Sitting of 2 April 1912

Preamble
The House met at a Quarter before Three of the clock, Mr. SPEAKES in the Chair.

PRIVATE BUSINESS.
Royal Scottish Museum (Extension) Bill (Standing Orders complied with).—Mr. SPEAKER laid upon the Table Report from one of the Examiners of Petitions for Private Bills, pursuant to the Order of the House of the 29th day of March, That, in the case of the following Bill, the Standing Orders which are applicable thereto have been complied with, namely:—
Royal Scottish Museum (Extension) Bill.
Wirral Railway (Extension of Time) Bill [Lords] (by Order).
Second Reading deferred till Tomorrow.
Pier and Harbour Provisional Order (No. 1) Bill.
"To confirm a Provisional Order made by the Board of Trade under the General Pier and Harbour Act, 1861, relating to Tarbert (Loch Fyne)." Presented by Mr. JOHN ROBERTSON; supported by Mr. Sydney Buxton; read the first time; to be referred to the Examiners of Petitions for Private Bills, and to be printed. [Bill 125.]
Belfast Water Bill.
Reported, with Amendments; Report to lie upon the Table, and to be printed.

COLONIAL STOCK ACT, 1900.
Copy ordered, "of Treasury List of Colonial Stocks in respect of which the provisions of the Act are, for the time being, complied with."—[Mr. Masterman.]

£2½ per Cent. Consols.

£2¾ per Cent. Annuities (1905).

£2½ per Cent. Annuities.

Local Loans £ 3 per Cent. Stock.

£2¾ per Cent. Guaranteed Land Stock (1891).

Guaranteed £2¾ per Cent. Stock (1903).

Guaranteed £3 per Cent. Stock (1909.

Other Securities.

Total (excluding Annuities)."

Annuities for Terms of Years.

Exchequer Bonds and Treasury Bills.

NATIONAL DEBT.
Return presented relative thereto [ordered 1st April; Mr. Masterman]; to lie upon the Table, and to be printed. [No. 84.]
ARMY (ORDNANCE FACTORIES) (ESTIMATE, 1912–13).
Estimate presented of the Sum required for the year ending 31st March, 1913, to defray the Expense of the Ordnance Factories [by Command]; referred to the Committee of Supply, and to be printed. [No. 85.]
RAILWAY ACCIDENTS.
Copy presented of Returns of Accidents and Casualties as reported to the Board of Trade by the several Railway Companies in the United Kingdom during the year ending 31st December, 1911 [by Command]; to lie upon the Table.

FINANCIAL STATEMENT (1912–13).
Copy ordered, "of Statement of Revenue and Expenditure as laid before the House by the Chancellor of the Exchequer when opening the Budget."—[Mr. Masterman.]
Copy presented accordingly; to lie upon the Table, and to be printed. [No. 86.]

GOVERNMENT DEPARTMENT SECURITIES.
Return ordered, "of the amounts of British Government Securities held by the several Government Departments and other Public Offices on the 31st day of March, 1912, specifying whether held in England or Ireland (in continuation of Parliamentary Paper, No. 165, of Session 1911):—
ORAL ANSWERS TO QUESTIONS.

  Royal Flying Corps.
  Mr. FELLasked the Under-Secretary of State for War if his attention has been directed to the recent order of the French War Office that the use of monoplanes in the aviation schools is to be discontinued until certain defects in their construction have been remedied; if a similar order has been issued by the War Office; and if the matter is being especially studied, having regard to this warning?
  The UNDER-SECRETARY of STATE for WAR (Colonel Seely): Yes. The attention of the War Office has been called to this order. No special order has been issued by the War Office.
  Mr. FELLasked what is the present condition of the Army dirigible airships; are they provided with crews for their navigation and are they navigated from time to time; and, if so, why do they not visit London so that the public may have the same opportunity of seeing them that the public in Paris and Berlin have from time to time?
  Colonel SEELY: In answer to the first part of the question there are two airships at present available for service. They are provided with crews which can navigate them and do so from time to time. I do not see how the suggestion in the last part of the hon. Gentleman's question can be followed as they are fully engaged in training officers.
  Mr. FELL: Are they really making occasional flights as those in France and Germany do, or is it the fact that they are only kept within the sheds at Aldershot and do not make any flights?
  Colonel SEELY: They are capable of making extensive flights, but they are used chiefly for training officers. I do not think that bringing them to London, as suggested by the hon. Gentleman, would be the best way of achieving that object.
  Mr. LEE: What has become of the Clément-Bayard airship which was taken over by the Government? Has any attempt been made to make use of it since it was purchased?
  Colonel SEELY: If the hon. Gentleman will put down a question with regard to the Clément-Bayard, I will give him a full account of it.
  Mr. FELLasked the Under-Secretary of State for War how much is to be spent this year on the construction or purchase of dirigible airships for use with the Army; how much on the training of crews to navigate them; and if his attention is being directed to the increasing numbers of these airships constructed on the Continent and to the use that is being made of them by the Italian Army in the operations in Tripoli?
  Colonel SEELY: Perhaps the hon. Member will put down this question again, as I have not got the figures with me at present.

  Royal Hibernian Military School (Colour-Sergeant Moore).
  Major WHITEasked the Under Secretary of State for War whether he has yet made further inquiries into the case of Colour-Sergeant Moore, late company instructor at the Royal Hibernian Military School; and whether, in view of the fact that this man was discharged from his post for no offence and that through inability to obtain employment he is now in poverty, he will give an undertaking to provide him with employment at the Duke of York's School, as a War Office messenger, or in some other Government service?
  Colonel SEELY: The answer to the first part of the question is in the affirmative. Colour-Sergeant Moore has obtained a situation in Canada. I have not yet ascertained what the situation is.

  Territorial Force.
  Mr. HUNTasked the Under-Secretary of State for War whether, in view of the fact that General French stated in 1910 the Yeomanry squadrons were very much hampered during their annual training by recruits who were without the elementary knowledge necessary to fit them for the ranks, he could say whether all these recruits have done the necessary preliminary drills, as laid down in the Regulations for the training of the Territorial Force; and, if not, whether they were deprived of their pay, as laid down in Appendix 6, Sub-appendix I., Training of Yeomanry?
  Colonel SEELY: I would ask the hon. Gentleman to put down this question until after Easter.
  Mr. HUNTasked the Secretary of State for War whether, in view of the fact that forty-one officers and 6,703 non-commissioned officers and men absented them-

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  selves altogether without leave from camp training in 1911, he could say how many of them were punished for this breach of discipline, and of what the punishments consisted; and are these officers and men still borne on the strength of the Territorial Force?
  Colonel SEELY: No statistics are available at the War Office which would give the information required. It would involve a great deal of labour to prepare statistics of the officers and men who were absent from annual training in camp, and if the hon. Gentleman will excuse me I should like to avoid giving this extra trouble to the Department.
  Lord BALCARRES: Is it not the case that as regards each individual unit the figures are available?
  Colonel SEELY: We could get the information both with regard to this and some following questions, but it would involve a great deal of labour. Of course, if the hon. Gentleman insists on it, I will get the information, but in view of the great labour involved I think that it is not necessary.
  Mr. HUNT: Were any of these officers and men punished, and, if not, why not?
  Colonel SEELY: Of course action can be taken with regard to every man who fails to attend under the Territorial Forces Act, and with regard to officers disciplinary action is taken in some cases, and in the case of, I think, eleven officers, they have left the country. If the hon. Member wants the information and insists upon it, it shall be obtained.
  Earl WINTERTON: Cannot these statistics be obtained quite easily by the secretaries to the Territorial Associations, as each county would have all the statistics at hand?
  Colonel SEELY: That is not my information. I inquired at the War Office, and the different officials concerned pointed out the great mass of correspondence which would be involved in obtaining the information.
  Mr. HUNTasked the Under-Secretary of State for War whether he will grant a Return showing the average number of drills performed by the non-commissioned officers and men of the Artillery, the Yeomanry, and the Infantry, respectively, of
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  the Territorial Force, exclusive of camp training, during the year ending 30th September, 1911?
  Colonel SEELY: I will obtain the information asked for in this question.
  Mr. HARRY LAWSONasked whether Colonel Satterthwaite had been appointed as the representative of the Territorial Force upon the Headquarters Staff at £150 a year; what time he would be expected to give to his duties for that rate of salary; whether he would have an office; and what assistance will be afforded him?
  Colonel SEELY: The answer to the first part of the question is in the affirmative. Colonel Satterthwaite has been appointed at a salary of £150 a year. It is not a whole time appointment; he does in point of fact give a considerable amount of time to his duties. He retains the other appointment which the hon. Gentleman knows he now holds; his duties are advisory. He does not do routine work. I think the arrangement made a good one.
  MARQUESS of TULLIBARDINE: I would ask the right hon. Gentleman if he would try to get adjutants who give their whole time to the Territorial Force adequate pay?
  Colonel SEELY: I do not think that arises out of the question.

  Australian Defence Act.
  Mr. HUNTasked what is the annual training laid down under the Australian Defence Act of 1910 for junior cadets, for senior cadets, and for members of the citizen forces?
  Colonel SEELY: I am having a list of all the qualifications for the cadets of Australia circulated with the Votes.
  Mr. HUNTasked what is the total number of days of training which an Australian cadet has to undergo between the ages of twelve and eighteen years of age under the Australian Defence Act, taking a whole day's drill at six hours; and what is the total number of days' training which an Australian soldier of the citizen forces will have to undergo between the ages of eighteen and twenty-five?
  Colonel SEELY: I will circulate this.
  Mr. LEE: Will the right hon. Gentleman have his full answers circulated with the Votes, as they do not seem to have arrived?
  Colonel SEELY: I have said with regard to this question referring to Australia in reply to No. 10 that I would have a full statement circulated. I never intended to give the information now, because it would involve the taking of too much time at Question Time.

  Development Fund (Fishery Grants).
  Sir GODFREY BARINGasked the President of the Board of Agriculture what interim fishery Grants from the Development Fund will now or will shortly be available?
  The PRESIDENT of the BOARD of AGRICULTURE (Mr. Runciman): Interim Grants have been made to the Board from the Development Fund in aid of fishery research work to be carried out by the following bodies, namely:—

  Lancashire and Western Local Fisheries Committee

  £1,640

  Marine Biological Association

  500

  Eastern Local Fisheries Committee

  50

  Liverpool Marine Biological Committee

  100

  University College of Wales, Aberystwyth

  50

  £2,340

  An interim Grant of £4,100 has also been made for work to be carried out partly through the agency of local fisheries committees and partly by the Board themselves. The total amount available is therefore £6,440.

