Sitting of 27 March 1903

Preamble
The House met at Twelve of the Clock.

MESSAGE TO ATTEND THE LORDS COMMISSIONERS.
The House went; and being returned—
Mr. SPEAKER reported the Royal Assent to—

1. Consolidated Fund (No. 1) Act, 1903.

2. Bank Holiday (Ireland) Act, 1903.

3. Light Locomotives (Ireland) Act, 1903.

The Clerk at the Table informed the House of the unavoidable absence of the Chairman of Ways and Means.
UNOPPOSED PRIVATE BILL BUSINESS.
  LAND DRAINAGE PROVISIONAL ORDER.
  Bill to confirm a Provisional Order under The Land Drainage Act, 1861, relating to lands in the parishes of Aslackby and Dowsby, in the county of Lincoln, ordered to be brought in by Mr. Hanbury and Mr. Hayes Fisher.
LAND DRAINAGE PROVISIONAL ORDER BILL.
"To confirm a Provisional Order under The Land Drainage Act, 1861, relating to lands in the parishes of Aslackby and Dowsby, in the county of Lincoln," presented accordingly, and read the first time; to be referred to the Examiners of Petitions for Private Bills, and to be printed. [Bill 125.]

PRIVATE BILLS (GROUP A).
Sir HENRY AUBREY-FLETCHERreported from the Committee on Group A of Private Bills; That the parties promoting the Walker and Wallsend Union Gas Bill had stated that the evidence of Thomas Messer Sturgess, Clerk to the Walker Urban District Council, was essential to their case, and, it having been proved that his attendance could not be procured without the intervention of the House, he had been instructed to move that the said Thomas Messer Sturgess, clerk to the Walker Urban District Council do attend the said Committee on Monday next, at Eleven of the Clock.
Ordered, That Thomas Messer Sturgess do attend the Committee on Group A of Private Bills on Monday next at Eleven of the Clock.

CORK HARBOUR BILL.
Reported, with Amendments; Report to lie upon the Table, and to be printed.

RAILWAY BILLS (GROUP No. 1).
Mr. KIMBERreported from the Committee on Group No. 1 of Railway Bills; That the parties opposing the North Eastern Railway Bill had stated that the evidence of E. B. Cargill, Fishing Vessel Owner, Billingsgate, Hull, was essential to their case; and, it having been proved that his at endance could not be procured without the intervention of the House, he had been instructed to move that the said E. B. Cargill do attend the said Committee on Tuesday next, at half-past Eleven of the Clock.
Ordered, That E. B. Cargill do attend the Committee on Group No. 1 of Railway Bills on Tuesday next, at half-past Eleven of the Clock.

PETITIONS.
  COUNTY COURTS JURISDICTION EXTENSION BILL.
  Petition from Southampton, in favour: to lie upon the Table.
DETENTION OF POOR PERSONS (SCOTLAND) BILL.
Petitions in favour: from Eassie and Nevay; and Newtyle; to lie upon the Table.
EDUCATION IN THE METROPOLIS.
Petition from Battersea, for legislation; to lie upon the Table.
LAND VALUES ASSESSMENT AND RATING BILL.
Petition from Battersea, in favour; to lie upon the Table.
RATING OF MACHINERY BILL.
Petitions against: from Goole; and Guisborough: to lie upon the Table.
ROMAN CATHOLIC UNIVERSITY IN IRELAND.
Petitions against establishment: from Inverness; Jedburgh; and Broughty Ferry; to lie upon the Table.
SALE OF INTOXICATING LIQUORS ON SUNDAY BILL.
Petitions in favour: from Little Halingbury; and West Hendon; to lie upon the Table.
RETURNS, REPORTS, ETC.
  BOARD OF AGRICULTURE.
  Copy presented, of Annual Report of Proceedings under the Tithe Acts, Copyhold Act, 1894, Inclosure Acts, and other Acts for the year 1902, together with a summary of the powers and duties of the Board under these Statutes [by Command]; to lie upon the Table.
BOARD OF AGRICULTURE.
Copy presented, of Annual Reports of Proceedings under the Diseases of Animals Acts, the Markets and Fairs (Weighing of Cattle) Acts, etc., for the year 1902 [by Command]; to lie upon the Table.
EMIGRATION (COLONIES).
Copy presented, of Report on the Emigrants' Information Office for the year ended 31st December, 1902 [by Command]; to lie upon the Table.
AGRICULTURAL STATISTICS (IRELAND).
Copy presented, of Return of Prices of Agricultural Products and Live Stock for the year 1902 [by Command]; to lie upon the Table.
CENSUS OF ENGLAND AND WALES, 1901.
Copy presented, of Summary Tables. Area, Houses, and Population [by Command]: to lie upon the Table.
EAST INDIA (PUBLIC WORKS DEPARTMENT).
Address for "Copy of a Despatch from the Government of India, dated the 26th day of September, 1901, and of the Reply of the Secretary of State in Council, dated the 8th day of November, 1901, on the subject of Memorials from the officers of the Public Works Department appointed from the Royal Indian Engineering College in the years 1878—(Sir Seymour King.)
QUESTIONS AND ANSWER CIRCULATED WITH THE VOTES.

  Railway Repairs—Danger to Public.
  MR. BELL: To ask the Secretary of Stale for the Home Department if his attention has been called to the arrest of a flagman on the Great Western Railway at Frome on the 5th February last on a charge of picking up coal from a passing train, with the result that the bridge undergoing repairs which he was protecting at the time was left unprotected for three hours; and whether, in the interests of the safety of the travelling public and the railwaymen, he will take steps to prevent repetitions of such occurrences.
  (Answered by Mr. Secretary Akers Douglas.) I called for a report from the chief constable of Somersetshire on this case and am informed by him that the arrest was effected after communication with the stationmaster, and it does not appear that the man was wanted at the
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  bridge at the time as no train was timed to pass there until seven hours later. No action on my part seems necessary.

  Clerks to Surveyors of Taxes.
  MR. T. M. HEALY: To ask the Secretary to the Treasury whether, in view of the petition of the clerks to the surveyors of taxes, of April, 1900, presented by the Board of Inland Revenue to the Treasury, the Treasury are prepared to establish these officials as permanent officers of the Crown.
  (Answered by Mr. Hayes Fisher.) The Treasury are not prepared to establish these officials as permanent officers of the Crown with pensionable rights.

  Hinckley Guardians—Vaccination Officers.
  SIR CHARLES M'LAREN: To ask the President of the Local Government Board if his attention has been called to representations of the Hinckley Guardians as to the state of the law as to the control of vaccination officers; and whether he will take steps to prevent these officials engaging legal advisers without consultation with or the consent of the guardians.
  (Answered by Mr. Walter Long.) My attention has been called to representations made, by the guardians on the subject. As regards the last part of the Question, I must point out that the duty of the vaccination officer to take proceedings in cases of default is quits independent of any directions from the guardians. In cases where the guardians are opposed to the enforcement of the Vaccination Acts it would obviously be impossible for the vaccination officer to carry out the duty referred to if he had to obtain the consent of the guardians to the legal assistance which was requisite for the purpose; and I am advised that it is a necessary incident of the statutory duty of the vaccination officer that he should have authority to engage legal assistance where this is required.

  Sale of Burghclere Poors Land.
  MR. CHANNING: To ask the hon. Member for the Tunbridge Division of Kent, as a Charity Commissioner, whether, seeing that, in the case of the Dunwich Town Lands

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  some years ago, the Charity Commissioners held that the trustees could not sell the land by private negotiation to a single purchaser without first giving an opportunity to the public to purchase by tender or otherwise, the Commissioners will apply the same rule to the proposed sale by the trustees of the Burghclere Poors Land.
  (Answered by Mr. Griffith Boscawen.) As has already been explained, in the case of the Burghclere Poors Land the trustees have a statutory power to sell without reference to the Commissioners and the Commissioners have accordingly no jurisdiction to direct the proceedings to be taken.

  Vaccination Acts—Exemption Certificates.
  MR. LEVY: To ask the Secretary of State for the Home Department whether his attention has been directed to the refusal of the justices of the Altrincham Petty Sessions on the 16th instant to grant a certificate of exemption under the Vaccination Act to an applicant who stated he had a conscientious objection to vaccination; and whether he can take any steps in the matter.
  (Answered by Mr. Secretary Akers Douglas.) I have no information as to the case referred to. Certificates of exemption are, by law, to be granted when the justices are satisfied that the applicant has a conscientious objection; and the Secretary of State has no authority to intervene in the matter.

  R.A.M.C.—Compulsory Vaccination of Civilian Clerks.
  MR. CHARLES HOBHOUSE: To ask the Secretary of State for War if he is aware that an officer of the Loyal Army Medical Staff requires civilian clerks in temporary employ on Loyal Engineering Works to be vaccinated as a condition of employment; and will he say whether this action has received his sanction.
  (Answered by Mr. Secretary Brodrick.) Will the hon. Member kindly refer to a reply which I gave to a similar Question the Rugby Division of Warwickshire.

  China Medal for Tientsin Volunteers.
  MR. BRYCE: To ask the Secretary of State for War whether he is aware that the Tientsin corps of Volunteers, who rendered efficient service in the defence of Tientsin during the military operations in North China in 1900, complain that the clasp which has, along with a medal, been given to the rest of His Majesty's forces concerned in those operations is being withheld from them, the medal alone being offered; and whether he will further consider the matter with a view to awarding due recognition to these Volunteers, whose spirit and conduct were of value at a critical time.
  (Answered by Mr. Secretary Brodrick.) The clasp has been already awarded in these cases.

  MESSAGE FROM THE LORDS.
  That they have agreed to—
  Consolidated Fund (No. 1) Bill without Amendment.
  That they have passed a Bill, intituled, "An Act for codifying the Law relating to Marine Insurance." [Marine Insurance Bill (Lords).]

LAND VALUES ASSESSMENT AND RATING BILL.
[SECOND READING.]
Order for Second Reading read.
DR. MACNAMARA, in moving the Second Reading of the above-named Bill, said the Budgets of the Inst few years had been awaited with much curiosity and speculation, but, whatever surprise those Budgets might have contained, there was always one thing certain about the speeches in which they were introduced by the Chancellor of the Exchequer, and that was that he would appeal for a broadened basis of Imperial taxation in order that he might be furnished with new revenues wherewith to meet the necessary charges on the public purse. Justifiable though that plea was with regard to the question of Imperial taxation, it was applicable with much greater force to the problem of local rating. In 1868 the amount raised by way of Imperial taxation in the United Kingdom was £63,700,000, in 1899–1900 the amount was

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£109,63000, an increase of 72 per cent. As to local rates in England and Wales, the amount raised in 1868 was £16,500,000, and in 1899–1900 £40,750,000, an increase, not of 72 per cent., but of 150 per cent. Then, to take the case of London, the amount raised by way of local taxation in 1868 was £3,702,000, and in 1899–1900 £11,154,000, an increase not of 72 per cent., or even of 150 per cent., but of 200 per cent. Therefore the plea for redress in the incidence of local rating was much more urgent and powerful than in the case of Imperial taxation, and the problem was bound rapidly to become more acute. The burden of local rating on the working, shopkeeping, lower middle and professional classes was becoming too grievous to be borne, and as the standard of comfort and civilisation was raised, a larger expenditure in local government would have to be contemplated. Apart from that, the Government last year passed a Bill which, in its immediate effect, would increase, by not less than £2,000,000, the aggregate amount of money to be raised by way of local rating.
While not professing to be a scientific economist, he had, after watching this matter with close interest for a considerable number of years, come to the definite conclusion that in great towns, and especially in London, there existed between rate expenditures and land values a direct relationship, viz., that of cause and effect. If the people of a city opened a park, widened a street, built an embankment, laid an electric railway, or constructed a bridge over, or a tunnel under a river, out of the rates, the value of adjoining land was enormously enhanced. To put his case in a sentence, the landowner was the residuary legatee of the great bulk of rate expenditure. Last year, in a debate similar to the present, the hon. and learned Member for the Stretford Division said there was no unearned increment. He had thought a great deal of that statement since, and he would put one case to the acute intellect of the hon. and learned Member. In 1865 a piece of land near the Temple Station, on the foreshore of the Thames, covered with coal sheds and wharfing, changed hands for £8,250. In 1809–70
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the London ratepayers built the Embankment at enormous cost. In 1872 the I London School Board desired to secure a piece of land on which to build its central offices. They obtained the very piece of land to which he had referred, and the jury awarded the owners the sum of £26,420. That appeared to him to represent an unearned increment of about £18,000. The ratepayers were first of all hit to build the embankment, and were hit again when they wanted to purchase land for a public office. He could multiply such instances, as also no doubt could every urban Member.
They were confronted in London with two rapidly moving phenomena in connection with this question. In or near the centre of the City leases were falling in, and ground rents had become three, four and five times larger than the entire rental of the whole tenement as they stood before the leases fell in. Mr. Gomme, the Clerk to the London County Council, wrote to him as follows:
"It is not an unusual thing to find when leases expire in the central districts of London and new building leases are granted, that the ground rents obtained by the owners exceed in amount the total rental value of the business premises originally standing on the sites."
The other phenomenon with which they were confronted was that at the present moment, as the result of the general desire to go away from the centre of the city in order to live in the suburban zone, the value of those sites was increasing fabulously at the present time. Take an estate in Wandsworth with which he was familiar. This estate stood near the Common, and contained an area of about twenty acres. About ten years ago it was occupied as a residence, and the whole thing had been assessed at £650. The house had been pulled down and the estate let out in building leases, and what was the result? They had now crowded on that property ground rents to the value of £3,500 per annum. That was an instance which he could multiply indefinitely. As chairman of the School Accommodation Committee for the School Board of London he had had to go into the question of buying sites for board schools. In 1895 they went down to Cavendish Road, Balham, and bought a large piece of land containing 87,120

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square feet, at 9d. per square foot. Six years after they wanted another site close to this one, upon which to erect another board school, and they bought 90,660 square feet of land close by the other site, but they had to pay 1s. 6¼d. per square foot. That was they were charged more than double the amount six years later compared with what they had to pay in 1895. He had spent a certain amount of time studying the posters issued by land agents announcing sales of land. He found that the auctioneers in setting forth the advantages of certain sites put into their prospectuses either prospective or actual public improvements which were going to increase the value of the land. He had read with great care the Estates Gazette and the Land Agents' Record and similar journals, and there he found innumerable cases of prospective improvements given as a reason why a larger price should be secured for some particular land. There was a case at Wimbledon where the fact that electric trams were about to be constructed within 100 yards of an estate was given as a reason for improving the value of the land. This meant that the people having spent their money on trams would directly increase the value of that particular estate. In another instance, at Bridgwater, a reason given was that the Borough Council contemplated the formation of a new street which, if carried out, would give an important frontage to this particular property. He knew of a plot of land in Battersea where a factory or warehouse might be built. In the advertisement offering this land for sale it was stated that the land was almost opposite the Battersea Borough Council's Electric Lighting Station, from which power could be economically supplied. Therefore the landowner was the residuary legatee of the great bulk of this expenditure.
They did not propose to touch agricultural land at all; they confined themselves to the land in London, and they said that all urban land must be assessed whether occupied or not under the scheme set out in this Bill. That was compulsory. Having assessed the land the overseers would place the assessment in a separate column; having
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done that, then they might lay a land rate on the capital value of the land of not more than one penny in the pound. Who was to pay this new rate? They declined to interfere with existing contracts, and they said that for the moment in the case of all existing contracts, the new rate must be paid by the new occupying tenants. After the date of the passing of this Act, in the cases of all new contracts the occupying tenant would make a rent reduction on account of the land rate laid upon him. Hon. Members would recognise that they had based this scheme Upon the Minority Report of the Commission on Local Taxation. The majority of the Commissioners, he was a ware, were against him. The Majority Report was signed by Earl Cawdor, Sir J. T. Hibbert, the hon. Member for the Hallam division of Sheffield, the hon. Member for the Stretford division, Mr. C. N. Dalton, Mr. Harcourt E. Clare, Mr. J. H. Elliott, Mr. E. Orford Smith and the hon. Member for the Ripon Division. There was, however, a very remarkable Minority Report to which he particularly desired to call attention. It was signed in the first place by the Chairman of the Commission, who was a member of the Cabinet, Lord Balfour of Burleigh. It was also signed by Lord Blair Balfour (Lord Justice-General of Scotland), Sir Edward Hamilton (Assistant Secretary to the Treasury), Sir George Murray (Secretary to the Postmaster-General) and Professor Stuart. There was also a most powerful Report by His Honour Judge O'Connor, who also went the whole length of the Minority Report. He wished to give one or two brief extracts from this Minority Report. They said—
"That site and structure, which are now combined for rating purposes, differ so essentially in character that they ought to be separately valued."
"That when separated from structure, site is capable of bearing somewhat heavier taxation, and should be made to bear it, subject, however, to strict respect for existing contracts."
"That the differential treatment should take the form of a special site value rate, payable in part by means of a deduction from rent on the Income Tax method, and that thus a part of the burden should visibly fall on those who have interests superior to those of the occupier."
"That subject to the conditions which we have specified, the special site value should be

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charged in respect of unoccupied property and uncovered land."
There was another quotation which he would give, because it touched the heart of an appalling social problem which they could not tackle until they had dealt with the land question, and that was the question of the housing of the working classes. It was because he was interested in that question that he had asked the House to pass the Second Reading of this Bill. They said—
"While the rating of site value thus concerns the public as an administrative reform, it is of special importance in connection with the urgent problem of providing house accommodation for the working-classes. Anything which aggravates the appalling evil of overcrowding does not need to be condemned, and it seems clear to us that the present heavy rates on building do tend to aggravate those evils, and that rating of site values would help to mitigate them, If more of the burden were thrown on sites, the portion left to be borne by building would be diminished, and this would weigh with the builder who is hesitating to embark on the erection of new structures."
He could not add another word to such a convincing comment as that, it was said that it was not practicable to assess land separately. The right hon. Gentleman the Member for Sleaford in 1890 said that it would cost between £3,000,000 and £6,000,000 to do what was proposed, and that it would be ruinous, and the hon. Member for Tunbridge Wells said it would be impracticable and costly. What did the Minority Report say? They said—
"A valuation sufficiently accurate for the purpose and not inferior to the present valuation, could be made without undue labour and expense."
Then there was the following remarkable comment by Judge O'Connor—
"Many witnesses who appeared before the Committee dwelt with emphasis on the alleged or suggested difficulty of estimating the value of land apart from buildings upon it; but no one of the expert witnesses would say that it was impossible, and none would admit that he could not himself do it if it was necessary. But, in fact, the matter is past the stage of mere argument, for not only is the thing being done every day for private purposes, but it is also done on public account in all three countries under the established practice. The entire system of valuation in Ireland under Acts of Parliament is based upon the separation valuation of land and of buildings. In England land has to be separately valued in the country for the purposes of the Agricultural Rates Act. Under numberless private
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Acts of Parliament the thing has been done for many years in connection with compensation to owners, lessees, and occupiers disturbed in their 'quiet enjoyment' by promoters. In the case of the Tower Bridge Southern Approach Act, 1895, not only was the valuation differentiated, but the principle was recognised and applied."
Then it was actually objected that they did not propose to break existing contacts. It was pointed out by the hon. and learned Member for the Stretford Division that this would involve a new burden on the occupying tenant. He remembered with what horror the hon. and learned Member raised his hands at the suggestion last year. He said that they should go direct to the ground landlord, but the hon. and learned Gentleman knew better than he himself did that that was impracticable. The minority of the Commission reported that it was "neither workable nor equitable." It did seem to him that the Minority Report hit upon the best way out of the difficulty of the case. Let him examine the most serious charge brought against them, that they were proposing something very detrimental to the occupying tenant. It was said that they were imposing a new rate on occupying tenants. First of all he would suggest that the rating of unoccupied land would bring such a sum of money into the local purse with such a rebating influence that the occupying tenants would pay with the two rates together no more, and probably less, than the single rate they were paying now. He might be wrong there, but in any case his second answer was that for the great bulk of the I people, for whom he was concerned—I the working classes who felt the burden of rates so grievously before they knew where they were, their tenancies being so short, they would fall under the rent deductions which would come into active operation. And if they did not get relief by the rebating influence of the rating of unoccupied land, before the new burden—if there was a burden, and he challenged that—fell upon them, they would be universally applying the second part of the system which applied to new tenancies.
The next objection was that they were saddling the landowner with this new rate, and that he would take it

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out of the occupying tenant. It was said that he would increase rents. If that was true, he was lost in wonder at the objection to this proposal from the point of view of the landowner's friends. If that was true, let him take it out if he could. He would take all he could get, no doubt, like most of them. But the rating of unoccupied land would have such an effect upon building operations that he did not think the landowner would be able to get quite as much as he did now, where a large amount of land was held up and kept out of the market in order to enhance its value. He would suggest to hon. Members opposite that they should choose the horse on which they were going to win. They should choose whether it was to be the tenant or the landlord. When they came forward with a number of arguments on behalf of the tenant, and a number of arguments on behalf of the landlord, which were mutually self-destructive, he would respectfully suggest that they should stick to the one or to the other. They could not have it both ways. He was very much amused that morning in reading a memorandum issued by the Property Protection Society. There he found the same conflict of argument. They began by protesting against the bad effect which this Bill would have on property. They said it would enormously depreciate the value of freehold property. That was an understandable argument. Having said that, and laid it down as their first line of defence, they said,—
"The Bill would seriously diminish the existing check upon extravagant expenditure on the part of local authorities, who, at present, are restrained by the knowledge that the cost of any increase in expenditure comes immediately out of the pockets of the general body of their constituents."
He thought that landowners were constituents as well as tenants. There were some that he knew who were constituents three or five times over. They were told, in the next place, by the hon. Member for Tunbridge Wells, and the hon. and learned Member for the Stretford Division, that this was not a question to be dealt with in a piecemeal way—that it was an important and far-reaching question of local taxation. That would
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apply very admirably to the case of the Agricultural Rating Act, or to the case of the Clerical Tithes Acts. His memory failed him as to whether the hon. Members raised it on those occasions. He rather thought that they did not. Then they were told that this Bill as it stood was not comprehensive enough. Now, that was a singular charge for Conservatives to bring against Radicals. Since he had been in the House he had learned to respect one excellent Conservative doctrine: "Drastic remedies often create greater evils than those you seek to remove." It was a little hard when they were endeavouring to apply such an unexceptionable doctrine that they should be reproved by those from whom they learned it. What was the Government's position in regard to this matter of the taxation of land values? At the General Election of 1895, the Unionist Party undoubtedly looked upon this as a matter calling for legislation. He remembered a debate on a similar subject on the 1st of May, 1900, in this House, when the hon. Member for North Islington made this statement—
"He had with him a hook issued at the Conservative Party's headquarters on the eve of the General Election. That book commended the Report of the present First Lord of the Admiralty's Committee, and suggested as possibly desirable that the ground landlords should contribute directly to the rates. On the strength of such authority he had made certain promises to his constituents."
The Conservative Party at their headquarters were in favour, according to that statement, of the Report of the Committee presided over by the then First Lord of the Admiralty. He wondered if they had any idea of what they were committing themselves to. He would repeat one sentence from the Report of Lord Goschen's Committee of 1870. The Report was a most uncompromising document in favour of the rating of land values. Going through the matter in great detail, the Report gave statistics which were of the most admirable character. They showed how land, year after year, had borne less and less of the entire rating, and how the rating of houses had gone up, and up, to the amount they now

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bore. That was conspicuously set forth in this Report, which said—
"It has been conclusively proved that a great proportion of the rates, especially in towns, does not fall upon the owner, but is paid by the occupier."
On that the Committee suggested the rating of land values, and their suggestion was entirely homologated by the Conservative headquarters in 1895. In 1896, after the General Election, the Government appointed a Royal Commission. In 1899 the late Mr. E. J. C. Morton, the Member for Devonport, moved an Amendment to the Address on the question of land values, and the right hon. Gentleman the Member for the Sleaford Division, who was in charge of the Government opposition to the Bill, said—
"For the hon. Member to comedown to the House on an afternoon like this,"
—he confessed that he forgot what was the matter with the afternoon—
"and move a Vote of Censure on the Government because they had not put into the Queen's Speech a matter which was being dealt with by a Royal Commission, was one of the wildest propositions he had ever heard."
Well, of course, that killed it at once. In 1900 the hon. Member for the Pontefract Division moved a Resolution referring to the taxation of urban land values, and on that occasion it was ill-timed, according to the right hon. Gentleman the Member for Sleaford. It was said to be "academic," and that they must wait once more for the Report of the Royal Commission. They had done what. Lord Goschen told them to do. Lord Goschen told them not to bring forward general Motions, but to bring forward a specific Bill, and that the Government would give it due and proper attention. The hon. Member for Thirsk, as representative of the Local Government Board, spoke in the debate on behalf of the Government on what was practically a similar question last year. He said—
"If the Bill was as sound in principle as it was unsound, he would still say that it was not a suitable Bill to give a Second Heading to."
That was a very good beginning. The hon. Member continued—
"The question of rating was too important to be dealt with as a plaything in a Private Member's Bill on a Wednesday afternoon."
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He could assure the hon. Member in all sincerity that this was not a plaything to them. It had been a matter of labour, and of some care and industry. In this connection he might paraphrase a saying of Lord Beaconsfield, and state, "If you want to know anything of a subject, bring in a Bill about it." The hon. Member for Thirsk also stated that—
"The Bill did not go near touching the crux of the problem of local taxation, which was: How could local burdens be better distributed according to the ability to bear them? If the quest in was to be touched, it ought to be touched by the Government, and the Government would deal with it."
That was a year ago. The hon. Member also said:—
"He was not at liberty to say how the Government would deal with it."
He asked this House to decline to wait to see how the Government would deal with it. While the Government procrastinated the ratepayers starved. Was it that we were to take a place behind Continental countries and our own Colonies in this matter? There were seventy-six towns and counties in Germany where already this system was in full vogue. Paris was already engaged on a separate assessment of urban land values. Five out of seven of the Australian Colonies had the system in effect. New Zealand had had a general land tax of one penny in the pound since 1891, and had, since 1896, a Local Option Act permitting municipalities to levy a rate on unimproved land values. Sixty-two localities had already adopted that local option scheme in New Zealand, and Mr. Seddon, the Prime Minister, had lately said on behalf of his Government that they intended to universalise the scheme. He had sent this Bill to a great many municipalities and had received a great many resolutions in its favour. He would read the names of a few of them. The Parliamentary Committee of the London County Council were in favour of the principle of the Bill, and were to have reported upon it last Tuesday, but that business was not reached, and it would probably be discussed next Tuesday. He had, however, not the shadow of a doubt that approval of the Bill would be carried. The Bill had been approved of by the

