more important in Ireland than another, it is to give that unhappy country rest; and I honestly say that—within certain limits—almost any legislation would have been better for Ireland in times past than the system of perpetually passing legislation and then tearing it up, and allowing no man to believe that there is ever to be any finality or any rest. I now pass to the question of evictions. There is, no doubt, a very considerable change contemplated in this measure. It introduces a considerable breach in the ordinary law as between
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landlord and tenant, and the only ground on which I can agree to it personally is that the circumstances in Ireland are absolutely unprecedented, and that there are certain cases which the ordinary law does not meet. If I thought that by agreeing to this clause I was laying down a precedent for action elsewhere, I should have much doubt about doing so. Now I come to the question, of the equitable jurisdiction in bankruptcy, and I am free to express the hope that my noble Friends below me will take it into their cairn and full consideration whether these clauses can be allowed to stand in their present form. I am sure that they have been influenced by the best intentions, and a desire to meet a most exceptional and most trying state of circumstances, and a desire, above all, to deal gently and tenderly with the tenants of Ireland. But I think that they must be themselves aware that the proposal, in its present form at all events, has not been received favourably either by their friends or by their opponents. I listened to the speech of the noble Earl, and though I think there may be a little that is over-coloured in that statement, at the same time in the substance of it there is a good deal with which it is impossible not to agree. Such clauses as those contained in this Bill for equitable jurisdiction in bankruptcy are an inducement to tenants who pay under £50 of rent to declare themselves insolvent. Further, you have imposed upon your County Courts an almost impossible task, unless, indeed, you mean to create an enormous staff, and thus make what would be a judicial revolution. Nor must you omit to bear in mind how very open would be the door to fraud, and how difficult it would be to prove that fraud. I think that in the interest of the Irish landlords, who may be very heavy sufferers by any mistake in this vital matter, these clauses should be carefully considered. I noted with extreme satisfaction in the speech of my noble Friend the Lord Privy Seal his promise of a further instalment of land purchase. I am satisfied with this—that the settlement of the Land Question lies—and this is not too strong an expression—at the root of all the Irish grievances. When I was in Ireland I consulted confidentially a large number of those whose opinions I thought were most de-

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serving of attention, and whose names, if I gave them, would carry the greatest weight in this House. There was a singular agreement among them, to the extent, I should say, of 19 out of 20, that the settlement of the Land Question really lay at the root of the Irish difficulty. I do not say that the settlement of the Land Question is the only cure. The evils which we find in Ireland are too complicated and of too ancient a date to be cured by any one specific; but the difficulties of religion, terrorism, crime, all are overspread by this one question of land. I believe that Her Majesty's Government are trying to the best of their power to hold an even balance between the landlord and the tenant in this very difficult matter—on the one hand to temper evictions, and on the other hand to secure the landlord in his just rights. So long as property and land continues eviction must be the last resort of the landlord. I shall not refer to the burning question upon which the noble Earl opposite has touched—namely, the enforcement of the law. We shall have before very long an opportunity, in one shape or another, of discussing that matter. I will not now anticipate that discussion, except to say that remedial legislation is not applicable unless the law is upheld. Remedial legislation cannot have fair play if the minds of men are set on fire by personalities and invectives, misrepresentations and calumnies. Remedial legislation at the present moment has a hard task before it. Doctrines are now propounded that criminal outrage can be justified in view of the acquisition of Constitutional or moral rights. I read of nightly scenes whereby Parliamentary institutions are degraded; I read with astonishment of appeals made from Parliament to mass meetings, and to what I may almost call mob law. I will not pursue this subject further, but will merely say that these are unfavourable conditions for remedial legislation. I trust, however, that the Government will not, on that account, refrain from persisting with their remedial legislation. I heartily welcome the promise of the comprehensive legislation which my noble Friend has given the House, and I gladly accept this Bill as an instalment.
LORD FITZGERALDsaid, he had observed that both the noble Earls (Earl
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Spencer and the Earl of Carnarvon) who had spoken had devoted considerable attention to the provisions of the 1st clause; and the general acquiescence of their Lordships—as they had both been Lord Lieutenants of Ireland—in the principle of that clause must insure the second reading of the Bill. He desired to point out that the 1st clause of the Bill was so framed as to do what he scarcely thought was the intention of its promoters. He referred to the provisions dealing with leases, and the inclusion of leaseholders in its operation, to which there would be very grave objections. Their Lordships might recollect that the Act of 1881 was mainly confined to tenants from year to year; but it contained a Proviso that tenants who held under leases which terminated within 60 years after the passing of the Act should, upon the termination of their leases, become present tenants, with all the rights which the Act conferred upon tenants from year to year. When the Bill reached this House the Marquess of Lansdowne moved the omission of the Proviso, and, being supported by the noble Marquess at present the Leader of the House (the Marquess of Salisbury), the Proviso was struck out, on a Division, by 142 to 59. How it was restored he (Lord Fitzgerald) could not say, but it was probably in the compromises which followed between the two Houses. The Proviso, however, appeared to have been re-inserted. He did object to the Bill on the ground that it broke leases, nolens volens, whether the tenant desired it or not, and without any action on the part of the tenant. No matter what length of time the lease might be for, it would be broken by the 1st clause of this Bill and converted at once into a yearly tenancy. He thought that would be a very great danger, and he wished to draw strongly the attention of the noble Earl in charge of the Bill (Earl Cadogan) to it. The provision of the 1st clause of this Bill sets forth that, on the passing of this Act, the lessee of any holding who, at the expiration of any lease existing at the passing of the Land Law (Ireland) Act, 1881, would be deemed to be a tenant of a present ordinary tenancy from year to year within the meaning of the said Act, at the rent and subject to the conditions of the lease shall, at the date of the passing of this Act, if