  Fertilisers and Feeding Stuffs Act.
  Mr. C. BATHURSTasked whether, in view of the fact that under Section 1 (2) of the Fertilisers and Feeding Stuffs Act, 1906, every person who sells for use as food for cattle any article which has been artificially prepared is bound to give to the purchaser an invoice stating what are the respective percentages, if any, of oil and albuminoids contained in such article, and that Section 6 (1) (a) of the same Act makes it an offence to fail to give the invoice required thereby, neglect to state in an invoice, as in the case of Bastol, as high a proportion of oil as 1 per cent. and of albuminoids as 1.93 per cent., is deemed by the Board to be no offence under the Act; and, if so, for what reason?
  Mr. RUNCIMAN: In the cases in which an analysis of Bastol has either been submitted to or obtained by the Board, the percentages of oil and albuminoids were
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  considerably less than those stated in the hon. Member's question, and it did not appear that they had any feeding value. No useful purpose would have been served by the institution of proceedings for neglect to include particulars of those percentages in the invoice.
  Mr. C. BATHURST: Is it not a fact, on the right hon. Gentleman's own admission, that his own Department in respect of this Act are contravening its express provisions?
  Mr. RUNCIMAN: No; I certainly could not admit it. In fact, there is no weight in the argument.

  Trade Commissioners (British Dominions).
  Major ARCHER-SHEEasked the Secretary of State for the Colonies whether he will consider the advisability of inviting some of the more important Crown Colonies and Dependencies to appoint visiting Trade Commissioners who could bring before the commercial community of this country the capabilities of their respective Colonies for providing raw materials and other products, in view of the fact that the United Kingdom only received 32.8 per cent. of the exports from these parts of the Empire in the year 1910?
  The SECRETARY of STATE for the COLONIES (Mr. Harcourt): There are already several organisations in this country, both of a public and of a semipublic character, which endeavour to promote the use of the commercial resources of the Crown Colonies and Protectorates and to bring them to the notice of the trade interests in this country. In the circumstances I do not consider that any useful purpose would be served by the adoption of the hon. Member's proposal.
  Major ARCHER-SHEE: Does not the right hon. Gentleman think it worth while to spend a few thousands of pounds to capture a trade worth £68,000,000?
  Mr. HARCOURT: It is not a question of economy. I believe the work is efficiently done by the bodies I have already mentioned.
  Sir GILBERT PARKER: Are we to understand that none of the Crown Colonies have any official representative in any of these organisations which are supposed to assist in developing the commercial relations between the Colonies and this country?
  Mr. HARCOURT: I am not quite sure what definition the hon. Member would give of "official representative." We certainly have representatives on some of these bodies to which I was alluding—the West India Committee, the Asociation of Malay States, various chambers of commerce, like the Liverpool Chamber of Commerce, which has a West African section, and the Imperial Institute.
  Sir G. PARKER: Has any Crown Colony or Dependency a trade commission, as we understand a trade commission?
  Mr. HARCOURT: No; I think not.
  Mr. HARRY LAWSON: Have any of those associations an official status?
  Mr. HARCOURT: I should say none has an official status, except perhaps the Imperial Institute.
  Sir HERBERT ROBERTSasked whether the Royal Commission to inquire into the trade of the Empire would include a representative of India?
  Mr. HARCOURT: The answer is in the negative, for the reason that the Resolution under which the Royal Commission is to be appointed related only to the parts of the Empire represented at the Conference, and did not therefore include India or the Crown Colonies.

  Nyasaland Ordinance.
  Sir CLEMENT KINLOCH - COOKEasked (1) whether the Secretary for the Colonies is aware that, under Sections 23 and 24 of the Nyasaland Ordinance, No. 6, of 1909, as amended by Section 3 of the Nyasaland Ordinance, No. 14, of 1911, any person who causes or attempts to cause any native to leave the Protectorate by any suggestion or advice whatsoever may be convicted of a criminal offence, and on conviction is liable to a fine not exceeding £100 or to imprisonment with or without hard labour for a term not exceeding one year, or to both fine and imprisonment; whether there is any precedent for legislation of this character; and, seeing that the Ordinance interferes with the liberty of the subject and is opposed to the best interests of the natives themselves, whether he will issue instructions to have the terms modified; (2) whether the right hon. Gentleman is aware that Rhodesian farmers pay £1 a month for native labour, whereas the rate current in Nyasaland for similar work is only 5s.; that there is a
  1032
  superfluity of labour in Nyasaland requiring an outlet for its energies, and that in the present conditions that outlet is closed; that the net result of these restrictions is to keep the Nyasaland natives in idleness or to compel them to work for a far lower rate of pay than they can obtain elsewhere; and whether he will consider the advisability of permitting these British subjects to sell their labour as they themselves may think best and not enforce them to hire themselves out to masters who do not pay them the price their labour will fetch amidst the equally healthy surroundings in Rhodesia?
  Mr. HARCOURT: The hon. Member's statement of the law is correct. I know of no precedent, but the legislation has been framed to meet exceptional conditions, and I cannot accent his suggestion that it is opposed to the best interests of the natives. I am aware that the wages paid by farmers to native labourers in Rhodesia are considerably in excess of those paid in Nyasaland for similar work, but I am not prepared to admit that there is a superfluity of labour in Nyasaland. The evidence, indeed, in my possession points to the opposite conclusion, and, in view of the rapid development of the Protectorate and of the fact that this development will be accelerated by the improvements which are about to be made in the means of communication, I see reason to apprehend a shortage of labour in the near future. Moreover, I consider that the Nyasaland Government is amply justified in restricting as far as possible the emigration of natives from the Protectorate, if for no other reason than that such emigration is entirely subversive of domestic and tribal ties, and imposes considerable hardship on the wives and children who are left behind.
  Sir C. KINLOCH-COOKE: Is not the right hon. Gentleman aware that the conditions of native labour in Rhodesia are generally superior to the conditions of native labour in Nyasaland, and that the mortality of native labour in Rhodesia is very much less than in Nyasaland, or is comparatively insignificant?
  Mr. HARCOURT: No; I do not think I should be prepared to admit that statement.

  Ceylon (Medical Department).
  Mr. MacCALLUM SCOTTasked whether the attention of the Secretary for the

  1033
  Colonies has been called to the speech delivered by His Excellency the Governor of Ceylon at the meeting of the Legislative Council on 24th April, 1911, in which he announced that the sanction of the Secretary of State had been obtained for the appointment of two superintending medical officers on the staff of the medical department, and further stated that it was proposed that these new staff appointments should be filled by European medical men; whether this reservation of certain posts for Europeans only is contrary to the settled policy of the Colonial Office in Ceylon; and whether this reservation has the approval of the Secretary of State?
  Mr. HARCOURT: The proposal which was made by the Governor and which my predecessor approved was that these two new posts should usually be recruited from Europe, unless there were local applicants possessing very exceptional merits, qualifications and attainments. This is the policy to which I propose to adhere. The passage in the Governor's speech to which my hon. Friend refers appears to relate especially to the first two appointments to be made after the creation of the new offices, which have now been filled by the transfer of experienced officers from another Colony.
  Mr. MacCALLUM SCOTT: Are we to understand that these posts in future are not to be specifically reserved for Europeans only?
  Mr. HARCOURT: I think the hon. Member ought not to understand more than I definitely stated.
  Mr. MacCALLUM SCOTT: May I ask what the right hon. Gentleman stated?
  Mr. HARCOURT: My hon. Friend will read the answer to-morrow and can form his own opinion as to what I mean by it.
  Mr. MacCALLUM SCOTT: May I ask whether these posts are being reserved for Europeans at present?
  Mr. HARCOURT: I was referring to appointments to these two posts, which have been generally given to Europeans.
  Mr. JAMES HOPE: May I ask the right hon. Gentleman if he does not consider these hostile questions unfortunate, in view of the recent conclusion of their joint labours in another sphere?

  Marlborough Post Office.
  Mr. PETOasked the Postmaster-General whether he is aware that until four or five years ago the post office at Marlborough was open until 9 p.m., and that since the hours of opening have been reduced successively to 8.30 p.m. and now to 8 p.m.; and whether he has been able to make arrangements for the posting of parcels up to a later hour than 8 p.m.?
  The POSTMASTER-GENERAL (Mr. Herbert Samuel): I have carefully considered the matter, and regret that I do not see my way to make special arrangements for the acceptance of parcels after 8 p.m. at the Marlborough Post Office.

  Telephone Service.
  Mr. WILLIAM THORNEasked whether the Postmaster-General is aware that, following the withdrawal of the organised rest reliefs, an unusual amount of sickness has obtained in the Manchester trunk exchange, and that the local authorities have been compelled to requisition assistance from the telegraph branch in order to meet the permanent shortage of staff; whether this arrangement has his sanction; and whether, in view of the fact that the medical committee reported favourably on the system of organised rest reliefs, he will order that the system be restored?
  Mr. HERBERT SAMUEL: I am having inquiry made, and will communicate further with the hon. Member.

  Post Office (Competitive Examinations).
  Mr. WILLIAM THORNEasked the number of appointments or promotions to the secretarial or surveyors' establishments of the Post Office, by nomination and by competitive examination, respectively, during the last three years; and if the Postmaster-General can say whether the Royal Commission appointed to inquire into the question of appointment to and promotion in the Civil Service will receive evidence from representatives of the various grades regarding the restrictions imposed during recent years against progress from the lower to the higher grades of the Post Office?
  Mr. HERBERT SAMUEL: Nine officers have been appointed to the secretary's office (higher grade) by open competition within the last three years, and two by selection from existing classes of the Post

  1035
  Office. For the similar class of the surveying service, the numbers are five by open competition and five by selection from Post Office classes. No outsider was appointed otherwise than by open competition. I am not aware to what restrictions the hon. Member refers, but in any case it will be for the Royal Commission to determine what evidence it will receive.

  Parcels Post (Rates).
  Mr. MEAGHERasked whether there are numerous complaints that the present rates of postage on small parcels operate injuriously on the transmission of small packets of agricultural produce by post; and whether, in order to encourage direct trading between the producer and consumer, the Postmaster-General would grant exemption of charge on wrappers enclosing farm produce of one, two, or three pounds weight, respectively, or, in the alternative, charge a uniform rate of 1d. per pound on wrappers enclosing the said quantities?
  Mr. HERBERT SAMUEL: I beg to refer the hon. Member to the written answer which I gave him on the 21st of March in reply to a similar question.