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Borough Councils of Camberwell, Hampstead, Battersea, Fulham, Deptford, the Town Council of Bradford, the Parliamentary Committee of the Town Council of Cardiff, the Town Council and Guardians of Blackburn Union, Dewsbury, Darwen Union, the Town Councils of Burnley and Torquay, the Finance Committee of the Town Council of Eastbourne, the Town Councils of Clitheroe, Loughborough, Newport in Monmouthshire, Northampton, Newton, Longton, the Borough of Bootle, and Hastings. He had had one letter out of all which was against the scheme and that came from the Metropolitan Borough of Stoke Newington, but why they were against it they did not say. He began his investigations on this subject by studying with great care the speeches of one of the most distinguished Members of the House of Commons. When he wanted information on questions of political reform he always went to these. He referred to the right hon. Gentleman the Colonial Secretary, and he based his plea for this modest little scheme upon a deliverance from the lips of the right hon. the Colonial Secretary, who said:—
"I would ask again why should owners of ground rents escape all contribution to the expenditure of their localities? These ground rents have all grown out of the prosperity and industry of the community. The property of the owners has been improved by local expenditure, and why should not the owners contribute towards the local expenditure of which they ought to bear a part?"
He could not add a syllable to that deliverance, and with these sentiments on his lips he begged to move that this Bill be now read a second time.
Motion made, and Question proposed, "That the Bill be now read a second time."
Mr. GRIFFITH BOSCAWENsaid that the hon. Member in the course of his very interesting speech had told them that his object was to do something to relieve the burdens of existing ratepayers; and that the rates had gone up something like 200 per cent. With that he was in cordial agreement with the hon. Member. And then the hon. Gentleman went on to say that there had been an enormous in crease in the value of urban sites. He did
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not deny that there had been an enormous increase in the value of urban sites, but when the hon. Member told the House that that increase was principally due to the expenditure of the rates, he took issue with him. His argument was that it was not the expenditure of the rates which, as a rule, had increased the value of urban sites; it was the advantage of the site and the presence of the community. That was not the same thing, for the expenditure of the rates in many cases, so far from increasing, had diminished values. Very often when a man took a house the first question he asked was "What are the rates?" and if the rates were high he would give less rent for it than if they were low. The hon. Member must be aware that certain public expenditure, while it improved one part of the town, operated in exactly the opposite direction in another part of the town; that there was a worsement as well as a betterment, and if the hon. Member was going to tax owners of property for the expenditure which had improved their property, was he going to compensate those owners whose property had been worsened? If they were going to put an extra rate on simply in consequence of betterment, they ought to differentiate the rate paid by the man whose property was diminished in value and make it smaller.
DR. MACNAMARA: His assessment would be lower.
Mr. GRIFFITH BOSCAWEN: The Assessment would be lower! But were they going to put this additional rate on capital value all over the urban district and then say to owners of certain property that they would get the benefit of a lower Assessment? He had been amused at the example given by the hon. Member of property being improved by expenditure by public bodies. What did he tell them? That the town or borough council spent money on electric tramways, and therefore that the charge which had been incurred by the borough or town council ought to be borne by the property which had been benefited. Well, but he thought that electric tramways and other forms of municipal trade were no charge on the rates. At least,

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that was what hon. Gentlemen opposite told them: that they were in fact a relief to the rates. What followed? They were going to relieve the rates, but the owner whose property was benefited by the relief of the rates was not to have any advantage of the benefit because he was not a direct payer of the rates. He sympathised entirely with the object of the hon. Member if he could do anything to relieve the burden that pressed so hardly on existing ratepayers, but this Bill, so far from diminishing the burden; on the existing ratepayers, would actually increase it; and so far from its promoters having found a great undeveloped source of wealth, never before tapped, they were simply sinking a shaft into an old mine, and putting fresh burdens on those who, at the present moment, were already overburdened. The Bill put an additional tax on the capital value of the sites to be paid for by the occupier. The hon. Member pointed to the fact that he did not propose to break contracts. Very well, but how was he going to benefit the present occupiers, the present ratepayers? The hon. Member dismissed that matter in an airy way, by saying "We put the tax on the occupier only for the moment." But there were leases for 999 years, and in the course of that very long period the "present rate-payers" were going to bear the burden of this extra rate. In fact, the Bill was precisely the same Bill which was rejected by the House last year, with one or two minor alterations. It got rid of the Schedule of the so-called permanent improvements to which this new site value rate was to be applied, but substantially the Bill was the same as that which was rejected last year. On that occasion the hon. Member for Launceston, who was perhaps the most learned and expert advocate of rating ground values in the House, condemned the proposals in the Bill. After referring to the fact that it was a source of satisfaction to him that a Bill on the subject had been brought in, the hon. and learned Member said—
"I am bound to say that there is another side to it; and that is that the minority [of the Royal Commission] in their practical recommendations abandon those principles and propose a plan which I think I shall show to the House is not only diametrically opposed to
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the opinions they accepted but which is one which will do great injustice to existing occupiers."
And yet the hon. Member came forward with practically the same proposal of a new rate on the capital value of the site to be paid by the existing ratepayers!
He passed from that point to the argument that the owner of the ground values paid us rates. But what happened when a man let his land on building lease? The builder, knowing what he was likely to get for the house when built, in a particular locality, in the way of rent, agreed with the owner to pay so much ground rent, and he took into consideration that he would have to pay all the rates, including those on the ground rent, and therefore offered the owner of the land so much less. The hon. Member might say that the builder did not anticipate that the rates would be so high; he quite agreed, but the owner did not anticipate that there would be this large increase in value of his property. And who benefited by this increase in value? The lessee entirely, and very often the speculative builder could sell his building lease for a very large sum. No doubt the speculative builder, who was not a philanthropist, made a very shrewd guess of what were likely to be the rates before he fixed the ground rent; and therefore, he contended, so far from this rate being a new source of untaxed rent, it had been paid all along. He would quote a few opinions on that point. Sir Robert Giffen, in his memorandum submitted to the Royal Commission, said—
"The idea of the separate rating of ground values arises from a misunderstanding of the real incidence of rates. As that burden falls ab initio on the ground landlord, diminishing the sum of capital or income he is able to obtain for his property, there is really no separate ground value to be assessed."
Very well, if that were so, where was this new and undeveloped source of wealth which had never yet been tapped? Take, again, an authority who had been recognised—the Secretary of the Cobden Club, Mr. Harold Cox. In his book on "Land Nationalisation," speaking of the

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very proposals in this Bill, Mr. Cox wrote—
"These three suggestions—the division of rates between occupier and owner, the taxation of ground values and the rating of vacant sites—are the proposals most frequently made for amending the present system or local taxation. As we have seen, they will none of them bear the lest of criticism; and this was to be expected, for they are all tainted in their origin by the false theory that rates fall upon the occupier, and are all prompted by the paradoxical desire to make the owner pay what he already does pay."
What were the undeveloped sources of wealth which the hon. Gentleman thought he was going to tap for the benefit of existing ratepayers? On that point he would refer to the minority Report of the Royal Commission, because somehow or other, it was the practice of hon. Gentlemen opposite, not only on this question, but also on the licensing question, to accept minority Reports as gospel truth, and to argue from them The minority Report winch was signed by Lord Balfour of Burleigh and others did not hold out the prospect of large new sources of wealth. It said that the proposed tax—
"Would, or at least should, conduce to the removal of some of the widely-spread misconceptions which seemed to prevail, not only in political circles, but among economic authorities and responsible statesmen; for while it would be admitted that there were defects in the urban rating system, and an attempt, to remedy those defects, it would show that this is no large developed source of taxation available for local purposes and still less for national purposes.
Therefore, taking the very authority on whose recommendation the Bill was founded, the large source of taxation and of wealth which hon. Gentlemen opposite thought was untaxed, was not going to provide any great relief for the existing taxpayer; and was only recommended in order to dissipate a misconception which appeared to prevail, he would not say with the hon. Gentleman, but at all events with some of his friends.
He wished the hon. Member to consider what would really be the effect of his proposal. When existing leases fell in, what would happen? Then, according to the hon. Gentleman, they would get at the rich and bloated owner of land values; and they would tax the noble Duke or the noble Marquess who owned large blocks of property in London, and who, according to the hon. Gentleman's
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contention, was deriving a large and increasing income on which he was paying no rates. But the hon. Gentleman should remember that ground rents had now become the subject of investment by the poor hard-working man, by the widow, and by the small Government or City clerk, who all invested in them because of the safe income, and for that reason were content with the very low rate of interest which attached to them. Now it was proposed to impose fresh taxation on these incomes, which would very largely diminish their value; but not only would these people be taxed, but great charitable and educational endowments would also be taxed. Mr. Matthews, one of the witnesses before the Select Committee of the House of Commons on Town Holdings, gave as an instance the case of King Edward's School at Birmingham. He said—
"Our income from ground rents is £27,000 a year. Supposing the £27,000 is rated (the rates in Birmingham are 6s. 8d. in the £) we should lose £9,000 a year, or one-third of £27,000. That, at twenty-five years purchase, would be £225,000. If our ground rents were to be rated, a portion of the school property equivalent to nearly a quarter of a million would be confiscated at one stroke."
That was the sort of proposal which the hon. Gentleman contemplated with equanimity.
What was really wanted was to tax personal property for local purposes. The right hon. Gentleman said, quite frankly, that the Bill merely put a tax on real property; and he was rather sarcastic because hon. Members objected to an isolated proposition. But why they objected to an isolated proposition was that even the Minority Report, on which the Bill was based, only recommended it as part of a comprehensive scheme of rating reform, in which personal property would be brought in. He was quite prepared to admit that one part of the Bill, if given effect to, would find a new source of revenue—namely, the taxation of vacant land; but he was bound to say that that seemed to him to be the most extraordinary proposition he had ever heard. Take a concrete case. There was a certain amount of land in the immediate vicinity of a town paying, for instance, an agricultural rent of £2 an acre, and rates amounting to 10s. Under this Bill, it might be said that

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part of this land was building land. Many urban districts went very far into the country, and there must be a point at which building land ceased. The Bill would draw an arbitrary line, and say that all within the line was building land. Then the capital value of the land would be fixed at, for instance, £100 an acre, and 1d. in the £1 would have to be paid on that fictitious capital in respect of rates on the site value. In other words, for that land nearly £5 would be paid in rates, or nearly £3 10s. more than the rent received. He ventured to say that that was an unfair and absurd proposition. What was the reason given for it? They were told that it was because bloated landowners would not allow building. He challenged any hon. Member opposite to give one authentic instance where that had occurred. He had heard of many instances, but they had never borne the test of examination; and Sir E. Hamilton, in the Minority Report, distinctly said that there was not a single authentic instance. The Report further said that it was very unlikely to occur, at all events for a long period. Naturally a landowner receiving £2 an acre for his land, would only be too glad to sell it for £500, or £1,000 an acre. If land was held up there was a far better remedy than this unfair tax. The best remedy by far would be to give the local authorities power to buy and build for themselves.
MR. JAMES LOWTHER: No, no. That is municipal trading.
MR. GRIFFITH BOSCAWENsaid he was certainly in favour of that amount of municipal trading in preference to the plan suggested by hon. Gentlemen opposite. Passing from that to the case of vacant land, did the hon. Gentleman seriously suggest that the rates benefited vacant land? That could not be contended for a moment, and as soon as ever the land was built on and the rates did benefit it, then the owner of the land bore his share of those rates. This was a very important question, and it had been brought forward in a very lucid and temperate speech by the hon. Member. It had been brought forward
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in order to give some relief to the taxpayer, and to give some case in the matter of overcrowding. He was equally sincere in agreeing with those objects, but he doubted whether they could be accomplished in this manner. To sum up the position, he would only say that this Bill, so far as it went, only added to the burdens of the existing ratepayers on all land values, because they were taxed already; and, so far as vacant land went, it was obviously unfair to put a tax on that, because it was putting a tax on capital unrealised. For these reasons he moved that this Bill be read a second time this day six months.
MR. M. WHITERIDLEYsaid the hon. Member who moved the Second Reading of this Bill had two objects in view—first, to tap new sources of revenue, and second, to diminish the existing burdens on building enterprise. Every Member of this House could sympathise with those objects, but he thought that they would not be attained by this Bill. How did the hon. Member propose to tap a new source of revenue in relief of the taxpayer, when it was already taxed sufficiently heavily? He proposed to get relief of rates by taxing twice over. If this Bill proposed to alter the whole system of rating, then there might be something to be said for separating land values from other property for the purpose of taxation, but under this Bill the hon. Member proposed to tax land values and leave the old system of land rating untouched. The hon. Member had brought forward some striking cases as to the increased value of land, and those cases might be multiplied in every district in the country; but as the value of the land increased, so the assessment of that land also increased, and the land paid more rates in consequence. That was a matter which the hon. Member had appeared to have for gotten. Then the hon. Member proposed to diminish the existing burdens on building enterprise by taxing unoccupied houses. It did not seem to him that taxing unoccupied houses was likely to encourage building, and he did not see how taxing unoccupied land was going to bring real relief to the problem of housing the poor. The land was an essential portion of the house which was

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built upon it, and although separate taxes might be placed on the house and the land, they could not be separated one from the other, because bricks and mortar without the land would be worth nothing. This Bill, which was founded on the Minority Report of Lord Balfour of Burleigh's Committee, had a different object altogether to the objects of that Committee. The object of that Committee was to redistribute values, and although they thought no scheme, that they had considered, satisfactory, for political and sentimental reasons, it was better to redistribute values in appearance, if not in reality. If this Bill was founded on Lord Balfour of Burleigh's Report, then it ought to carry out the objects of that Committee, and if those were its objects, he contended that the Bill was premature and totally unnecessary. That Committee examined all the schemes submitted to it, and having examined them and found they were unsatisfactory, said it was better on sentimental grounds to redistribute values, but the Bill which the House rejected last year by a majority of seventy-one was a much better Bill than this, and he sincerely hoped that on this occasion that majority would be largely increased This Bill was inconsistent. It had already been pointed out that it introduced the novel principle of taxing unrealised capital, but the striking inconsistency, as he read the Bill, was that in Clause 5, Sec. b, it broke existing contracts by providing that where a house was divided into two, the rate was to be paid by the person who owned the whole house. It was not right to lay down a general principle unless that principle was carried to its logical conclusion. The general principle laid down by this Bill was that land was a separate source of revenue which did not pay enough rates under the present system of rating. With that principle he totally disagreed, and it was one that he hoped the House would not endorse. On these grounds he hoped the House would accept the Motion of his hon. friend and reject this Bill which, though dealing with excellent objects, would not, he felt sure, attain those objects, but would lay down general principles which would be most injurious, and would establish a lack of faith in landed property.
Amendment proposed—
"To leave out the word 'now,' and at the end of the Question to add the words 'upon thisdaysixmonths.'"—(Mr. Griffith Boscawen.)
Question proposed, "That the word 'now' stand part of the Question."
MR. SOARESsaid he was one of those who recognised the difficulties which lay at the bottom of a measure of this kind. To a very considerable extent he agreed with Lord Rosebery when he said that so far he had not seen a Bill to which he could give his whole-hearted approval; but that should not prevent the House endeavouring to find a satisfactory solution to this problem. He believed that if this Bill which was now before the House was read a second time to-day, that after it had gone through the Committee Stage, and certain alterations had been made in it, it would be a Bill which would be acceptable, not only to Lord Rosebery, but to the whole of the Liberal Party. This question had made considerable advance during the past few years. People were beginning to understand it, and what was meant by it, and the Report of the Royal Commission had helped considerably in that direction. It was true that the Report did not lead them to any very drastic conclusions, it did not take them very far in the direction which they wished to go, but it assisted them materially in one respect, and that was with regard to the doctrine of unearned increment. He contended that both the Majority Report and the Minority Report recognised the doctrine of unearned increment, and that was by far the most important part of the case, because that deduction was the foundation on which they applied for public support, and it was undoubtedly the ground on which they based the whole of this proposed legislation. The Majority Report, on page 44, admitted that the value of land might be enhanced by circumstances beyond the influence or control of its owner, and the Minority Report, on page 167, stated.
"There is, however, another feature about urban site value which appears to us to be almost if not quite peculiar to it, that is the increase of value by the expenditure of the public authority upon improvements."
Since the issue of the Report there had been additional testimony in the same

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direction. Another Daniel had come to judgment in the person of the right hon. Gentleman the Member for Cambridge University. Sir John Gorst, in the March number of the Nineteenth Century. in an article on Social Reform, had stated—
"But owners of property had more interest financially than any other class in the prosperity of the people; a large share of prosperity means greater power of production, and the additional production finds its way into the landowners' pockets."
He quite agreed with all these statements, and held that the right hon. Gentleman had rightly diagnosed the situation. Nevertheless, he said that this state of affairs was undoubtedly wrong, because in the first place no member of the community should be allowed to arrogate to himself profits which are made by another portion of the community, and therefore rightly belonged to them, and in the second place because the attempt to obtain these improper profits leads to grave social evils, such as over-crowding, hindrance to the development of trade, and the extension of towns in unsuitable directions according to the caprices of landowners.
Now in dealing with a new legislative idea, and this course was a new legislative idea, it was important for one moment to consider the principles of the State with regard to the ownership of land. It was unnecessary for him to remind the House that in law no one was an absolute owner of land. The Crown was, of course, the ultimate owner of all land, and the holder of the freest and largest fee-simple in the country was only a tenant in the eyes of the law. Notwithstanding this fact, everyone recognises that land is private property, but it is property of a peculiar description. Land is a monopoly, but a monopoly of such a nature that the user of it is necessary to the existence of everyone of us. Therefore land is quite distinct from other kinds of property, and consequently the State has never hesitated when the rights of the community, and the rights of the landlords, came into conflict to declare that the rights of the landlords should go to the wall. For instance, no man is allowed to use his land in such a way as to permit it to become a nuisance to his neighbours. Then, too, in many towns there are restrictions put upon the right of a man to build what he may think fit on his own property. It is seen
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in many existing urban building by-laws. Then, too, in the country districts the State has gone so far as to interfere in the contracts between landlords and tenants—as in the Ground Game Act. Now, in all these cases the interests of the community have come first, and the interests of the landlord have come second, and if therefore it could be proved that the rating of site values was in the interests of the community, the case will have gone a long way towards being established.
Then, too, he was not sure that the principle for which they were now contending, namely, that a landlord was not entitled to take the profit of other people's work, had not already been admitted by the State. He thought it had been admitted with regard to agricultural lands, because in agricultural tenancies the landlord was obliged to pay the tenant, in some cases, compensation for improvements which had been made by the tenant. He thought, therefore, that it was this doctrine, mutatis mutandis, which they were now endeavouring to apply to urban land. There was another argument which he would like to place before the House, because he thought the strength of it had not been sufficiently considered. The argument he alluded to was the argument used in the Minority Report, when the signatories of the Minority Report stated that the rating of site values was advisable, both on the ground of sentiment and political expediency. In the course of the debate last year, over and over again it was said that politics and sentiment had nothing to do with this matter, and the hon. Gentleman who had just sat down had again repeated this argument. It is said that this subject is a dry-as-dust subject, and should be settled by mutual arrangement between all parties. He did not agree with that statement. He thought that sentiment might in the future play a very large part indeed in the settlement of this question, and he considered that those gentlemen who had signed the Minority Report were not by any means talking shallow nonsense, but displayed a quite unusual intelligent anticipation of events.
He said that, if he were a Socialist, if he were a man who believed in the single

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tax, if he were in favour of confiscatory measures, then he would hope that this Bill would not pass into law. And why? Consider for one moment the present condition of matters. Remember that £100,000,000 are annually paid as rent. Remember that the landlords who receive this money, quâ landlords, "toil not, neither do hey spin." Remember that taxation is steadily increasing; remember that much is being put on the shoulders of the working class, more and more by corn duties and sugar duties. Remember, also, that taxation is likely to increase in the future. Remember, ten, that working men are becoming more and more educated, and more and more powerful every day. Consider the lessons of Woolwich [MINISTERIAL cries of "Chertsey"]. Yes, they had succeeded in holding a seat by a reduced majority in what was one of the greatest Conservative strongholds. Nevertheless, this Government would not always be in power, and sooner or later the great town landlords would be arraigned at the bar of the nation. What would they ask for in that day? They would ask for justice, for equity, and appeal for no confiscation. What would be the reply? It was possible in those days they might be reminded of the old equitable maxim, "He who comes to equity must come with clean hands." If when that day came it were proved that these town landlords had ground the faces of the poor; if it were proved that they were even the partial cause of the overcrowding which has proved such a curse to our large towns; if it were proved that they had taken profits not rightly theirs, then, perhaps, they might be dealt with more severely than was absolutely just, and would regret not accepting this mild and moderate measure, which would remove for ever the principal ground of agitation against them.
Having alluded to the general principles, he would like to say a few words with regard to the Bill, and more particularly with regard to some of the difficulties in connection with it. Perhaps one of the greatest difficulties was the question of the alteration of existing contracts. He admitted that the Majority Report, and the Minority Report, and Judge O'Connor had all
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spoken against the alteration of existing contracts, and he admitted also that this Bill did alter them in certain cases; but it must be remembered that there are precedents for the alteration of existing contracts. You had them in the Irish Land Acts; then in the Education Act of last session you had alterations in the most solemn form of contracts, contract and trust deeds under seal. Then, too, it must be remembered that by the law of this land contracts made in restraint of trade were looked upon as void, and he was not sure that many of these contracts between landlord and tenant were not morally, at all events, contracts in restraint of trade. Personally, he was not against the alteration of existing contracts. So far as he could see there was only one class which would suffer to any appreciable extent, namely, the purchasers of ground-rents. He admitted that this was a large class. He admitted that many people who were poor enough, at all events, to be excused the Income Tax, had invested their money in this security, and he also admitted that their securities were very little improved by public improvements. But he desired to point out one important fact in connection with this matter, namely, that this subject, the question of the taxation of ground values and ground-rents had been under discussion for years, many people had been frightened in regard to it, and consequently the class of purchasers of ground-rents had been reduced in number, hence there was not the same competition, and a great majority of people had purchased ground-rents for a much less amount than they were intrinsically worth. Then there was another difficulty. The difficulty in regard to occupiers. He admitted this difficulty, and admitted it was a flaw in the Bill, but he thought it could be put right in Committee. It would be necessary to divide the occupiers into three classes. The first class were the occupiers on weekly tenancy, and they would not be affected by the contents of this Bill, because in almost every instance their rates were compounded for. The second class were the class which he might describe as on short tenancy, namely, the occupiers on an annual tenancy, and on short leases, leases for five,

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seven or fourteen years. With regard to this class, he would advise that a similar course should be taken as is taken with regard to the Private Improvement Rate in Section 214 of the Public Health Act, 1875. That clause provides that if a tenant holds at a rack rent, he should be entitled to deduct three-fourths of the Private Improvement Rate from his rent. He would suggest that instead of taking three-fourths that the whole of the Site Value Rate should be deducted. Then the clause went on to say that if the landlord of this tenant held for a term of which less than twenty years was unexpired, and if he paid rent to his landlord he should be entitled to make a similiar deduction, and so on right up till you get to the original vendor. Then, with regard to the third class, the tenants who hold for twenty-one years or more, and without doubt this is a very large class of leaseholders, embracing as it does leases for twenty-one, sixty, ninety-nine and 999 years. He said that he would protect them by inserting a clause giving drastic powers of leasehold enfranchisement. In this way he considered the difficulties would be solved with regard to all the various classes of tenants, weekly, short tenancy, and long leaseholders, and they could then place the burden on the shoulders of those by whom it ought to be borne.
Then there was the difficulty with regard to valuation. The Majority Report quoted the evidence of a number of surveyors, and he would like to point out that there was one thing in common with all of them. They all said it could be done, but they were all extremely shy as to doing it. Not one of them considered he was incompetent. What was the reason of this? Why did we find this startling unanimity? The reason of this was because they made such valuations every day, or rather as often as they could be paid for it. Not only did they make these valuations, but they must notice that the law recognised the validity of them, and allowed people to act on them. A good many of the vacant sites in the large towns of this country, and in fact nearly all those vacant sites which are in the hands of speculators, are mortgaged, in many cases the first mortgage is held by trustees, and the law said that these trustees could be held indemnified
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for any loss, provided they had acted on the report of a valuer and had only advanced two-thirds of his valuation. Hence the law now recognised that these gentlemen were competent at the present time, and they take money for doing something which seemed when they were before the Royal Commission to send a cold thrill of nervousness down all their spines. But there is one serious matter in connection with these valuations which was not touched upon by the Bill, viz., the question of restrictive covenants. If this Bill became law as it now stands, it would be found that there was much land which looked like valuable building land, and from which it was expected that a site value rate would be obtained, which would be valued at almost nothing, because of the restrictive covenants upon it. For instance, he knew of a plot of land of nine acres in an urban district which was absolutely suitable for building cottages or shops upon, and could be sold for that purpose, but nothing could be got out of it by way of site value rate because of the restrictive tie upon it that only houses of £100 a year were to be built upon it. In order to remedy this serious defect, he would suggest that local authorities should be given power to deal with these restrictive covenants whenever they were a drawback to the selling value of the land, and if the Bill got to the Committee Stage he would move a clause to that effect.
He had referred to some of the difficulties in connection with the Bill. What were the advantages to be derived from it. All landlords would benefit by it, because the greatest cause of the agitation against them would be removed. The poor landlords especially would benefit by it, because land which remained undeveloped could only be held by rich landlords or speculators, as the poor landlord was compelled to use his land to its fullest capacity. Then there was no doubt whatever about the public gaining from it. More land would be available for building, trade would be encouraged, there would be an equitable distribution of burdens. To his mind, it was a great social reform, with which many other social reforms were closely intertwined. Who would believe, for instance, that the question of