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bonâ fide in occupation of his holding, be deemed to be a tenant of a present tenancy, in like manner and subject to like conditions as if his lease expired at the passing of this Act; and his holding shall be subject to all the conditions of the Act of 1881 with regard to present tenancies as if the tenancy therein were a tenancy from year to year. Now, these provisions would apply to every lease bolder on the passing of this Act. The Bill showed a laudable desire to confer the benefits of the Act of 1881 on leaseholders, and that he appreciated; but they must take care how that was done. The change contemplated by the Bill was a very great one, and the full responsibility for it must rest upon the Government. With their Lordships' permission he would call attention to some of the provisions of the measure, in the hope that it would be amended in Committee. Now, he had said that the immediate effect of the Bill would be to turn all leaseholders coming within its provisions into tenants from year to year, but the true course would be to enable them to come into the Court to secure a fair rent without in any other respect altering the leases. In all other respects they would continue in occupation, subject to the other covenants of the lease. He submitted to their Lordships that the immediate effect of the clause would be to create alarm in the minds of the tenants, especially in the North of Ireland, when it was seen that any action on the part of the tenant puts an end to his lease, and converts him into a tenant from year to year. The tenants in the North of Ireland were hard-working, industrious, and steady men; and if this provision bore hard upon them it would create great disquiet and discontent. They were also men of independent views, and they would regard this provision in the Bill with alarm. He thought, indeed, that many of them would not accept the benefit proposed if coupled with the destruction of the lease. As to the Bankruptcy Clauses of the measure, he hoped to induce the Government to abandon them altogether. He believed—after a most careful consideration of these clauses—that they were demoralizing in their tendency and would be so in their effect, and they would also prove to be unworkable in
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practice and most expensive. If these clauses were to be retained in the Bill, he believed, in the case of the smaller holdings, it would be impracticable for any landlord in Ireland to enforce the payment of his rent from an unwilling tenant. Not only that, but a strain would be put upon the County Courts which they would be unable to bear, for the Bill proposed to make every County Court Judge a Bankruptcy Judge; and in Ireland the Bankruptcy Law, he could assure the House, was extremely complicated. There would be so many applications to the County Court Judges that they would not be able to deal with them, and the Courts would be blocked. The County Court Judges laboured under great difficulties in dealing with their work at the present time. The Judge had also a large equity jurisdiction, which embarrassed him very much at present; and if these Courts wore created perpetual Bankruptcy Courts they would be overwhelmed. A very experienced Judge had said that he alone would have 4,000 bankruptcy cases in a year. These Bankruptcy Laws, which were to be transferred to the County Court Judges, gave them jurisdiction in every case of a tenant whose rent was not more than £50 a-year. The Bill would also deal harshly with the tenants in some ways. If a tenant was in arrears he might pay to his landlord one day a year's rent, and on the following day a petition might be presented to make him a bankrupt. In such a case the Judge had no discretion, and had to take the usual course. He also objected to cast on the County Court Judges full and plenary jurisdiction in administering a difficult and complicated set of laws. There was certain to crowd around these Bankruptcy Courts a sot of legal practitioners who would use every means in their power to make the process expensive for both landlord and tenant, and that would lead to great evils. He also objected to the system of dealing with the creditors. Under the system proposed by the Bill, the primary creditors—such as those who had lent money to the tenant—got nothing, and thus the credit of the tenant was destroyed. When a tenant should have been brought by the landlord into the County Court, and should have been ad-

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judicated a bankrupt, his farm would not be sold, but would be managed under the supervision of the authorities of the Court. To this the creditors of the tenant would very naturally object, and those who had lent him any money would also object. Besides, this was not a temporary measure, but was to last for ever, so that the County Court Judge would be perpetually involved in this bankruptcy business. He gave the Government credit for wishing to benefit the tenant in this Bill; but he did not think they were taking the right course in some respects. He had no desire to criticize the measure, but rather to point out in what way it might be amended. He wished to support the second reading of the Bill, because he believed it would be a benefit to the tenants of Ireland. He had no wish in this matter but to benefit the Irish people. There were many other objections to this measure as prepared, but they would rather be for the Committee than on second reading.
THE LORD CHANCELLOR OF IRELAND (Lord ASHBOURNE): My Lords, there have been many great efforts to deal with this great question in many great Bills. In 1870 a very important measure was introduced, and it was considered by its authors—I am sure honestly—to be a just and a final measure. But in 1881 another measure was introduced, which, it was thought, would be more just and more final; yet that Bill is the direct cause of the introduction of the present measure. The Act of 1881 involved the question of dual ownership in Ireland, and that has thrown the whole question of land in Ireland into endless and hopeless confusion. A wise and sound measure of purchase must be looked to for a real solution of the present difficulties. Such a Bill necessarily takes time to introduce and get into working order, and thus it was essential to act at once; and, therefore, this Bill has been introduced into this House and is now before your Lordships for acceptance, for examination, and for criticism. It was introduced, my Lords, with no extravagant expectation that it will please everybody and do everything; but I may say that it was introduced with the earnest hope that it will meet the exigencies of the position, and that it
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will be found to apply adequate remedies where hardships and abuses are found to exist. The landlords of Ireland have not yet taken part in this discussion; but still, from my experience and knowledge of Ireland, I know that necessarily they cannot view with favour many of the provisions of the Bill, although, probably, there are clauses in which they acquiesce and which they consider necessary. The time has gone by when anyone would introduce an Irish Land Bill with the expression of extreme hope. My Lords, the way in which this Bill has been received is noteworthy; but, after all, it is very much what might have been expected. I should like to know what conceivable Land Bill that could be promoted by any statesman, I care not whom, would be received by the Irish Party? If the genius that is now arrayed upon their side applied itself once more to the production of the most just settlement of the Irish Question, do any of your Lordships think that it would be received and accepted as final by that Party? My Lords, the discussion to-night has been extremely interesting, and worthy of the closest and most attentive consideration. Many of the criticisms made were on clauses and details which it would be more desirable to deal with in Committee. I assume those criticisms will find their places on the Amendment Paper in Committee, when every particular criticism can be more easily and satisfactorily dealt with. My Lords, there are some points that cannot be regarded as matters of mere detail which I should like to note. The question of leases has been naturally very fully referred to. I do not myself know what is the exact number of those leases; but it is very considerable, and has been said to amount to 150,000. Those leaseholders are a very deserving class of tenants, and the change which the Bill proposes to make in their position—the gravity and importance of which I do not for a moment deny—was brought before us in the unanimous Report of the Royal Commission, and it is supported by a vast mass of public opinion. As to the phraseology of the clause, I admit, as everyone must admit, that the matter is beset with some complications, and may require examination in Committee. By