  Cable Rates (Great Britain and Canada).
  Mr. HARRY LAWSONasked whether the attention of the Postmaster-General has been drawn to the Debate in the Canadian House of Commons upon cable rates; whether he is aware that Mr. Lemieux moved a resolution in favour of the further reduction of cable rates between Great Britain and Canada, and demanded 6d. a word for ordinary traffic and 3d. a word for Press messages, and that the Canadian Postmaster-General stated that he had asked the Postmaster-General to use his authority to promote easy and cheap communication between the Mother-country and Canada; and will he say what he proposes to do to carry out the wish of Canada, as expressed by all parties in the Canadian House, for a cable owned by British subjects not controlled by Foreign capital?
  Mr. HERBERT SAMUEL: I am aware that in the Debate to which the hon. Member refers a general desire was expressed in the Canadian House of Commons for cheap and easy communication between Canada and the United Kingdom, a desire which is fully shared by His
  1036
  Majesty's Government; but no resolution was adopted in favour of any specific rates or recommending any definite lines of policy. The Postmaster-General of Canada stated that he did not think that a State-owned cable would be necessary. When the question of a State-owned cable to Canada was considered by the Imperial Conference last year, I intimated that endeavours were being made to obtain a reduction of 50 per cent. in favour of non-urgent messages in plain language, and also, if possible, a reduction in the rate for Press telegrams. These reductions have since been secured, together with a large reduction in the rates for deferred messages known as cable-letters. I do not wish to regard these reductions as final, but I cannot see my way to demand further reductions at present. Any company coming forward to lay a cable owned by British subjects between Canada and the United Kingdom, either with a reduced tariff or at the rates now in force, would be welcomed by His Majesty's Government; but they are not prepared to grant a subsidy for the formation of such a company.
  Sir GILBERT PARKER: May I ask the right hon. Gentleman whether the Government would not consider it advisable, in view of the opinions they hold, to make direct proposals to the Canadian Government concerning this All-British cable route, inasmuch as the Colonies or Oversea Dominions do not hesitate to make important proposals to this Government when they consider it necessary?
  Mr. HERBERT SAMUEL: His Majesty's Government are not in favour of a State-owned Atlantic cable.
  Major ARCHER-SHEE: Is it not a fact that the Canadians are not at all pleased with the present rates even since the reduction, and that New Zealand strongly favours the laying of a State-owned Atlantic cable?
  Mr. HERBERT SAMUEL: I know that further reductions are much desired on both sides of the Atlantic.
  Mr. HARRY LAWSON: May I ask the Postmaster-General, in reference to the last part of his answer, whether a proposal has been made by any company in this country to lay a cable with British capital, and with cheaper rates?
  Mr. HERBERT SAMUEL: No, Sir; not that I am aware of.

  Small Landholders (Scotland) Act.
  Mr. WILLIAM YOUNGasked the Secretary for Scotland, whether, in view of the fact that the Small Landholders (Scotland) Act will shortly come into operation, he will state the acreage of land in Scotland formerly cultivated but now lying under grass or out of cultivation, more especially in the county of Perth; and, if he is not in possession of the figures, will he take steps to obtain them?
  MARQUESS of TULLIBARDINE: May I ask, as the question is not clear, will the right hon. Gentleman interpret the word "formerly" as from the date when Free Trade was first introduced?
  The SECRETARY for SCOTLAND (Mr. McKinnon Wood): I cannot put new interpretations on the question at the last moment. The latest statistics on the subject to which my hon. Friend refers will be found in the Agricultural Statistics for 1910 (Vol. XLV., Part I, Acreage and Live Stock Returns of Great Britain, Cd. 5585–1911), particularly in Tables 4 and 5 as to individual Counties, and Table 20 as to Scotland as a whole.

  House of Commons (Members' Dinners).
  Mr. STANLEY WILSONasked the right hon. Member for the Epping Division, as Chairman of the. Kitchen Committee, whether there is any intention of altering the price of the dinner for which the charge hitherto has been 1s.?
  Colonel LOCKWOOD: The Kitchen Committee recently appointed will consider the question on the first opportunity. I have traced the constitutional history of the 1s. dinner to its source. In May, 1899, it was introduced to Members, and consisted of choice of three joints (one helping), with vegetables, cheese, butter, and bread. On 17th May, 1905, the 1s. dinner was made to include the choice of two sweets in addition to joint (sometimes three helpings), vegetables, cheese, butter, and bread. Members will see that on the foundation laid in May, 1899, a superstructure has been raised that is a regular "skyscraper." Since 1905 rare and refreshing dinners have dropped into hon. Members mouths, who have been receiving nearly 1s. 6d. for 1s. The dinner is now partaken of by over 50 per cent. of the House. To show how great is the consumption of dinners in this House at the price of 1s., I quote the following figures: Number of meals served in the Members'
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  dining rooms during the week ending 15th March, 1912, was 1,329. Of these 805 of the bills were 1s., approximately 60 per cent.; week ending 23rd March, 1912, the number was 2,090, and of these 1,126 of the bills were 1s., approximately 54 per cent.
  MARQUESS of TULLIBARDINE: May I ask in view of the fact that Members now get £400 per year—
  Earl WINTERTON: Scandalous.
  MARQUESS of TULLIBARDINE: Will the right hon. Gentleman consider whether the dinner ought either to be reduced or the price increased?
  Colonel LOCKWOOD: I will lay the Noble Lord's suggestion before the Kitchen Committee.
  Mr. W. THORNE: Is it not the fad that the price of champagne sold to Members is five shillings per bottle below the price for which they could buy it outside and will the right hon. Gentleman consider the advisability of increasing the price of the champagne?
  Colonel LOCKWOOD: Rather following the example of the Chancellor of the Exchequer, which I always try to follow, we put on a super-tax, and the price of champagne has been considerably raised during the last year and a-half.
  Mr. W. THORNE:Is it not the fact that it is five shillings per bottle less than the price at which they could buy it outside?
  Colonel LOCKWOOD: It depends on where the hon. Member buys it.
  Mr. W. THORNE: May I say I never buy any at all.

  British Empire Imports.
  Major ARCHER-SHEEasked the President of the Board of Trade whether, in view of the fact, as disclosed by him, that the proportion of imports from the United Kingdom, in the year 1910, into parts of the British Empire, other than the self-governing Dominions and India, only amounted to 26.4 per cent. of their total imports, and that the United Kingdom only received 32.8 per cent. of the exports of these Colonies and Dependencies, he will appoint a Special Committee to inquire into the means by which the Mother-country may obtain a larger share of the trade, in view of the heavy burdens incurred in the administration, defence, and diplomatic representation of these parts of the Empire?
  The PARLIAMENTARY SECRETARY to the BOARD of TRADE (Mr. J. M. Robertson): My right hon. Friend sees no occasion for the appointment of a Committee. The hon. Member has left out of account the figures which my right hon. Friend was careful to give him showing how large a proportion of the trade of these Colonies is inter-Imperial. Thus, in addition to the 26.4 per cent. of the imports into the parts of the Empire referred to in the question which were derived from the United Kingdom, a further 38.5 per cent. (making 64.9 per cent. in all) were derived from other parts of the Empire. Moreover, the apparent imports from foreign countries are enormously swollen owing to the fact that several of the Colonies included are large distributors of goods. No less than half of the thirty-two million pounds' worth of foreign imports into the parts of the Empire referred to consist of imports into the Straits Settlements mainly for distribution in the Far East, and a large proportion of the foreign imports into such Colonies as Aden, Malta, and Ceylon are, no doubt, redistributed in a similar way. The exports are mainly sent, if not to the United Kingdom, at least to some part of the Empire.

  COAL STRIKE.

    WORKMEN'S TRAILS.
    Mr. MacCALLUM SCOTTasked the President of the Board of Trade whether any railway company has obtained his sanction to any reduction of services of workmen's trains during the coal strike; and, if so, will he inquire whether any of these companies have sold coal during that period?
    Mr. ROBERTSON: Any reductions in the service of workmen's trains which the railway companies may have made in the present circumstances do not require the sanction of the Board of Trade.
    Mr. LAMB: May I ask will the hon. Gentleman take steps to ensure at the conclusion of the strike that the services, both as to goods and passengers, will be reinstated?
    Mr. SPEAKER: The hon. Member has stated in his reply that the sanction of the Board is not necessary.
    Mr. MacCALLUM SCOTT: May I ask if any railway company has obtained the sanction of the Board of Trade for a reduction of workmen's services?
    Mr. ROBERTSON: The answer given is that under the present circumstances they did not require sanction, and therefore they would not get it.
    Mr. MacCALLUM SCOTT: Have any obtained sanction?
    Mr. ROBERTSON: I presume not, as they would not ask it if it was not required.

    Suffragists (Window Smashing).
    Mr. HINDSasked the Secretary of State for the Home Department whether it is the intention of His Majesty's Government, under the provisions of the Riot Damages Act, 1886, or any other Act, to recompense traders for the losses sustained by them in consequence of the recent disturbances and damages committed by women in the West End of London?
    The SECRETARY of STATE for the HOME DEPARTMENT (Mr. McKenna): I am advised that there was no riot within the meaning of the Riot (Damages) Act, 1886, on the occasion in question, and consequently that no compensation can be paid under that Act. Apart from the Act I have no power to authorise the payment from public funds of the cost of repairing the damage done. I would point out that the law provides means for recovering from the persons who committed or employed others to commit the damage.
    Earl WINTERTON: May I ask if an action is now pending against the Commissioner of Police by the National Plate Glass Insurance Company under this Act?
    Mr. McKENNA: If that be so, I anticipate that the Commissioner of Police will win the action.
    Mr. J. WARD: What was the riot in 1886?

    Old Age Pensions.
    Mr. DORISasked the President of the Local Government Board whether he will cause directions to be given to the Registrar-General, Somerset House, that the English Census Schedules of 1851 may be searched for evidence of age by or on behalf of Irish-born claimants for old age pensions who resided in England in 1851, and who have no other means of establishing their age qualifications for pensions, as there was no statutory registration of births in Ireland until 1864, or that certified extracts from the schedules may

    1041
    be issued to such claimants on payment of fees or stamp duties at the rates charged in similar cases by the Deputy-Keeper of Public Records in Ireland?
    The PRESIDENT of the LOCAL GOVERNMENT BOARD (Mr. Burns): I have brought the hon. Member's suggestion under the notice of the Registrar-General and of the Treasury, who are considering the matter.
    Mr. DORIS: And are poor people entitled to pensions to remain without them because evidence of their right to them is locked up in Somerset House?
    Mr. BURNS: I assure the hon. Member that I am doing my best in the matter.
    Mr. HACKETTasked the Chief Secretary for Ireland whether he was aware that Mrs. Keavey, Ballyknockin, Templetoughy, was allowed an old age pension by the Templemore pension sub-committee, county Tipperary, N.R., and that the Local Government Board determined, on appeal by the pension officer, that she was not entitled to a pension; whether the Local Government Board were aware that Mrs. Keavey was supported by her sister when they determined that she was not entitled to a pension; and would he take steps to have this pension granted?
    The CHIEF SECRETARY for IRELAND (Mr. Birrell): When determining Mrs. Keavey's case the Local Government Board were aware that she lives with her sister on a farm of fifty acres. Claimant had also some money in the bank, and altogether the Board were of opinion that her means exceeded the statutory limit. The Board have no power to reopen the case.

    Poor Law Officers (Superannuation).
    Sir HILDRED CARLILEasked the President of the Local Government Board whether he is aware that, under the Poor Law Officers Superannuation Act, 1896, no repayment of the contributions made by Poor Law officers to the Superannuation Fund, or any portion of them, is allowed if an officer leaves his employment with an excellent character of his own accord in order to better his position, nor is any repayment made in the case of a female employé who leaves her employment in order to get married, nor is any allowance made from the fund to a widow on her husband's death, although he may
    1042
    have contributed to the fund for many years; and whether he is aware that under this Act the completed number of years of service only of a Poor Law servant are counted for superannuation, no allowance being made for part of a year's service; and whether he will now introduce legislation at an early date to amend the law in these respects?
    Mr. BURNS: I am aware of the points referred to in the question, but I cannot promise an amendment of the law.
    Sir H. CARLILE: Will the right hon. Gentleman consult with the Prime Minister as to the possibility of the introduction of some legislation dealing with this point?
    Mr. BURNS: I am afraid facilities for the passage of an amending Bill are not possible this Session.