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the cure of phthisis was affected by this Bill. Yet such was the case, because it was no use building expensive sanitoria, or paying doctors, so long as there existed the foetid dens in the large towns which were the fruitful breeding-grounds of the tubercular bacillus. In the same way, with the drink problem. It was no use restricting the opportunities of getting drink while the people were housed worse than the animals. The more the question was looked into the more would the conclusion be arrived at, that all social reforms were closely connected with the reform of the Land Laws, and he sincerely hoped that this Bill would be read a second time, and become the keystone of the arch of Progress.
MR. CRIPPSsaid he did not propose to follow the hon. Member for Barnstaple in some of the wide considerations he referred to in the speech he made just before the adjournment, because it appeared to him that this Bill had to be considered as a Rating Bill, and the question was whether as a Rating Bill it suggested a fair and equitable solution of what he admitted was a difficult question, and upon which there was so much difference of opinion, He did not think that those who opposed this Bill were in any sense opposing a Bill which would give facilities for the housing of the working clashes. This was a matter they had to consider on the Royal Commission, and he was bound to say that for his part he could not see how they facilitated a solution of this difficulty by placing a further charge on the site value of land, the value of land itself being one of the chief reasons why it was so difficult to bring about a true solution of the housing of the working classes. That question was quite outside the purview of this Bill, and would not be substantially affected whether this Bill were passed or not. There were two points in this Bill which constituted its novelty, and it was in reference to these two points that he would ask the House to decide whether this Bill as a rating reform was a Bill which ought to be accepted or not. The novelties were these. In the first place this Bill brought in the principle of rating capitalised value which had never
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before been recognised in the rating law of the United Kingdom.
The second point raised by this Bill was also an extremely important one, and it was as to whether they ought to select a particular class of property, and put upon it special and exceptional burdens in addition to the burden which it shared equally at the present time with all other classes of rate able property. It was an entire mistake to suggest that the owners of land were in a position at the present moment to escape their fair share of burdens for the purposes of local taxation or rating. The question really was not whether a man was fairly rated or not at the present time, but whether land was a class of property which ought to bear some special charge beyond what other rate able property bore in reference to local improvements and local expenditure. That was the way in which the Bill was brought forward by the hon. Member for North Camber-well, and he would meet the hon. Member on that issue. Before he came to those two points he wanted to say a word about what had been called "the unearned increment." He did not know what passage the hon. Member referred to when he quoted him in regard to this unearned increment. It was obvious that from various causes land was enhanced in value outside any special effort on behalf of the owner. That was certainly a proposition familiar to anyone who had anything to do with landed property. What was said both in the Majority and in the Minority Report of the Commission was that so far as land was enhanced in value it was rated to a corresponding extent. Supposing these enhancements of value had taken place, be contended that the land was rated to a corresponding extent, and if certain land was worth £200 a year and was rated on that basis, if, owing to enhancement or to unearned increment, it became worth £500 to £600 a year, that, land would be rated on the increased value. What the Royal Commission pointed out was that land was not alone in regard to this question of unearned increment, for there were other classes of property for which the value was enhanced outside the particular effort of the particular owner, and there was no reason whatever as regarded

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the unearned increment to put any extra burdens on land alone, and at the same time exempt all other classes of property in a similar position. It was not true that the cause of the unearned increment was always local expenditure.
DR. MACNAMARA: Not always, but in a great many cases
MR. CRIPPSsaid there was one notable exception he would quote in order to show that the principle, as laid down in this Bill, went too far and would operate very unjustly. Take land which had been enhanced by a railway being brought into the city. This was a case quite outside any local expenditure of the particular district or locality. He understood that the hon. Member for North Camberwell, in a case of that kind, considered that there was no unearned increment due to public local expenditure. Nevertheless, he would put this burden on the increased value of land whether it was due to local expenditure or to outside causes. They were not dealing with the question of unearned increment at all in any real sense of the term. This Bill would apply to land whether the increased value was due to expenditure by local authorities, or some entirely outside body, such as the advent of a particular railway. If they took the case where land had decreased in value, they would still put a special and exceptional burden upon it under the Bill brought forward by the hon. Member. In rating, apart from whether there was any exceptional burden to be put upon land, they took the value of the thing as it was. It might be enhanced or diminished, and directly they went away from that principle and tried to introduce some clement of prejudice, they lost sight of the principle altogether and got to the level of mere prejudice, as regarded this question of justice and fairness. What had been the operation of the Betterment Clause? When a particular improvement had given enhanced and special value to a particular district, it laid down that such district should specially contribute towards that particular improvement. But that was not a rating principle. They could not apply it fairly as regarded rating, or even seek to apply what might be perfectly
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true as regarded betterment. It would be unfair to lay that down as a general principle as regarded questions of rating in their various town and country districts. He did not think that in a case of this kind there was any true distinction at all between the land in urban districts and outside. He was not seeking to emphasise the difficulty which the hon. Member for Tunbridge Wells pointed out the extreme difficulty of drawing the line. As the hon. Member pointed out whenever they got to a particular point they would put such an extreme burden upon the land that it might prove to be an actual loss to be the owner. If this were a true principle to put an especial burden upon land then they ought to put it just as much upon land in the urban district as in the rural district. The attempt to limit this to urban districts was for the purpose of getting rid of the prejudice, and it did not consist in the rating principle. They ought to apply a true principle not to one class of property but to all classes, and to apply it to one class of property as proposed in this Bill would produce results which could never have been anticipated, or thought of, by the hon. Member for North Camberwell.
This Bill proposed to put 1d. in the pound on the capitalised land values. Land values capitalised were worth about thirty-three years purchase on land in towns, and upon the annual value that meant a rate of about 2s. 9d. in the pound. That penny was very misleading. It looked a small sum, but when they brought it down to the annual value, and saw how it compared with the rating of other property, it was not one penny but it was 2s. 9d., and in some cases it might be even a much larger figure. It amounted to about one-seventh of the entire value, and this was the exceptional burden which they were seeking to put upon one class of property for the first time. Let them see how it would work out. Take one or two different classes of property. Let them take building property, which was not yet ripe for building purposes. There was not the slightest doubt that under this Bill the owner of that property would be paying more in rates than he was receiving in rent. Was that just? It

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was contrary to every rating principle which they were applying at the present moment. Take another illustration. Take the case of an undeveloped mining property. What would be the effect? The owner of a mining property, which was not for the moment developed, would under this Bill have to pay far more per year under the head of rates than he would receive. Take a third illustration. Take for example a railway company. A railway company, after all, could not be looked upon as an institution which had done harm to a district, but probably railway companies had been great benefactors as regarded facilities of transport, and the introduction of advantages into the district through which they ran which they did not enjoy before. What did they propose under this Bill? Not only would they rate a railway company at the full annual value as the occupier, but they would take the site value of all the property over which the railway had been constructed. They would capitalise that, and if the hon. Member for Camberwell had his way they might put upon it a rate of 2s. 9d. in the pound. That would be a great injustice, and would be sufficient not only to prevent railway enterprise in the future, which would be nothing but a disaster, but it would put a burden upon railway enterprise and railway interests, for which, in his opinion, there was no justification. Upon an occasion of this kind, to seek to introduce this principle of rating capitalised value would mean an entire revolution in their rating machinery, and it could not be done justly at all without it was accompanied by a similar rating proposal with regard to all other kinds of property. The hon. Member brought forward this Bill on the ground that he was supported in it by the Minority Report.
DR. MACNAMARA: Generally.
MR. CRIPPSsaid this Bill would be condemned by almost every principle which was to be found in the Minority Report. Let him take the particular subject matter with which he was dealing The question of the rating of capitalised value was before the Royal Commission. Did the hon. Member find either in the
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Minority or Majority Report anything which supported his view of seeking to rate capitalised value as distinguished from annual value, which was the basis of all rating at present? He thought it was rather hard on the names associated with the Minority Report to quote them in this way. He thought it was particularly hard on those great names when they were quoted as supporting Bills which were introduced not in accordance with their Report, but altogether contrary to every principle which they put forward. They should not be made indirectly responsible for a Bill framed in the teeth of their propositions. He would give another illustration before he came to the question of special or exceptional burdens upon the land. The hon. Member introduced this Bill as one to a great extent in relief to other ratepayers. He said they would get a large fund from this Bill in relief of local taxation, but that was not the view of the Minority Report. Those who signed the Minority Report pointed out that even if they had some system of rating land values, they would not touch any new source of revenue at all. They pointed out first of all that any Bill would not in substance assist the ratepayers in this respect, although on sentimental and political grounds they thought they might get rid of a grievance which was brought forward from time to time. Surely it was very hard to attach to these names, which were appended to the Minority Report, principles not only antagonistic to their views, but principles which they considered it neither right nor just to apply to rating questions.
He would now come to the other point which was really involved in the hon. Member's Bill. Upon this point he agreed with the strong criticism of the hon. Member for Barnsley, although it would pass his wit if the Measure went into Committee to draft clauses to remedy defects in the Bill at the present moment. If landed property was rated at the present time up to its full value, and if on the same principle as all other classes of rate able property, was there any reason why they should put a special and exceptional burden upon it? That was the proposition put in its shortest and simplest form. He did not think there

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was any reason for taking out any one form of property and putting an exceptional and a special burden upon it, and that was the ground on which the Majority Report was based. There was no reason why land should be selected, and the considerations applying to land should apply to every other class of property. It was unfair to take out one particular class of property in order to put a special and exceptional burden upon it.
What was the answer made to-day? In the first place, if he understood the hon. Member, they ought to put some special and exceptional burden on the land because the land in a particular sense got some special and exceptional advantage. Let them follow up that argument by putting a concrete case, because one very often lost sight of an important principle of this sort by the use of general terms. He took the most familiar case in London—the case of the ninety-nine years lease. He took it that when the lease was originally made the burden of the charge with respect to the land as between the lessor and the lessee was thrown upon the owner. That was the whole basis of the Minority Report, and in that respect they agreed with the Majority. Who got the benefit during these ninety-nine years? Suppose that during the course of these ninety-nine years land had gone up very much in value, and that the lessee had given £100 for what he could now sell for £200. The owner did not get the advantage of that, nor did he get a penny out of it during the pendency of the lease. [An HON. MEMBER "What if the owner wants to sell?"] That made no difference. He took the ordinary case. Suppose they had a thoroughly secured ground rent—did they mean to say that whether that was secured twenty or thirty times over made any difference? During the pendency of the lease the lessee or occupier got the advantage out of letting the premises. The hon. Member for Camber-well would agree with him on that point. That was why he thought the Bill required looking at closely, and that was why, he assumed, the hon. Member proposed to put the rate on the occupier and not on the owner. So far as this Bill was concerned it would be almost
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entirely a new charge on the occupier, because they were not going to rate property under existing contracts. He recollected he pointed out last year that nothing could be more unfair than that under a Bill which purposed to relieve existing occupiers of burdens which they could hardly bear, they should make a proposal of this kind, which put a special and exceptional charge upon them, from which, at any rate at present, they were free, and in substance, as long as these existing contracts continued, this charge would be entirely a charge upon occupiers—the men who ought not to bear a charge of this kind, and who were heavily burdened at the present time. Some matters of prejudice had been introduced regarding the Bill. He should like to know whether the hon. Member for Camber well would go into one of the crowded districts and point out that his proposal was to put a further charge on the occupiers in that district, it might be for 999 years.
DR. MACNAMARA: I have done so.
MR. CRIPPSsaid that was entirely antagonistic to the argument the House had heard. Every hon. Member on the Opposition side of the House had denounced the view of putting the charge on the occupiers, and one gentleman made an animated speech, in which he said that the time had come when the owners should look after the future, because, if they did not accept this, something worse would come. It was not for him to reconcile opinions of that kind, but he was justified in pointing out that the principle of the Bill as it stood, was to put a new charge on the occupier—the man who was overburdened at the present time. The hon. Member for North Camber well referred to what was said by Lord Goschen in 1870. Lord Goschen differed entirely from the view expressed in the Minority Report of the Commission on which his hon. friend relied. He thought that the charge did not go back to the owner. What the Royal Commissioners, the Minority included, thought was that the charge did go back on the owner when a fresh contract was made. That was perfectly right. There was

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no doubt that these burdens were ultimately borne by the owner. They ought to be, and he thought that they were. The only thing was that during the existence of the contract the person who might have to pay for a time was undoubtedly the occupier. The whole principle of rating law was that the occupier should pay and not the owner, but the ultimate incidence did fall back on the owner, and they could not alter that unless they had an entirely different system as regards representation on local rating authorities. What Lord Goschen pointed out was that before any scheme such as he suggested was carried out, they must have an initial alteration in representation, and have some system or other in which the owner was represented with respect to the local expenditure of local bodies.
He had listened very carefully to what was said by his hon. friend who introduced the Bill, and he was not aware of any other point made which would suggest the putting of this exceptional burden on site land or land value apart from the value of the land which was used. He had a strong view that when land was occupied they got the advantage of local expenditure, and they ought in that case to make a contribution. It was when there were buildings on land that there were occupiers, and they wanted light and all those other matters incidental to local expenditure, and it was quite right in principle to take hereditaments as a whole, because the great mass of those privileges or advantages granted by local expenditure were what were wanted by people living on the sites from day to day. It was very important to see what the principle involved was. If they once got away from that they got amongst the shoals and rocks of a large number of prejudices which were brought to bear on questions of this kind. He opposed the Bill for these two reasons. In the first place the principle of selecting a particular form of property and rating it on its capitalised value was bad and unsound, and unjust to the owners and persons interested in that particular class of property. Secondly, there was no case whatever made out why land, either in country or town, should bear an exceptional and special burden.
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It ought to bear the full share of burdens which it did at the present moment. The Minority Commissioners themselves said that the prejudice of some people who did not understand the rating question had gone by, and it was realised that the land did bear its full share of local burdens at present. He was quoting the substance of the words used in their Report. He denied absolutely that they should take one class of property, whether land, buildings or anything else, and treat it separately and distinctly. They ought to have equal treatment all round, and if they departed from that they would have nothing but confusion and difficulty in dealing with the rating question.
MR. THOMAS SHAWsaid the House always heard his hon. and learned friend with pleasure on the rating question, but he confessed that he listened on the present occasion to his speech with a great sense of dissatisfaction. The two points which he elaborated with much ingenuity and care were, first, that this was a novel proposal to have taxation levied on capitalised value; and second, that there was a proposal involved in this Bill for special and exceptional rating upon ground value as apart from other types of hereditaments. The proposal in the present Bill was to tax the value of sites, and, if his learned friend preferred it, he would use the term site values. With regard to capitalised values, he was anxious to hear whether there was anything in the principle of the proposal which was made which was open to any. and, if so, to what objection. He could con ceive no objection to the taxation of capitalised value unless there was some inequitable result produced by that operation. He listened in vain to the speech of his hon. and learned friend to ascertain where the inequitable result would be. But his hon. friend answered his own arguments. In the course of his speech he was quick enough to show how very flimsy his objection to this Bill was, because in the limits of a minute or two he was able to transmute capitalised value into annual value. He wondered then what the hon. and learned Gentleman was

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complaining about. The fact was, that capitalised value was a convenient method of ascertaining real as against fictitious value. The present system was one under which a fictitious value had substantially taken its place in local administration. Although land might be of itself of enormous value, if, at caprice, or from interested motives, the proprietor of that land was holding it back from profitable occupation by members of the community, it was dealt with at the unreal and fictitiously low valuation thus arrived at, whereas it should be treated on the basis that its real value "was much higher, and that that value was in point of fact the value which the community had given it. The whole argument as to capitalised value was an argument amounting to nothing in the result except this, that the capitalised value was a proved method of getting the better of a fiction of law which had wrought much havoc in social communities. He hoped he had satisfied his hon. and learned friend that there was nothing of substance in the objection as to capitalisation. All that was required as to capitalisation was for him to transmute the whole thing into annual value, and the idea of capitalised value being objection able at once disappeared.
The hon. and learned Gentleman's second objection was this, as he understood him—it was a cardinal objection to the Bill—that there was what he called a special and exceptional rate to be put upon site values. He would present this view to the House as a sufficient and, he thought, complete answer to that consideration. The site owners were members of the community. The community as a whole had its local exchequer. Nobody proposed, certainly not the authors of this Bill, to keep existing local taxation at its present amount, and to put on the top of that a special and exceptional rate. What was proposed was that the special and exceptional rate should fall upon the person who had value out of that rate, and thereby, ipso jure, there would be effected, to that extent, a relief for the local exchequer, and therefore relief from the local discontent which the present system caused. That was, in a word, the answer to what had been said with regard to a special and exceptional
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rate. It was only special and exceptional in respect that it went behind the artifices of the law at the present moment, and it got at the owner of the land. [An HON. MEMBER: "It touches the spot."] That was so, and the effect of that was that they had, pro tanto, relief to the entire body of the community to that extent. He was extremely interested in the opposition to this Bill, which was stated in the excellent speech of his hon. friend the Member for Tunbridge. The hon. Member stated his case with great moderation. But his in tial and cardinal proposition was that this Bill was founded not on unsound but really on sound principle. He said that site value was increased by the advantages of the site and the presence of the community. That was just about as near the ratio of this Bill as anything. It was a concession that the improvement in value was not an improvement which had been executed by the owner of the site it was a concession that the owner of the site was going to reap where he had not sown; and further, it was a concession that the presence of the community had caused that increase in the value. While the community had done certain things to make the property valuable and worth living in, why should one section take the advantage of all these things without being rated for the advantages? Assume that the community provided a new park, built a new bridge, or gave a magnificent avenue or road leading through an estate, would any man in the House get up and say that it was fair that the property thus benefited by the labour, expense, industry, and enterprise of the community had a right to pocket all that without bearing the fair and special share applicable to these improvements?
Then his hon. friend said that it was a Bill for taxation in regard to betterment, but that it did not apply to the case of "worsement." The Bill provided both for the case of worsement and betterment. If a community was badly administered, if its roads went into decay or if its bridges became rotten, from that moment the site value would be decreased, and therefore the taxation on that site value would be lessened. He submitted to his hon. friend that the

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argument he had used with regard to betterment was altogether out of place in regard to a carefully drawn Bill of this kind. The site value went up and down according to the actual facts of the situation. His hon. friend said this Bill would not be a present benefit to the occupier. He agreed with him in that, but the reason why the could not get a present benefit to the occupier was that his hon. friend who drew this Bill had paid strict and sacred regard to private contract. On the other side they objected to this Bill because it respected existing contracts. That was a strange objection to come from such a quarter. Would they like existing contracts to be interfered with? Well, so far as he was concerned he thought some recent contracts might very well, without any real injustice, be interfered with. His hon. friend had seen that it was better that he should take the line of least resistance, and accordingly he had respected contracts. For that reason he himself regarded the Bill as a moderate and sensible proposal. There was a sense of wrong and injustice in many communities throughout the country. That sense of injustice was, he thought, well-founded. It was undoubtedly established—he thought almost by the Majority as well as by the Minority Report—that taxation within the ambit of the community itself had produced, he did not say the whole of, but in a marked sense, the very value which it was now proposed to make a contributor. There was a feeling among the members of many communities that they were being deprived of this contribution to the general well-being to which they were entitled. It was realised, and it would go on being realised in a much greater degree, if Parliament was too guarded in this matter, that site owners were not in a position of partners in the community, but really were parasites upon it, and that this state of things should be brought to an end.
Besides all these considerations there was a system of speculation in land areas and in burghal communities which was legally permissible, but was certainly in many cases socially disastrous. Under that system the industry and enterprise of the community
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were really put in pledge for private profit and advantage, to the prejudice of the community as a whole. This Bill was only permissive. It allowed local authorities to exercise their judgment on the particular circumstances of the locality. He could conceive many cases in which the local authorities would see no cause to interfere because the conditions of congestion on the one hand and improvements on the other did not arise; but in many other cases, such, notably, as those of great cities, it was clear that the local authorities would rejoice in this privilege of really putting the burden on the exact shoulders which ought to bear it. He totally disagreed with the argument of the hon. and learned Gentleman the Member for the Stretford Division that this was solely and exclusively a rating question. It was far more than a rating question. There were collateral advantages to be derived from this legislation of, he had almost said, an infinite kind. The Majority and the Minority Reports of the Commission all tend to show that this problem was intimately associated with a deep and growing feeling in our midst connected with the question of the housing of the working classes. He thought this all would provide, not a new source of taxation in an exceptional sense, but would provide certainly a fresh channel for taxation in the direction of uncovered and unbuilt on land. He knew that it was said that cases of held-up land for speculative purposes did not exist. He differed from that criticism, and he would give an illustration from the county in which he dwelt. There was unbuilt on land in Edinburgh which was rated on a value of £2,570 per annum, and it only brought in an assessment to the town of £344 a year. If it were rated on 4 per cent. on its actual value it would give a rateable basis of about £220,000, and would bring in at least £27,500.
One result of taxing land according to what it would bear on its actual as distinguished from its fictitious value would be to bring necessarily an alleviation of the taxation of the remainder of the land in the borough. It would remove the existing friction and make these sites available for building dwellings and manufactories upon. The new houses would be the competitor in the market with the old houses, many of

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which were slum properties, and the demolition of the slum property would make way for houses more worthy of being occupied by human beings. The true issue was often avoided in discussing this great question. It had been said that the true issue was not the housing issue. In answer to that he would not give his own opinion, but that of the Housing Commission of 1885. In their report it was said—
"At present, land available for building in the neighbourhood of our populous centres, though its capital value is very great, is probably producing a small yearly return until it is let for building. They can thus afford to keep their land out of the market, and to part with only small quantities, so as to raise the price beyond the natural monopoly price which the land would command by position. Meantime the general expenditure of the town on improvements is increasing the value of their property. If this land was rated at, say, 4 per on its selling value, the owners would have a more direct incentive to part with it to those who are desirous of building, and a twofold advantage would result to the community. First, all the valuable property would contribute to the rates, and thus the burden on the occupiers could be diminished by the increase in the rateable property. Secondly, the owners of the building land would be forced to offer their land for sale, and thus their competition with one another would bring down the price of building land, and so dimmish the tax in the shape of ground rent, or price paid for land, which is now levied on urban enterprise by the adjacent landowners—a tax, be it remembered, which is no recompense for any industry or expenditure on their part, but is the natural result of the industry and activity of the townspeople themselves."
That was the testimony of the Royal Commission of 1885 with regard to the intimate connection of the taxation of site values with the problem of the housing of the poor. It was perfectly plain that there was a system afoot in this country under which land was not only purchased, but held up for the purpose of bleeding the community as a whole when it required that land for public purposes. There were some striking illustrations of that fact in and about the neighbourhood of Edinburgh, but he would only give two. There was a little block of land near the city, forty-five acres in extent, which the Water Trust some time ago wanted for the purpose of forming filtering beds. Now, the value of that land at thirty years purchase of the existing rent was £4,387, but when it was wanted for this public and necessary purpose
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the owner charged for it £20,000, or at the rate of 136 years purchase. Would any person get up in this House and tell them that that vast sum was a fair representation of the interest of that property in the fortunes of the community? The thing was impossible. There was another transaction this time between the Town Council of Edinburgh and the Duke of Buccleuch. The city required land for the purpose of erecting new gas works in the neighbourhood of Granton, but within the territory of the borough. The ground extended to 105 acres, and it was partly built upon, but the average price at which it was rated was £5 10s. per acre. At thirty years purchase the amount would be £165 per acre, or a total value for the ground of £17,300. How much had the city of Edinburgh to pay for that ground? No less than £124,000, or 212 years purchase of the rating value. Therefore he contended that under the existing law, which this Bill would go a little, not the whole, way to remedy, astate of matters existed which was perfectly legal but socially scandalous. It was time that these estate owners came to the full burden of their responsibilities as members of the community in or near which their property was situated.
This Bill was not a mere rating reform. It would promote civic development on proper lines, and do much to alleviate many of the sordid conditions of life amongst the poor, and its effect would not confiscate but would eradicate what, in his opinion, was the constant confiscation of the values contributed to the land by the community. Opposition to this reform would provoke discontent and poverty, and might lead to violent efforts for a more drastic reform. In a matter of this kind, going so near the roots of our social system, the Parliament which gave promptly, gave twice. If we were too tardy in our legislation we might find that we would be too late altogether for moderation in this reform. He commended the Bill to the House as one which would essentially make for the peace and welfare of the community.
MR. VICARY GIBBSsaid that the hon. and learned Gentleman had concluded his speech with something approaching