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Clause 21 of the Land Act one of the most important covenants in the leases was broken, and it was a mere question of time how soon the question would have to be more fully dealt with. At the same time, I must say that it is not correct to say that all clauses in leases are intended to be broken by the operation of the clause in the Bill dealing with leases. Another observation was made with reference to town parks. There was no criticism on that subject, the noble Earl opposite expressing himself satisfied at the way in which the Government were going to deal with the question. I do not propose to weary your Lordships by going in detail into the Bill. There are 33 clauses, many of which are so obviously remedial clauses that they may be passed with general consent. I propose to deal with a few of the more important matters which have been brought forward. The remission of rates is, no doubt, a difficult question, that must be looked at from several points of view; but unquestionably it is an evil for which it is necessary to find a remedy. As an example of the evil, I may point out that in Co naught the tenancies of some of the great properties are very small, and that landlords are in the position of being unable to collect their rents, whilst liable for all the rates. The Guardians will not give credit to landlords for the rates; but obtain judgments and present petitions for the sale of their properties. It is very hard that a landlord who is unable to get a farthing rent from the tenants of these small holdings should be compelled to pay the rates of them. This is certainly a matter to be discussed and examined with a view to the discovery of a satisfactory remedy. As to the recommendations of the Cowper Commission for a revision of rents. Her Majesty's Government have considered with every respect the views of the majority of the Commission, though it is obvious that in appointing a Commission the Government did not bind themselves to accept every recommendation made by the majority of its Members, independently altogether of their own views on a full and fair examination of the evidence. Mr. Justice O'Hagan and Mr. Commissioner Litton, two of the greatest authorities, were, however, opposed to the suggestion of the ma-
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jority of the Commission, and gave very weighty and powerful reasons against the proposal to reduce the term of revision from 15 to five years. We have been told that rents should be automatically regulated in relation to prices; but I should like to ask what prices? I am told that it might take two years to get anything like an authoritative and satisfactory statement of prices that could be appealed to in each locality for an automatic revision, even were such a revision considered desirable as a matter of policy. Mr. Justice O'Hagan and Mr. Litton pointed out that the people would never regard anything as final when judicial rents, fixed by the authority of Parliament, were to be unsettled and disturbed every five years in the way suggested by the majority of the Commission. The Government are of opinion that the provisions of the Bill will make things bettor for the tenant, and are sound provisions to work; but when the Bill is in Committee there may be useful criticisms of the details. I believe that it will be found that the Bill puts a serious and substantial check on evictions; it deals with arrears, and gives power in certain cases and at certain times to refix rents. No doubt, my Lords, those are great powers, and well worthy of your Lordships' attention. With regard to the proposal of the Bill to enable the landlord to give the tenant notice, so that the six months' period of redemption might run without an actual eviction, I believe it will be of the greatest value. I am of opinion that this clause will largely check evictions. Under the present condition of things a landlord cannot be finally assured of possession until that period has run, and one of the great grievances of Irish landholders was the uncertainty of this period. In order to begin this period at all the landlord must evict, though in the majority of cases tenants are returned as caretakers. But what is done by this clause? It dispenses with the necessity of going down and evicting the tenant, a process which is apt to produce bitter feelings of exasperation; and it allows six months to run from the notice, during which the parties may have a fair chance of coming to terms together, and without an eviction the tenant is made caretaker. That, I think, is a sound inten-

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tion, and one calculated to check evictions and to bring about a settlement which, will prevent some of those scenes from occurring which have not been satisfactory from the point of view of law and order, and have caused great trouble and expense to the Executive. There is another clause which has not been discussed by anyone to-night, which will also have a great and beneficial effect in checking evictions, and that is the 21st clause, which is the first of the Equity Clauses. This clause is free from some of the criticisms which we have heard to-night. It is not a Bankruptcy Clause; It is a clause which gives the widest possible discretion to the tribunal which has to deal with ejectment for rent, and allows it to grant a stay of execution for a reasonable time and on fair terms whenever it thinks that justice and fair play require it; and the Court: is also allowed to order that arrears are to be paid by reasonable instalments. It is a fair and equitable clause, conceived in the most reasonable spirit, and one which can obviously be worked without the inconveniences, which have been pointed out, and is free from the objections which have been taken to the Bankruptcy Clauses. I do not contend that the Bankruptcy Clauses have been received with widespread enthusiasm; I know that they have been assailed on the part of the tenants, and that they do not seem popular with landlords; but I can only say that the Government will give careful attention to all the suggestions and criticisms which may be made with regard to them. But I should like now to present the question from a point of view which may, perhaps, be narrower and humbler than any which has as yet been presented to your Lordships. One of the great grievances among the poorer tenantry in Ireland is this—and it is not a question only of recent years—that a load of debt presses them down. Debts, not to landlords only, but to shopkeepers, money-lenders, loan funds, banks, and sometimes to the gombeen man, hopelessly keep them down, and the greatest possible been to the Irish tenantry and small farmers would be some cheap and expeditious local system of bankruptcy. That is a matter which, of course, the Government have had in
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view. It is desirable that, if possible, the tenantry of Ireland should be given a fair start from their incubus of debt, and allowed a chance of fighting out the battle of life, under freer and better conditions. Those who claim to speak for the tenants have received these provisions in a very critical spirit. They say that they do not like bankruptcy at all, and have an excessive dislike of the summary process of bankruptcy procedure, because it is a summary and resolute method which does not stand anything in the way of evasion or deception. As to the landlords, I do not think that they have as yet shown any marked desire to have these clauses carried into effect, as far as I can understand from the Press and in other ways, on the ground that it may lead to litigation, expense, and delay. But it appears to me that in the views which are thus taken it seems to be assumed that everything bad that is conceivably possible will happen at the same time and on the same occasion. That, in my opinion, is not the way to look at legislation of this kind. I read in The Times of this morning a very interesting speech delivered by Mr. John Morley, in which he seems to speak of these clauses in a very disparaging way, and talks of annual bankruptcies, while the landlord is to be deprived of his accruing rent. This is not the case, as it is the first charge after the tenant is allowed to remain in possession. This system, like any other, may be abused; but if the Bankruptcy Court frees the tenant from debt, it must naturally claim great power over him. All powers of bankruptcy are conferred on the County Court Judges, with certain additional powers, which will be found in Clause 23, and they will be exercised under prescribed rules, and with judicial discretion. It is contemplated that these rules will be carefully framed, with a view to avoiding dilatoriness and litigation, and of reducing costs to the lowest possible figure. We have had a sketch of a rather startling character of the procedure under these clauses, and if it was at all likely to happen, we should have a very troublesome time in Committee. I believe that arrangements in bankruptcy do not run for an indefinite period, but for a period ranging from 12 to to 15 or 18 months.