  ROYAL NAVY.

    PENSION CLAIM.
    Mr. HUNTasked the First Lord of the Admiralty whether he is aware that Rudgley, who was invalided out of the Navy on account of a wound received on active service, was laid up and quite unable to work on 17th February last, and for three weeks from that time, and is now destitute, except for the help of his relations; and whether he can now see his way to restoring Rudgley's pension of 1s. 1d. a day?
    The PARLIAMENTARY SECRETARY to the ADMIRALTY (Dr. Macnamara): No information as to Rudgley's recent illness has been received, other than that contained in the question. I can only repeat what I stated to the hon. Member in reply to his question on 12th March last that the Regulations do not, except in special circumstances, contemplate the continuance of pensions for life to men with only short service. In awarding pensions in such cases, consideration is given both to the character of the injury and to the man's capacity to contribute to his own support. Until it can be definitely established, in accordance with the condition already prescribed by the Admiralty, that Rudgley is, as a result of his injury, unable to work, there do not appear to be sufficient reasons for reopening the case.
    Mr. HUNT: Is the right hon. Gentleman aware that this man was laid up for three weeks as the result of the wound; and if the right hon. Gentleman is not satisfied

    1043
    will he make inquiries, and if he finds that to be the case, will he give him compensation for the three weeks he was laid up?
    Dr. MACNAMARA: The certificate which the hon. Gentleman sent to me did not show that Rudgley was entirely unable to work, but it did show that he was not able to work on certain days. Unless he is entirely unable to work the Regulations do not permit of a pension.
    Mr. HUNT: Is it not plain that the man was unable to work for three weeks?
    Dr. MACNAMARA: He is not generally unable to work. The hon. Member must remember the conditions under which the pension was withdrawn some time ago.

    Land Purchase (Ireland).
    Mr. JAMES O'KELLYasked the Chief Secretary to the Lord Lieutenant of Ireland what progress had been made with the sale of Mr. P. Taafe's estate, at Fox-borough, in the county Roscommon, and known to the Congested Districts Board as the Taafe estate, or if the pending sale of the said estate to the Congested Districts Board had been withdrawn; and, if so, on what grounds and by whose advice?
    Mr. BIRRELL: The Congested Districts Board have made an offer for this estate, but have not yet come to terms with the owner.
    Mr. O'DOWDasked whether Mr. John Woulfe Flanagan, of Billinafad, Boyle, refused to sell his estate situate at Ross, Boyle Union, county Sligo, to the Congested Districts Board; and, if so, whether, in view of the feeling prevailing in the district, the compulsory powers of the Board would be put into operation in order to have a sale effected?
    Mr. BIRRELL: The Congested Districts Board are in communication with the owner of this estate regarding purchase, but they are not at present in a position to make any further statement in the matter.

    Lough Gara (Improvement Scheme).
    Mr. O'DOWDasked the Chief Secretary whether the Congested Districts Board had given a Grant towards improving the outlet from Lough Gara, adjacent to Sligo and Roscommon, to the Lough Gara Drainage Board; and, if so, could he say
    1044
    under what authority the proposed improvement scheme would be carried out, seeing that under the Acts 5 and 6 Vic. the present Board had only maintenance power?
    Mr. BIRRELL: I have nothing to add to the reply given to the question on this subject asked by the hon. Member for North Roscommon on the 25th March.

    Industrial Unrest.
    Mr. CHIOZZA MONEYasked the Prime Minister if, in view of the prevalence of labour unrest in this and other countries and of the many years which had elapsed since the deliberations of the Labour Commission, he could see his way to appoint a Royal Commission to inquire into and report upon industrial conditions in the United Kingdom?
    The PRIME MINISTER (Mr. Asquith): I must refer the hon. Member to the answer which I gave yesterday to the Member for Leicester.
    Mr. CHIOZZA MONEY: May I point out that my question covers a rather wider ground than that of the hon. Member for Leicester?

    Home Rule Bill.
    Mr. WHELERasked the Prime Minister whether the leaders of the Irish Nationalist party had been consulted with reference to the proposals to be contained in the Home Rule Bill; and, if so, whether, as the Bill was for the better government of Ireland, he would also consult the leaders of other political parties in that country?
    The PRIME MINISTER: Conferences have taken place in regard to the Bill between members of the Government and some of the Irish Members. The Government must exercise their own discretion as to whom they consult in such matters.
    Mr. JAMES HOPE: Does the right hon. Gentleman give preferential consideration to Celtic as against Anglo-Saxon advisers in these matters?

    General Strike (Legislation).
    Major ARCHER-SHEEasked the Prime Minister whether his attention had been called to the statement of the organising secretary of the Liverpool branch, Amalgamated Society of Railway Servants, that a railway strike in May was not improbable; and whether, as a general strike had recently been advocated, and as such a

    1045
    strike advocated by leading Anarchists, Socialists, and others was of a revolutionary character, the Government would introduce legislation at an early date making the organisation of such a strike a criminal offence, punishable with the severest penalties, and scheduling certain callings a combined strike in any two of which should be regarded as a general strike?
    The PRIME MINISTER: I have seen certain reports of the alleged statement referred to by the hon. Member, but they appear to vary considerably in different newspapers. With regard to the latter part of the question, I have nothing to add to the answer which I gave yesterday to the question by the hon. Member for Leicester.
    Major ARCHER-SHEE: Is the right hon. Gentleman aware that legislation has been introduced in Australia and New Zealand, making strikes illegal, unless the cause of the dispute has first been placed before a properly constituted judicial tribunal? In view of that fact, will the right hon. Gentleman introduce legislation?
    The PRIME MINISTER: I am well acquainted with the legislation to which the hon. Member refers.

    Franchise Reform.
    Sir HENRY KIMBERasked the Prime Minister if he was now able to state whether or when the Government Suffrage Bill would be brought in, in this Session or in this Parliament, and whether it would contain or be accompanied by any proposals for reform of the representation by redistribution of seats?
    Mr. PATRICK WHITEasked the Prime Minister whether, in the proposed extension of the franchise in Great Britain, he had any intention of giving effect to the principle of proportional representation?
    The PRIME MINISTER: I am not able at present to make any statement in reply to these two questions.

    Calendar Reform.
    Mr. ROBERT HARCOURTasked the Prime Minister whether he was aware that the question of Calendar Reform had been discussed at the meetings of the Chambers of Commerce by Lord Desborough and others, and that an International Conference had been proposed by the Swiss
    1046
    Government; and whether he would consider the possibility of appointing a Select Committee to examine and report on the three Bills now before the House?
    Mr. McKENNA: My right hon. Friend has asked mo to answer this question. I have no information as to the discussions at the meetings of the Chambers of Commerce. As regards the International Conference proposed by the Swiss Government, His Majesty's Government in May last asked to be informed as to the attitude of the other Powers towards the proposal for a conference, but has not yet received this information. I do not think that the question could usefully be referred to a Select Committee at the present time.

    Incidence of Taxation.
    Mr. BOYTONasked the Chancellor of the Exchequer if the Special Committee appointed by him to inquire into the Incidence of Local and Imperial Taxation were still taking evidence?
    The FINANCIAL SECRETARY to the TREASURY (Mr. Masterman): The answer is in the affirmative.

  NATIONAL INSURANCE ACT.

    LECTURES.
    Mr. WHELERasked the Secretary to the Treasury whether he was aware that a Government lecturer addressed a meeting of the local friendly societies on the National Insurance Act at the Salem Institute, Hunslet, Yorkshire, on the 26th March, and that the meeting was a private one, being only for those persons to whom tickets were sent; and whether any charge was made for the services of the lecturer employed under such conditions?
    Mr. MASTERMAN: The hon. Member presumably refers to the first of a course of twelve explanatory lectures, commencing on the date mentioned, at the Salem Institute, Hunslet Road, Leeds, which were arranged for officials and accredited representatives of organisations likely to become, or to assist in the formation of, approved societies. Notices were widely circulated to the Press, as well as to societies direct beforehand, inviting applications for tickets, and tickets were, in fact, issued to representatives of over 100 different organisations, including trade unions, friendly societies, collecting and dividing societies, and others.

    OFFICE FURNITURE FOR COMMISSIONERS.
    Mr. TYSON WILSONasked the hon. Member for St. George's-in-the-East, as representing the First Commissioner of Works, whether he is aware that information as to what firms are supplying office furniture and other such articles for the use of the National Insurance Commissioners has been refused on application being made by unions concerned; will he state the reason for this refusal; and will he now give the information desired in order to ensure that the Fair-Wage Clause is not being violated?
    Mr. WEDGWOOD BENN (Lord of the Treasury): The rule of the Department is to publish monthly in the Board of Trade "Labour Gazette" the names of successful tenderers for all important contracts. It is not usual to furnish the information to individuals, and the present practice appears to be fair to all parties concerned.

    SCOTTISH COMMISSION.
    MARQUESS of TULLIBARDINEasked in what manner typists were appointed in the offices of the Scottish Insurance Commissioners; if by examination, who were the examiners in the last examination; was it publicly advertised; on what date and where was it held; and how many applicants were there and how many vacancies?
    Mr. MASTERMAN: The typists employed by the Scottish Commission have been appointed in accordance with the ordinary Treasury Regulations. Nominations were invited from the seven principal training schools for typists in Edinburgh. Eighteen applicants sent in their names, of whom three were disqualified by their age. The remaining fifteen were examined on the 9th and 10th February by the Civil Service Commissioners, and the six who proved to be most proficient were appointed.
    MARQUESS of TULLIBARDINE: Is it the fact that five out of the six went to one particular firm? If so, what is the name of the firm?
    Mr. MASTERMAN: How on earth can I answer that without notice?
    Sir C. KINLOCH-COOKE: Will the hon. Gentleman say whether the chairman of the Scottish Insurance Commission was ever connected with a firm of typewriter agents?
    Mr. MASTERMAN: The hon. Member must give notice of that question.

    Unemployed Workmen Act (Grant to Ireland).
    Mr. WILLIAM ABRAHAMasked the Secretary to the Treasury if he would state precisely the basis upon which the Grant to Ireland, under the Unemployed Workmen Act, was made?
    Mr. MASTERMAN: The Grant to Ireland from the Grant under the Unemployed Workmen Act is, like that to England and Scotland, settled in communication with the Local Government Boards of the three countries respectively, after consideration of the representations of the districts committees as to the extent and causes of the unemployment.

    Piccadilly Quadrant.
    Mr. HINDSasked the Secretary to the Treasury whether His Majesty's Commissioners of Woods and Forests proposed to adhere to the plans for rebuilding the Quadrant in Piccadilly, in face of the objections put forward by practically the whole of the existing leaseholders on the ground that such premises already erected in accordance with such plans were found to be utterly unsuitable for trading purposes?
    Mr. MASTERMAN: The matter is receiving careful consideration.