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to a threat of violence; that we were to agree with our enemies while they were in the way lest a worse thing might happen to us. He was not prepared to accept an unsound Bill because he was told that at some future time somebody might bring in a worse measure. On what did the hon. Gentleman rely? He read a strong passage from the finding of the Royal Commission on housing with regard to vacant building land; but he would remind the House what it had probably forgotten, that that statement was based on no evidence, and that it was objected to and dissented from by Mr., now Lord, Goschen on whom the hon. and learned Gentleman relied for some of his statements—and by Lord Salisbury and Lord Cross. The hon. and learned Gentleman assumed a case where a town needed some large and expensive permanent improvement, and asked whether it was right and proper that a man who benefited from that improvement should escape altogether from the rates. Of course it was not right and proper if by that the hon. and learned Gentleman meant the ground landlord. The ground landlord did not escape at all, as had been shown very clearly by the hon. and learned Member for Stretford, for he could not possibly be interested in anything but permanent improvement. He had made a calculation of what proportion of the rates in any city was devoted to permanent improvements, and, roughly speaking, it was under 3 per cent. Was it reasonable to enter on a very large expenditure to charge the owners with 3 per cent of it? The hon. and learned Gentleman spoke a great deal about land being rated at its actual value. What did he mean? One would suppose that it was the value the owner received from it. But the hon. and learned Gentleman meant something quite different. It meant that although the owner might be getting nothing out of the property, he was to be rated on its potential or problematical value.
MR. THOMAS SHAW: If the hon. Member will allow me, I will take the term "market value."
MR. VICARY GIBBSsaid he was venturing to deal with facts as they
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were. He distinguished himself from those people who introduced these measures and who dealt with what might be. He was dealing with what the hon. and learned Gentleman said, not what he might have meant to say. He wished to express the pleasure with which he had heard the extremely interesting speech of the hon. Member for Camber well. He thought some of his remarks were received with loud cheering more from the effective way in which they were made than from any real or essential merit in them. The hon. Gentleman had told a very interesting and pathetic story of what had happened to a piece of land in the neighbourhood of the Embankment. That portion of land on the Embankment had to be bought at great expense by the people who made the improvement. But the local authorities had a simple and complete remedy, by availing themselves of the recoupment clause under the ordinary law, to take any property which they thought might be of value to them in consequence of the improvement. Such a Bill as that before the House was not necessary to meet the case mentioned. The Minority Report of the Commission recommended that site values should only be rated in respect of permanent improvements. That was the Bill of last year but it was not the Bill of this year. The site values were to be rated on all improvements, whether permanent or not, or whether the owner ever had or ever would have any advantage from them. He would refer to the foreign and colonial examples given by the hon. Gentleman, as he thought it very likely they had impressed the House. New Zealand was one of the cases cited. Inquiry had been made of the town clerks of the various colonies as to who bore the rates and in almost every instance the answer was that it was left to be adjusted by freedom of contract as between the occupier and owner of property. Well, that was directly contrary to the spirit of this Bill.
MR. TREVELYAN,: Will the hon Gentleman give us his authority, because there are towns in the colonies where the sole rate is on the land?
MR. VICARY GIBBSsaid he had not got the document with him, but the hon. Gentleman would have an opportunity of correcting him and showing how far he had misrepresented the gentleman from whom he quoted. The hon. Member for Camberwell said that there was also a national land tax in New Zealand, but why did he not also tell the House that land in that colony was specially exempted from Income Tax. The House should realise how dangerous it was to draw an inference from one or other particular circumstance in another country unless they knew all the circumstances and all the taxation. The hon. Gentleman certainly implied that this sort of system of taxation was general in the colonies, but the hon. Mr. Reeves, in his book published this year, said that very few of the colonies had adopted the rating of land values, and those who had done so had done so quite recently, so that there was no opportunity of judging how the system had worked. In regard to the city of Paris he would quote one of his political enemies. A newspaper called Justice, a Socialistic organ, said that in their opinion the action of the Paris municipality in taxing land values had done more harm than good to the working classes. Prussia had been referred to; but the hon. Gentleman who now so ably represented the Government—Mr. Grant Lawson—had told them last year that the system had been abandoned in Prussia because it was found that it did not work well.
He should like to say a few words on the general question. These measures turned up every year, but always under different names. They reminded him of those gentlemen with high sounding aliases who were charged at the police courts with obtaining money by false pretences. The pretence in the case of this Bill was shown in the Memorandum accompanying it, by an audacious begging of the whole question. It was said that this was a new source of revenue. That was not the view of the hon and learned Member for Launceston, nor of the hon. Member who introduced the Bill. They did not increase their supply of fruit by cutting apples in two, although that might be a cheap and simple amusement. But the proposals in this
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Bill were neither simple, cheap, just, nor effective, and this was not the way in which this matter could be properly handled. He recognised that there was a grievance. At present the way in which the net rateable value of property was reached was by deducting from the gross value the cost of annual repairs and insurance. It was the habit of the rating authorities to allow the maximum deduction in every case, a system which bore obviously too heavily on certain poor classes of property and too lightly on such property as Bond Street. The remedy was very simple. All they had got to do was to instruct the valuer to decide what was the difference between the value of a repairing and non-repairing lease of any particular property, and the difference was the amount which ought to be deducted, and no more. In Clause 1, sub-Section 2, there were four hypotheses, every one of which was false in fact, at any rate in London. Freeholds in possession were so few as to be practically negligible. Leaseholds might be subjected to restrictive covenants which materially reduced the value of the property. But these covenants were to be ignored as if they did not exist. Another hypothesis was that land had no building upon it. But there were such things as easements. This Bill opened up a vista of appeals and litigation, and was based on the assumption that something had happened which, in fact, had not happened, and would present a continual puzzle to valuers. They were going to respect present contracts of course, but they were going to put a fresh rate on, to relieve the rates of the man who was going to bear the fresh rate. Intact, complicated machinery was to be set up to take a shilling out of a man's pocket and put it into his other pocket. But they would get at the ground landlord in one event. If they let certain municipalities sup pose that they were going to get fresh sums of money to play with and spend unremuneratively on fancy experiments, then so far they would get at the ground landlord.
The hon. Member for North Camber-well said that he explained the Bill to his constituency. Many of them were not orators of the same power or

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capacity as the hon. Member, and he thought they would find it very difficult to persuade any lessee to support a measure of this kind. He had no right to occupy the time of the House longer, although there were several questions to which he wished to refer. There was the question of vacant land, and the question of unoccupied houses. He would only say in conclusion that the proposal of the Bill was to rate vacant land in order to force it into the market for building purposes before the owner considered it suitable. Hon. Members opposite would say to the owner, "This land is susceptible of being built upon, and we will so rate it whether you build on it or not." The unfortunate owner, having to pay a building rate, entered into a speculation, built on the land, and, like many other speculative builders, he went bankrupt or lost a large sum of money. The houses instead of being occupied remained unlet; and having forced the unfortunate owner, in self-defence, into an injudicious speculation, it would have been thought that the poor wretch would be left alone. Not at all. Then, under the Bill, he would be told: "Halloa, you have a row of houses; they bring in no income to you; they cost you money, but we will rate you on them." First of all he was made to put up houses that nobody wanted; and then when that was proved he was again rated on houses which were a source of outgoing, not income to him. That was justice! That was reform of the rating system! This was a fantastic scheme which was based on an economic fallacy. It gave the maximum of trouble and the minimum of advantage to the country. It was perfectly true that it escaped the Scylla of dishonesty, but it was wrecked on the Charybdis of futility.
MR. TREVELYANsaid he would deal with a practical question in connection with the Bill. It had been urged that a tax of the capital value of the land would be new, revolutionary, and impossible. After all, the evidence of one man who bad practical experience was worth the evidence of a hundred men who had merely a theory. In Paris during the last three years local taxation had been
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gradually changing. Direct taxation was imposed to some extent, instead of octroi, on which the revenue of the city hitherto chiefly depended. In 1889, a Committee of Assessment was appointed by the Hotel de Ville, which cost something between £40,000 and £50,000, to assess the whole of the city afresh—first, on the annual value, then on the capital value. In the case of the capital value, it was to be, firstly, the buildings, then the land, and thirdly both together. This Commission sat for two years; and without any greater expense than he had mentioned, it assessed the whole of the city of Paris; and now there was a tax both on the buildings, and also on the capital value of the land. He inquired into the matter himself, and he found that there was no doubt that the greatest city, next to London, in Western Europe, succeeded in doing what they were now told was difficult, revolutionary, and impossible. He wished to mention one extremely important consideration, when the House was asked to reject this Bill on the ground that it was fragmentary; and that was, that it would have a very profound influence on the National Exchequer. They had heard a good deal recently about economy, but even if they were able to reduce the expenditure on the Army and the Navy, there would still remain the unfathomable pit of local expenditure into which they were thrusting the money of the nation at the present time. It was taking a very comfortable view of human nature, which experience did not actually justify, to assume that if another Government came into power, not particularly interested in agricultural interests, it would resist the demand on the part of the towns for new doles from the National Exchequer. They were at an early stage of a long series of projects of plunder on the part of different sets of ratepayers from different kinds of Governments. He appealed to all interested in reducing the national expenditure to look forward, and see what was likely to occur with the enormous increase in local burdens. The Bill proposed other means of local taxation. They did not admit that, in this great and prosperous country, the local authorities had not themselves resources from which to provide the money they spent at the present day, and more. Their contention was, that the loud

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cries of the burdened ratepayer were justified, because the system of raising revenue, to which they had got accustomed, was one of the worst.
He wished to approach the question chiefly as to its aspect as a housing reform, and he thought the House would realise that, whether consciously or not, the ratepayer rebelled against the existing system. If they looked at the census returns, they would find that greater London was increasing at the rate of 95,000 per annum, and that Manchester and Salford were increasing at the rate of 61,000. How was it possible that municipalities would be able to deal with such an enormously increased population. It was only by making it easier for private enterprise to build houses that they could possibly get any real advance in dealing with overcrowding in cities. It was one of the most deplorable and strangest phenomena that, while there were complaints of overcrowding in the cities, there were constant complaints that the building trade was slack. Looking through the Reports of the Labour Gazette for the last eight months, he found that there was not a single month in which it was not stated that the building trade was dull or slack. What was the reason? He would recall to the House an instance he gave last year. A property was given to the London County Council at Edmonton on which to put up workmen's dwellings. The County Council decided that they could not put up dwellings on that property, and they handed it back to the philanthropic gentleman who gave it to them. They found it would be necessary to pay on the buildings £2,056, and that there would be a deficit of £793 annually. He wished to show the House how the operation of a land tax would work. The value of the land in that case was small and comparatively insignificant; and what they maintained was that in the part of the town where it was wanted to expand in order to relieve the overcrowding at the centre, there should be a relief of taxation, because almost every penny imposed in such a part was upon the building value, the land value being very small. The real point was, that if a large part of local taxation was raised from land values, it would relieve property
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where the land value was comparatively small—that was to say on the outskirts of a town. The only place where the burden would be greater, would be in the centre of a town, where the land values were great and growing. Was not that right, because there the value upon which assessment was based was chiefly landed property, and it was steadily increasing in value, with the increase of the town. The chief object of this taxation was to relieve buildings in the outskirts of a town; and he said that if it put some further taxation upon the occupier, the ratepayer in the centre of a town could afford to pay.
MR. BONDsaid it was rather amusing for one who, like himself, had watched for a long time the progress of opinion with regard to this matter to see how policy had changed. He could remember the time very well when the House was treated to fierce denunciations of the great ground landlords of London, and other places; and a spirit was being engendered against those landlords, under which, although they did not derive any immediate benefit from the works on which the rates were being expended, they were to be brought in, and compelled to pay a substantial contribution to those rates. Apparently, some of those engaged in that attack had come to a better mind; and now, after many years of discussion, they had the Bill which was before the House. It was suggested that a new field of taxation would be opened up in a way which he had not been able entirely to apprehend. It was suggested that the imposition of this tax would do something to promote the housing of the working classes. He could not discover that the hon. Member had made out any real case for the suggestion contained in the memorandum of the Bill that a new area of taxation would be opened up. To complete the metaphor of his hon. friend, he did not think they would get any more out of their apples by cutting them in two, or that they could squeeze any more out of their lemons by dividing them into four. The fact really was they would find by this new system of taxation that while it produced an immense amount of inconvenience, on which sufficient stress had

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not yet been laid, it would not result in bringing into the exchequer of the local authorities one single penny more. It would have the effect of reducing rather than of increasing their revenue, because this system of double valuation and taxation could not be carried on without involving extra expense; and expense which would recur from time to time. Further, it would produce an immense number of appeals, and they would have the inconvenience and friction which inevitably resulted. Every person who paid or received rent, every owner of property would find the inconvenience which arose in cases of dispute with regard to the reductions which had to be made, and very considerable loss would accrue to the community.
As to the question whether the Bill would have any appreciable effect on the housing problem, he could not discover what had got into the heads of the very able men who signed the Minority Report when they agreed to the suggestion on which the Bill was based. It seemed to him that it would tend rather to discourage than to encourage buildings. The case put forward was that land, not occupied by houses, should be brought before an Assessment Committee, and that an attempt should be made to estimate its intrinsic value; and that on that intrinsic value a rate should be levied. Incidentally, he would remark that that was an entire departure from the principle of valuation as at present adopted. Assessments were not made on capital value, but on the income derived from the property; or if the hereditament was occupied by the owner, then on the rent he would be able to obtain from a hypothetical tenant. A great deal of criticism of the hon. and learned Gentleman opposite was based on an entire misapprehension as to the way in which rating was conducted in England. He suggested that assessment was based on a fiction. He said that the assessor, in determining what value should be put on a particular property for assessment purposes, was actually benighted enough to have regard to the existing condition of affairs, the state of the property, and the rent it was producing, or might be supposed to produce. That the hon. and learned Gentleman called fiction; but it would be much more of a notion if the assessor set himself to find out what a particular land would be
522
worth if put into the market. The real sting of the Bill was that it proposed, for the first time, to set up the principle of rating unoccupied land, or land within an urban district occupied as agricultural land, not on the value it produced, but on the value it might fetch if it were used for other purposes than those to which it was devoted. It was evident that they would be embarking on a very dangerous course if they accepted that principle. The suggestion that the adoption of this principle would facilitate the erection of houses, and would remove the evils of overcrowding, which they all deplored, he could not accept. He knew something about the housing question from practical experience, and he also knew something—indeed, if he might say so, more than many hon. Members—of the way in which towns were developed. He did not think that the House realised that in dealing with the housing question they had to rely principally, if not entirely, on the efforts of speculative builders and commercial men who went into the business with a view of getting a fair return for their money.
What was the process which usually took place? Assuming it was desirable to extend the area of building in a town owing to the increase of population land was mapped out on the outskirts, oftentimes on a large scale. Then the people engaged in that class of business set to work and made roads; and they then offered the land on building leases. A man who was considering whether he would go into a venture of that kind would be very much disposed to take into account the fact that under this scheme the land which he took, whether he would be able to put it to immediate use or not, would be rated from the very first; and, in course of years that might amount to a very formidable sum. It should be remembered that it was not because a particular speculator thought land was ripe for building that, therefore, it was ripe. There might be a check in the growth of the population of the town, or in the prosperity of the district It would be felt to be a monstrous injustice if a man, who found himself with the whole estate on his hands owing to some mistake, found himself involved in the

523
payment of rates to a considerable amount on land that was practically useless to him. That would discourage rather than encourage building. He was quite unable to understand how those who signed the Minority Report arrived at the conclusion they did. If at any time the owner of land set to work to arrange with a builder to put up houses, both sides would have to take into account all the facts of the case. A man who was going to build would give less for the land where the rates were high, and more for that on which the rates were low, and therefore he could not see what possible advantage could be obtained from separating the rates which belonged to the land from those which appertained to the building on the land. The whole argument was founded on an illusory basis. He objected to the Bill because it did not carry out the promises hold forth in the Memorandum. He thought that to effect such the separation proposed would be of no value as a means of increasing the revenues of a town, and he was perfectly sure that to introduce a system not thoroughly needed and foreign to our habits and traditions would create an immense amount of friction, inconvenience, and injustice, and it could be hardly worth while to bring in such a system merely to produce an illusion in men's minds that they were not paying such high rates as they were before. He hoped the Motion for the rejection of this Bill would be carried by a large majority.
SIR H. CAMPBELL-BANNERMANsaid this subject was one which excited the greatest interest in many parts of the country, and yet, during the whole of the discussion, the Parliamentary Secretary to the Local Government Board had been practically the sole occupant of the Treasury Bench. Of course every one recognised how competent the hon. Gentleman was to deal with subjects of this kind, and what his knowledge on the subject was, but the Government appeared not to have realised the fact that this was no mere whim or notion of his hon. friend the Member for Camber-well. This was not a question of coquetting in an amiable sort of way with some strange doctrines. The object of the Bill was one which attracted the
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warmest appreciation and approval throughout the country. The hon. and learned Member for Stretford had asked what was the real principle of the Bill. He would say what he considered to be the principal and main object of the Bill. It was the recognition of the distinction between site value and structural value. It was the recognition of the fact that they had separate values; that they advanced or receded on altogether different scales and sometimes in opposition to each other. He thought that once they recognised that fact, they were led directly to the purpose of the Bill—that it should be incumbent on the local authorities to ascertain and record those separate values. The further action which should be taken was left to the local authorities themselves, except that the Bill excluded existing contracts.
This extreme moderation on the part of his hon. friend had been seized on by hon. Gentlemen opposite as a fault in the Bill. He believed the opinion of the country would have supported his hon. friend if he had dealt a little more valiantly with existing contracts. That might have been done without creating any terrifying precedents. Sir Robert Peel dealt in a more manful way with existing contracts when he introduced the income-tax in 1842; but his hon. friend, coming upon somewhat degenerate days, had yielded to what he believed to be the general sentiment, and had omitted existing contracts altogether. The advantages of this recognition of site values as apart from the general value of the hereditament, were clearly set out in the Report of the Minority Commissioners. They pointed, first of all, to the fact that the benefit of municipal and other improvements attached to the site, and, therefore, if a tax were necessary at all, it ought to be in proportion to the site value. It was not the house, but the site, that was increased in value. Here was a case of the value that had been given to land within quite recent years by a great public improvement. The Manchester Ship Canal, which was largely made with the money that was found by the City of Manchester, had the effect of raising the value of land on the Trafford Park estate from £237 an acre to £4,840 an acre within the years of its construction. That was a proof,

525
surely, that there was a case for saying that land so artificially increased in value should contribute to the very expensive processes by which that new value was given.
The Minority Commissioners further pointed out that if more of the burden of rates was thrown on the site, the proportion left to be borne by the buildings would be diminished, and this would weigh with builders. Then there was the question of overcrowding, which, of course, was part of the same matter, and which was greatly aggravated by the present system. The rating of sites, in the opinion of the Commissioners, would help to mitigate this evil; and, if it was objected that it ran in any way counter to established principles, they pointed out that a structure was, after all, perishable property, but that the site was permanent property, which rather increased than diminished in value. These were the sort of arguments, of which they had not heard much in that debate, by which the Minority Commissioners supported this proposal. The most urgent matter of all seemed to be to break down the ring fence which was in some places established round a rising and prosperous community by the owner or owners, who withheld their land from building in order to gain the benefit in the increased value. Public energy or private enterprise increased the value of the property, and why should it not be assessed? They wished to prevent the occupiers from actually suffering in their health, comfort, and convenience, by the action of such owners, for suffering was caused, and an insanitary condition of things was created by the circumscription of a community. Anything which tended to distribute the burden more equably, and to prevent such evils, deserved the favourable consideration of Parliament. This Bill represented a desirable reform in the interests, not only of urban communities but of the whole people, and he gave it his heartiest support.
MR. GRANT LAWSON, regretted that his right hon. friend the President of the Local Government Board could not reply, but he was absent in order to pay a last tribute of respect to an old friend. This was a very difficult question, and
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he quite believed that it would be possible on a public platform to obtain a certain amount of applause and support to the principle that someone else ought to bear the burden of taxation, He had great sympathy with the restlessness of the ratepayers under the increasing weight of their burdens. Perhaps it would not be fair to consider how far the occupiers had been compensated for that increase by increased health, and consequently increased wage-earning capacity, or how far the weight of the burdens had arisen from the apathy of the ratepayers, who would not take part as councillors, or even as voters in their own affairs. But one thing was certain, that both the control and the advantage of the expenditure of rates from day to day came into the hands of the occupiers as such. The ratepayers of this country had, he believed, this serious grievance, that only one form of property, real property, was put under substantial contribution to local burdens; but this Bill proposed to put an additional burden on realty, which was the very part of our property that was already injured by our rating system. He objected to the Bill in the interests of economic local government. Anything which would distinctly encourage the local authorities to extravagance must stand condemned; and this applied to the Memorandum which prefaced the Bill, which stated that it was framed to provide local authorities "with a new source of revenue." Nothing could be more disastrous than to give these authorities the impression that a new gold-mine had been discovered in which they could dig.
With regard to occupied houses, the whole hereditament is rated together, and it is rated at its full annual value, so that nothing else is left to rate. There is consequently no new source of revenue. To rate unoccupied houses would be to take from those who had not sold or let their houses in order to give to those who had. This, too, would have a most discouraging effect on the building trade. Land in an urban district, if it was not occupied, received no benefit from the expenditure of the rates. This was a very difficult question, but he wished to dispose of the impression that

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the increased value of some of our towns was mainly due to the expenditure of the rates. In nineteen cases out of twenty it was due to some natural position, or to money laid out not by the local authorities but by railway companies or industries due to private enterprise. In the case of the land for the Edinburgh gas-works, which had been cited, the Duke of Buccleuch and his ancestors had spent £500,000 there on making a harbour. High rates, so far from benefiting land in the neighbourhood of the town, were absolutely detrimental to its value.
The hon. Member for the Elland Division had both in this and the previous year made considerable electioneering use of the proportions to which land rents in towns had increased entirely owing to the expenditure of the rates, but he could cite a case where land was offered to a Town Council as a free gift, yet so high were the rates upon it that they refused. Did that show that the owners of land had lost nothing by the rates increasing? There was a misapprehension as to who provided the streets and sewers for the accommodation of urban property. Hon. Members not learned in the law probably considered that the streets and sewers were provided by the community, while hon. Members learned in the law were aware that they had to be provided by the landowner. He would like to know where was the land in urban districts that was wilfully kept out of the market. He personally knew of land in a high-class district where the landowner was not prepared to let his property go to be used for small cottages or factories, but in so doing—although he was not restrained by covenants—he
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was acting in good faith towards those who already had built high-class houses on the estate. Other land might be kept out of the market because the owner had not received an offer which he felt justified in accepting. But it was suggested that one of the advantages of this Bill was that it would bring land into the market. Was that so? What it did do was to seek to so arrange the taxation as to force one individual to part with his property to another. It was a proposal to put a special tax on unoccupied land in urban districts so as to force individual owners to part with it, not to the State but to some other individual who might desire to possess it, but was not prepared to pay the present value of it.
In a recent debate it was suggested that the taxation in South Africa should be so arranged as to compel the native to go to work on terms which he would not otherwise accept, and it was urged that that was justified because cheap labour was necessary for the development of South Africa. To-day it was being contended that cheap land was necessary for the development of our towns, and, consequently, they had the proposal to compel landowners to part with their land. Was it the duty of the community so to arrange taxation that one citizen should be forced to part with his property to another citizen on terms which he would not otherwise accept? He maintained that the rating of unoccupied land at a hypothetical value was not a legitimate, though it might be a new, source of revenue. Let the House remember that the Royal Commission had already reported that there was no considerable undeveloped sources of taxation available for local purposes.

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It was said that this Bill did not impose a new burden; that it simply redistributed an old burden. That might be so if they put a limit on the spending powers of local authorities. But only give them the idea that they had a new fund to draw upon, and they would at once increase their expenditure. The economic objection to subventions in aid of the rates from the exchequer was that it encouraged extravagance. Their objection must equally apply to a rate which was paid only by a small proportion of the community, as was proposed to be authorised under this Bill. Lord Balfour of Burleigh, in his Report on that matter, used very strong language. He said the danger was that if a rate were charged directly on the lessors, it led to extravagance and plunder, since the lessees, in most cases, had no votes, or if they possessed any at all, it was an inadequate voting power. There had been an attempt to fasten this Bill on Lord Balfour. But the Bill differed from the Minority Report of the Royal Commission on the three most essential points—the amount of the rate, the hereditament on which it was to be levied, and the purposes to which it was to be applied. Take the first point. The Minority Report recommended a strictly limited rate. But this Bill proposed a rate of 1d. in the £ on the capital value. That was an extremely deceptive proposal. It really amounted to an income-tax of 2s. 9d. in the £, to be levied on one particular form of property, whether any income was forthcoming from it or not. As regarded the next point, the Bill proposed that the rate should be levied on all land in urban districts where, as one knew, there was much land in so-called urban districts which was of a purely agricultural character.
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Lord Balfour's suggestion, on the other hand, was that only land covered by houses or ripe for building, in districts where the population was comparatively dense should be thus rated. He said that to put a tax on other land would be anomalous and oppressive, and go undoubtedly it would be.
Again, the Minority Report recommended that the rate should only be applied to purposes closely connected with and tending to improve the value of land. But under this Bill it might be used for the purchase of water carts, and how could such expenditure be held to improve the value of a reversion at the end of a ninety-nine years' lease? The Bill could not, therefore, fairly be fathered on his noble friend the Secretary for Scotland. The Report suggested many safeguards that were not to be found in the Bill. One was that if a local authority thought certain land was ripe for building purposes, the burden of proving that should rest on it. But there was no such provision in this Bill. Then there was the difficulty of valuation. How was it possible to arrive at a fair judgment of the capital value of something which had never been sold in the market? How was it possible to decide the value of a site apart from the building on it? According to the expert witnesses, whose evidence was relied on in the Majority Report, separate valuation would be expensive, complicated, and uncertain; while those who relied on the Minority Report held that it could be efficiently carried out without unreasonable expense. He did not deny that a valuation of the site as separate from the structure could be arrived at—a valuation of some sort.

531
If one paid a valuer he would value anything But these were valuations on which the rights of individuals would depend, and the contributions of individuals would be levied. If a bad valuer were employed, it would be necessary to employ a good lawyer; so that to valuers or lawyers the rating authority would probably have to disburse an enormous sum if the principle of valuing the site apart from the structure were adopted. In order to meet the difficulty presented by the existence of so many covenants restricting the use of land, and the existence of so many easements, the hon. Member for Barnstaple had suggested that the local authority should be empowered to dispense with such covenants. What, however, was to happen to the rights of those in whose interests the covenants had been made? They would have to have continual revaluations, or else great injustice would be done to the different persons interested in the matter.
He had a report in his hand as to the effect in Berlin of attempting the separation of site values and structural values, from which it appeared that the inconvenience which it had entailed on that city had been so great, and the cost so excessively heavy, that it had been decided to abolish the tax altogether. It would perhaps, however, be worth while to accept the risks attending the Bill if it would adjust local burdens more fairly. But what would actually happen? Take the case of an occupier of a moderate house on a good site, and of an occupier of a good house on a moderate site, both
rated at present at £200 a year. If this Bill passed, the man whose house was on a good site would not only pay on £200, but would also pay this extra tax on the site, while the other man would escape the site tax. The measure violated all the four canons of taxation laid down by Adam Smith—that the contribution should be in proportion to the-revenue enjoyed under the protection of the State; that the tax which each individual paid should be certain, and not arbitrary; that it should be levied at the time most convenient to the contributor; and that it should be levied in the most economical manner possible. He asked the House to reject it on the ground that it would cause extravagance and introduce a new principle—an annual tax on capital value—in respect, to one form of property only. His most solid objection to this Bill was that it did not in any way approach the real remedy for the high rates which were the crux of the housing problem, while on the contrary it would create many more grievances than it would remedy. The real solution was to obtain contributions from other forms of property than the form which was now rated, and the passing of the Bill would only delay the steps which the Government would shortly have to take for the reconsideration of the whole question of the incidence of the taxation.
Question put.
The House divided:—Ayes, 170; Noes, 183. (Division List No. 45.)

AYES.

Allan, Sir William (Gateshead)

Beckett, Ernest William

Boland, John

Ashton, Thomas Gair

Bell, Richard

Bolton, Thomas Dolling

Asquith, Rt. Hon. Herbt. Hy

Bignold, Arthur

Bousfield, William Robert

Austin, Sir John

Black, Alexander William

Brigg, John

Barry, E. (Cork, A.)

Blake, Edward

Broadhurst, Henry

Bryce, Right Hon. James

Hayter, Rt Hon Sir Arthur D.

Pickard, Benjamin

Buchanan, Thomas Ryburn

Healy, Timothy Michael

Pirie, Duncan V.

Burke, E. Haviland

Hemphill, Rt. Hon. Chas. H.