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The 23rd section, which gives a wider discretion to the County Court Judges than is usually possessed in bankruptcy, must have presumed that it would be administered by them as trained Judges. However, every one of these possibilities will be examined by the Government, and will be discussed in Committee: What the Government have in view, and desire, is some method by which the Courts will be armed with ample power to deal with hard cases, and to check harsh evictions, and the more speedily and cheaply this can be done the better pleased will the Government be. When Amendments are put on the Paper, we shall be glad to examine and consider them with attention; and I trust that the result will be that the Bill will leave your Lordships' House what the Government desire it to be and have framed it to be—a measure which will be practical, remedial, and just.
VISCOUNT MIDLETONsaid, he could not agree with the noble Earl (Earl Spencer) as to the effect of that most unfortunate measure the Land Act of 1881, which, in his opinion, proceeded on entirely false lines, unsettling everything and settling nothing. With regard to the earlier clauses of the present Bill and the question of admitting leaseholders, he had no objections to the Bill. He also approved the provision which made the time for redeeming run from the date of the decree. If a decree was given for possession, and if the tenant did not redeem within the period of six months, the Sheriff ought then to place the landlord in possession, and it should not be left to him to take possession by his own servants. A great deal had been said against landlords exacting "impossible" rents. This was an expression rather racy of the soil, for how anyone could exact what was impossible passed his comprehension. Landlords, as a rule, were not, he believed, at all prone to exact exorbitant rents from their tenants, and they, on their part, had good cause for complaint against the Inland Revenue, who charged the landlords Income Tax on the valuation of the holding, which in many cases was considerably above the "fair rent" which the landlord received. The Bill contained two entirely novel legal principles—first, that in considering what was a fair rent the Courts should have
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regard not to the value of the land, but to what might be described as the value of the man—what he could pay. The County Court Judge was to decide whether the tenant became bankrupt through default of his own. Supposing a man had 13 children on a holding that would only support three, was that to be regarded as his own default? Supposing his wife was a drunkard, or that he commenced to farm without having any capital land which required capital? Were these matters for which he was to be responsible? These questions would be constantly cropping up, and they would be left to the decision of a County Court Judge, who, in many cases, would have had no previous experience of land at all and knew nothing of the tenant. He hoped that these provisions would be carefully considered by their Lordships. The second novel principle which the Bill contained was that a tenant who became bankrupt was to be allowed to retain his assets—namely, his tenancy. He did not desire to speak harshly of Irish tenants, many—perhaps most—of whom, if left alone, would do their best to meet their liabilities. But they were easily led by bad advisers. They saw looming a large land purchase scheme, and, indeed, there was no other means than such a scheme of bringing peace to the country. Of course, the tenants' desire was to bring the price down to the lowest possible figure. But this meant absolute ruin to many a landowner, and it was only reasonable that men in this position should understand exactly where they were and what was the nature of the measure, as they had their mortgages and other charges to meet out of the rent, and there would probably, in many instances, be nothing left. One of the most serious defects in the Bill was its tendency to encourage litigation, over which the lawyers were already jubilant. There was no reason why the tenants on an estate should not purchase as a body and not as individuals. While, therefore, supporting the second reading of the Bill, he reserved liberty to oppose certain clauses; and he particularly objected to Clause 23, which gave a minimum amount of relief to the tenants with a maximum of inconvenience to the landlords. He was entitled to speak, not only for himself, but for others on the other side of the Channel, when he said that something

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on the lines of Mr. Parnell's Bill of last Session, suspending eviction on payment of a certain percentage of the rent, would be more preferable to the machinery of the Bill. But, as he had already said, a large measure of purchase was the only possible solution; and he should like the measure to be compulsory, with every reasonable advantage secured to the tenant. The land was now becoming a damnosa hereditas, and no other escape was possible out of the present deadlock.
LORD CASTLETOWNsaid, he was glad that a large and industrious body like the Irish leaseholders were about to be admitted to the important provisions of the Land Act of 1881. He also felt sanguine that the new Purchase Clauses would, in many respects, effect the good they were intended to do, and facilitate the working of a valuable measure. They required amendment, however. As to the clauses relating to "equitable jurisdiction" and bankruptcy, they introduced a new feature and principle into commercial and agricultural life which ought to be scrutinized with the greatest care. It seemed to him that if some of the clauses of this Bill were to pass into law as they stood, it would be quite justifiable to introduce a Bill for the purpose of making their application possible with regard to town holdings held at a yearly rent of £50 or more. The average Irish landlord was now only a ground-rent landlord. He had none of the privileges of the position of an owner of house property. He could not raise the rent at the expiration of a lease without the permission of a Court. He could not assume possession of the improvements of the tenant without compensation, and his power of re-entry in case of non-payment was very slow, tedious and expensive. It was now proposed to debar him from recovering his land out of which the ground-rent was paid, and to place him on an equal footing with an ordinary creditor. Why should not this law, if just to the Irish landlords, be applied for the benefit of English bankrupts? The tenants of town holdings were a more numerous class than the Irish tenants, and according to the figures of Mr. Lee Knowles, quoted in The Times on April 16, they suffered greater hardship; and cases of eviction among them were, pro ratâ, more numerous. He feared that
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in the congested districts the Bankruptcy Clauses of the Bill might lead to perennial bankruptcy and extravagant usury. There was no doubt that if Clauses 22 and 23 were to pass unchanged, many improvident and fraudulent bankrupts would be supported for a time by the "gombeen" men; and though the landowner might be ruined during the transaction no class would be benefited except the village usurers. If these sections of the Bill were remoulded, the circumstances of the occupiers in the contented districts might be alleviated, though he feared that it would be at the expense of the shopkeepers, small traders, and landowners of the district. But if the clauses to which he referred were not altered, what would be their effect on the ordinary tenants holding under £50? Of these men holding under £50 there were about in number 208,250. He excluded all holdings up to and at £4. Of this 208,250, in all probability every man made his rent out of the land. How would these people be treated by the Bill? Their financial credit would be destroyed the day that Bill became law. Many of these men were well off. Their position was sound, and that position the Bill would endanger in order to keep one or more fraudulent bankrupts in their holdings. Suppose one of those £50 men was made bankrupt; the unfortunate shopkeeper who had given credit, and the landlord who had given time, would be heavily mulcted, and the tenant, who would, perhaps, have paid honestly in the long run, would find bankruptcy a useful game, and become a confirmed swindler. This would be the case of a man who began, bankruptcy as an honest man. He would agree to anything that would make the rare case of an unjust eviction an impossibility; but he could see no advantage in inflicting injustice on all the creditors of an improvident farmer simply because he was or had been a spendthrift. That section must be amended in such a way that the honest but unfortunate farmers would be protected, while the reckless and fraudulent were made to incur the penalty which was the fate of all classes under such circumstances. It was possible that, once law and order were restored in Ireland, these clauses, even when amended, might prove useless. He believed free