    Road Improvement Grant.
    MARQUESS of TULLIBARDINEasked why the Grant towards the Road Improvement Fund for the county of Perth had been reduced this year from £12,000 to £2,500; and whether the rate of decrease was similar for other areas?
    Mr. MASTERMAN: The estimated sum available for advances to highway authorities in Scotland up to 31st March, 1912, was £175,000, being the share of the Road Improvement Fund, which had been accumulating since April, 1909, allocated to Scotland. From this sum Grants amounting to £12,000 were made to the County Council of Perthshire. The Grant to Perthshire was a special one in view of the need of strengthening the trunk roads in the county without delay. The sum now available for distribution is the proportion allocated to Scotland of the estimated revenue for one year, 1912–13. The Grants to Scottish counties cannot therefore be on the same scale as last year,

    1049
    when nearly three years' revenue was available, nor can the Board repeat the special Grant to Perthshire without delaying Grants to proposed works in other districts. The amounts of the Grants to highway authorities are fixed after consideration of all the relevent circumstances affecting each area, and the rate of decrease varies accordingly.

    Linguistic Difficulties (India).
    Mr. MacCALLUM SCOTTasked the Under-Secretary of State for India whether he was aware that the population of the northern parts of Ganjam, which is entirely Uriya-speaking, suffered hardship owing to the appointment of police officers and constables who had either no knowledge or a very imperfect knowledge of Uriya and also owing to the fact that though all complaints, reports, etc., were tendered to the police in Uriya all the vernacular records of the police were maintained in Telegu only; whether the Government would provide better facilities for the training of Uriya-speaking people as policemen; and whether it would issue instructions that when the parties in a case were Uriya-speaking the record should be kept in the Uriya language?
    The UNDER-SECRETARY of STATE for INDIA (Mr. Montagu): I believe that the Madras Government are considering the representations on these points made by the Uriya-speaking people of the Ganjam district, and I will make inquiries.
    Mr. MacCALLUM SCOTTasked the Under-Secretary of State for India whether the Government of Madras had considered the proposal made by the Uriya Samaj Ganjam, which waited upon Sir Arthur Lawley in 1909, to redistribute the boundaries of the districts of Ganjam and Jeypore Agency and form two Uriya-speaking districts, excluding Chicacole and Narasanpet Talugs, thus removing their linguistic difficulties; whether the Government of Madras had taken any steps in the matter; and whether he recognised the desirability of doing something to remove the present disabilities of the Uriya-speaking peoples in Madras?
    Mr. MONTAGU: I find that the Madras Government, after the reception of a deputation in 1909, issued renewed orders on the subject of giving due recognition to Uriya as the language of the greater number of inhabitants of the Ganjam district. But the judges of the High Court considered it impracticable to make Uriya the
    1050
    only court language in any part of the district, and the Government accordingly ordered that both Telugu and Uriya should be regarded as the court languages in every criminal and civil court within the district. I may add that the Secretary of State is confident that the Madras Government fully recognises the desirability of removing any genuine grievances from which the Uriya-speaking people under its control may be found to suffer.
    Mr. MacCALLUM SCOTTasked the Under-Secretary of State for India whether he was aware of the educational disabilities under which the Uriya-speaking people of the Ganjam district of the Presidency of Madras laboured; whether the Government was unable to establish an English high school in the Gumsur division owing to the difficulty of obtaining qualified Uriya teachers; and whether the Government, could accede to the requests of the inhabitants of the Gumsur division for an English high school by obtaining teachers from Orissa, where the educational facilities were more highly developed?
    Mr. MONTAGU: I understand that this matter is under consideration by the Government of Madras.

    Royal Dockyards (Deaths).
    Sir JOHN JACKSONasked the First Lord of the Admiralty whether the number 269, given as the number of men in the home dockyards retired from establishment since 1st April, 1911, included men who died during that period; and, if not, could he give the number of established men who had died since the date in question?
    Dr. MACNAMARA: The answer to the first part of the question is in the negative; the reply to the second part is forty.

    "Syndicalist" Prosecutions.
    Major ARCHER-SHEE: I beg to ask the Home Secretary a question, of which I have given private notice, namely, upon what grounds the recent sentences upon Messrs. Bowman and Buck have been reduced, and entirely altered in character?
    Mr. McKENNA: It is not usual for the Home Secretary to state the grounds on which he advises His Majesty in the exercise of the Prerogative of Mercy, but I may say that in advising the reduction of the sentence on the Bucks from six months to one month, I had in view the

    1051
    facts, represented to me by the Attorney-General, that the part they took in the offence was subordinate and little more than ministerial, and that the main object of the prosecution, which was to establish the gravity of the offence and warn others against its repetition, had been attained. The same considerations applied in a less degree to the case of Bowman, whose sentence has been reduced from nine to six months. It can hardly be said that the character of the sentence has been altered by the remission of hard labour, as under modern conditions the difference between hard labour and imprisonment in the third division is comparatively slight.
    Mr. REMNANT: Will the right hon. Gentleman reconsider in the same way the sentences of hard labour recently passed on certain women who lost control of themselves?
    Mr. McKENNA: Yes, Sir, any particular case that the hon. Gentleman brings to my notice I shall certainly consider.
    Mr. REMNANT: I shall bring to the notice of the right hon. Gentleman all the cases in which hard labour was imposed.
    Mr. McKENNA: I cannot deal with the cases en bloc; if the hon. Member will show me any particular case of hardship I will consider it.
    Mr. W. THORNE: In face of the public opinion existing in different parts of the country in connection with the three cases mentioned in the question, can the right hon. Gentleman see his way clear to release the men at once?
    Mr. McKENNA: No, Sir, I cannot go beyond what I have done.

BUSINESS OF THE HOUSE.
Ordered, That Government Business have precedence this day of Notices of Motions and all other Orders of the Day; and that the Proceedings of the Committee of Ways and Means be not interrupted under any Standing Order regulating the Sittings of the House.—[The Prime Minister."]
Ordered, That this House do meet Tomorrow, at Twelve of the clock.—[The Prime Minister.]
Mr. BONAR LAW: May I ask the Prime Minister whether the Motion for the Adjournment of the House will be the First Order to-morrow?
The PRIME MINISTER: Yes; the adjournment Motion will be taken first to-morrow. Afterwards we shall ask the House to give a Second Reading to two small and non-contentious Bills—the Public Offices (Sites) Bill and the Light Railways Bill.
Perhaps, at the same time, I may say I have considered what the right hon. Gentleman said the other day in regard to the resumption of business after Easter, and the Motion for Adjournment will be, "That the House, at its rising, do adjourn till Wednesday, April 10th," instead of to Tuesday, the 9th. That, I believe, is the general wish. The business on the resumption will be the Committee stage of the Army (Annual) Bill.
Mr. AUSTEN CHAMBERLAIN: May I ask the right hon. Gentleman, in regard to future stages of the Budget, what he proposes to do this year? It is customary to give the Chancellor of the Exchequer the necessary Resolutions on the First Reading with comparatively little discussion, on the general understanding between the two sides of the House that in the Committee, with the consent of the Chairman, discussion may be recommenced on another Resolution. Owing to the time at which the Budget is taken that particular course cannot be applied this year. Will, therefore, similar facilities be given at an early stage after Parliament reassembles for the general financial discussion to which the House is accustomed after the introduction of the Budget?
The PRIME MINISTER: Yes, Sir; certainly the rule that has always been observed will be followed, that on the second night there should be what I may call a Second Reading discussion, not strictly confined to the terms of the Resolution. I would not like at the moment to commit myself to the exact date, but it will be as soon as possible.
Colonel WILLIAMS: May I ask the Prime Minister if in the business after Easter he will remember his promise to have a discussion on the Public Accounts Committee, and will he take the question of the New Committee on Estimates?
The PRIME MINISTER: I am anxious to bring on the Motion for the New

1053
Committee on Estimates as early as possible, and if I can combine the other matter with it I shall be glad.
Mr. LOUGH: Will the House have an opportunity of considering the terms of that Motion?
The PRIME MINISTER: It will be put on the Paper.

NOTICES OF MOTION.
  BANK LAW.
  Major WHITE: I beg to give notice that to-morrow three weeks I will call attention to the present unsatisfactory state of the law with regard to the use of the title of "bank" for certain private trading concerns, and move a Resolution.

  PRIVY COUNCILLORS' SPEECHES.
  Mr. W. THORNE: I beg to give notice that on 24th April I will call attention to seditious, inciting, and treasonable speeches delivered in recent months by certain Privy Councillors, and move a Resolution.
  Mr. LANSBURY: I beg to give notice that to-morrow three weeks I will call attention to the seditious, incendiary, and treasonable speeches delivered during recent months by certain Privy Councillors, and move a Resolution.

BILLS PRESENTED.
  PUBLIC HOUSES IMPROVEMENT BILL.
  "To facilitate the provision of accommodation for supplying food, and of other improvements in connection with premises licensed for the sale of intoxicating liquors by retail." Presented by Mr. WATSON RUTHERFORD; supported by Mr. Austen Chamberlain, Mr. Frederick Edwin Smith, Mr. Staveley-Hill, Earl of Ronaldshay, Sir Henry Kimber, Mr. Goulding, Sir Alfred Cripps, Mr. Bridge-man, and Mr. Montague Barlow; to be read a second time upon Thursday, 2nd May, and to be printed. [Bill 126.]
  VACCINATION ACTS (REPEAL) BILL.
  "To repeal the Vaccination Acts." Presented by Mr. BLACK; supported by Sir George White, Mr. James Parker, Mr. M'Callum, Mr. Kellaway, Mr. George Greenwood, Mr. Snowden, and Mr. Chancellor; to be read a second time upon Tuesday, 16th April, and to be printed. [Bill 127.]
  ANCIENT MONUMENTS PROTECTION (NO. 2) BILL.
  "To extend the Ancient Monuments Protection Acts, 1882 to 1900." Presented by Mr. NOEL BUXTON; suppor ed by Mr. Charles Roberts, Mr. Essex, Mr. Whitehouse, Mr. John Lyttelton, Sir Hildred Carlile, Lord Henry Be tinck, and Mr. Ramsay Macdonald; to be read a second time upon Wednesday, 10th April, and to be printed. [Bill 128.]
  SUNDAY CLOSING (WALES) ACT (1881) AMENDMENT BILL.
  "To amend the law as to the sale and supply of intoxicating liquor on Sundays in Wales and Monmouthshire." Presented by Sir HERBERT ROBERTS; supported by Mr. Ellis Davies, Mr. Robinson, Mr. Hugh Edwards, and Mr. Thomas Richards; to be read a second time upon Monday, 6th May, and to be printed. [Bill 129.]