Power, Patrick Joseph

Burns, John

Hobhouse, C. E. H (Bristol, E.

Priestley, Arthur

Burt, Thomas

Jacoby, James Alfred

Randles John S.

Buxton, Sydney Charles

Jones, David B. (Swansea)

Rea, Russell

Caldwell, James

Joyce, Michael

Reddy, M.

Cameron, Robert

Kearley, Hudson E.

Redmond, Jn. E. (Waterford)

Campbell-Bannerman, Sir H.

Kennedy, Patrick James

Redmond, William (Clare)

Chamberlayne, T. (Southmptn

Labouchere, Henry

Reid, Sir R. Threshie (Dumfries

Channing, Francis Allston

Lambert, George

Rickett, J. Compton

Clancy, John Joseph

Law, H. Alex. (Donegal, W.)

Roberts, John H. (Denbighs.)

Cogan, Denis J.

Leese, Sir Jos. F. (Accrington)

Robertson, Edmund (Dundee)

Condon, Thomas Joseph

Leigh, Sir Joseph

Robson, William Snowdon

Corbett, T. L. (Down, North)

Leng, Sir John

Roche, John

Craig, Robert Hunter (Lanark)

Levy, Maurice

Roe, Sir Thomas

Crean, Eugene

Lewis, John Herbert

Rollit, Sir Albert Kaye

Cremer, William Randal

Lloyd-George, David

Rose, Charles Day

Crombie, John William

Lundon, W.

Runciman, Walter

Crooks, William

MacDonnell, Dr. Mark A.

Russell, T. W.

Dalziel, James Henry

Macnamara, Dr. Thomas J.

Samuel, Herbert L. (Cleveland)

Davies, M. Vaughan- (Cardign

M'Crae, George

Samuel, S. M. (Whitechapel)

Delany, William

M'Fadden, Edward

Shaw, Charles E. (Stafford)

Dewar, John A. (Inverness-sh.)

M'Killop, W. (Sligo, North)

Shaw, Thomas (Hawick, B.)

Dilke, Rt. Hon. Sir Charles

M'Laren, Sir Charles Benjamin

Sheehan, Daniel Daniel

Donelan, Captain A.

Mansfield, Horace Rendall

Shipman, Dr. John G.

Doogan, P. C.

Mitchell, Edw. (Fermanagh, N.

Sinclair, John, (Forfarshire)

Douglas, Charles M. (Lanark)

Mooney, John J.

Sloan, Thomas Henry

Dunn, Sir William

Morgan, J. Lloyd (Carmarthen)

Smith, Samuel (Flint)

Edwards, Frank

Morley, Charles (Breconshire)

Soares, Ernest J.

Elibank, Master of

Morley, Rt. Hn. John (Montrose

Spencer, Rt. Hn. C. R. (Northants

Emmott, Alfred

Murphy, John

Sullivan, Donal

Esmonde, Sir Thomas

Nannetti, Joseph P.

Thomas, Sir A. (Glam., E.)

Farquharson, Dr. Robert

Newnes, Sir George

Thomas, F. Freeman (Hastings

Farrell, James Patrick

Nolan, Col. John P. (Galway, N.)

Thompson, Dr E. C. (Monagh'n, N.

Fenwick, Charles

Nolan, Joseph (Louth, S.)

Toulmin, George

Ferguson R. C. Munro (Leith)

Nussey, Thomas Willans

Trevelyan, Charles Philips

Ffrench, Peter

O'Brien, James F. X. (Cork)

Ure, Alexander

Field, William

O'Brien, K. (Tipperary, Mid)

Wallace, Robert

Flavin, Michael Joseph

O'Brien, Patrick (Kilkenny)

Warner, Thos. Courtenay T.

Flynn, James Christopher

O'Brien, P. J. Tipperary, N.)

Wason, E. (Clackmannan)

Gilhooly, James

O'Brien, William (Cork)

Wason J. Cathcart (Orkney)

Grant, Corrie

O'Connor, Jas. (Wicklow, W.)

White, Luke (York, E. R.)

Grey, Rt. Hn. Sir E. (Berwick

O'Connor, T. P. (Liverpool)

Whiteley, G. (York, W. R.)

Griffith, Ellis J.

O'Donnell, T. (Kerry, W.)

Whiteley, H. (Ashton-u.-Lyne)

Gurdon, Sir W. Brampton

O'Dowd, John

Whitley, J. H. (Halifax)

Haldane, Rt. Hon. Richard B.

O'Kelly, J. (Roscommon, N.)

Williams, O. (Merioneth)

Hammond, John

O'Shaughnessy, P. J.

Wilson, J. W. (Worcestersh, N.

Harcourt, Rt. Hon. Sir Wm.

O'Shee, James John

Woodhouse, Sir J. T. (Hud'sfild)

Harwood, George

Palmer, Sir C. M. (Durham)

Hay, Hon. Claude George

Partington, Oswald

TELLERS FOR THE AYES—

Hayden, John Patrick

Paulton, James Mellor

Mr. Herbert Gladstone and Mr. Causton.

Hayne, Rt. Hon. Chas. Seale-

Pease, J. A. (Saffron Walden)

AYES.

Agnew, Sir Andrew Noel

Boulnois, Edmund

Clare, Octavius Leigh

Aird, Sir John

Bowles, T. G. (Lynn Regis)

Clive, Captain Percy A.

Allhusen, Aug. Henry Eden

Brodrick, Rt. Hon. St. John

Cochrane, Hon. T. H. A. E.

Allsopp, Hon. George

Brown, Sir Alx. H. (Shropsh.)

Cohen, Benjamin Louis

Anson, Sir William Reynell

Bull, William James

Collings, Right Hon. Jesse

Arkwright, John Stanhope

Burdett-Coutts, W.

Colston, Chas. Edw H. Athole

Arnold-Forster, Hugh O.

Butcher, John George

Corbett, A. Cameron (Glasg.)

Atkinson, Right Hon. John

Campbell, Rt Hn J. A. (Glasg.)

Cox, Irwin Edwd. Bainbridge

Aubrey-Fletcher, Rt. Hn. Sir H.

Campbell, J. H. M. (Dublin Univ.

Craig, Charles Curtis (Antrim, S.

Bain, Colonel James Robert

Carson, Rt. Hon. Sir Edw. H.

Cranborne, Viscount

Baird, John George Alexander

Cavendish, R. F. (N. Lancs.)

Crossley, Sir Savile

Balfour, Rt. Hn. A. J. (Man'r

Cavendish, V. C. W. (Derbysh.)

Cubitt, Hon. Henry

Balfour, Capt. C. B. (Hornsey

Cayzer, Sir Charles William

Dalkeith, Earl of

Banbury, Sir Frederick George

Cecil, Lord Hugh (Greenwich)

Davies, Sir H. D. (Chatham)

Bigwood, James

Chamberlain, Rt. Hon. J. (Birm

Dickinson, Robert Edmond

Blundell, Colonel Henry

Chamberlain, Rt. Hn. J. A. (Worc

Dickson, Charles Scott

Bond, Edward

Chaplin, Right Hon. Henry

Dimsdale, Rt. Hon. Sir Jos. C.

Boscawen, Arthur Griffith

Charrington, Spencer

Disraeli, Coningsby Ralph

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535

Dixon-Hartland, Sir F. Dixon

Legge, Col. Hon. Heneage

Roberts, Samuel (Sheffield)

Douglas, Rt. Hon. A. Akers

Leveson-Gower, Frederick S.

Rolleston, Sir John F. L.

Duke, Henry Edward

Lookwood, Lieut.-Col. A. R.

Ropner, Colonel Sir Robert

Dyke, Rt. Hon. Sir Wm. Hart

Long, Col. Chas. W. (Evesham

Round, Rt. Hon. James

Long, Rt. Hn. W. (Bristol, S.

Elliot, Hon. A. Ralph Douglas

Lonsdale, John Brownlee

Sackville, Col. S. G. Stopford

Lowe, Francis William

Sadler, Col. Saml. Alexander

Faber, Edmund B. (Hants, W.)

Lowther, C. (Cumb. Eskdale)

Sassoon, Sir Edward Albert

Faber, George Denison (York)

Lowther, Rt. Hon. Jas. (Kent)

Seely, Chas. Hilton (Lincoln)

Fellowes, Hon. Ailwyn Ed.

Lucas, Col. Francis (Lowestoft

Seely, Maj. J. E. B. (Isle of Wight

Finlay, Sir Robert Bannatyne

Lucas, Reg'ld J. (Portsmouth)

Sharpe, William Edward T.

Fisher, William Hayes

Shaw-Stewart, M. H. (Renfrew)

FitzGerald, Sir Robt, Penrose-

Macdona, John Cumming

Simeon, Sir Barrington

Fitzroy, Hon. Edward Algernon

Maconochie, A. W.

Skewes-Cox, Thomas

Flower, Ernest

Martin, Richard Biddulph

Smith, Jas. Parker (Lanarks.)

Forster, Henry William

Maxwell, Rt. Hn. Sir H. E. (Wigt'n

Stone, Sir Benjamin

Meysey-Thompson, Sir H. M.

Garfit, William

Middlemore, Jn. Throgmorton

Talbot, Rt. Hn J. G. (Oxford Univ

Gibbs, Hn A. G. H. (City of Lond

Milvain, Thomas

Thornton, Percy M.

Gibbs, Hn. Vicary (St. Albans

Mitchell, William (Burnley)

Tollemache, Henry James

Godson, Sir Augustus Fredk.

Montagu, G. (Huntingdon)

Tomlinson, Sir Wm. E. M.

Gordon, Hn. J. E. (Elgin & Nrn

Morgan, D. J. (Walthamstow)

Tritton, Charles Ernest

Goschen, Hon. Geo. Joachim

Morton, Arthur H. Aylmer

Tufnell, Lieut.-Col. Edward

Greene, W. Raymond- (Cambs

Mount, William Arthur

Tuke, Sir John Batty

Guest, Hon. Ivor Churchill

Muntz, Sir Philip A.

Guthrie, Walter Murray

Murray, Rt. Hn. A. Graham (Bute

Valentia, Viscount

Murray, Col. Wyndham (Bath)

Walrond, Rt. Hon. Sir W. H.

Hamilton, Rt Hn Ld. G. (Midx

Welby, Lt.-Col. A. C. E. (Taunton

Hanbury, Rt. Hn. Robt. Wm.

Newdegate, Francis A. N.

Whitmore, Charles Algernon

Hare, Thomas Leigh

Nicholson, William Graham

Williams, Rt. Hn. J. Powell-(Birm

Harris, Frederick Leverton

Nicol, Donald Ninian

Willoughby de Eresby, Lord

Henderson, Sir Alexander

Willox, Sir John Archibald

Hobhouse, Rt. Hn. H. (Somrst E

O'Neill, Hon. Robert Torrens

Wilson, A. S. (York, E. R.)

Hogg, Lindsay

Wilson, John (Falkirk)

Horner, Frederick William

Palmer, Walter (Salisbury)

Wilson-Todd, W. H. (Yorks.)

Hozier, Hon. Jas. Henry Cecil

Percy, Earl

Wodehouse, Rt. Hn. E. H. (Bath

Hudson, George Bickerstern

Pilkington, Lt.-Col. Richard

Wolff, Gustav Wilhelm

Platt-Higgins, Frederick

Wortley, Rt. Hon. C. B. Stuart-

Jeffreys, Rt. Hn. Arthur Fred

Powell, Sir Franc's Sharp

Wrightson, Sir Thomas

Jessel, Capt. Herbert Merton

Pretyman, Ernest George

Wyndham, Rt. Hon. George

Johnstone, Heywood

Pryce-Jones, Lt.-Col. Edward

Purvis, Robert

Yerburgh, Robert Armstrong

Kenyon-Slaney, Col. W. (Salop

Pym, C. Guy

Younger, William

Kimber, Henry

Knowles, Lees

Rasch, Major Frederic Carne

Rattigan, Sir William Henry

TELLERS FOR THE NOES—

Laurie, Lieut.-General

Remnant, Jas. Farquharson

Sir Alexander Acland-Hood and Mr. Anstruther.

Law, Andrew Bonar (Glasgow

Renshaw, Sir Charles Bine

Lawrence, Sir Jos. (Monm'th)

Renwick, George

Lawson, John Grant

Ridley, Hon. M. W. (Stalybridge,

Lee, A. H. (Hants, Fareham)

Ritchie, Rt. Hn. C. Thomson

Main Question, as amended, put, and agreed to.

Words added.
Second Reading put off for six months.

MESSAGE FROM THE LORDS.
That they have passed a Bill intituled, "An Act to empower the Urban District Council of Nantwich to supply gas; and
536
to provide for the transfer of the undertaking of the Nantwich Gas Company, Limited, to the Council; and to make further and better provision with regard to the supply of electricity; and for the improvement, health, local government, and finance of the district; and for other purposes." [Nantwich Urban District Council Bill [Lords.]
Adjourned at twenty minutes before Six o'clock, till Monday next.

PRIVATE BILL BUSINESS.
The LORD CHANCELLOR acquainted the House, That the Clerk of the Parliaments had laid upon the Table the Certificate from the Examiners that the further Standing Orders applicable to the following Bill have been complied with.
Tynemouth and District Tramways [H.L.].
The same was ordered to lie on the Table.
Jewish Colonisation Association Bill [H.L.].
Presented [pursuant to leave given yesterday]; read 1a, and referred to the Examiners.
Life Association of Scotland Bill [H.L.].
Reported, without Amendment.
Mersey Docks and Harbour Board Bill [H.L.].
The King's consent signified; and Bill reported from the Select Committee, with Amendments.
Tynemouth and District Tramways Bill [H.L.].
Read 2a (according to order).
Nantwich Urban District Council Bill [H.L.].
Western Trust Bill [H.L.].
Read 3a, and passed, and sent to the Commons.
South-Western and Isle of Wight Junction Railway Bill [H.L.].
South-Eastern and London, Chatham and Dover Railways Bill [H.L.].
Sutton Coldfield Corporation Bill [H.L.].
Cardiff Railway Bill [H.L.].
Manchester Southern Tramways (Lancashire) Bill [H.L.].
Manchester Southern Tramways (Cheshire) Bill [H.L.].
South Lancashire Tramways Bill [H.L.].
Nottinghamshire and Derbyshire Tramways Bill [H.L.].
North Cheshire Tramways Bill [H.L.].
Report from the Committee of Selection, That the Earl of Lauderdale be proposed to the House as a member of the Select Committee on the said Bills in the place of the Earl of Camperdown; and that the Earl of Lauderdale be Chairman of the said Committee; read, and agreed to.
Dublin Improvement (Bull Alley Area) Bill.
Brought from the Commons; read 1a;and referred to the examiners.
Great Western Railway (Pension Fund) Bill.
Brought from the Commons; read 1a; and referred to the examiners.

PETITIONS.
  SHOPS (EARLY CLOSING) BILL [H.L.]
  Petition in favour of; of Reading Early Closing Association; read, and ordered to lie on the Table.
RETURNS, REPORTS, ETC.
  EMIGRATION.
  Report on the Emigrants' Information Office, for the year ended 31st December, 1902.
AGRICULTURAL STATISTICS (IRELAND).
Return of the prices of agricultural products and live stock, for the year 1902.

BOARD OF AGRICULTURE.
Annual report of proceedings under the Tithe Acts, 1836 to 1891, the Copyhold Act, 1894, the Inclosure Acts, 1845 to 1899, the Agricultural Holdings Acts, 1883 to 1900, the Drainage and Improvement of Land Acts, the Universities and College Estate Acts, 1858 to 1898, the Glebe Lands Act, 1888, etc., etc., for the year 1902, together with a summary of the powers and duties of the Board of Agriculture under the statutes, and the method of administration.
Annual reports of proceedings under the Diseases of Animals Acts, the Markets and Fairs (Weighing of Cattle) Acts, etc., etc., for the year 1902.

CENSUS OF ENGLAND AND WALES (1901).
Summary tables, area, houses, and population, also population classified by ages, condition as to marriage, occupations, birthplaces and infirmities.
Presented [by Command] and ordered to lie on the Table.

HOUSE OF LORDS OFFICES.
Leave given to the Committee to report from time to time; First Report from the Select Committee made, to be printed, and to be considered on Monday next. (No. 25.)
PREVENTION OF CORRUPTION BILL [H.L.]
Read 3a [according to order]; an Amendment (Privilege) made; Bill passed, and sent to the Commons.
SHOPS (EARLY CLOSING) BILL [H.L.]
Amendments reported [according to order], and Bill to be read 3a on the second sitting day after the recess at Easter.

PREVENTION OF CRUELTY TO CHILDREN (AMENDMENT) BILL [H.L.]
[SECOND READING.]
Order of the day for the Second Reading read.
LORD ALVERSTONE: My Lords, this Bill has been prepared in order to remedy certain practical defects that have been found to exist in carrying out the Act of 1894. The details will, of course, require consideration in Committee, but I do not think there is anything in the clauses of the Bill to which I need call attention on the present occasion. There is, however, one rather important proposal in the Bill. I ask that a clause may be passed enabling offences under the Prevention of Cruelty to Children Act to be dealt with on indictment for manslaughter. There is a difficulty at present in getting a conviction in the case of persons indicted for manslaughter when the real offence is one against the Act of 1894. The other Clauses of the Bill, as I have said, deal with matters which do not require to be explained now. I have a reason for them in every case, based upon the experience
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and working of the Act of 1894. There are two clauses in the Bill which relate to an entirely different matter and which I do not propose to press when the Bill gets into Committee. I refer to the clauses which deal with the punishment of incest. It was in consequence of representations made to me by Grand Juries in the North of England that I introduced these clauses, but as they are likely to give rise to opposition I shall not endanger the Bill by insisting upon them and shall move their deletion in Committee. Whether your Lordships think that this Bill can be best dealt with by any particular form of Committee is a matter to which I do not attach any importance, but I am quite satisfied that as regards the great majority of the clauses they propose Amendments of the law which are really necessary having regard to the defects and omissions found by experience in the Act of 1894.
Moved, That the Bill be now read 2a.—(Lord Alverstone.)
THE LORD CHANCELLOR (The Earl of HALSBURY): My Lords, with the main part of the Bill I entirely concur. It is a measure that will require consideration, and after it has been read a second time I shall move your Lordships to refer it to a Select Committee.
On Question agreed to; Bill read 2a [according to order], and referred to a Select Committee.

COUNCIL FOR NATIONAL DEFENCE.
Order of the day read for resuming the debate on the motion of the Lord Rosebery to resolve "that this House desires to express its approval of the proposed Council of National Defence, and its earnest hope that the first efforts of that Council may be directed to the adjustment of the national armaments and to the naval, military, and financial conditions of the Empire."
Debate resumed accordingly.
THE MARQUESS OF RIPON: My Lords, the noble Earl the First Lord of the Admiralty concluded his able speech on Tuesday night by a strong and

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earnest appeal that at all events care should be taken that any future reductions of military expenditure should not be made hastily and should not involve sweeping changes. As to the general advisability of that course I suppose none of us find any objection, but I venture to think that if the noble Earl is desirous of preventing that state of things, as far as he can, the best possible mode of doing so is to begin reductions of taxation at the present time. The war has come to an end; we have entered upon a time of peace. The condition of the country is not un-prosperous. There is, I fear, in many quarters considerable distress, but, nevertheless, I may truly say that our prosperity is still largely maintained. But we all, I suppose, hear various rumours of a period of bad trade which is coming. I hope it may not come, but I would earnestly impress on the noble Earl and upon his colleagues that if they want this gradual reduction of taxation rather than the adoption suddenly of any sweeping measures they must take care that they are not caught by bad trade, because they may rely upon it, that not all the earnestness of the First Lord of the Admiralty or all the determination of his colleagues would be able to maintain such expenditure as we have at the present time, if unfortunately we were to find ourselves in what are ordinarily called bad times.
The noble Earl took considerable exception to the terms in which my noble friend Lord Rosebery spoke of the present burden of taxation. I do not want to enter into any dispute with the First Lord of the Admiralty upon a question of adjectives, but I venture to assert that there can be no doubt that the pressure of taxation at the present moment is heavy, that there are already signs that it is a pressure which the people of the country will not long be able to bear at its present height, and that the time has therefore come when we should recognise the fact put before us the other night by Lord Rosebery, and should set ourselves to work with determination steadily to relieve that pressure. There was one reason offered to us on Tuesday night by Lord Selborne why that course might not at present be necessary, which I confess filled me with
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much surprise. The noble Earl said that at the conclusion of the great war with France in the year 1815 our ancestors bore the pressure of those times and the heavy taxation which was then maintained; and, he asked, "Why should we not do so? "My Lords, I think it was a little unfortunate that the First Lord of the Admiralty should carry back our thoughts to the years which succeeded 1815, because I venture to say that the six or seven years following the great peace were some of the most unhappy years in this country, when the working classes were in the most wretched and miserable condition, and I confess it does not encourage me to advocate a system of heavy taxation when I recollect what was the condition of affairs at the time to which the noble Earl referred. They were the years of Peterloo and of the Cato Street Conspiracy. But I am bound to say, if that comparison of the noble Earl's surprised me, I was yet more surprised by the reason which he gave for our not being able now to bear taxation that was borne in 1815. I do not admit the fact. I think we are better able to bear taxation now than we were in 1815; but what was the noble Lord's reason for his statement? He said that in 1815 we had very numerous sources of taxation, but that now, in consequence of the policy of Free Trade, we had greatly limited the field of taxation. I entirely deny that that is any reason whatever why we should be less able to bear taxation than we were in the earlier period to which the noble Earl referred. But I will not go into that discussion now. I must say it does not diminish my desire for an early adoption of a more economical system when the noble Earl holds out the prospect that if we are to bear a large weight of taxation the only way by which we can do it is by returning to innumerable small taxes on many articles of consumption and to the financial policy of Vansittart.
The noble Earl told us that the present Army proposals of the Secretary of State for War were adopted very deliberately. My noble friend Lord Rosebery had appeared to intimate that they were hastily adopted; "but," said the First Lord of the Admiralty, "they were adopted

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very deliberately." If the First Lord means by that statement that Mr. Brodrick took three or four months to consider those proposals, and that he did not act without deliberation; that he did not go down to the War Office one fine morning and write out the whole scheme in half-an-hour, I have no doubt that is the case, but it does not appear to me that therefore it is true to say they were not hastily adopted. I think they were hastily adopted. I think it would have been far better if the Secretary of State, instead of attempting to reorganise the Army in the middle of the war, had waited till the war was over; had waited, not only for the return of the present Commanderin-Chief, however important his concurrence in the matter is, but had waited until we had had the full experience of the war, and until other experienced officers who had been serving in South Africa after Lord Roberts left had returned to this country and been able to assist the Secretary of State for War in the preparation of his proposals.
The main defence at the present moment of these proposals, as I understand it, at least as regards that Army Corps which has been most under discussion of late, rests on the needs of India. I confess I am a little suspicions that that defence is something of an afterthought. I know that somewhat alarming statements have been made in very high quarters with reference to some Indian questions. I agree with Lord Selborne that there is no necessity for our refusing to discuss the possible requirements of India. I concur with him in thinking that we may just as well discuss those requirements as discuss what is necessary for the defence of this country, but I cannot say that I think it is wise or judicious that we should have these vague and uncertain statements made which are calculated to fill the mind with considerable alarm, and out of which panic has often arisen before now. The reason why I say that in my opinion the connection of this Army Corps with the wants of India is an afterthought is this. I cannot conceive an organisation less suited to the possible military needs of India than that of one of these Army Corps. Such an Army Corps is a
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great body of European troops. The fighting organisation of India does not consist of large Army Corps, some of them European and some of them native. It consists of a constant intermixture of native and European troops. That is the very foundation of the military organisation of India for fighting purposes, and therefore it seems to me—perhaps the noble Earl the Under Secretary may be able to throw some other light on the subject—that if you send out a great European Army Corps to India the first thing you will have to do will be to break it up in order that the European troops may be distributed among the divisions and brigades in India, according to that organisation upon which alone an Indian Army can properly be framed. I cannot but think that the expenditure involved in the maintenance of this Army Corps is unwise and unnecessary. I quite agree with my noble friend opposite, Viscount Goschen, who said that if you were to look mainly to the defence of this country against invasion by your Militia, Yeomanry, and Volunteers—that is to say, by what is now called the Auxiliary forces—they would require to be stiffened by Regular troops. But then he placed the number of Regular troops that would be required for that purpose at 30,000 men, which is very different from the Army Corps which it is proposed to maintain. I venture to think that this Army Corps will not meet the requirements for which it is now said that it is intended. I think it will cast too great a burden upon the finances of the country, and that that burden will create that very reaction against which the First Lord of the Admiralty pleaded so eloquently the other night.
I must now say a few words in regard to the matter which stands first in the Motion of my noble friend Lord Rosebery—the proposed Committee of Defence; and, by the way, before I proceed to argue that question, I should like to ask what is the real name of this body. The Prime Minister and the First Lord of the Admiralty called it a Committee, but my noble friend in his Motion describes it as a Council. The point is not a large one, but, at the same time, we might just as well know what is the

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proper official designation of the body. I cannot help thinking that there has been considerable exaggeration in what has been said with respect to the necessity of it, and to the effect that it is likely to have. I do not want to exaggerate upon the other side, though I feel bound to say I am not prepared to express approval of this proposal. As was very well pointed out on Tuesday night, both by Lord Goschen and also, I was glad to observe, by Lord Selborne, this is not the first body of this kind which has existed, nor have the services of those which have preceded it been of a nature which ought to be overlooked. They have been very readily acknowledged by those who have had the best means of becoming acquainted with their proceedings—by Lord Goschen, a former First Lord, and by Lord Selborne, the present First Lord.
We have not heard much of what was done by the recent Defence Committee presided over by the noble Duke the Lord President of the Council, but the Prime Minister assures us that it did good service, and we accept that statement without dispute. But the peculiar distinction of all the bodies that have been mentioned is that they were either Departmental Committees, upon which only the subordinates were placed, or, at all events, no Cabinet Ministers, or they were Committees of the Cabinet of which Cabinet Ministers alone were Members. You now propose to deviate from those principles which have hitherto guided the organisation of bodies of this kind, and to create a new mixed body partly composed of Cabinet Ministers and partly of other persons. I shall have a word to say upon that in a moment, but I think it can scarcely be said that the system which has been in force in the past has prevented or interfered with the progress of military reforms. The greatest military reform of our time, that which is always spoken of with such approval and respect by my noble friend Lord Wolseley, namely, Mr. Cardwell's reform, was made without any Committee of this kind. It was made by Mr. Cardwell in consultation with his professional advisers, and, of course, was submitted to and approved by the Cabinet. Therefore it cannot be said that it is impossible to make a large, important, and successful reform in our
414
military arrangements without a heterogeneous body of this kind. Then, of course, I may be told that what this Committee is intended to do is not only to secure reform but to co-ordinate—I think that is the word which has been generally adopted—Military, Naval, Indian, and political affairs. That no doubt gives a very large scope to the work of this Committee, but I still venture to think that it does not prove that it is the best body that could be established for the purpose.
I entirely agree with my noble friend Lord Goschen in desiring that the Foreign Secretary and the Chancellor of the Exchequer, especially the Chancellor of the Exchequer, should be put on the Committee. It is impossible that this Committee, which is heralded by such loud expressions of its great importance and high value, can discharge any such wide functions as it is proposed to give to it in regard to Naval and Military matters without touching constantly and continually on questions of finance. What will be the result? The Chancellor of the Exchequer is not to be a regular member of the Committee. He is to be called in when the Committee like to call him in. I do not think that is a position in which the Chancellor of the Exchequer ought to be placed. I do not think it will work well. You cannot always tell in the deliberations of a body of this kind whether questions regarding finance will come into their consideration at a particular meeting or not; and suppose this dignified Committee, this Committee which is to co-ordinate everything, were to come to a decision involving an important expenditure of public money without the Chancellor of the Exchequer having been heard! You are to have upon the Committee the Prime Minister, the Secretary of State for War, the First Lord of the Admiralty, and the Lord President of the Council. They are parties to this expenditure. The Chancellor of the Exchequer is not there, but hears of it when the Cabinet meets. What will be his position? How can he hope to contest it successfully; how can he hope to be heard with that openness of mind with which he ought always to be heard if this question has been prejudged in the Defence Committee? I should very much like to have heard what Sir Robert Peel, or Mr. Gladstone, or Sir M.