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sale of the goodwill was the real preventitive of eviction, and it would then have fair play. At present the National League almost entirely prevented it, and would prevent any remedial measures to be utilized. He knew of many cases of that interference. He now came to the second question of vital importance in the Bill—that of fixing a fair rent. That question underlay the whole matter they were dealing with. How was the County Court Judge going to fix assets if he did not know what the income was or had been? Take the case of a judicial rent. After all the trouble and expense, there was not one record to help the County Court Judges to arrive at an opinion as to assets, improvements, income, & c. Next came the question of the leaseholders, who were admitted to the benefits of the Act of 1881; but little or no provision was made to amend the obviously unequal administration and decisions of the fair-rent Courts. The manner in which fair rents were fixed was absurd. In the first place, the intentions of the Act of 1881 had not been carried out. The cost of each Sub-Commission was about £3,800. Then the cost of each case to a tenant was about £3, and to the landlord a little more. After all that cost there is not a vestige of a record, not even notes of what they have seen on the land they have run over. Surely some amendment was needed now that it was proposed to bring 160,000 leaseholders under the Act, and that many other tenants were going into Court. In thousands of cases appeals for a rehearing had been lodged. These appeals would never have been proceeded with had justice been meted out. This was proved by the fact that, out of 4,000 cases fixed by arbitrators, only six appeals had been proceeded with. He welcomed most portions of the Bill, though he considered it susceptible of great and useful amendment in many of its clauses. The Government had an immense opportunity now of making the Land Act of 1881 a workable measure and of use. But tinkering would not do. This Bill should facilitate those portions of that measure they proposed to introduce which dealt with land purchase. The abolition of dual ownership, fair rent, and fair sale questions were interwoven. The fair rent decisions must contain some data by which
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the two parties in the ownership might arrive at a conclusion. In this way men would begin to assent to terminating that partnership voluntarily. This could be done if they choose to do it. If not done, those portions of the Bill he had referred to would be nothing but shams, and of no value. It was, undoubtedly, the fact that in many parts of Ireland the people were getting tired of agitation, and were anxious to get from under the coercion of the National League; and it was also certain that, once the village tyrants—as a rule, reckless bankrupt men of no character—realized that their power to do evil and coerce was limited, and the law of the land was stronger than the law of the conspiracy, peace and prosperity would return. The present Government had the best means of solving the Irish Question. They had a strong majority, composed of Members of the two great English Parties, at their back. They had means of carrying through measures, not only calculated to prevent crime, but also of a remedial nature, with greater effect and facility than any other Government for many a long day. They had received a distinct mandate from the country to settle this Irish Question. If they faltered in their task, if they were led astray by partizan notions, or by ignorance, when they could be taught, the result would be disastrous to themselves and to the whole country, and especially to Ireland, whose social and commercial existence was at stake. On the other hand, he was convinced that the question could be solved now, and permanently, if it was dealt with bravely, vigorously, comprehensively, and without fear, favour, or affection.
THE EARL OF BELMOREsaid, he certainly did not intend to speak in any spirit of hostility, as he was of opinion that the Government was actuated by the best possible motives in bringing forward this Bill, with the hope that a better condition of things might be produced in Ireland. The question of Irish land was often discussed as a matter merely between landlord and tenant; but, in reality, the subject affected a great number of persons outside those classes. For example, the income from the Irish Church estates had suffered very severely already from the state of things in Ireland. The Representative Church Body had some

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£3,500,000 of trust money invested in Irish mortgages, of which the interest amounted to about £1,500 a-year, the accumulated arrears of which, owing to the present state of things, was now no less than £57,000; and, if matters went on in the same way, the income of the clergymen depending on the Fund could not fail to be injuriously affected. They would be reduced to a state of semi-starvation, and would be unable to educate their children. In dealing with the Bill before the House, he said about 110,000 leaseholders would now be brought under the operation of this Bill. A strong point was made by the noble and learned Lord (Lord Fitzgerald) that many of the persons who would be brought under the operation of the Bill would not want it at all. Whether that was so or not, there could be no doubt that many leaseholders would be greatly injured by it. As a landlord, he might be told that it was better for him to say nothing on that subject. He wished, however, to be perfectly fair; and the tenants had plenty of friends "elsewhere" who would call attention to the matter if it were passed over here. He would, however, call the attention of the noble and learned Lord on the Woolsack to the provision that a leaseholder was not to be liable to become a present tenant under the Act if a valuable consideration had been paid for the lease. He presumed that that was intended to apply only to the case of a fine paid to the original lesser by the original lessee, and not to a subsequent sale of the tenant right? [The LORD CHANCELLOR intimated assent.] If so, it would be better to say so in terms. With regard to the question of town parks, he had stated on the occasion of the first reading, that the Bill seemed to leave the law as it was before; and he was still of the same opinion. He did not see that the Bill did much more than give a definition of what a town park was; it did not really alter the law with regard to them. He approved of the suggestions made by the noble and learned Lord in the direction of amending the Bill. He also approved of the clauses dealing with ejectments and evictions. There might be some harsh evictions. A farmer might, not merely from the fact of prices, but from other causes, be unable to pay his rent, and so be evicted; but he thought moat landlords
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would hesitate to take that step in such cases. Indeed, in many cases compromises had been effected when the tenants saw that their landlords did not wish to take them into Court. He further hoped the Government would consider the question of re-imposing the duty of carrying out evictions on the Sheriffs. He approved of the proposed alteration by which a tenant would remain in as a caretaker during the six months which the law allowed him wherein to redeem, instead of, as at present, evicting him at once. From his own experience as trustee of a public estate in Ireland—that of the Raphoe Royal School—he was of opinion that that provision would be a beneficial one. On that estate, the tenants refused to pay, not because they could not, for they had money in their pockets, probably; and these provisions would deal with such cases. He, therefore, attached much importance to the clauses. With regard to the Bankruptcy Clauses, while admitting that something should be done to prevent harsh evictions, he thought that tenants would prefer to throw themselves on the generosity of their landlords, rather than appeal to the Bankruptcy Court. As to the question of the Appeal Court, it was necessary that something should be done. Cases for hearing had so largely accumulated that a long time elapsed before they could be disposed of. In his own experience, it had taken three years to have an appeal case decided. Meanwhile, prices had fallen, and the rent had to be fixed on a lower basis, increasing the chance of the loser having to pay the costs. He approved of the recent appointment of Mr. Wrench as one of Head Land Commissioners. He knew him well; he was an experienced and competent Englishman. He would not occupy their Lordships' time further; but—particularly by calling the attention of his noble and learned Friend the Lord Chancellor of Ireland—who had come in whilst he was speaking—to the question of the fines paid by leaseholders—would express a hope that a more distinct definition of some of the points in the Bill would be made in the Committee stage.
VISCOUNT DE VESCIsaid, he would congratulate the Government on having introduced a Bill dealing with the land question of Ireland, and hoped that it would be proceeded with pari passu with