  CHECKWEIGHING IN VARIOUS INDUSTRIES BILL.
  Mr. HODGE: I beg to ask leave to bring in a Bill "to provide for checking the weight or measurement of ma rials produced, handled, or gotten by workmen paid by weight or measure in certain industries."
  In 1907 a Bill having a similar object was carried without a Division, and was committed to a Committee of the Whole House, because of the fact that the Government had decided that they would set up a Departmental Committee for the purpose of making inquiry into the matter. That Departmental Committee was presided over by Sir Ernest Hatchbart, and amongst its members were two employers of labour, Mr. George Ainsworth, manager of the Consett Steel and Iron Company, one of the largest concerns in the county, and Mr. Ed. Eccles, who has occupied the high position of High Sheriff of Glamorganshire and chairman of the South Wales Steel Employers' Association; two representatives of the men, as representing a section of the iron and steel trade; and Mr. Morgan, K.C., then Member of Parliament for West Glamorgan. After hearing evidence and visiting various works as to the practicability of a desire for this checkweighing that Committee came to a unanimous finding. Notwithstanding that, and in spite of the expenditure of public money, the Hone Department have failed entirely to give effect to the recommendations of that

  1055
  Committee. Hence my desire to have the matter placed before the House as I feel confident that, employers and workmen having agreed as to the desirability of a measure of this character, no section of the House would for a moment wish to treat such a Bill as of a controversial character. The agitation for this measure of justice has been carried on for many years, and deputations ever since 1893 have appeared at the Home Office, and Home Secretary after Home Secretary has agreed as to the justice of the case, and that, judging from the evidence of the men, a primâ facie, case was made out for a measure of this character. We hear a great deal these days about industrial unrest. Here the House has an opportunity of getting rid of one case, so far as unrest is concerned. In the navvy districts, where men are paid by weight in this way there is a great deal of dissatisfaction, because, when they are paid by measurements they have no real assurance that they are paid according to the amount of work they have done. For these reasons, I ask the leave of the House to introduce this Bill for the purposes I have already mentioned.
  Bill ordered to be brought in by Mr. Hodge, Mr. Gill, Mr. William Thorne, Mr. Parker, Mr. Pointer, and Mr Clynes. Presented accordingly, and read the first time; to be read a second time upon Friday, 17th May, and to be printed. [Bill 130.]

  WAYS AND MEANS.
  Considered in Committee.
  [Mr. WHITIEI in the Chair]
  (IN THE COMMITTEE.)

FINANCIAL STATEMENT.

  YEAR'S SURPLUS.
  The CHANCELLOR of the EXCHEQUER (Mr. Lloyd George): The expenditure last year aggregated £178,545,000, and the revenue of the year came to £185,090,000. That leaves a balance of £6,545,000, which is, I believe, the largest realised surplus on record. The particulars will appear in the printed Paper which has been left at the Vote Office, and of which I perceive the majority of Members have already secured copies. I ventured to predict last year, when making my annual Budget Statement, that we were in for a sunny year. That has been
  1056
  realised not merely metaphorically but actually; but the prosperity of trade exceeded my most sanguine expectations. I budgetted on the assumption that it was going to be a year of good trade. All the taxes which are a test of good employment and prosperity have gone beyond the most hopeful expectations of my advisers. They have all done well in spite of the arresting hand of a great strike. Most of them have exceeded the Estimates. Three only have been disappointing. The first is sugar. Owing to the drought the sugar harvest failed and the price at a certain period of the year was more than double what it was at the beginning of the year. High prices always mean limited consumption, a truism worth repeating in a financial statement. It is proof of the great prosperity of the year that, in spite of the fact that prices were almost doubled, the consumption exceeded the consumption of the preceding year. But the estimate was not realised by £321,000 although the yield exceeded that of the two previous years. The same thing applies to tea. This estimate was not realised by the sum of £141,000, although the yield exceeded that of the previous year. There were two explanations of this. One, I am told, is that a good many tea estates have been converted into rubber plantations, and the rubber boom is partly responsible for the decrease in the production of tea in the East. The second explanation is the strike; that had a very considerable effect upon this and other items of revenue during the last month. That applies also to stamps. On the whole, I estimate that the loss to the Revenue up to 31st March directly attributable to the strike —I am referring to the miners' strike— amounts to £400,000. But taking all the other taxes which are generally regarded as a test of good or bad trade, they have done exceedingly well—spirits, beer, tobacco, the Petrol Tax, the Motor Tax, the Post Office, and the Income Tax. Under spirits and beer we have received £2,016,000 above the estimate.
  Mr. AUSTEN CHAMBERLAIN: Could we have the amount of the increase for each?
  Mr. LLOYD GEORGE: Quoting from memory, I think there was an increase of nearly £700,000 under beer; the rest would be spirits. I budgetted for a large increase in petrol and motor licence duty, but that estimate was exceeded by a sum of over

  1057
  £200,000 and the Income Tax Estimate was exceeded by £504,000. The Post Office was doing remarkably well up to the end of February. Then, entirely owing to the strike, there was a falling off, and we lost about £40,000 during the month of March; but, on the whole, the Budget Estimate has been realised. These results prove that the community as a whole and every class of the community shared in this prosperity. Not merely with the well-to-do but with the wage-earning class there was evidently a considerable margin for indulgencies, such as alcoholic liquors and petrol. Even the underspending, to a certain extent, is a proof of good trade, because the underspending in the Admiralty is partly due, though not entirely, to the fact that all the shipbuilding yards were so full up with private orders that there was a difficulty in finding rivetters and they could not turn any more men on. Therefore shipbuilding slowed down; they could not keep up with the programme, and this underspending is proof of the excellent trade which the country enjoyed last year. The surplus, therefore, is a by-product of great national prosperity. The actual amount of the surplus was, as I have said, £6,545,000, and but for the strike it would have been £7,000,000.

  RESULTS OF 1909–10 BUDGET.
  Three years ago when I stood at this box I was confronted with the largest deficit any Chancellor of the Exchequer has had to encounter in time of peace. It was a deficit that was serious in itself, but what made it still graver was the fact that we had certain commitments—they were not commitments of one party alone, but of all parties in the House—that indicated clearly a rapid growth in expenditure during the impending year. I therefore had to budget not merely for that particular year, but I had so to arrange the taxation that it should provide for the growing needs of the ensuing year. The proposals which I then submitted to Parliament were carried into law after I think probably the fiercest political conflict we have been engaged in since the days of the great Reform Bill, a conflict which deeply shook the Constitution and in the issue profoundly modified it. There were more than the usual number of prophecies of evil, and I think I may say they were characterised by more than the usual virulence. Those proposals have been in actual operation for three
  1058
  years. I think the time has come to review their working, and I propose to ask the indulgence of the House while I do so. I admit that three years do not provide a final test of the effect and influence of proposals of so far-reaching a character. Still, if one-tenth of the things said about those taxes was well-founded, at least there ought to have been some symptoms of the decay and destruction then predicted. Before you can judge whether taxes have answered their purposes you must, first of all, consider what those purposes were. That is necessary in order to arrive at any judgment as to their adequacy and fitness. A legend has grown up and has been assiduously cultivated that the purposes for which that Budget was designed to finance were of a revolutionary, Socialistic, and subversive character in themselves. [An HON. MEMBER: "Hear, hear."] There is still one hon. Gentleman in the House who believes it. [HON. MEMBERS: "More."] What were those purposes? There were three causes that created the deficit. The foremost of those causes was the increase in naval expenditure. The increase the first year was £10,000,000 from all these causes put together. The increase in the second year was £17,000,000, and the increase last year was £23,000,000. I am comparing the expenditure of each year with the expenditure for 1908. Those were the deficits that I had practically to make provision for in the Budget of 1909. Half of that deficit in each year was attributable to the increase in naval expenditure. I will just give to the Committee a few figures in order to show how naval expenditure suddenly sprung up in the year 1909. During the last three years of the Unionist Administration the programme of naval construction in the aggregate amounted to £29,000,000, and those were years of abnormal naval expenditure compared with the past. During the ensuing three years we were committed to an expenditure on naval construction of £23,000,000. Those were the first three years of Liberal administration. Now I come to the three years for the finance of which I have been responsible. During those three years our naval construction amounted to £45,000,000. In the year 1908 our naval programme was an £8,000,000 programme. In 1909 we were committed to a naval construction of £18,000,000—there was a leap from £8,000,000 to £18,000,000. That is the first, revolutionary purpose for which I had to find money, and I think I can say that I

  1059
  doubt whether the most suspicious member of the Anti-Socialist League could find a trace of Socialism in that purpose at any rate.
  4.0 P.M.
  What was the next purpose. The next in point of expense was to find money for old age pensions. That was a purpose which was enshrined in the Unionist programme since the year 1895, enshrined like a fly in amber, not a live thing, but something to inquire about. That, therefore, I think, we can rule out as a Socialistic purpose. The next item in point of expense, until we come to the present year, was the Grant-in-Aid to local authorities to meet the exigencies of the new traction that had come suddenly clattering into our civilisation, the new motor traffic on the roads, involving an enormous expense to local authorities. The Treasury had to find Grants-in-Aid, and we found a substantial sum. I take it that is not a very revolutionary proposal. The next was to find money for the demands which came from all quarters of the House for agricultural development and reafforestation. The next was assistance to local authorities to help towards relieving the burden of the rates. And the last was the contribution towards National Insurance which was contained in the programme of every party except one—the Socialist party. I do not think that, on reconsideration, anyone can say that any one of those purposes could be justly stigmatised as being of a very revolutionary character. I would like to make one observation before I pass to the actual taxes. There is no item in that programme in respect of which the Opposition resisted contributions from the State. There is no item in the programme in respect of which the Opposition tried to cut down the contributions from the State. There is not a single item in that programme in respect of which the Opposition did not press the Government to increase the contributions from the State, and, if hon. Gentlemen opposite were prepared to shoulder their share of the financial responsibility, I should have congratulated them on their enterprise, because, undoubtedly, all these projects went to increase the national strength and efficiency. As to the national defences, any plan for improving the conditions and prospects of the people adds to their fitness and capacity for service. Anyone who knows the working classes knows perfectly well they
  1060
  live in a constant apprehension of stumbling into the pit of poverty, and all these projects for which the Budget of 1909 found the finance helped to remove an old fear and to substitute for it a new hope, and hope is the mainspring of efficiency. Those are the purposes for which the money was raised.
  I now come to the actual taxes, and I shall then consider, having regard to the actual sums, how they have worked out. As they passed through the House of Commons there were some modifications. Those modifications had two effects. One was to reduce the yield, and the other was to postpone in certain cases fructification. That was notably the case with the Land Taxes. But I laid down four principles, and I shall ask the House to consider how those have been justified. The first was that the new taxes should meet, not merely the year's requirements, but should be of such an expansive character as to grow with the growing demands of the programme that I then sketched out, and which I have now summarised. The second principle was that all classes of the community in times of financial emergency should be called upon to contribute. The third was that, although all classes should be called upon to bear their share, the taxes should not enhance the cost of the necessaries of life for any class. And the last was that the taxes should be of such a character and should be so adjusted as not to interfere with the industry, and the trade, and the commerce, which are the sources of the wealth of this country. Now, how have they worked out in practice? The story of the first two years I have already told in this House. We met all the new increased expenditure; we devoted large sums of money towards reduction of debt; and we had a five million surplus, part of which was devoted to sanatoria purposes and to providing capital for the development of the resources of the Empire at home and abroad, with a substantial balance for reduction of debt. Now we reach the third year. The yield of these new taxes last year was £23,900,000. How is that money distributed? Eight millions of that money comes from what I call indulgencies and luxuries—intoxicating liquors, tobacco, motor cars. With regard to the rest, the 2d. that was then imposed upon unearned incomes and upon earned incomes of over £3,000 produced last year £4,000,000. The Super-tax of 6d. on incomes over £5,000 produced £3,000,000. Now I come to the Death