415
Hicks-Beach would have said of a proposal of that kind. I cannot think it is possible that it can work. I am afraid I must go further than my noble friend Lord Goschen, and say that if you have this Committee you must have upon it another Cabinet Minister, namely, the Secretary of State for India, and he must be accompanied by his principal military member of Council. Everything connected with the Army in this country touches India. When I was in India the Government with which I was connected undertook a great work of military reorganisation, which required that we should look at all the past proceedings in respect to the Indian Army in various directions; and one of the most startling facts produced by that inquiry was that in the eighteen years preceding that period there had been added to the military expenditure of India no less a sum than £800,000 a year. That was added without the Government of India having been consulted, or knowing anything about it until it was done. It was added by small additions here and small additions there, but the result was that the expenditure was being thus increased at the rate of nearly £1,000,000 in twenty years.
I hope that whenever your Lordships are called upon to consider questions relating to Indian expenditure you will remember how extremely limited are the sources of Indian revenue. You can hardly increase them, and those that grow, grow very slowly. To find a new tax in India is one of the hardest tasks that anyone can undertake. You must always bear in mind, when you are dealing with questions of Indian finance, when you are by the action of the Home Government throwing additional burdens on the finance of India, that you will very rapidly arrive at the end of your tether, and will not be able to get the money. We have been discussing, very naturally, as I think, the increased burden of taxation in this country, but we, at least, thanks to that system of Free Trade which does not appear to commend itself financially to the First Lord of the Admiralty, are able to bear, however much we may dislike it, and justly complain of it, a much larger extension of taxation than
416
would be possible in India. In those circumstances I do say that if you are going to establish this Defence Committee you must put upon it the Secretary of State for India and his principal military officer. I do not at all deny what Lord Selborne said, that if you are to have this Committee it is very desirable that it should not be too large; but if you are to have it you must constitute it in such a way that it will not come to important decisions without the knowledge and behind the backs of members of the Cabinet, who are deeply concerned in the matter. Therefore, if you are to have the Committee at all you must, as it seems to me, put upon it all those Cabinet Ministers of whom I have spoken. They are pretty nearly all the most important members of the Cabinet. Why are their decisions to be taken apart from their colleagues, without consultation at the time with their colleagues, and in a mixed Committee consisting of other persons as well as themselves? In that respect I take it that the construction of this Committee has no precedent. I may be wrong in that, but I do not know of one. It will consist, as is proposed, of Cabinet Ministers, of Privy Councillors, of persons who are not Privy Councillors, of important high officials in the public services, and of subordinate officers like the Directors of Military and Naval Intelligence. When I speak of those distinguished officers as subordinate I am only speaking of their comparative official position. I quite agree that they are officers of great importance, and I can only say, upon that, that I wish the Government which was in office at the time the war broke out had more carefully studied the excellent and complete reports which had been prepared by the Intelligence Department of the War Office. Still, I do not think that so great a departure from ordinary and established custom, as is involved in the mixing up of these officers with Cabinet Ministers, has been justified by any argument I have yet heard.
We are told that it will be an admirable system, that it will supply a great want, that it will prepare information for the Prime Minister. I think the Prime Minister ought to have the fullest possible information supplied to him,

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but I think it might be done in another way. I have also another doubt upon the subject, and it is a grave one. I confess I am unable to dissuade myself nom the opinion that the establishment of this heterogenous Committee will tend to affect the public sense of Ministerial responsibility. I know that that is denied, and, of course, in one sense it must be denied, because no administrative arrangements made by the executive Government can by any possibility affect a constitutional principle like that, but I do think it will have a tendency to diminish in the public mind and in public opinion the idea of Ministerial responsibility. We have seen more instances of late than I desire of an inclination on the part of Ministers to hide themselves behind the expert opinion of their professional advisers, and I think that evil would unquestionably be increased, and that the danger would become more imminent, if you were to establish a body of this kind, placed in the high position in which it is contemplated by this scheme that it should be placed. I have another remark to make, which, I submit, is worthy at least of consideration. You are going to put upon this Committee the Secretary of State for War and the Commander-in-Chief, the First Lord of the Admiralty, and my noble friend Lord Walter Kerr. I cannot think that there is not a risk—I do not say with the present Commander-in-Chief, nor yet, far from it, with the present First Sea Lord—if you bring the Secretary of State and the Commander-in-Chief, the First Lord of the Admiralty and the First Sea Lord as equal members of a Committee of this kind, of your weakening that confidential feeling which ought to exist between them. The Secretary of State for War ought to be in daily, in hourly, I might almost say, communication with the Commander in-Chief. I am quite sure that the noble Earl opposite, the First Lord of the Admiralty, is in daily communication with the First Sea Lord.
THE FIRST LORD OF THE ADMIR ALTY (The Earl of SELBORNE): Hourly.
THE MARQUESS OF RIPON: I am quite sure that the relations between them are of the best and most confidential nature; but bring them together as equals upon a Committee of this kind, and I think difficulties may very possibly arise between them; at least, I think that that free and confidential intercourse which is essential to the good working of the Department will be somewhat endangered. I think I might claim my noble friend Lord Goschen as not disinclined to agree with me in this respect, because he said he hoped there would be no voting. I concur with him in that hope. He said it would be awkward if there had been a discussion in the Admiralty between the First Sea Lord and the noble Earl as to whether there should be four or three new battleships, and they were to have that discussion over again in the Committee. I do not believe that danger is altogether imaginary. I think, looking to men as they ordinarily are, the difficulty will be great. I think that that perfect union which exists between Ministers and the members of the military, naval, and civil Departments in this country, which is the pride of our administrative system, might be somewhat endangered by deliberations of this kind, which are to be placed upon record, which are not to be produced, as I understand, to Parliament, but are to be there to be asked for from time to time, and to be alluded to, if not openly, at least in a manner which will be easily understood either by the Ministers themselves or by those who, having knowledge of the past records, might find themselves in opposition. Therefore I am bound to say, and I say it with great regret in one respect, because I find myself on this point differing to a certain extent from my noble friend Lord Rosebery, that I do look with some uneasiness upon the proposal to establish a body of this kind. The evils which I have ventured to suggest may, no doubt, to some extent be remedied by arrangements which may be made for conducting the operations of this body, and I am sure your Lordships will think that I have not been wrong in frankly stating the view I have been led to take of this matter. For I prefer the strict enforcement of Ministerial responsibility—I wish

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it was enforced more strongly than it is—to a system which it seems to me will weaken that responsibility and shield Ministers under the protection of an irresponsible Committee.
THE UNDER - SECRETARY OF STATE FOR WAR (The Earl of HARDWICKE): My Lords, the noble Marquess has been the first speaker in the course of this debate who has not been able wholly to agree with the Resolution before the House. I feel sure that he will not expect me to answer the latter part of his speech, which the House will readily understand is a matter to be dealt with by a Cabinet Minister. The noble Marquess told us in the earlier part of his observations that there were signs that the burden of taxation was beginning to tell, and he referred to a remark of my noble friend the First Lord of the Admiralty that the burden was equally heavy in 1815. I think he misinterpreted what my hon. friend behind me stated with reference to that period. I did not understand my noble friend to say that the British public were less able to bear the burden of taxation now than they were in 1815, but that the field of taxation had been narrowed since that time, and therefore people were more ready to complain. But I think the majority of the Members of this House will not hesitate to admit that, however large the cost of the late war has been, and however great has been the increase in taxation, no burden has been so little felt in the history of this or any other country. We were told the other night that our securities were falling and that the price of Consols was a great deal lower than it had been for many years. The speakers who referred to the fall in the price of Consols as evidence of financial depression seem to have forgotten that whereas they have in the past borne 2¾ per cent. interest, they will from the end of this month forward bear 2½ per cent. interest only, which in a great measure accounts for the recent fall in the price of Consols. I have also been told on high authority that in the City of London there is no less a sum than £178,000,000 invested in South African gold stocks, and that owing to the insufficiency of labour to work the mines
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it is not easy to realise those investments. I believe the first sign of improvement in the supply of labour in South Africa will be followed by a large rise in the price of Consols.
I now turn to the noble Marquess's remark with regard to what he describes as the hastily adopted policy of my right hon. friend the Secretary of State for War when he introduced the present scheme of Army reorganisation. The noble Marquess considered that it would have been very much better to have delayed any scheme of reorganisation until after the war had been brought to an end. Well, my Lords, had the Secretary of State acted on those lines what would have been the result? The result would have been that to-day we should have no Army organisation. We should be beginning where we began two years ago, and it would be another two years before we should be in a position to show the public that we really had an organisation, shortly to be developed in its fullest possible sense. I think that we should have been somewhat in the position of the noble Earl with his germ of a Defence Committee. If the Secretary of State had delayed carrying out what he believed was the best policy for the military reorganisation of this country it is possible that for some reason or other it might not have been carried out at all. As it is, the organisation that we have adopted is an organisation that carried with it the fullest concurrence and whole-hearted support of the Commander-in-Chief, and when the noble Marquess says that the Army scheme is not adapted to the requirements of India, he seems utterly to forget that the scheme is based absolutely on the organisation of the Indian Army, the only difference being that the units are called Army Corps at home and commands in India.
THE MARQUESS OF RIPON: The commands in India are composed of mixed troops. When your Army Corps get out there it will have to be broken up in order to be adapted to that system.
THE EARL OF HARDWICKE: It is quite true that troops in India are black and white. But if an Army Corps was sent to India it would not be split up, but

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would act as a whole. The next point to which the noble Marquess referred, was as to the title of the Committee to which the Resolution alludes. The proper title of the new body is the Committee of Imperial Defence. I may here mention that the Prime Minister is not the President of the Committee.
THE MARQUESS OF RIPON: I did not say he was.
THE EARL OF HARDWICKE: No, but that statement was made by the noble Earl below the Gangway. The President is the noble Duke the Leader of this House. I confess that I find some difficulty in clearly answering criticisms that have been passed which it is not always easy to understand. I understand that it is contended that our Army organisation is unsuited to the needs of the Empire, and that the increased expenditure has not produced a proportionate increase in the strength and efficiency of the Army. I do not know that it is possible for any one to say to-day that what has been done has not produced a proportionate increase in strength and efficiency, because this organisation has only been in force for two years. We have admitted frankly that the scheme of Army reorganisation is not yet fully developed, and I would like to point out to your Lordships that after the Franco-German War the German nation took fifteen years to reorganise its military forces. Seeing that we have only been engaged in the reorganisation of our Army for so short a period as two years, I think we are entitled to some credit for the length we have been able to go.
I would like to point out to the House, with reference to the remarks that have been made in the course of the debate as to the Estimates for this year, that our net total for normal services is this year £27,588,000. From that sum you can take £4,300,000, which represents such charges as annuities on loans for works, fortifications, and other works expenditure not of the nature of maintenance of barracks, War Office expenditure, expenditure for horses for Home force, for manœuvies, and about £2,000,000 for stores. Thatleaves us a sum of £23,288,000,
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and I will point out how that is distributed. It is absorbed as follows: Force maintained at home to provide for the garrison of India, £2,074,000; force at home and abroad for Naval Coaling Stations (i.e. Bermuda, Jamaica, St. Lucia, Mauritius, Straits Settlements, and Esquimalt), £1,220,000; force at home and abroad for South Africa, £2,388,000; force at home and abroad for Egypt and Colonies, not mentioned above, £3,866,000. Therefore at the present time the total cost for forces abroad amounts to £9,548,000. I do not think anyone will suggest that it is possible to minimise in that direction. Then, for home purposes, our Regulars cost £8,740,000, the Auxiliary and Reserve forces, £5,000,000, making a total in respect of forces maintained for home purposes of £13,740,000; the total for the whole of the men at home and abroad, exclusive of the £4,300,000 to which I have referred, is £23,288,000. As to the proportions of the expenditure between the two branches of the service, it should be remembered what the Army does for the Navy. Does anyone suppose that Gibraltar, Malta, and the various coaling stations are occupied for the purposes of the Army? Of course they are entirely maintained in the interest of the Navy, and I hope your Lordships, in considering the cost of our military administration, will reckon the large sums of money that we are paying which in the nature of things would be charged to the Naval Estimates if we had not got an Army to provide the forces.
The statement that we have done nothing to increase the efficiency of the Army is a bold one for anyone to make, and it is absolutely contrary to fact. In 1895 the Army Estimates, including supplementaries, stood at £18,655,100, and the Navy Estimates at £18,701,000—that is to say, the late Government, of which the noble Earl below the Gangway was Prime Minister, considered that an equal sum should be spent on the Army as was spent on the Navy. Today His Majesty's Government have clearly shown that they think it is right to spend a far larger sum on the Navy. I would point out that we have been able since 1895 to increase the Regular Army by—British, 57,300; Colonial and

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Indian Corps, 8,860. We have increased the pay and improved the clothing. There has been an increase of over 14,000 horses, and also increases in the medical services and in the veterinary department. A new Militia Reserve has been created, and a new force of Yeomanry, which in the past numbered only 10,000, but which now consists of 24,000, and will shortly, I hope, number 30,000. These changes have not been effected without expenditure. The expenditure under the heads I have mentioned amounts to an increase of £7,680,000. These figures are interesting to those who are apt to think that though we have spent a great deal of money we have nothing to show for it. I pass to another charge that has been brought against the present system. It is said that the Army Corps cannot be sent abroad as they stand. It is perfectly true that it would be impossible at the present day to send the first three Army Corps abroad. But within a few months it will be perfectly possible to send away three Army Corps, perfectly equipped and able to go wherever they are required.
Another argument was—I think it appeared in The Times—that we needed an Army trained as no Army can be trained in this country. It would, of course, be an admirable thing if we could train our Army in the country in which it was going to fight; but that is not possible. There is no other country in which the Army can be trained except South Africa—and I will refer to that directly—and no other part of the Empire so suitable for training as this country. For that reason it has not been thought advisable to keep a large force abroad, except in India. Then it is asked: Why is this particular number of men necessary, and how are they to get to India in the event of an emergency? The number of troops has been fixed as the minimum compatible with the safety of the Empire. It is perfectly certain that if we were prepared to increase the number the expert authorities would welcome it, but they certainly will not consent to any reduction. The suggestion of the noble Earl that in an emergency the troops would take thirty-six days to get to India, and would therefore arrive too late, was a melancholy anticipation which I think no one else in the House will share; and if that is his only argument against having a large force it vanishes into thin air as soon as spoken. Again,
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it is said that our scheme does not provide for a small body of men capable of being sent abroad at a moment's notice. I deny that entirely. We could send, if necessary, to-morrow, the First Army Corps. Our system enables us to mobilise the Army Reservists, who could be called up at any moment, and we should be able to despatch a small force of 10,000 or 12,000 men abroad as quickly as it would be possible under any other organisation. Then we are told that we do not require what is called any stiffening in the Army Corps for home defence. The first three Army Corps are entirely independent of stiffening. The stiffening that we provide is 30,000 men for the Fourth, Fifth and Sixth Army Corps, and the object of that stiffening is very simple. Nobody suggests that you can train the Militia and the Volunteers to be expert artillerymen. In the nature of things the Artillery require continuous and active training, and it is therefore necessary in the Fourth, Fifth and Sixth Army Corps to provide Regular Artillery. It has been laid down that so far as Horse Artillery is concerned there should be no Auxiliary Artillery in existence, and that as regards the Field Artillery in the last three Army Corps the proportion to Militia Artillery should be three-fourths to one-fourth.
The noble Duke who spoke the other night stated that according to the requirements of the existing organisation we should have to increase our establishment. The noble Duke was inaccurate in that statement. With the exception of a few thousand men that we require in order to bring up our Yeomanry to the full 30,000, we have all the men that we require for our organisation. Then the noble Duke suggested that we should have to largely increase our expenditure in the future on barracks. The money for barracks has been taken under the Military Works Loans Act, 1901, and there will be no extra charge in the future except for interest. But there will be, I confess, a small extra charge on account of the increase in the Yeomanry, the Militia Reserve, and also for the men that go to the Reserve during the next few years. I now turn to the question that has been raised as to the possibility of keeping a large force in South Africa.

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I do not wish to say more this afternoon than that if we keep a full Army Corps in South Africa one of two things must happen—either it must be kept at war strength, which would entail keeping battalions at home for drafts, or we should have to create large depots for the supply of men at great cost. If, on the other hand, we adopt the scheme that is proposed in The Times of making South Africa a home station, we are faced with one very serious difficulty, namely, that we would not be able to mobilise for service the troops kept in South Africa until their reserves had been able to join them from this country. Therefore, the obvious conclusion is that if you can send your Reservists to South Africa on mobilisation you could perfectly well send the complete unit. There might also be difficulties in finding sufficient transport in South Africa when the troops had to be moved, whereas, in this country we could always get transports. For that reason, among others, it is strongly felt that the most suitable base for our troops is the United Kingdom.
I now turn to one or two of the points in the speech of the noble Earl who moved the Motion before the House. At the conclusion of his speech he said that he laid his views before your Lordships as those of a common citizen, of a common Imperialist, and a common taxpayer—and, he added, as a matter of common sense. I hope he will not take it amiss if I say that from the War Office point of view I cannot accept this statement that all he said with reference to our Army organisation was a matter of common sense. I do not think it is common sense to be inconsistent, and I think I can show the House that the noble Earl made certain statements the other night which are wholly inconsistent with statements he has made on previous occasions. Speaking of the necessities of this country, and the number of men we might require, the noble Earl said he had no idea of compulsion in his head and that the nation would never undertake the burden. But speaking in this House in January, 1900, he said:—
"I do not see that it is so immeasurably remote as the noble Marquess considers that some form of compulsory service should have to
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be introduced to meet the growing exigencies of the Empire."*
THE EARL OF ROSEBERY: Does the noble Earl call every form of compulsory service conscription?
THE EARL OF HARDWICKE: The remark of the noble Earl was in answer to Lord Newton, who interrupted the noble Earl with the observation "By conscription."
THE EARL OF ROSEBERY: My point is—is there no other form of compulsory service except conscription?
THE EARL OF HARDWICKE: Having regard to the context of the noble Earl's remark, I took it to point to a modified form of conscription.
THE EARL OF ROSEBERY: The Militia Ballot is a form of compulsory service. Would the noble Earl call that conscription?
THE EARL OF HARDWICKE: I have always understood that there is very little difference between compulsory service and conscription.
THE EARL OF ROSEBERY: Oh, yes there is. I altogether repudiate the interpretation put upon what I said.
THE EARL OF HARDWICKE: I accept the noble Earl's disclaimer and will not press the point. The noble Earl said there would be 7,000,000 soldiers available if we resorted to conscription.
THE EARL OF ROSEBERY: I was referring to the case of Switzerland, where, without what is called conscription, but with compulsory service, they have a force of no less than 518,000 men. What I said was that, if we raised a force on the same basis, we should obtain 7,000,000 fighting men.
THE EARL OF HARDWICKE: I have been looking up the case of Switzerland and I find that the noble Earl's statement was quite inaccurate. AS a matter of fact, the
*See (4) Debates, LXXVIII, 38.

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total number that the Swiss Republic have under their system is 242,462, and not 518,000. Then they have 225,156 men who have served but are now out of the service.
THE EARL OF ROSEBERY: But who are liable to serve.
THE EARL OF HARDWICKE: They are described as a landsturm non armée which I interpret to mean men who are considered not competent to hold arms. In stating that if we raised a compulsory force on the principle of the Swiss we should have a force of 7,000,000, the noble Earl is including women and children. The noble Earl said that, considering that last year we had raised 50,000 recruits, of which 8,000 were specials, we would probably on that basis only succeed in raising 42,000 men in a good year. But the fact is that though we began last year by taking specials at the rate of 33 per cent., we gradually and surely reduced the percentage; and when specials were only being taken at the rate of 7 per cent., it was decided that no more should be taken at all. I therefore think we may reasonably hope that in the coming year we shall be able to get the number of recruits we require without taking specials. Then the noble Earl said that Mr. Brodrick was considering quantity and not quality. The fact that we have done away with specials, and that the character of every recruit is now asked for before he is enlisted—
THE EARL OF ROSEBERY: How long has that been?
THE EARL OF HARDWICKE: The order was issued recently. We cannot do all these things at once. I only state the facts in order that the noble Earl should understand that we do desire quality just as much as he does, and that we have taken practical steps to give effect to our desire. I turn now to certain remarks which the noble Earl made with reference to a statement of the Secretary of State for War when he introduced his Army Scheme in the House of Commons. Of course, by quoting one sentence it is not difficult to draw conclusions that perhaps are not always fair, and I would like to quote the full statement that was made
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by my right hon. friend when he introduced his scheme, and to which the noble Earl referred. Mr. Brodrick said—
"I shall endeavour to lay down what it is for which we ought to prepare. In the first place, when we talk of home defence let us not confuse our minds by considering the position and action of the Navy. The Navy is obviously our first line of defence, and if all naval matters were matters of certainty we might dispense with an Army for home defence altogether. I quite agree that invasion may be an off-chance, but you cannot run an Empire of this size on off-chances. We are bound, with the Army and Navy acting together, to provide a proper system of home defence."
Therefore, it is not true to charge my right hon. friend with neglecting the part the Navy plays in the scheme of Imperial defence. The words used by him, which I have quoted, show that the contrary is the case, and when he made that statement he did it after full consideration of all the strategical questions involved, with the First Lord of the Admiralty and his own military advisers. It is, therefore, a little unjust and small that the statement should continue to be made, both on public platforms and in the Press, that the Secretary of State for War had not considered the Navy in his Army calculations. I pass now to the statement my right hon. friend made at the Colonial Conference that we had a total military force of 600,000 men. Referring to that statement the noble Earl said—
"If they exist, how are we to employ them; if they do not exist the Estimates are too high."
I only refer to that to tell the noble Earl that they do exist. Therefore, if I can show the noble Earl that they exist at this moment, am I not right in assuming that in his opinion the Estimates are not too high?
THE EARL OF ROSEBERY: That is a very large deduction.
THE EARL OF HARDWICKE: But I think it is a fair one. I assure the noble Earl that they do exist, and, therefore, I think the statement of my right hon. friend at the Colonial Conference was fully justified. Then I come to the statement of the noble Earl that if we were at war our colonies would be at war, and that every colony which knew we had 120,000 men to send out for its defence would claim the advantage of that contingent.
THE EARL OF ROSEBERY: Might.
THE EARL OF HARDWICKE: If those words mean anything at all, they seem to me to suggest that we ought not to keep this number of men for fear the colonies might wish to grab them, on an emergency, and might not take proper precautions to defend themselves. [The Earl of ROSEBERY dissented.] I thought I must be wrong, because I remember the statement of the noble Earl that the colonies had come enthusiastically to our support because they believed they were associating themselves with the most powerful Empire the world had ever seen, and that if we deprived them of that feeling, the Empire was threatened. Those were the words he used. Therefore we ought not to let the colonies feel for a moment that the Mother Country was showing any petty economy on questions of this kind. The Defence Committee will have many difficult and important questions to decide, and I trust that they will succeed in convincing the public and Parliament of the real extent and character of our military requirements; and if the Committee succeed in doing that, much will have been done to remove the discussion of Army problems from the arena of party politics, and those in authority at the War Office will be given a greater chance than they have at the present time, when every trivial mistake and every detail of administration is criticised and questioned. I might also point out that at the present time the area of the British Empire is 11,400,000 square miles, that the total population is 450,000,000—that is to say, the area is one-fifth of the surface of the globe, and the population one quarter. In face of these figures, I am sure your Lordships will at once see that the Regular forces we have, both here and in India, of British troops are not extravagant. At any rate I can state this, that the Secretary of State has no hesitation in taking the full responsibility for the strength of the organisation that he has asked Parliament to sanction, and for the expenditure that he has asked the country to meet to maintain it.
LORD BURGHCLERE: My Lords, I must confess that I feel very considerable diffidence in venturing to address your Lordships on this occasion—in the first place because I cannot claim in any way to be an expert on military or naval matters; and in the second place because it seems to me the ground has already been so well traversed by previous speakers, and especially by the exhaustive and luminous speech in which my noble friend Lord Rosebery introduced the Resolution before the House. My noble friend said practically all that I have to say, and it is needless to add that he said it in a manner and with an eloquence to which I cannot hope to attain. There is, as your Lordships are aware, no possibility of a division on this Resolution, and consequently there is no chance for an individual member like myself to put upon record his opinion on this important question. I would therefore ask permission to state in a few words that I am in perfect accord with the views of my noble friend who introduced the Motion, and that if a division could have been challenged I should have followed him into the Lobby with the clearest conscience and the greatest confidence. The noble Earl who has just sat down has delivered a long and technical speech into which I shall not venture to follow him. He seemed to have devoted many sleepless nights to studying the speeches of my noble friend Lord Rosebery—a very excellent practice—but I venture to think, with all submission, that the result of his studies were not so effective as the noble Earl himself seemed to fancy. The noble Earl, in answer to the statement of my noble friend Lord Rosebery that the Army scheme was produced in a hurry, said, speaking for the War Office—
"If you had put off this organisation scheme you would have had no organisation at all."
If that was so, what, I ask, was going on in the Army during the South African War? The worst enemies of the Government have never said that there was no organisation at all; it has been reserved for the Under Secretary to declare solemnly in Parliament that, there being no organisation of any sort at the time of the South African War, it