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the sister measure in the other House for amending the Irish Criminal Law. He regarded it as the precursor of a much larger measure of land reform, which would deal with and utterly extinguish the intolerable anomaly of dual ownership of land in Ireland. He thought the country was deeply indebted to the members of the Royal Commission, who had, at great sacrifice of time and personal convenience, visited Ireland to inquire into the Irish Land Question on the spot. Ho, however, regretted that one member of that Commission had thought fit to present a Report different from the Report of the other members, for that gentleman was a very fair representative of the substantial North of Ireland farmers. Without desiring to offer this Bill any factious opposition, he thought it necessary to point out that several provisions of the Bill would, if not amended in Committee, work great injustice both to landlords and tenants. The disease from which Ireland was suffering was undoubtedly serious; but he denied that it was so desperate as it was sometimes painted, or that desperate remedies were required; and he had good hopes of great benefits flowing from the land legislation of the Government.
THE EARL OF KILMOREYsaid, he would be the last man to desire to embarrass the Government; but there were clauses in the Bill which made it quite impossible for any Member of the House as deeply interested as he wax in the Irish Question to permit the second reading to pass without uttering a strong protest. Personally, he was one of the fortunate landlords who had no rents in arrear; but that was no reason why he should not stand by his fellow-landlords in the universal shipwreck which threatened them. If English, Scotch, and Welsh landowners should continue to admit the principle that the value of the landed property of an Irishman was no longer what it would fetch in the open market, but what a confiscatory Court of Commissioners assumed a lazy or improvident tenant was able or willing to pay for the privilege of "squatting" on land which did not belong to him, the day would come when the saying, "what is sauce for the goose is sauce for the gander," would be forcibly applied to themselves. It should not, however, be
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assumed that the opposition to this Bill was confined to landlords, or that he opposed it on their behalf only. As he was informed, the Bill had no friends, at least, in Ireland. The general opinion was that the Bill, besides suspending and eventually wiping off, not only all arrears now due to the landlords, but all that which would become due between this and the date of the settlement of the composition alluded to in the Bankruptcy Clauses, would destroy all credit, paralyze all trade, and rapidly establish universal bankruptcy. If the landlords hated it much, the shopkeepers hated it more, and the "gombeen" man more still. The Government asked them to accept this Bill merely as an instalment of further remedial measures, which were to culminate at some not far distant date in the introduction of a grand scheme of purchase, which was to put an end to the dual ownership and all its concomitant difficulties, and finally settle the great grievance of the Irish people. He could not refrain from remarking that, in his opinion, the passing of this Bill would render unnecessary a second and more popular instalment of remedial measures. Why should the tenant buy at any price, however low, the holding that he could continue to occupy under the benevolent provisions of this Bill without paying any rent at all? For unless certain clauses were amended that would certainly be the result. He could not support the Motion of the noble and learned Lord. By the courtesy of the Prime Minister ample time would be afforded them for the consideration of Amendments; and he would, therefore, offer no opposition to the second reading. All he would do that night was to protest against the introduction of the Bill at all. He objected, to begin with, to the clauses which affected leasehold property and town parks. Previous Bills were bad enough, but this was worse. Previous Bills introduced by Liberal statesmen contained certain exemptions. This Bill removed them. It was left to a Conservative Government to introduce another instalment of remedial legislation more confiscatory than its predecessors. He looked upon this as the refinement of political cruelty; and, as a Conservative of 20 years' standing, who had seen a deal of Irish land law reforms, he felt constrained to address

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to the Prime Minister the memorable words of the stricken Cæsar—Et tu, Brute! The position of the Irish landlords in that House afforded a painful illustration of the unusual hardships, commented upon on a former occasion by a noble Friend of his (Lord Brabourne)—namely, that of the eels being asked to skin themselves. It was time, no doubt, that the eels got used to the skinning, but they could not be expected to enjoy the process. A noble Lord in "another place," not long ago, prominently connected with the present Government (Lord Randolph Churchill), was heard to say—"You have got the Crimes Act—what more do you want?" And then he added with great lack of feeling, "You must make up your minds to leave some more of your clothes behind you." Let them picture to themselves the melancholy effect of this gradual removal of their garments by Irish landlords. What was an average Irish landlord to do whose income was solely dependent on his rents if this Bill passed? How was he to pay, first, the heavy family charges on his estate; secondly, the interest on mortgage money; and, thirdly, maintain his family. If this Bill passed as it now stood three-fourths of the Irish, landlords would become hopelessly and irrevocably insolvent. Bad as their case had been and still was, the passing of this Bill would aggravate their misery and intensify their distress. The action of the Bankruptcy Clauses would be that the landlord must lose one year's rent, because the tenant must owe that before the landlord could proceed against him. Then ensued the unlimited period during which the tenant's Petition to be adjudicated a bogus bankrupt under Clause 23 was under consideration. County Courts were few and far between, and did not sit daily, and the number of applications would be as the sands of the seashore. Rest assured the landlord would receive no rent in the meanwhile. The plan of his noble Friend was 20 times more injurious than any Plan of Campaign. But if Her Majesty's Ministers would consent to tone it down, they would find the band of resolute opponents to the Bill gratefully doing their utmost under those trying circumstances to assist, not to retard, the passing of what appeared
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to be one of the most important measures of this surprising and turbulent Session. He was sure they were all equally determined to prevent the repetition of those deplorable scenes which, alas, too frequently, characterized an Irish eviction, and which excited so much sympathy antagonistic to the administration of the law and to the legal vindication of the rights of property. At the same time, he failed to see how, since the passing of the Act of 1881, any eviction for the non-payment of rent could be fairly said to be harsh and unreasonable. At all events, under this Bill, as amended, they would have the satisfaction of knowing that never again would there be such a thing, if indeed there ever was, a case of an unjust and unreasonable eviction. He objected to granting power to a County Court Judge to tamper with the decision of the Land Commission and stultify its judgment by a readjustment, however temporary, of a judicial rent. Power to do this was given by the 23rd clause, and he trusted this would not be enforced. Let him have a power to stay evictions by all means. Let him have power to deal with rent, arrears, and liabilities due up to the passing of this Bill or the date of a tenant's application to the Court, but no further. He prayed his noble Friend to purge the Bankruptcy Clauses of their novel and eccentric peculiarities or expunge them in toto, and re-introduce the unobjectionable portions of them in some other place—say, at the foot of Clause 21. If his noble Friend could see his way to assent to certain Amendments in Committee his noble Friend might count on the speedy equipment of the new ship just launched upon the troubled waters of the ocean of politics. And when it left Lake Superior, and was piloted and manned in "another place" by a crew and master no less hard-working and efficient than its present "company," he wished it all the success it deserved; and when laid up in ordinary as an obsolete hulk, its batteries no longer needed, might it always be said of the old ship that she held water, and might she always rank with credit among the Parliamentary achievements of the Lord Privy Seal.
THE EARL OF DUNRAVEN: Nearly every noble Lord who has spoken objects to every part of the Bill from opposite reasons and motives. Approving of