  1061
  Duties, and that is a very good illustration of the way in which the taxes have fallen. Last year the total number of deaths was 666,000 in the whole of the United Kingdom. The number of adults who died amounted to 441,000. The total property passing at death was £270,000,000. Half of the property belonged to 970 persons. The new duties began at £5,000. There was no increase up to that point. Three-fourths of the property that passed last year belonged to persons who owned £5,000 and over. The number of these persons last year was 7,000.
  Sir F. BANBURY: What, more than £5,000?
  Mr. LLOYD GEORGE: Yes; I agree it is a very startling figure. I was struck with it, and I made further investigations. The total produced last year by the new duties was £6,300,000. I have just analysed the new duties and the new taxes showing how they fell, in order to demonstrate to the Committee that there was no tax there upon the necessaries of life, and to prove there was no tax there to interfere with trade, business, and commerce. [HON. MEMBERS: "Oh, oh."] I observe that is challenged. I now come to the fourth proposition I laid down, that these taxes should not be of such a character as to hamper and handicap business. What was the condition of trade in April, 1909, when the Budget was introduced? Unemployment had reached almost the highest figure it had attained for years in this country. We were passing through a period of profound depression. The very controversy we were engaged in—whether there was any foundation at all for the criticism or not—might have been expected to have had the effect of postponing any trade development. One or two of the criticisms upon the proposals of the Government were of a character to make people believe their property was in danger, that their investments were in danger. The majority of the property-owning class in this country, I think, profoundly believed it at the time. I believe they were sincerely frightened. So you had everything in those statements that would have the effect of retarding the development of trade, apart from any real foundation for them. What happened? In spite of all that, soon after the Budget was introduced, trade began to boom and unemployment began to diminish. It has gone on in an unbroken record of prosperity
  1062
  ever since, until unemployment before the strike had reached almost the lowest point it had ever touched in this country, an unbroken record of growing prosperity, expanding business, increasing profits, better employment. Our exports have increased by 20 per cent.; and, if the old saying is an accurate one, that half of that increase went in wages, you must have had an increase of £40,000,000 in the wages bill of this country. Both our home and our foreign trade were doing well. Wherever you looked before the strike, which is a purely temporary incident, you had growing bank deposits and an enormous increase in bankers' clearances, showing great trade activity; and, what still more remarkable, the increase in bankers' clearances was not merely in London, which might mean only Stock Exchange transactions, but it was still more marked in the provinces, where they represent real business. Factories working full time and overtime, collieries at full pressure, ships that were lying idle three years ago at full work and with excellent freights, new tonnage added by the million, and, the surest test of all, increasing traffic receipts on our railways—that is the best answer to those who predicted ruin from the Budget of 1909. I am sure we must all without distinction of party feel glad, because he must be a poor patriot indeed who does not rejoice in the prosperity of his own country lest perchance the avowal of it might do some damage to the party to which he belongs.
  I have no doubt I shall be asked, What about the Land Taxes? From the kind of statements which are being made, anyone might imagine that I had anticipated the Land Taxes would produce millions during the first few years, and that I relied on them as the mainstay of my financial provision for necessary reforms. It was quite the reverse. I made it perfectly clear that the tax which I put forward as the most productive, the Increment Tax, was a tax the productiveness of which must necessarily be postponed for a few years, and, as a matter of fact, Lord Rosebery, in his great attack on the Budget, referred to the Land Tax as "that violent onslaught on the land which is, according to the statements of it? promoters, to bring in little or nothing." That was said at the time. Indeed, for the first few years I agreed that half the revenue from them should be given to the local authorities. I could not, therefore, have felt dependent on the revenue from the receipts of the Land Taxes for the purposes of defraying the general charges

  1063
  which I saw in sight. They have been in operation two years. Last year I estimated the revenue at £700,000. They have realised £200,000 less than that, but that is less than 1 per cent, of the total additional revenue produced by the Budget. Let me point out that in the nature of things they cannot, for a few years, produce a large revenue. The valuation will not be complete for four or five years from the date of the Budget—I said so at the time—and you cannot levy the Undeveloped Land Tax until the valuation is complete. We have already valued one-fifth of the land of the Kingdom. I have no doubt at all that, preliminary difficulties having been overcome, and the staff having been increased, we shall value at a greatly accelerated pace, and at the end—well, within the three years I have mentioned—we shall have in this country what they have in every other civilised country, a great national survey of the land, which will be available for the purposes of the readjustment of local taxation, and which, I have no doubt, will be available for equally important public purposes of another character.
  But even if the whole Undeveloped Land Duty came in I never put it higher than £300,000. The Reversion Duty I never put very high, and the Royalties I put at £350,000, and they again cannot go higher without putting more on them. Therefore these three taxes were never estimated to produce very much in the future. The three were estimated to produce less than a million sterling, and the only tax which I looked forward to as being of a very productive character was the Increment Duty. I am still of that opinion. But, in the very nature of things it is a tax which will yield revenue only in the future. Why? You tax upon the increment on the value as fixed in April, 1909, and you have to wait until the land increases in value from that date. There was an Amendment passed in Committee that there should be 10 per cent, on the top of that. You have, therefore, to wait not merely till the value of the land grows—and it is growing very rapidly in spite of the Land Taxes—you have to wait till it grows above the 10 per cent, which is added on. I have a test which I am prepared to put to those who contend that these taxes are not going to produce much money. We give a certain amount of money to the local authorities in composition for their right to one-half
  1064
  of the Land Taxes. I believe that bargain expires next year. If there is anyone in this Committee who believes that these taxes are not going to yield a real revenue in the future this is their opportunity. Are they prepared to release the Exchequer from the obligation which it is under to restore that half to the local authorities? If so, for how much? I am quite willing to make a bargain, and I have no doubt at all that, if it is done on the estimates placed on the Land Taxes on public platforms and in the House of Commons by their critics, the Exchequer is going to make a very good bargain indeed. I have reviewed the new taxes. I have told the House how much they have grown; how they have not merely come up to the anticipation of the Government in their yield, but have actually exceeded it; how they have met all the growing needs of the State from year to year, and have left us with a large surplus at the end of the third year—a surplus of £6,500,000, which would have been £7,000,000 had it not been for the great national strike.

  NAVAL POLICY.
  I now come to the question, What is to be done with the surplus? There are several circumstances which have to be taken into account which are of an abnormal character. The first is not merely the underspending which has contributed to the surplus, but the nature of that underspending. The Chancellor of the Exchequer always looks forward to these underspendings. It is not always possible for a Department to estimate, for a whole year in advance, to the very last penny, what sum of money it will require. Departments are very loth to come to the House of Commons and ask for Supplementary Estimates, and, therefore, I have no doubt they estimate liberally, though fairly, the requirements of the year. Chancellors of the Exchequer have always expected, and very rarely expected in vain, that, at the end of the year, they will get money back from most of these Departments to assist them either in swelling the surplus or in meeting a deficiency.
  The underspending on the part of the Admiralty is of a rather different character. There is a kind of underspending which represents permanent saving, but that is not the case here. The under-spending of the Admiralty means postponement and not saving. For instance,

  1065
  there is not a single ship the less in the Programme of this year, nor will there be in the next, because the ships of last year have not had this money spent on them. The ships are ordered, the orders will be executed, and the underspending has had no effect at all in diminishing, by a single torpedo boat, the number of ships ordered this year. This money which was voted by Parliament and which would, in the course of things, have been spent this year, will be spent either next year or the following year. Part of it is in the Estimates for this year—I think about £600,000. The rest, and the heaviest part of it, will fall on next year's Estimates. That represents something like £1,500,000.
  There are two other contingencies I have to take into account, but they are incalculable at the present moment. The first is the effect of the strike. I have every confidence that the struggle will be brought to an end this week. Still, one must prepare for contingencies. Even if work were resumed this week or next week the strike has had an effect—a considerable effect— on the trade of the country, and, consequently, upon its revenue. For five weeks about a million of men have been earning no wages. For three weeks probably another million have been out of work. I am not sure that is not an underestimate. You have got five weeks of arrears on the part of a million of men, and two or three weeks' arrears on the part of another million who have earned no wages, to make up. In addition to that, what they produce is for the moment lost. Some industries have been very hard hit, much worse than others, how hardly hit no one can tell yet. There was a good deal of pressure of work before the strike, and I have no doubt there will be a good deal of pressure of work after, and that will limit its effects. But still, making full allowance for all these things, the effect of the strike will be very considerable. I will give the House later on figures showing what the strike has cost and will cost in the coming year. All that has to be taken into account as a contingency which is for the moment incalculable. We cannot measure it.
  What is the second contingency—the possibility referred to by my right hon. Friend the First Lord of the Admiralty in the powerful speech he delivered in introducing the Naval Estimates this year? No one in this Committee deplores more than I do the enormous waste upon armaments. They are a burden on our industrial
  1066
  energy, and they limit the activities of the State in making provision for our social needs. An enormous amount of wealth which would be available for, I think, much better purposes, is drained by these epileptic fits of militarism which seize civilisation from time to time. But so long as they last we can take no risks. So much depends on securing the actual inviolability of our shores that, if we err, I think we ought to err on the safe side. As long as I am satisfied, as I am satisfied, that my right hon. Friend has only demanded Estimates which, high as they are, are only adequate to secure the minimum which is necessary for our safety, as long as I have the honour to hold the high office of Chancellor of the Exchequer, it will be my duty to do all I can to find the necessary finance to carry his purposes through. But in arranging the finance of the year I must take into account the very serious contingencies to which my right hon. Friend has referred. What it means, how much it means, it is premature to estimate, and therefore all we can do at the present moment is to provide the necessary reserve. I was fortified, before I came here, by a private letter, written by one of our most distinguished Chancellors of the Exchequer in the past, Sir William Harcourt, who was a great financial purist. He would have been the last man in the world to have encouraged any departure from the strict line of financial orthodoxy. He wrote a private letter in the year 1896, I think, to Sir Henry Fowler, in reference to a proposal made by Sir Michael Hicks-Beach, as he then was, in that year, to deal with the realised surplus, which was a large one. I remember Sir Michael Hicks-Beach said that it was the argest realised surplus for fifty years. He proposed that the whole of that surplus should be utilised for naval purposes, and Sir William Harcourt wrote this letter, for which I am obliged to the courtesy of my right hon. Friend (Mr. Harcourt) for giving it to me. It is dated 23rd January, 1896:—
  "The Government, I think, may spend their millions with less disadvantage on the Navy than on many of the other objects which they are supposed to contemplate. I should not be much disinclined to make them a present of the Old Sinking Fund for this single year, as twelve millions is more than we can fairly demand should be devoted to Debt in one year. I have always regarded the Sinking Fund as a resource in emergencies. I myself should be satisfied if we could secure the permanent maintenance of the Terminable Annuities and the New Sinking Fund, which amounts to seven millions, and it is about as much as we are bound to do for our successors. If we are too stiff we shall lose the whole."