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was absolutely necessary that they should put their house in order at once. If it be true, as the noble Earl suggested—following the precedent of the German Army after the Franco-German War—that it will take fifteen years to reorganise the British Army——
THE EARL OF HARDWICKE: I never suggested that.
LORD BURGHCLERE: But the noble Earl said that, if it took fifteen years to reorganise the German Army, surely it was necessary that we should begin to put our house in order at once.
THE EARL OF HARDWICKE: I merely wished to point out that we were being criticised for not having completed a scheme which had only been started two years, and I stated distinctly to the House that in a few months that scheme would be practically completed.
LORD BURGHCLERE: I am glad to think that it will not take so long as the reorganisation of the German Army. There was one sentence in the speech of my noble friend Lord Rosebery with which I should like closely to associate myself. I refer to the tribute which he paid to the present Board of Admiralty. If the First Lord will not think me presumptuous in saying so, I think he was somewhat too modest in dissociating himself from the tribute which the noble Earl paid the Admiralty. I am certain that my noble friend did not mean to separate the Board of Admiralty from its distinguished chief.
THE EARL OF ROSEBERY: Hear, hear.
LORD BURGHCLERE: I have on many occasions derived much instruction from the speeches of the noble Earl the First Lord of the Admiralty, but I venture to think that in some of the passages in his speech on Tuesday he was not so happy as he has been on other occasions. The noble Earl contrasted the position taken up by my noble friend at the present time with that he took up during the South African War. He said that at that time all the pressure that the noble
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Earl brought to bear on the Government was directed to increasing our military strength, and I suppose the First Lord deduced from that the argument that we ought at the present moment to acquiesce in this vast Army Scheme, which we are now told comprises 600,000 men. The same argument was used in another place by Mr. Brodrick, who said—
"You have forgotten the circumstances under which the Army was reorganised."
I venture to think that such a defence, if it be a defence, is a condemnation in toto of the scheme, because it is an admission that the scheme was brought about ad hoc, to meet a particular occasion. It is perfectly true that we on this side of the House, and many people in the country, asked at the time of the South African War—Why are there not more troops? The Government ought to have foreseen that more troops would have been wanted; and therefore my noble friend, like others, demanded that the Army should be increased, but it was not suggested that that should be a permanent increase. Such a defence as that is an absolute condemnation of the whole scheme, because it is an admission that it was made for a particular occasion which could never occur again. The business of the Army in the future, so far as I understand it, will be to defend the frontiers. If you had only had to defend the frontiers of Natal and Cape Colony you would not have required more than 100,000 men, but you had to do more than that. You had to conquer and annex two Republics of white men fighting for their freedom—an operation that required 300,000 or 400,000 men. But in what portion of the globe are you going to find another two Republics of white men that you might wish to annex? The business of the Army in the future, as I have said, will be to defend the frontiers, and for that purpose nothing like the great military preparations which the Army Corps Scheme involves are required. So far as India is concerned, the noble Earl the First Lord of the Admiralty found considerable fault with the statement of my noble friend with regard to the conveyance of troops to India. He said the noble Earl's statement filled him

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with amazement. But what was the position of my noble friend? I am far from saying that the position might not occur in which reinforcements would be required on a larger scale than has been thought necessary hitherto for the defence of that country. I hope that will be in the dim and distant future. But if your policy in India is to be changed, and if it is to be a policy of aggressive defence, I think you will want 200,000, 300,000, and perhaps 400,000 men; and that, I venture to think, will be a policy in which our military and naval authorities will not concur, which the Party on this side of the House certainly will not support, and which the majority in the country will condemn. But reinforcements, of course, will have to be sent to India. The noble Earl found fault with the statement of Lord Rosebery that it would take thirty-six days to get the troops to India. I think my noble friend was understating the case. Does the noble Earl mean to say that the Government has 126,000 men ready at this moment to start for India?
THE EARL OF HARDWICKE: We have never said so.
LORD BURGHCLERE: Then why find fault with my noble friend Lord Rosebery when he says that it would take thirty-six days to get the troops to India?
THE EARL OF ROSEBERY: After they had collected the transport.
THE EARL OF SELBORNE: What I found fault with was the statement of the noble Earl that after the thirty-six days which it would take to get to India the troops would be too late.
THE EARL OF ROSEBERY: I never said anything of the kind. I said that when you had collected the transport—I might have added "and called out the Reserves"—and taken thirty-six days to get to India, you would arrive somewhat late at the scene of action.
LORD BURGHCLERE: Does the First Lord mean to say that when they have collected the 120,000 men, called out
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the Reserves, and got together the necessary impedimenta, the Government can put their finger on the transports necessary to take that number of men to India in thirty-six days?
THE EARL OF SELBORNE: My noble friend has entirely mistaken the point of my criticism. The noble Earl, as I understood him, said that to take thirty-six days to convey reinforcements to the North-West Frontier of India, no matter how many or how few, would mean that they would arrive rather late. What I say is that if we were involved in such an unfortunate war we might require them many months after.
LORD BURGHCLERE: I fail to understand the noble Earl. I should imagine that 30,000 troops always on the spot, ready to strike at once, would be worth much more than 126,000 troops in this country who would have to be conveyed to India in transports, and would not get there for some months. But I will pursue that subject no farther. The noble Earl, criticising again the speech of my noble friend Lord Rosebery, said it was better to have 50,000 Volunteers really organised than double or treble that number unorganised. Here I venture, with all humility, again to differ from the noble Earl. With regard to the Militia he may be right, but I contend that you cannot have too many citizens who have passed through the ranks of the Volunteers. What showed that better than the South African War? The first Imperial Yeomanry you sent out did very well; but who were they? They were trained men from the ranks of the Volunteers; they were men who had had military training; but the second body of Imperial Yeomanry sent out did not meet with quite the same approval from the military authorities. And why? Because they had had no military training, because we had exhausted the supply of those who had had military training in the first batch.
I have risen chiefly to express sympathy with the first portion of my noble friend's Motion, which approves the proposed Committee of Imperial Defence. I am warmly in favour of the creation of this Committee. You are

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giving in both Houses of Parliament by this Resolution a pledge for the first time to the nation that the Government are setting up a body whose principal duty will be to co-ordinate the two great official branches of national defence. It is a matter of the greatest importance which ought to tend to the efficiency of the Army and Navy, and to the economy of our expenditure. What are the objections that are taken to the proposed Committee? It is contended that the constitution of the Committee will lessen the responsibility of the Government of the day. For the life of me I cannot see how it can do that. When the Committee arrives at a conclusion, that conclusion will naturally be referred to the Cabinet as a whole, which will have to consider it and give their assent to it. The Ministers representing the various Departments will have to bring the schemes before the House of Commons, and if the House of Commons withholds its confidence, the Government must inevitably fall. I cannot see how such a Committee can possibly lessen the responsibility of the Government of the day. Objection has been taken to the presence on the Committee of distinguished permanent officials, but I would point out that these permanent officials have seats on the Committees of the Cabinet which are from time to time appointed. They are consulted by the Cabinet Ministers who are present, and the decisions they arrive at are reported to the Cabinet as a whole, just as I suppose the decisions of the Committee of Imperial Defence will be reported. Then something was said about voting. Is it at all likely that a body of this sort would vote? When this Committee comes to a conclusion it may often happen that of the eight members five may support one view and three another, and I can quite conceive that occasions will arise, when the recommendations are submitted to the Cabinet, when the opinions of the three will hold against the opinions of the five.
The only other objection I have heard to the constitution of this Committee is that there is no precedent for it. I have read the statement that it was such an unconstitutional body that it would make the bones of every ancient Prime
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Minister rattle in their graves. I hope I have a proper and fitting respect for precedent. All of us who have had experience, however small, of official life must have pleasant recollections of the soothing influence of that blessed word "precedent"; but there is such a thing as the pedantry of precedent, and it is against the pedantry of precedent that I lift up my voice. We live in times of vast expenditure and of great Imperial responsibility, and surely if we are to hold our own in the rivalry of nations we ought to be up-to-date and move with the times; and if there is one party which ought to do so more than another it is the party whose motto is "Progress and Reform." There is one thing which the country wants, and which, I venture to think, this Committee may give it, namely, a settled scheme of national defence. The man in the street thinks that those two Departments of the War Office and the Admiralty do not always see eye to eye on matters of Imperial and national defence. The man in the street often thinks that those two Departments are practically watertight Departments that have no communication with each other, and which formulate their schemes and plans independently of each other. If a tenth part of that be true—and I venture to think that more than a tenth part of it is true—surely it is that system which is responsible for the incoherencies in the scheme of defence of which we have heard so much in the past, and for the large and extravagant expenditure of which at the present moment we venture to complain.
This question is far above party. It concerns the safety of this country, of our Empire, of our food supply; it concerns the very existence of the citizens of this country. Unless I am very much misinformed there is, and always has been, a difference of opinion between the Admiralty and the War Office as to the question of invasion. The Admiralty reckon for the defence of the country on the supremacy of our ships, and the War Office formulate their plans on the failure of the Navy. Those are two entirely different schemes. For my own part, I am strongly in favour of the Admiralty view. The noble Earl the First Lord of

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the Admiralty stated the other night that if we pressed this too far, to what I think he called the bed rock of logic, we then had no necessity for any Army or Volunteers at all. I do not think my noble friend put that forward quite seriously. Surely he must recognise that there is a difference between having no defensive Army at all and having a great military organisation of 600,000 men, which the Under Secretary told the House the Government possessed. This country is an island; it is not part of a Continent, and consequently has not got Continental responsibilities; it has no vast land frontiers to maintain, and therefore we do not require an Army on the Continental principle. The frontiers of this country are not the chalk cliffs of the South or the sands of the East; the frontiers of this country are the Channel Fleet, the Home Fleet, and our Naval supremacy; and the sooner the disputants on this subject arrive at that conclusion, and all that that conclusion means, the sooner shall we be on the direct path to efficiency of national defence and economy of national expenditure.
THE EARL OF CAMPERDOWN: My Lords, so far as the debate has proceeded I venture to think the Government may congratulate themselves on the fact that all the speakers, with the exception of my noble friend, Lord Ripon, have approved the change which the Government propose to make in the reorganisation of the Committee of Imperial Defence. As to the details of that change, as to how far that Committee may enter into fields of work which so far as they are traversed at all, are traversed at present by other Committees belonging to the Admiralty or the War Office, or to other Departments, I think it is unnecessary for us to enter. Those questions will be solved in the course of time by the actual procedure of the Committee. In the meantime the one thing which strikes me is the amount of additional work which will be thrown upon the Prime Minister. So far from thinking this to be an evil, I believe it will be a good thing, because the Prime Minister, although he is not as we have heard to-night, to be the President, is to be a very important
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member of the Defence Committee, and will be compelled to keep his eye upon the policy and the practice of his Government. I think this will necessarily prevent him from undertaking the management of one of the important Departments of State—a change which will certainly be for the general advantage of Government, of Parliament, and of the country.
It has been the habit to blame the old Defence Committee and to say that they did nothing. Well, my Lords, I never could bring myself to see upon what grounds those allegations were founded, because we never knew what the Committee of Defence did. Their only action of which I am aware, and in which I think they rendered one eminent service, at all events, to the country, was the appointment of Lord Roberts and Lord Kitchener at a very critical moment in the late war to take over the operations in South Africa. If they never did anything else, they rendered a very signal and important service to the country at that time. The mind of the country, stable and steady as it was, was beginning to be most seriously perturbed by a series of misfortunes and reverses, and the appointment of Lord Roberts and Lord Kitchener steadied the people and prevented what might have been, and what certainty would have been in any other country than this, a serious popular outbreak. I think that in justice to the Committee it should be remembered that the only action we know it to have taken was one of very great advantage to the country.
I now enter upon the more serious and more debatable portion of the subject that has been raised—the position of the Army and the Navy. Our attention was directed to the gigantic proportions of the Naval Estimates, and the First Lord of the Admiralty told us that he could not promise that those Estimates had attained their final magnitude, and that we must be prepared for possibly larger expenditure. Those large Estimates, Lord Goschen pointed out, had been voted without any difficulty. Why was that? Because, in the first place, the country feels that naval supremacy is absolutely vital for the existence of the Empire; and, in the second place, because it believes that the system of Admiralty organisation works with as

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little friction as possible. It is only just to pay some slight tribute, as, indeed, the First Lord of the Admiralty did not forget to do the other night, to the signal capacity which naval officers seem to possess, not merely of pressing forward that which from the professional point of view they consider desirable, but of being able to enter into the Parliamentary, and other difficulties of those political officers with whom for the time they are called upon to serve. If this expenditure is already so great, and if it is going possibly to be greater, is it unnatural that not merely the country but Parliament should say that it is therefore all the more necessary to inquire closely into the Estimates of the sister service?
I am not going to enter at all into the discussion of whether the Army Corps is, or is not, the right system. I am not an expert in these matters, and the expediency or not of adopting that system rests on circumstances, and depends upon conditions into which I do not feel myself able to enter with any advantage to your Lordships. I wish to approach the subject from quite a different point of view—from the point of view of the number of men. I wish at once to draw a distinction between home defence and foreign service. Some objection is being taken to a force of 30,000 men being voted for the purpose of stiffening the Volunteers and other troops serving at home. I would submit to the House that there is no reason why any exception should be taken to a demand of that sort. It does not seem to me that it is in that part of the question that there is any necessity and objection. It is only natural that there should be a force of men for this purpose, and, after all, 30,000 does not appear at all an excessive number.
But the question I want to apply myself to is that of the 120,000 men who are to be ready to go abroad. I want to know for what they are wanted. I noticed that the noble Earl the Under-Secretary in his speech to-night did not apply himself to that point at all, beyond intimating that they might be wanted for India in certain events. I would ask the House to consider, in the first place, what 120,000 men ready to go abroad means. This force means that
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we are, for all time to come, apparently, for it is a permanent force, to be a first-class military Power. I would submit to your Lordships that it is very doubtful whether there is any nation which could send out at once 120,000 men. It does not mean merely that you have the transport, or the men, but both, and any nation which has anything approaching to both is, I submit, a first-class military Power. To that position I am not aware that we have ever aspired, and what I should like to know is, what are the purposes for which an expeditionary force of three Army Corps is required, or is likely to be required?
My noble friend Lord Goschen, in his most instructive speech the other night said, "You must trust the Government." I think that is asking us to place a very large measure of trust in the Government. We never have had 120,000 men at one time fit to go abroad. I for one am bound to say that I feel some hesitation in placing a trust to that extent in the War Office; and if any of us feel hesitation in placing a very great measure of trust in the War Office, the War Office itself is chiefly the cause of it. I would ask your Lordships to remember our recent experience of the War Office. The noble Earl who moved this Motion pointed out, and it has been mentioned again to-night, that this scheme was brought forward very suddenly indeed, and within four months of the present Secretary of State for War taking office. As your Lordships will remember, doubts were expressed with regard to it at that time, both in this House and in the other House of Parliament, but those doubts were brushed aside. In the very next year the same Minister was obliged to make a recantation, to admit in Parliament that the scheme had not worked as quickly as he had expected, and he then proceeded to ask for time. I confess I think he would have done better, as Lord Ripon observed to-night, if, in the first instance, being at war, and being in a position of great difficulty, he had said to Parliament, "The Commander-in-Chief has only just come home. The task of reorganising the Army is an enormous one, and I must ask Parliament to give me time." If he had taken

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that course I am sure Parliament would most readily have given the time for which he asked. I must say I should have felt much more confidence in that course than in the course he ultimately adopted.
Passing from that, the difficulty that I, and, I think, nearly all of us, have is this, that we cannot get any further information with regard to this scheme than we already possess. Every speech that is made, every Return that is given, mystifies me more. I take the very last of them, because it is a Return which I have applied myself to and endeavoured to understand, and which leaves me with just as much information as I possessed before it was issued. Some one in the other House asked for information with regard to these six Army Corps, and he was informed that a statement would very shortly be put forward. Well, my Lords, this statement is now published, and presumably most of your Lordships have looked at it. I do not know what information you have derived from it, but I have been unable to elicit any information of any sort or kind. I will read an extract. Take the First Army Corps. This is what appears—
"Cavalry regiments—required, five; available, five."
That is the whole of the information that is given to us with regard to cavalry regiments. We are not told where the regiments are, whether they are here or in South Africa; we are not told whether they have any horses and whether they are at full strength; no information is given of any description whatever. If you look through the Return you will see that the whole of it is exactly of that kind. I think it was the city of Washington that was once described as a "city of magnificent distances." This is simply a "Return of magnificent blanks," and the hon. Member who asked for it is a very much abler person than I am, if he has been able to derive any information from it. It has been said that this scheme was adopted deliberately, and that therefore we are bound to go on with it. Was the scheme adopted deliberately? I venture to express some doubt as to that. It is quite true that the scheme was adopted by the House of Commons, and adopted in one session of Parliament. Was
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it at all likely, when a scheme of that kind was put forward, and put forward with the whole strength of the Government, who, of course, possessed a very large majority, that it would not be adopted? I submit to your Lordships that the whole circumstances have since changed. In the first place, there has been a continual fire of criticism, which gives signs of increasing rather than abating; in the next place, the South African War is at an end. When that war was still proceeding the taxpayers of this country would have voted to the Government any sum of money that they required. There was no hesitation then, and there would be no hesitation, on a similar occasion, of doing the same again. But, after all, what we must look to, and what the Government ought to look to, is what are the present probabilities? It has already been pointed out by Lord Burghclere that even supposing war was to break out again in South Africa, it would be quite a different war from that of which we have had such grievous experience. I do not believe there ever will be, but if, unfortunately, there should be, a revolution in that country, it would be dealt with under quite different conditions. Where is there any probability of your requiring an expeditionary force of 120,000 men? If the Government will not give us any information we must make for ourselves such information as we can, and we must take it from the newspapers and other ordinary sources. If there is any truth in the newspapers, and in what we hear in other ways, it would appear that the feeling in France towards this country is very much better than it has been for a long time past, and although German feeling towards this country has not been very cordial, and although we may think that some German Statesmen have given utterance to sentiments they had better have kept to themselves, yet that is removed by many miles from anything approaching to the probability of a war between Germany and this country. Then we pass on to the Far East. I suppose it must be over in that direction that there is danger, if any. Well, my Lords, if that be so, why cannot we be told? These things are quite well known, and, depend upon it,

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official reticence will not avail this country much. If the papers are all wrong and there really is some danger of which we know nothing, then that makes one draw the disagreeable inference that we may possibly be on the brink of some war of which we have no intimation and no idea whatever.
We have been found fault with for asking questions, and those who ask questions are said, having had a hot fit, now to be having a cold one. I submit that that description is very far from being correct. When we are told that we are for the first time to have 120,000 men ready to go abroad, is it a strange thing that the taxpayers and Members of Parliament should ask for what purposes those 120,000 men are wanted? Let me further observe that in democratic countries it is impossible to avoid having questions asked, and, more than that, the taxpayers and others will think that such questions ought to be answered. The impression that remains on my mind is this. I entertain some doubt as to whether this scheme has been thoroughly thought out and considered. I remember the time at which, and the manner in which, it was brought out, and the fact that the Commander-in-Chief at that time had only recently returned from the war. The question which your Lordships should ask yourselves is—Do you feel satisfied in your minds with the present condition and future prospects of the Army? I am very glad to have heard of the change which has been made in the Committee of Imperial Defence, and I venture to hope that the very first thing to which the members of that Committee will apply their minds will be this Army Scheme, and I hope they will not be restrained from altering it, if they think a change is necessary, by any desire for consistency in their declarations and policy.
LORD BRASSEY: My Lords, the notice which my noble friend has placed on the Paper, though dealing specially with the Council of Defence, admits, and even invites, discussion on the whole subject. With regard to the Council I desire strongly to urge that upon a fitting opportunity representation should be given to the federated Governments of the self-governing colonies. It would
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be a step towards Imperial unity in relation to defence. Until a plan of representation has been devised, it is unreasonable to look to the colonies for subsidies sufficient in amount to give substantial aid. They can greatly strengthen the Empire by maintaining such local forces as their mounted infantry. They did splendid service in South Africa, and Reserves for the Navy have been promised in New Zealand and Australia. While the present loyal feeling remains, we may look on all Colonial forces as in the true sense Imperial.
Turning to the Navy, it is satisfactory to know that the Council finds us in a commanding position. We are above a two-Power standard, and the experience of history shows the extreme difficulty of co-operation between allied Navies. We have not attained to the position we hold without proportionate sacrifices. Adding the expenditure of India and the colonies, and the £3,000,000 to be provided under the Naval Works Act, to the Navy Estimates, the total for 1903–4 is no less than £38,000,000. Let us compare our expenditure with that of other Powers. The return laid before Parliament last session on the Motion of Sir John Colomb gives the aggregate naval expenditure on seagoing forces for the Russian Empire at £9,944,750; for Germany, £9,624,956; and for France, £12,356,602. In round figures the aggregate amount for the three Powers is £33,000,000, as against £38,000,000 for the British Navy. We have to ask ourselves, Is the burden heavier than we can bear? What is the opinion of leading authorities on this grave question? Sir Michael Hicks-Beach has been frequently quoted in this debate, but we have had other testimony, and of the greatest weight. In opening the last Colonial Conference Mr. Chamberlain insisted in impressive language on our increasing burdens.
"The weary Titan" (he says), "staggers under the too vast orb of his fate."
There is another authority to which we are bound to defer; it is that of public opinion. I live in the Rye Division, and know the arguments which were used at the recent by-election. Much was said about taxation. Criticism has been directed chiefly to the growth of military expenditure; yet even for the

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Navy ever increasing charges may become intolerable, and lead to a dangerous reaction. Let us endeavour to prevent it by maintaining our naval efficiency, as far as it is possible, without adding to the public charge.
Naval expenditure may be classified milder three heads — construction, manning, and works. For 1903–4 our shipbuilding Votes reach a total of no less than £10,137,000. The amount required for the British Navy depends on the expenditure elsewhere, and great as has been the increase in our shipbuilding Votes, our Estimates will not exceed the total appropriations to shipbuilding in France, Germany and Russia. It has been necessary to add to our Votes for shipbuilding. We would gladly follow a lead in the direction of retrenchment. I now turn to the votes for personnel.The aggregate amount for 1903–1904 is little less than £9,000,000. Adding the Vote for pensions, we have a total charge of nearly £11,000,000 for the personnel of the British Navy, as against approximately £5,000,000 for France. Russia, and Germany. The increase of charge has been far in excess of that in other countries. In the last ten years we have added 50,000 to the numbers and £4,000,000 in round figures to the annual cost, as against £1,000,000 for France, Russia, and Germany. If we continue to advance in the next ten years at the rate of increase shown in the manning Votes for 1903–1904, we shall have added £7,000,000 to the manning Votes. The policy we have been following for the manning of the Navy is becoming impossible. We have the disadvantage, or perhaps the advantage, of a voluntary system, as against conscription.
But there is another reason for our heavy expenditure. Great Britain stands alone among the maritime Powers in providing for manning the Navy mainly with a permanent force, and the financial results of our policy are clearly shown in the Estimates. The expenditure on the Reserves is in striking contrast to that on the permanent men. The Reserve Vote for 1903–1904 is £297,000. Ten years ago the Vote taken was £286,000. In ten years we have added £4,000,000 for the permanent forces, and for the Reserves £9,000. I contend, my Lords,
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that the Reserves have been starved. The training has been imperfect, the numbers insufficient. France has a Reserve of over 100,000 on the rolls, and at least 50,000 effectives; Germany has 74,000 on the rolls; the British Reserves number 34,000 all told. The growth in the numbers and cost of the permanent force has given grave anxiety to successive First Lords. In 1890 Lord George Hamilton dealt with the question of manning in his memorandum of the Estimates.
"It would" (he said), "be unreasonable to expect that the whole of the extra force required for the next four years should be obtained simply by additions to the permanent establishment of the Navy. To the Naval Reserves we must therefore look to largely supply these prospective deficiencies."
The present First Lord suggests an obvious means by which the continual growth in the numbers of active service men may be checked. He deprecates the constant demands that are made in various quarters that additional ships should be placed in commission, with the necessary result that more active service men must be required. The remarks of Lord Selborne bring up for very serious consideration our policy in relation to foreign squadrons. In the distribution of ships in commission the essential principal is concentration at decisive points. We must keep our Mediterranean, Channel, Home, Reserve and Cruiser squadrons at full strength. We must be strong in China. On other stations, however, reductions should be possible. In the Atlantic, the Pacific, exclusive of China, and the East India Station, for many years past no squadrons have been seen under the flags of the leading maritime Powers of Europe. Single vessels have been few. Your Lordships will learn with surprise that on the stations to which I have referred we have a British force manned by more than 12,000 men. We have in commission four first-class, ten second-class, and fifteen third-class cruisers, twelve gunboats, and six sloops. Of these vessels, nearly fifty in numbers the cruisers of the first and second class type alone can be considered as effective for the protection of commerce. The smaller vessels are insufficient in point of armament and speed. They would give no protection from the