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the Bill, I wish to save myself from being supposed to approve of legislation of this kind. I do not approve of interference with the Law of Contract, and with the right of men to agree between themselves on business matters. There are peculiarities in different people and congregations of people, but there are certain great lines of policy common to all people; and if it be unwholesome to interfere with liberty of contract in Great Britain, it is equally unwholesome to do so in the sister island. The noble Earl opposite (Earl Spencer) said the advantage of doing it in Ireland had been shown by the fact that rents had been reduced; but if a Court had been set up in 1881 for Great Britain, I fancy it would have been found that rents had been largely reduced in Great Britain also. I believe the Bill is absolutely necessary in the present condition of Ireland. I can fancy some of your Lordships absolutely denying the conclusions arrived at by the Commission presided over by the noble Earl (Earl Cowper); and I can understand this Bill being objected to by those of your Lordships who absolutely ignore the evidence taken before that Commission, and the conclusions arrived at by the Commissioners. But if your Lordships accept the Report as being in the main correctly drawn from the evidence, I do not understand what logical objection can be taken to this Bill. The portions of the Bill which appear to be most objected to are the clauses with regard to bankruptcy. I will not attempt to go into detail upon them; but I would remind the noble Earl opposite—a late Viceroy of Ireland—that a great deal of the expense now incurred arises from proceedings being taken at a distance, and that undoubtedly the expense will be greatly lessened by the fact that proceedings can be taken in the County Courts. There seems to be a general impression that the tenants will flock into the Courts and declare themselves bankrupt. I have not the slightest fear of any result of that kind. I imagine that if there is one thing the Irish tenant dislikes more than another, it is to be made bankrupt. I have no doubt insolvent tenants will avail themselves of the clauses, and I should think it is an excellent thing that they should do so; but I do not believe any large number of solvent tenants will avail themselves
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of these clauses to make themselves bankrupt. To believe the contrary, we must suppose that the County Court Judges will be either indisposed or unable to do their duty. After all, it is not so very easy for a man to be a fraudulent bankrupt—it is not so very simple a thing to maintain before a Court of Law that he has no property and no assets; and owing to the way in which the powers of the Court are safeguarded in the Bill, and owing to my strong belief that solvent tenants will not be anxious to be made bankrupt, thereby losing their credit with the country, I have very little fear that these clauses will be used for a bad purpose. However, there seems to be a general idea in the House that the Government will abandon that part of the Bill. I do not know if that idea is well-founded or not; but I wish to point out that if it be well-founded, there would have to be some other clause in the direction of allowing County Court Judges to make a reduction of rent for a reasonable time. The 21st clause itself is admirable and equitable, and no valid objection has been made to it. That clause provides that the County Court may stay evictions; but more than that will be necessary. It will be absolutely necessary, in order that the main purpose of the Bill be carried out, that a County Court Judge or other officer should have power to reduce the rent to what he thinks a reasonable amount for a reasonable time. I think the course taken in the Bill is the best way in which it can be done, and that a man should make himself bankrupt before he can get his rent reduced. It will not be sufficient unless that is done. Then the provision as to caretakers is an enormous benefit, and the contention that it will do much to reduce the number of evictions is, I think, a correct contention. The noble Earl (Earl Spencer) thought it would only postpone evictions; but I think it would have quite the opposite effect. As the matter stands now, a landlord is obliged to evict on the granting of a decree, and is obliged to evict again to get rid of the caretaker; but by this Bill the first and most painful eviction will be done away with altogether. It may be that it would be advisable for the power to be exercised by the Sheriff instead of by the landlord. The general effect of the Bill will, I believe, be excel-

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lent; and I would wish to point out to those of your Lordships who object to the Bankruptcy Clauses and other portions of the Bill, that this Bill is an alternative. I assume that the evidence given before the Commission is valuable, and that it is necessary for any Government, with the Report of the Commission before it, to legislate on the subject. I must point out that the only alternative to a Bill of this nature is what was suggested by the Report of the Commission—that rents should be readjusted every five years. That, I think, would be intolerable; it would keep the country in an everlasting state of turmoil, and there would be no rest or peace. The only other alternative to the Bill would have been the exercise of what I may call an illegitimate dispensing power on the part of the Executive, which I hold would be absolutely destructive of all possibility of maintaining law and order in Ireland under any circumstances. The only alternative to these courses is what this Bill does—to increase the dispensing power which already exists in the hands of the County Court Judges. On the whole, I believe the Bill would do no more than what any reasonable landlord would do of his own accord, except this, that a large measure of responsibility will be taken from the shoulders of the landlords and placed upon the shoulders of the County Court Judges. I am certain in my own mind that the effect of the Bill will be to largely diminish the number of evictions, and thus to act beneficially. I am sure that the tenants will not avail themselves unjustly or improperly of the provisions of the Bill, and that its general effect will be to the advantage of landlord and tenant, and consequently to that of the whole country.
THE MARQUESS OF RIPON: This Bill has been brought in by Her Majesty's Government for the purpose of affording some further relief to Irish tenants, in consequence of the great fall in prices that has taken place during the last few years. It is, I think, much to be regretted that Her Majesty's Government did not know last autumn the real state of things in Ireland with respect to the fall in prices, and take measures for the remedy of that state of things at an earlier period, for, if they had done so, much that has happened would have been prevented, and
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many circumstances which we all regret, and which have occurred since, would have been averted, and the country would have been placed in a much more satisfactory position than that it now occupies. There has been displayed in the course of this debate great unanimity with regard to the necessity of some legislation of a remedial character, but it is remarkable that an almost equal unanimity, with the exception of the noble Earl who has just sat down, has been shown on the part of everyone, but the occupants of the Treasury Bench, in considering the measure proposed by the Government for dealing with this question, as in regard to some of its principal provisions, altogether unsatisfactory. This somewhat confusing position is due partly to the fact that we have now only a portion of the plan of Her Majesty's Government now before us. Had they put forward their promised measure with regard to land purchase in Ireland, it might have been possible that the scheme of Her Majesty's Government with regard to bankruptcy might have seemed less objectionable. The circumstances being such as I have described them, I venture to think that we are entitled to hear from Her Majesty's Government before this debate closes an explanation of the main object which they have in view. I think that your Lordships are entitled to a clear and definite statement as to the course that will be pursued. We have aright to know from Her Majesty's Government whether the whole of this Bill is open to consideration, or whether Her Majesty's Government intend to leave the House to deal with all the details as they think fit; or whether there are in the Bill matters of principle by which the Government intend firmly to stand. It is admitted on all sides that the measure of relief now dealt out to the leaseholders in Ireland is urgently needed. As to whether the Bill would decrease the number of evictions there are grave differences of opinion. In the formal sense it is true that under these provisions only one eviction would be necessary, instead of two as at present. But would there be any reduction of the number of persons ultimately evicted? Upon that point there are differences of opinion. Many persons believe that under the new Bill ejectment notices would be taken out in greater numbers.

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There would probably be for six months no actual forcible evictions, and for that the Government would be able to take credit. But what would result at the end of six months oven as regards the leaseholders? I do not think that the recommendation made by the Commission intended that the whole body of them should be turned at a stroke of the pen into the condition of tenants from year to year. The noble Lord (Lord Denman) who has just sat down said, that solvent and industrious tenants in Ireland would not avail themselves of the bankruptcy clauses. What does that mean? It means that the very men who called forth the interest of my noble Friend who presided over the Commission will get no benefit at all from it. I confess I cannot conceive any stronger condemnation of these clauses. To avail himself of them, a man has got to declare himself a bankrupt, or take steps which will entitle his landlord to have him declared a bankrupt. That is an extremely unpleasant position for any man to put himself into. If it is true that in consequence of the fall in prices many of the rents are rents which the tenants cannot legitimately afford to pay, you put them into the alternative of becoming bankrupt or deprive them of obtaining any relief whatever.
THE EARL OF MILLTOWN: May I ask the noble Marquess what portion of the Report makes any such statement as that which he has just made?
THE MARQUESS OF RIPON: The Report says—
"Although it is most undesirable to disturb an arrangement which was understood to be a permanent settlement, we cannot put aside the pressing necessities of the Irish tillage farmers, many of whom have lost much of their means, and are besides much indebted to banks, local merchants, and other creditors … Should the future range of prices continue on the present low scale, it will become absolutely necessary that a revision be made on the rents fixed prior to the beginning of 1886."
I think that that thoroughly bears me out in the statement which I have just made. I say that those men will not be provided for under this Bill unless they put themselves into the condition of bankrupts.
THE LORD PRIVY SEAL (Earl CADOGAN): The noble Marquess commenced his speech by saying that the course of this debate had been unprecedented, and he explained that obser-
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vation by the statement that whereas considerable objections had been taken to various portions and clauses of the Bill now under the consideration of the House, yet my noble and learned Friend beside me (Lord Ashbourne) had stated that he would give his consideration to the various points to which allusion had been made. I think that if anything has been unprecedented in the proceedings of to-night it has been this statement of the noble Marquess himself, in which he told us that because the Government accepts criticism and declares its disposition to give a favourable consideration to Amendments proposed on both sides of the House, therefore, and thereby, they declared their willingness to abandon the Bill. I must say I have often heard from the promoters of a measure, both inside the House and outside of it, the sentiment "the Bill, the whole Bill, and nothing but the Bill;" but I have never heard thick and thin opponents of a measure declare that they will be satisfied with nothing but the whole Bill. It is, I think, pretty well understood that on the debate upon the second reading of a Bill we should confine ourselves as much as possible to the main principles of the measure and avoid a discussion on its details. The noble and learned Lord opposite (Lord Fitzgerald) said that his view of the situation was that it was the duty of Members of the House who differed from the Government to offer their suggestions, and to make their criticisms, and to leave it to the responsibility of the Government whether they will accept those criticisms. That statement embodies the course which the Government will adopt. It is hardly necessary to repeat what I said when I had the honour of bringing in this Bill as to the position in which Her Majesty's Government found themselves when they embarked in legislative proposals with regard to the land in Ireland. The noble Earl the late Lord Lieutenant of Ireland alluded to the legislation of 1870 and of 1881, and told us that it was unavoidable and. justifiable. On the other hand, my noble Friend (Lord Carnarvon), who had equal opportunities as the noble Earl opposite with regard to experience in Ireland, told us that the Act of 1881 was the fountain head of all the troubles with regard

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to land legislation in Ireland. In a similar manner the noble Earl opposite told us that it was necessary to adopt that portion of the Report of the Commission which recommended a revision of rents, whereas my noble Friend gave strong reasons against the adoption of any such course. With regard to the provisions of the Bill which proposes to admit leaseholders to the benefit of the Act of 1881, I understand that there is a practical unanimity on both sides of the House as to the desirability of such a course. I believe it is rendered necessary by the fact of their being omitted from the Act of 1881, and we are obliged to give to one class of tenants what the noble Earl opposite gave to another. The noble and learned Lord opposite made some suggestions as to the drafting of that clause. I hope that if I say we shall consider those suggestions the noble Earl opposite will not think I am giving up the Bill. With reference to ejectments, I wish to say, once for all, that it is the main object of Her Majesty's Government in bringing in this Bill that harsh evictions shall be put a stop to in Ireland. The term unjust evictions can perhaps hardly be accurately used with reference to what after all is a resort on the part of the landlord to a legally authorized and legally sanctioned operation; but, at the same time, there is no doubt that harsh evictions have caused scandal, both in this country and in Ireland, which no Government should refuse to take into consideration. Therefore, I am anxious that it should be clearly understood that the great object which we propose to ourselves is to minimize, if possible, these evictions. Now, there appears to me to be a considerable difference of opinion as to the steps we have taken, and especially with reference to the powers of ejectment. I myself, from all the information I have been able to acquire, see no reason to qualify the statement which I ventured to make on the first reading of this Bill, to the effect that we believe that this system of giving notice would operate largely in diminishing the number of evictions. But the operation of that clause should be considered also in connection with the equitable clauses of the Bill. We believe that those clauses will operate in the same direction, and it is with that
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view that we shall press them. With reference to the equitable jurisdiction of the Bill, there is one remark that I desire to make. It has been impossible for me not to notice that noble Lords on both sides of the House have referred to "the equitable jurisdiction" which this Bill establishes, and have treated it as if it were confined to proceedings in bankruptcy. This view of certain provisions of the Bill has also been expressed outside the House, notably by Mr. John Morley, of whom I wish to speak with the highest respect for the consistency of his views throughout in regard to Ireland. He stated that he believed that the remedial policy of the Government could be summarized into one sentence, "an Act of Bankruptcy." It is not my intention to deal on the present occasion with the different clauses of the Bill; but I beg to point out that the 21st clause, which gives the County Court Judge the equitable jurisdiction, has nothing to do with bankruptcy. All it empowers the County Court Judge to do is to stay evictions in certain cases where he considers that a tenant is unable to meet his liability. This being the case, I think it is not fair to say that the relief is given only through the means of bankruptcy. I also desire to make a remark following upon, the observations which the noble Marquess opposite has made in reference to the position which the Government takes up in regard to this Bill. I cannot help referring to a question that was asked by Mr. Gladstone in "another place" not many days ago. He asked whether this measure was a reality or an "imposture," and when murmurs arose he altered the word to an "illusion." Now, I do not wish to anticipate any statement on the subject of the position of the Government in reference to this Bill which may be made by the noble Marquess the Prime Minister. But perhaps I may be permitted to say on my own account that if I believed that this Bill had been brought forward as an "imposture" or an "illusion," as Mr. Gladstone seems to suggest, I should certainly not have taken the part I have in regard to it. I may also be allowed to say on my own behalf that as I have undertaken the charge of this Bill it is my intention and anxious wish, so far as in me lies, to meet the views of noble

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Lords on both sides of the House in modifying and strengthening it, so as to make it, as I believe is the object of noble Lords on both sides of the House, deal as satisfactorily and with as much finality as is possible with one of the most difficult problems that any Government can have to face.
On the Motion of the Duke of ARGYLL, further debate adjourned till To-morrow.
House adjourned at half past Ten o'clock, till To-morrow, a quarter past Ten o'clock.