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attacks of larger vessels. The cruisers of foreign powers, in seas so distant from any naval base, must necessarily be of large size. The complements of our small and ineffective vessels on the stations to which I have referred aggregate no less than 5,000. By gradually paying off the small vessels, their complements would become available for seven battleships, without adding to the permanent force. The training of the Navy would be improved by the change. Training in squadrons, with ample means for exercises on a large scale, does more for efficiency than the routine of a foreign squadron.
While employing our permanent force to better advantage—that is to say in manning only such ships as are really effective—prompt action should be taken in the enrolment and training of the Reserves. Sir Edward Grey's Committee, have shown from how many sources Reserves can be raised to any number which may be necessary. There should be no distrust of Reserves on the point of efficiency for the duties they would have to undertake. I can contribute something on this subject from personal observation. When the fleet was assembled last year at Spithead for the Coronation Review, I took the opportunity of paying a visit to the American flagship. In reply to some remarks on the fine appearance of the crew, the Captain said:
"You will probably be surprised to learn that out of my ship's company of 700 men no less than 135 were drawn from the inland states, chiefly from Chicago and the vicinity. These men have fully compensated for their inexperience at sea by the pains they take to acquire a knowledge of their duties."
In addition to the novices the ship carried ninety-five apprentices.
I will refer very briefly to the expenditure on Naval Works. It vastly exceeds that of the chief Powers of Europe. In the period from 1895 to 1901 the amounts authorised under the Naval Works Bills increased from £8,805,000 to £27,502,000. In addition, large sums were voted under Military Works Bills for the defence of Naval Stations, and new proposals are in the air. The projected Naval Station on the Forth is a wise step, and it brings into strong relief expenditure on some other works
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in progress. There is one obvious remark. If some portion of the outlay were charged on Estimates, it would ensure closer scrutiny.
The circumstances of the time call for increasing care in husbanding our resources. Further additions to Estimates may, as I have said, lead to a dangerous reaction. In dealing with the Navy let us remember that we need an Army; and in this connection I think it was a wise caution that was addressed to us the other evening by Lord Goschen. I have endeavoured to show to your Lordships that without cutting down in manning, in shipbuilding, or in any essential service, it is possible to maintain and even to strengthen the Navy without further additions to Estimates. In conclusion, I desire to make the fullest acknowledgment of the work done by the present Admiralty. They have made a beginning in the redistribution of our Squadrons. I would venture to urge that the changes they have begun should be carried further. They have taken a first step in the reinforcement of the Reserve by the appointment of Sir Edward Grey's Committee, and I must acknowledge that they were not responsible for the Naval works to which I referred as of doubtful necessity. For forty years I have watched the naval expenditure of the country, and I am bound to admit that the present administration of the service has never been exceeded in efficiency by any previous Board.
EARL SPENCER: My Lords, I confess I think it is rather hard to have to address the House on an important subject of this kind at an hour when the Benches are certainly not full; and I may here sympathise with the noble Duke who, I am afraid, will find the House even emptier when he gets up to reply. I shall not, however, go into all the topics that have been brought forward to-night. No one has a greater right to speak on the Navy than my noble friend who has just sat down, but I almost wish that his speech had been delivered when the subject of the Estimates had been brought forward rather than on this occasion, when the debate turns mainly on this question of our Council of Defence, and although, no doubt, the end of the

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Resolution refers to the necessity of co-ordinating the forces and adjusting the national armaments to the naval, military, and financial conditions of the Empire, I shall not go into that. My noble friend Lord Rosebery made a clear and able statement in support of his Motion, with almost the whole of which I most cordially agree. I do not so joyfully accept the beginning of his Motion, in which he asks the House to approve of this Council for National Defence; and in what I am going to say I regret that I do not entirely agree with him and with my noble friend Lord Burghclere, but I have very little difficulty about the position to night; for certainly, even if I had a large majority at my back, I should not feel inclined to divide the House on the subject, and for this reason—that we know that this project is one which, as the Prime Minister has said, he considers experimental and tentative. But I agree with my noble friend entirely in thinking that it is absolutely essential that we should endeavour to co-ordinate the two services. With regard to that some instructive information was given to the House, for it was shown that the germ of the Committee of Defence was sown by my noble friend in the Government to which I had the honour to belong. The First Lord of the Admiralty said that, even if that germ was sown then, it had been crushed out or trampled down; but by whom was that done? It certainly was not by the Government of my noble friend, Lord Rosebery, because this Committee had not been formed very long before, unfortunately for the country, though perhaps to the relief of some Members of that Government, it ceased to exist.
THE EARL OF SELBORNE: I never said it had been trampled down. I said it had been concealed. We never heard of it.
THE EARL OF ROSEBERY: It had not been advertised.
EARL SPENCER: It does not follow that because it was not advertised it did not do useful work. In that I agree with the remark of the noble Viscount opposite that in these days people are apt not to approve of things which are
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done in silence and in quietude. I entirely agree with the noble Viscount and with the First Lord of the Admiralty as to the work already done by different Committees. The first Committee with which I was acquainted, and the one which did more work than any other when I was at the Admiralty, was the combined Naval and Military Committee at the Colonial Office. That Committee did admirable work. Paper after paper drawn up by it came before me as First Lord of the Admiralty, and they were papers of the highest importance. Then there was the Committee which was, I believe, appointed by the Government of Lord Salisbury in 1890. That also did admirable work, and it had upon it the naval and military experts. I cannot help thinking that too often in this country we condemn a particular office, or a particular system, not really because the system itself is wrong, but because it has not been properly appreciated and handled by those who are in office. The success of a mechanism depends on the force which works it. In this case, however, we have been told by the First Lord of the Treasury that the Committee over which the noble Duke the Lord President of the Council presided did very excellent work. But now we come to the new proposal. I confess I have very considerable doubts whether the new proposal is a sound proposal, or one that is likely to sustain and improve the responsibility of the Cabinet and of the political heads of great Departments. I admit that there is high authority for the proposal, because something extremely like it was recommended by the Commission over which the noble Duke opposite presided. The report of that Commission says—
"There might be some advantage in the formation of a naval and military council which probably would be presided over by the Prime Minister and would consist of the heads of the two services and their professional advisers."
And it ends by saying—
"It might be summoned from time to time to consider and authoritatively decide unsettled questions between the two Departments on any matters of joint naval and military policy which in the opinions of the two services required discussion and decision. It would be essential to the usefulness of such a council and to the interests of the country that its proceedings and decisions should be

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duly recorded, instances having occurred in which Cabinet decisions have been differently understood by the two Departments and become practically a dead letter."
That looks extremely like the germ of the present proposal; but the Report does not say how these different bodies are to be grouped and in what position they ought to be relative to each other, and in other passages the Royal Commission strongly supports the sole responsibility, for example, of the First Lord of the Admiralty. I confess myself that I see a very grave difficulty. However much I may admire the ability of the different officers of the Navy and the Army who are placed on this Committee, I feel extremely doubtful as to how they can carry out their duties in relation to the responsibility of the Cabinet. I am afraid that the constitution of this Committee may help to weaken that responsibility. I quote the deliberate opinion of important Members who have discussed this subject, to show how they view the matter. I find that some of these Members desire the Committee to deal with all kinds of subjects which seem to me to be of such importance that nobody except the Cabinet itself ought to deal with them. I see a statement, for instance, that this Committee would have prevented the possibility of Russian warships being allowed to pass through the Dardanelles unchallenged. The same speaker said that the incidents in regard to the search of a German mail ship during the South African War would never have happened if this Committee had been sitting. That is one view. There is another view, that the Secretary of State now has a great deal too much to do and that he will be relieved of half his responsibility if this Committee is appointed. I am not saying that His Majesty's Government hold that opinion, but that is the opinion outside; and I think such a state of things would have a very bad and prejudicial effect. I read the reference in the Report of the Royal Commission over which the noble Duke presided to the question of records. There may be considerable difficulty about that also. The moment it is known that these records are kept, those in another place who do not perceive the necessity of maintaining the responsibility of the Cabinet will endeavour to press on every possible occasion for the production of these
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records in order to test by them whether the Government have taken the proper course or not. I think a very great difficulty may arise.
There is another point. The First Lord of the Admiralty goes to this Committee, and he has with him the First Sea Lord and the Director of Naval Intelligence. It is possible, as the noble Viscount said the other day, that the First Lord may have had an amicable difference with the First Sea Lord as to the number of battleships necessary, or on some other subject. The First Lord of the Admiralty has absolute power to settle that himself. He may have settled it. But is that question to be raised again before this Committee? They are all to be on an equality on the Committee, so far as I can make out. The First Sea Lord has then a perfect right to raise this question. What position will the head of the Department be in then? He will be in a helpless position. The other Members of the Cabinet may decide against the First Lord who is responsible to the nation and to Parliament for his policy. I feel sure that if that took place the First Lord of the Admiralty would have to resign his position. Then there is the question of voting. I do not know what will happen. Will the First Lord of the Admiralty be followed by his two officers, and the Secretary of State for War be followed by his? It might be a very serious matter. I do not think it is right to put these officers, distinguished men as they are, in the position of having to vote when they know their vote cannot be equal to the votes of Cabinet Ministers, who eventually must be responsible. I feel these are difficulties of no small kind. No Minister directly responsible for the direction of the policy of the country would ever attempt to bring a matter before the Cabinet unless he had fully discussed it with the experts who are now to be put on an equality with him. If these distinguished officers are solely on the Council or Committee as assessors, well and good. I quite admit it is absolutely necessary that the Prime Minister should take a deep interest in these matters, and regulate any policy as between the Navy and the Army; but I cannot conceive any Prime Minister being able so to act without obtaining the best possible advice from all the

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exports now to be placed on this Committee. I do not think the Government will find this Committee very workable or a very useful change in the administration of the country unless they modify the proposals they have placed before Parliament.
THE LORD PRESIDENT OF THE COUNCIL (The Duke of DEVONSHIRE): My Lords, I entirely concur with the noble Earl who has just spoken as to the extremely depressing circumstances in which we are both obliged to address the House. I regret still more the absence, which I know is quite unavoidable, of the noble Earl who introduced this Motion; because it would have been far more agree able to me to make the observations I have to make on his speech in his presence. I do not know why any noble Lord should have thought it necessary to congratulate the noble Earl upon the tone and temper of the speech he made. I do not think that on any occasion we have had to complain on either of these points of the speeches of the noble Earl The speech he delivered the other day was a speech which, I think, we should have expected from him. It was marked by extreme eloquence though it was of a somewhat discursive character; in fact, I think very few other orators would have had the courage or the imagination to enable them to introduce the topics of the Irish Land Purchase Bill and old age pensions into the discussion of a Resolution upon the subject of this Committee. In some respects his speech appeared to me to be not altogether fair to the position of those to whom he is politically opposed. The speech omitted altogether any reference to some of the most important factors involved. But the point which struck me most in the speech was the contrast, the almost dramatic contrast, which it exhibited between the mental attitude of the speaker at the present time and on several previous occasions. I have a very accurate recollection of the noble Earl standing on the other side of this table and, in tones of the deepest emotion, reproaching His Majesty's Government with their total indifference Co the universal feeling of uneasiness and anxiety prevailing in the country, and for not taking timely measures in a
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matter of life and death to this country. We were greatly impressed by those utterances, and we have endeavoured to secure that the noble Earl should never again be called upon to address similar appeals to us. What was it that caused at that time the anxiety and uneasiness and dread which he found in the mind of the people? We had the Volunteers, the Militia, and the other Auxiliary forces, and all the elements on which he now considers we ought to rely for the defence of the country, but still, in his opinion, we were in a state of danger and unpreparedness. We have provided establishments, and we have endeavoured to organise our naval and military forces in a manner which we hoped would secure that the noble Earl should never again be exposed to similar alarms. But we find that, far from being grateful for having taken his advice, he now tells us that in a state of profound peace we are bleeding our country to death. I think that the speech of the noble Earl shows a most extraordinary and a most dramatic contrast between the attitude assumed by a statesman of his eminence in different sets of circumstances.
The reasons of the noble Earl in bringing forward his Resolution at this particular moment are not quite obvious. I think that the present time is most unsuited for such a speech. He has brought forward a number of questions which have been discussed at great length in both Houses, and still more largely in the Press. Two votes of censure have been moved against the Government in the other House, condemning their proposals, and both Motions were defeated. The Estimates of the Government in respect of their armament proposals have been practically accepted. A vote of censure was also moved in this House, and of that I think it may rather be said that it collapsed than that it was defeated. The Committee of which the noble Earl approved is in existence and is inquiring into the very subject to which he desires attention should be directed. What hen was or is the object of the noble Earl in bringing forward this Resolution at this particular moment? Is it in order to show hat on this as on most other questions a considerable difference of opinion exists between himself and his late

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colleagues? Or is it rather to show that the noble Earl on this vital question of Imperial defence, as the Leader of a new Party, has definite ideas and principles, which it is possible may in some other changed condition of political circumstances recommend him to the confidence of the country? I doubt, if this was the intention of the Motion and of the speech, whether it will meet with much success. I think that the country will be disposed to take at their true value the declaration and criticisms of a statesman who has, for reasons that are not very easy to understand, declined to give his guidance to the country or to Parliament at the moment when that advice and guidance might have been useful to influence the decision of Parliament, and seeks by this kind of criticism to establish a reputation for superior wisdom and judgment to that either of those with whom he has been politically associated, or of those to whom he has always been in opposition.
I need only say on behalf of the Government, with reference to the Resolution, that whatever be the motives which led to its proposal, we accept its terms without reservation. We do not accept them because they are in the form of a vote of confidence in the Government, framed in much the same terms as the Resolution moved by the Prime Minister in the other House, and which might have been moved by a supporter of the Government. We accept the Resolution without reserve, because we consider that its terms describe with sufficient accuracy, although not exhaustively, the subject of inquiry which we think ought to be entrusted to this Committee. The "adjustment of the national armaments to the naval, military and financial conditions of the Empire" are words which in our opinion adequately, though, as I have said, not exhaustively describe the task—the immensely difficult and responsible task—the responsibility and the decision of which rests upon the Government, and in the execution of which we hope to receive assistance and guidance from this Committee. The adjustment, or rather the readjustment, of the national armaments is a subject which has been already during the present year very fully discussed throughout the country. To hear some of our critics it might be supposed that
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very little was left to this Committee to do, that we might almost be expected to admit that all these questions had been solved from the point of view of statesmanship and strategy, and that nothing remained but to endorse what has been submitted by our responsible advisers. That is not the opinion of the Government. The difficulties which we have met with in the organisation, and especially in the provision of supplies for the military establishments—difficulties which existed before the late war, but the gravity of which has been still more forcibly brought home to us by our experiences in the war—have led us to consider that as to some of the higher problems of Imperial defence, of defence at home, the defence of our Colonies, the defence of our commercial interests in every part of the world, they have never been adequately confronted by any Government, either on our own side or by those who have preceded us. I say higher problems of Imperial and home and colonial defence because I do not at all consider that there has been a total want of co-operation between the two Departments in the past. Lord Goschen and the First Lord of the Admiralty spoke in terms the other night, which were not in any degree exaggerated, of the value of the services rendered by the Naval, Military, and Colonial Defence Committees. It would be untrue to say that in times past, at any rate in recent years, there has been a want of useful co-operation on a great variety of questions between the members of the two Departments of the War Office and the Admiralty. But these are mainly minor, though still immensely important, questions. When we came to what I may call the higher problems of national defence, those which can only be solved by the Cabinet itself, such as those relating to the scale of our armaments and the purposes to which those armaments were to be applied, we felt that many of them never had been adequately considered as affecting both Services, and that the two Services had been treated too much as Departments on a separate basis, and not, as they ought to be, a part of a united system of defence.
EARL SPENCER: Why?
THE DUKE OF DEVONSHIRE: I me now to the Committee of Defence.

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It was no doubt constituted for the purpose to which I have referred. The Prime Minister has stated some of the reasons which have prevented our obtaining from that Committee all the advantages we had hoped and expected from it In the first place, it was merely a Committee of the Cabinet. The permanent members of the Services were not members of it, although they were occasionally called in for consultation. The Committee had no permanent existence. It was only called together when special questions had to be considered. The President of the Committee had no authority to convene it and to raise questions for its discussion; and, above all, the Committee preserved no records, and its deliberations had not that connecting and permanent character and, in many respects, that authority which we trust and expect will attach to the proceedings of the Council of Imperial Defence. Many questions have been asked as to the constitution of this Committee. It has been stated by the Under-Secretary to-night that the Prime Minister is not at present the President of the Committee. I, as President of the Council, have the honour of occupying that position, although, of course, it is hardly necessary for me to say that in important deliberations, wherever the Prime Minister is able to be present, his voice will be potent; but questions of less urgent and pressing importance will, doubtless, come up from time to time in which his presence may not be necessary, and we thought it better that a Minister, who is less overburdened with work than the Prime Minister himself should keep a constant and general superintendence over the proceedings of the Committee and the preparation of the material for its deliberations, which naturally devolves I upon the President. The question has been asked whether this Committee is to vote. I cannot conceive circumstances arising under which such a course would be taken. The usual procedure of the Committee will be that, after full discussion of any question, it will draw up a report for the consideration of the Cabinet, and the form which any divergence of opinion will assume, will be separate reports, or the recording of a dissent to the conclusion arrived at by the majority of the members.
The noble Earl opposite concluded his criticisms of this Committee by saying
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that it was unnecessary. He also said that, in his opinion, the Council of Defence might tend to diminish the responsibility of the Cabinet, and he also agreed with the noble Marquess that it might affect or impair the confidential relations between Ministers and their professional advisers. I submit that these are apprehensions of so vague and shadowy a character that it is absolutely impossible to argue from them. These opinions can only be tested by experience. We see no reason why the responsibility of the Cabinet should in any way be diminished by having access to the advice of such a body. We see no reason why the confidential relations between Ministers and their professional advisers should be impaired; but if these apprehensions should be justified, the procedure, as has been stated, is only an experimental one. The Committee has probably not taken even now its final form. It is only by experience it can be ascertained whether any of the inconveniences or dangers indicated will arise. The noble Earl referred to the expenditure and scale of military establishments, and he pitied the successors of the present Government on account of the great legacy of expenditure which he thought we would bequeath to them. Now the Secretary of State for War explained very clearly in the other House where the £10,000,000 that we had added to the military Estimates had gone. The expenditure which we have added is expenditure over the greater portion of which our successors will have complete and absolute control. My right hon. friend showed that £5,000,000 of that expenditure had been incurred by the additions we had made to the regular military establishments. If our successors think these establishments are excessive, there will be nothing easier than by a stroke of the pen to reduce them to what they had been before the additions were made; and therefore full discretion is left to them in this respect. Another £2,500,000 had been added to the Estimates in order to replenish both warlike stores and stores of clothing which the experience of war showed had been kept by former Governments, and by the present Government, at an inadequate amount. That expenditure will not be a permanent charge, but will

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be in relief of any expenditure of that kind which our successors will have to undertake. Therefore, at least three-fourths of the expenditure which so alarms the noble Earl is either expenditure which will not recur, or expenditure over which our successors will have complete control.
The noble Earl went on to speak about the scale of our establishments, and referring to the 120,000 men who might be sent abroad, and also the 600,000 men, he said he did not know whether they existed or not. I am sorry that before the noble Earl made that statement he did not take the trouble to refer to the Army Estimates which have been laid on the table. If he had he would have seen that those Estimates deal with figures still more "spacious" than those he referred to in a vague and airy way. He would have seen that the Estimates of the year deal with a home and colonial establishment of 850,000 men, of whom 538,000 belong to the Auxiliary Forces and 281,000, including 70,000 Reserves, to British and colonial establishments for Regular troops. He would have seen, also, exactly how far these establishments were represented at the present time by effective men. He would have seen that while the establishment of Regular troops is complete up to that provided by the Estimates, the effectives of the Auxiliary Forces are still considerably below the establishment, because some of them—the Militia Reserve, for instance, and a number of the Volunteer corps—were only called into existence during the war, and the effectives have not yet reached their full establishment. It is difficult, indeed, to understand what the position of the noble Earl is in regard to that portion of these "spacious" figures which concern the Auxiliary Forces. He first says that if they exist he does not know where they are to be employed, and at the end of his speech he condemned us for not giving the Auxiliary Forces sufficient encouragement. Of course the primary object of these great auxiliary establishments is, as everyone knows, home defence. Whether those establishments are excessive or not must be a question—first, for the responsible Minister, then for the Government as a whole, and
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finally for Parliament to decide; but it is not easy to understand what is the position of a statesman who first charges us with providing establishments for which there is no employment, and then in the same speech reproaches us for not having appealed to the military instincts and the patriotic spirit of our country. The noble Earl did a great injustice to the Secretary of State for War by the way he represented his attitude on the subject of home defence. The noble Earl quoted from the speech of the Secretary of State the following passage, which he described as a very remarkable one—
"When we talk of home defence, let us not confuse our minds Ivy considering the position and the action of the Navy."
But the noble Earl omitted to quote the words which followed—
"The Navy is obviously our first line of defence, and if all naval matters were matters of certainly we might dispense with the Army for home defence altogether. I quite agree that invasion may be an off-chance, but you cannot run an Empire of this size on off-chances. We are bound, with the Army and Navy acting together, to provide a proper system of home defence."
A more unfair representation of the attitude of the Secretary of State for War towards the Navy in regard to the question of home defence could not be conceived. The real point of the critics of our scheme is that we provide in this year's Estimates for an excessive establishment of Regular troops to be maintained at home. I would point out that, whatever opinion we may hold as to the strategical advantages we enjoy from our insular position and our naval superiority, there are certain things which the Navy cannot do. The Navy may, and I hope can, secure to us immunity against invasion of our shores on any large scale. It may relieve our island colonies such as those of Australia and New Zealand and—since the South African war—our South African colonies from any apprehension of attack by foreign Powers. But the Navy cannot undertake, and does not undertake, to protect our Indian dominions from internal disturbances, or to protect India, Canada, and our West African possessions, all of which have long land frontiers, from the possibility of attack by foreign Powers. The Navy cannot

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secure, and does not profess to be able to secure, immunity from attack to our naval bases in all parts of the world, upon which the efficiency of the Navy itself depends; and, further, whatever protection the Navy may be able to accord to these islands and to our colonies against invasion, we may at some time be engaged in a war with a Tower which is as invulnerable to our Fleet as we hope we are invulnerable to its Army; and such a war could only be brought by us to a successful conclusion by being able to strike at the critical moment a blow of a decisive character. For these reasons it has always been held, and is held now by all authorities, military and naval, that no amount of naval strength and no amount of security which may be derived from our Auxiliary Forces at home can relieve us from maintaining considerable military establishments for immediate service abroad in emergencies.
The question, then, is. Are the establishments for which we provide excessive or not? I would ask the House to remember that the scale of these establishments is based on two factors, neither of which has been referred to in this debate. The first factor is the strength of the standing Army which we are compelled to maintain in India and the colonies for the defence of our naval bases. That is a factor which is permanent, and which is unalterable—at least to any great extent The landing Army which we are thus bound to maintain permanently for the protection of our Empire, and which is now larger than at ordinary times in consequence of the necessity of a larger garrison in South Africa, amounts at present to 138,000 men. Again, a large part of that Army has to be maintained in tropical climates, where it is impossible that the service of our soldiers can be a very long one; that is a fact which cannot be eliminated from the consideration of the question. The second factor is that the whole foundation of our military system—the method by which our troops are raised, by which they are organised—the whole basis of our military system is the scheme which was established by Mr. Cardwell, the principal and main object of which scheme was the provision of adequate
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drafts to keep that standing Army abroad, of which I have spoken, permanently up to its full strength and in a condition of full efficiency. I know that Mr. Card well's scheme had other objects, objects which in Egypt and the Soudan, and, I will also say, in the late war, it has not unsuccessfully accomplished; but the main object with which the scheme wad devised and recommended to Parliament was to provide in the most efficient manner for the maintenance of a great compulsory and obligatory standing Army abroad. Of course, if we consider that the scheme established by Mr. Cardwell is no longer suited to the altered conditions of our Empire, it is capable of modification. But I think we will pause a very long time before, on the advice of utterly and entirely irresponsible advisers, we discard a scheme which undoubtedly has up to the present stood us in good stead, and adopt another, until we are satisfied that it is recommended to us by those upon whose military judgment and knowledge we can rely. Our scheme of Army Corps has nothing to do with the real question raised by this Motion. That scheme, as has been explained over and over again, was intended to provide, and I think it does provide, a better system of organisation for the troops which we maintain at home; it has nothing whatever to do with the number and the scale of the establishment of those troops, which are based, as I have pointed out, on the requirements of Mr. Card well's scheme. Certain advantages are claimed, and I think rightly claimed, for the Army Corps organisation, but that organisation does not involve cither an increase or a diminution of the numbers of the establishment, which are based on altogether different factors, If I had time I would lay before your Lordships a few figures showing what is the actual establishment of troops in this country and how far they are absolutely required or in excess of the requirements contemplated by Mr. Carnwell's scheme but at this hour, and in the present state of the House, I will not venture to trouble your Lordships with any satistics of this kind. I come to the question which has been asked over and over again in the course of this discussion. How can we need in any

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possible circumstance an Army of 120,000 men to send abroad? I am bound to say that I do not understand the frame of mind of those who, after our experiences of the last three years, can ask such a question. What would have been thought two years ago of the judgment and capacity of the statesman who had said in the preceding year that he could not conceive the circumstances in which we should ever want three Army Corps of 120,000 men to send out of the country, when at a very short period afterwards we had to send to South Africa a force nearer to six than to three Army Corps. We are asked to say where we contemplate using these troops. If I could be told what our next war would be I might be able to say where we contemplate using these three Army Corps. Will any noble Lord or anyone venture to say that in an Empire of our extent, covering so large an area of the globe and with interests so varied and enormous, circumstances may not arise which may make it in the highest degree desirable and necessary to the protection of our vital interests to have the means of sending for service out of the country a force of the moderate number of 120,000 men?
One noble Lord, I think it was Lord Camperdown, said to-night that we were permanently placing ourselves in the rank of a great military nation. I wonder what France or Germany would say if they were told that their capacity as a great military nation was limited to the sending of three Army Corps of 120,000 men out of the country. It seems to me absolutely conclusive that the power to provide such a force in an emergency is essential to the best and the highest interests of the nation. It is conceivable that for the purposes of home defence we may be able to rely more than we have hitherto done upon a better organised body of Auxiliary forces. It is also conceivable that under some other military system we may be able to provide a more effective Army than has been provided under Mr. Cardwell's scheme. But until that time comes we are bound to ask Parliament to grant us the military establishments which are necessary to make our existing Army an efficient Army. We are not dealing now
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with the problems of the future. We have not had time since the war to elaborate a totally new Army system which would replace that which we are used to. When the time comes it is possible we may discover a system which may be worked with fewer men than are required at present. What we have to do is to provide for the wants of the present under our existing system; and until we have found some better system we must not grudge the establishments which in our judgment are necessary to secure the safety, and not only the safety, but also the honour and the interests, of the Empire.
On Question, Motion agreed to.
House adjourned at twenty-five minutes before Nine o'clock, to Monday next, a quarter before Eleven o'clock.