  1067
  That contains the principle on which I propose to act, although it is a justification which comes after the event. I therefore propose in the present year to devote the whole of the surplus to strengthening the Exchequer Balances. If at the end of the year it has not been found necessary to draw upon this reserve, or to the extent that it has been found unnecessary to draw upon it, Parliament can then, judging the situation as it then appears, deal with this reserve, and, if it so decides, devote it wholly, or in part, to the reduction of Debt. I hope I have made that clear. What I propose is that the money should pass for the moment to the Exchequer Balances, to strengthen them as a reserve. We do not prejudge the question at the present moment of what shall be done, either with the whole, or the balance, of that amount. If it is found unnecessary to expend it either in whole or in part, we propose that Parliament should decide at the time upon the facts as they present themselves to Parliament then what should be done with this amount.

  ESTIMATES FOR 1912–13.
  I come now to the Estimates for the coming year. I think the Committee is in possession of these figures, and I therefore will not enter into them in detail. The expenditure is up by £5,601,000. The total expenditure is £186,885,000. That is what I have got to find funds for. I shall just call attention to one or two items, and that is all, in this expenditure. I should like to say a word or two about the Navy Estimates. I had anticipated a considerable reduction this year. When I made my financial statement last year I gave expression to that hope, and I need hardly say it was not a mere expression of my own personal wish, or desire, or expectation; I made that statement after consultation with my right hon. Friend the then First Lord of the Admiralty. He hoped to effect a very considerable reduction this year, and a still greater reduction next year. But, unfortunately, conditions over which we have no control have supervened, and the Estimates for the year are considerably higher than I had anticipated. There is a reduction, a substantial one so far as it goes, but not so much as we certainly might have effected had it not been for the unfortunate conditions for which we are in no sense responsible, and for which my right hon. Friend the First Lord of the Admiralty is certainly not respon-
  1068
  sible. But that does make a difference. In financing the programme which we looked forward to in 1909, it was part of my anticipation that the Naval programme would grow rapidly for three years and then decline. The eight "Dreadnoughts" I thought would pass out of account by this year, and I looked forward to that saving very largely to assist in financing the Insurance scheme, which I knew was due somewhere about that time, all being well. I am afraid that the prospect of securing a reduction in our Naval expenditure is not a particularly bright one. We should have good cause to rejoice if this year we could go through without a substantial increase, and if we could pass through next year without a still larger increase.
  I would only utter one word of warning. If the needs of the nation demand it, it has to be faced; but the methods of raising the revenue for that purpose must also be faced. There is only one way of reducing taxation, or even of preventing an increase of taxation, and that is by reducing expenditure, for every pound spent on armaments costs the taxpayer as much as a pound spent on any other purpose. The next item of increase is £2,600,000 for health and unemployment insurance. There is £200,000 for small landholders in Scotland, £364,000 for education, most of it automatic, but part of it due to the provision for assisting local authorities in medical attention to diseased children. There is a considerable increase in the Post Office, but that is entirely due to the fact that the National Telephones have been taken over. The only other item to which I wish to call attention is one which does not, perhaps, appear on the face of these Estimates, but it is one I note with considerable satisfaction. It is, I think, the only decrease I have an opportunity of dwelling upon, and therefore I take the opportunity of dwelling upon it. It is a decrease of £450,000 in regard to our African Protectorates. I think that is a subject of satisfaction, because it shows not merely that the administration of the Colonial Office is a very admirable one, but it also demonstrates that the prosperity of these Protectorates is increasing so greatly under British rule that they are almost self-supporting for the first time. Then there is an increase of £170,000 for the Army, which is due to aviation. So much for expenditure.
  I now come to the Revenue. When you come to estimate the Revenue for this

  1069
  year, there are two main considerations to be taken into account. The first is the effect of the strike, and the second is the prospects of trade. The effect of the strike, even if it comes to an end this week, would be very considerable. The working classes during the first few weeks of the resumption of work have just as much as they can do with their wages to buy the necessaries of life, to pay off debt which has been incurred in purchasing those necessaries, and to pay arrears of rent, and they will have no margin for dutiable commodities. I therefore estimate that between spirits, beer, tobacco, and, also to a certain extent, tea and sugar, the loss of revenue for the coming year, owing to the strike, will aggregate £800,000— that is, taking the loss up to the 31st March, and adding it on to the prospective loss, it is a loss of £1,200,000 to the Revenue alone which arises from this labour trouble, and the Committee may readily infer from that what the loss must be to the country. The second item I have to consider is the trade outlook. The difference between good and bad trade is a difference of millions to the Chancellor of the Exchequer. He has only to look at the receipts of last year to find out what a great difference excellent trade has made in the receipts of the Exchequer. Practically the whole of the surplus on the revenue side has been due to good trade. That is £3,500,000, and it would be £4,000,000 but for the strike, and I budgetted for probably another £2,000,000 or £3,000,000 in anticipation of good trade. Therefore the first consideration of the Chancellor of the Exchequer and his advisers in estimating the revenue of the year is, Is it going to be a good or a bad year for trade? Last year I predicted good trade, and I need hardly say I did not do it upon my own authority. I consulted some of the best available authorities on the subject, and after hearing all they had to say I formed my own conclusions. I have done the same this year.
  Everything depends upon the outlook, not merely here, but throughout the world. Nations are becoming more and more interdependent in trade and, as our international trade is the greatest in the world, we are more dependent to that extent upon healthy conditions in other countries as well as our own. There is no self-supporting Empire in trade. What are the prospects according to my advisers? I am told that the conditions throughout the world appear excep-
  1070
  tionally healthy. The production of gold during the last few years has been abnormal and that, in spite of the criticisms of my hon. Friend behind me, has had great effect in greasing the wheels of commerce. Most of the recent storms which have blighted our industrial prospects in this country and on the Continent have come from across the Atlantic. I am informed that the conditions there this year are sounder than they have been for a good many years, and that instead of having the devastating cyclone which effected such destruction upon the trade of Europe a few years ago, we are likely to get a steady trade wind which will bring treasure to our shores from across the Atlantic. There is only one disturbing factor, and that is that there is a Presidential election due this year. I do not know anything about elections in America, but if they are anything like elections in this country I have no doubt there will be rows of bogies along the roads of commerce to frighten timid capitalists But still, when these roads are paved with gold nervous indeed will be the capitalists who will be frighted off the track, and I do not think that is going to have a very serious effect, from all I hear, upon the trade of the United States of America, and that is full of hope for our trade here.
  Another important element is this. All our best customers throughout the world are prosperous. The Argentine Republic, the countries of South America, Canada, India, Australia, and, I think, South Africa, are all doing better than ever. There has been a great development in all these countries during the last four or five years, very largely due to the beneficent use which has been made of British capital. It has increased their purchasing power, and that means that they buy more from us, and not only that, but they have been opening up railways to an extent that is almost unprecedented. During the years of the South African and Japanese wars there was less money spent upon developing new countries than had been spent for decades, I think, at least for a good many years. Capital was being absorbed in other ways. The result was that there was a sudden contraction in the development of those countries. It had a great effect upon increasing the cost of the necessaries of life, because the opening up of new harvest fields did not keep up with the increasing demands of the world. During the last few years there has been more enterprise displayed in those countries, and more money has been spent upon

  1071
  railways than has been spent for many years, and although the effect, of course, is not instantaneous, it began to operate last year, and the cost of the necessaries of life began to fall again. I believe in the coming year that tendency will grow, and that the working classes and all classes of this country will begin to reap the beneficent effects of the expenditure which has been incurred in opening out new countries. Our best customer on the Continent of Europe, Germany, is doing well, and the same, I believe, applies to France, and to Russia, who are also good customers of ours.
  At home, in spite of the disturbing effects of the strike, I am assured that the prospect is good. I believe the outcries about predatory legislation are losing their efficacy through sheer staleness. There has been nothing more entertaining and more instructive than the difference between what appears to be the belief of the capitalist and his action. He has always talked as if he were trembling on the brink of impending ruin through legislation, and he has always acted as if he was making a fortune. He attends a political meeting in the evening and hears that the, foundations of civilised society are being undermined, and he cheers the sentiment with great satisfaction. He goes to the counting house in the morning and orders his business as a man who knows that all is well with the world. So he enjoys the double sensation of receiving large actual profits whilst at the same time prophesying dire future evils. It seems to be the correct thing for every respectable man to talk in that strain, and also to leave it merely to cranks to arrange their affairs as if they believed it. They know from their experience that there is a great chasm between fear and fact, and therefore during the last two or three years the capitalists in this country have never shown greater enterprise and greater confidence, and trade shows every prospect, according to all I have heard, of a very booming time in the coming year. There may be labour troubles, but the future depends on the readiness with which capital is prepared to share its luck with labour and upon the moderation with which labour makes and presses its demands on capital. I have come to the conclusion that there is nothing on the horizon which will upset the promise which the world gives of a bountiful year. I ought also to mention the exceptional
  1072
  cotton crop of America, which is a great factor in our prosperity. I shall therefore base my Estimates for the year upon that assumption.

  CUSTOMS AND EXCISE.
  5.0 P.M.
  Now I come to Customs and Excise. The Exchequer receipts last year from Customs were £33,649,000. I estimate this year that they will produce £33,900,000, which will be an increase of £251,000. Excise last year was £38,380,000. I estimate that this year it will produce £37,700,000, a drop of £680,000. The reason why I take that estimate is that owing to the strike I have come to the conclusion that there will be a heavy loss. That is on the debit side. Coming to the credit side, I estimate that there will be an increase in the consumption of dutiable commodities. There has been a curious change in the last year in the matter of the consumption of alcoholic liquors. I remember the right hon. Gentleman (Mr. Austen Chamberlain) standing here and pointing out that for the first time in a period of prosperity the consumption of intoxicating liquors had gone down, and he rejoiced, with the rest of the Committee, in the prospect that it was a permanent change in the habits of the people. It seemed for some years as if that prediction would be verified. We had very good trade in the time of my right hon. Friend (Mr. Asquith) when he was Chancellor of the Exchequer, but in spite of that the consumption of alcoholic liquors steadily went down, and my advisers came to the conclusion that we must in future reckon upon a steady diminution in the quantity consumed. There is no doubt that, so far as the wine bill of the country is concerned, there is that change in the habits of the wine-drinking section of the community. I made some inquiries of a wine merchant on the subject as to how it was that last year, in spite of the fact that the wine-drinking classes were making very considerable profits, they consumed less wine, and he said it was due to a real change which wine merchants had been noting for years in the habits of those who were drinking wines. That was true also up to last year so far as the classes who consume spirits and beer were concerned. The Budget of 1909 accelerated the downward pace in the consumption of spirits, which now stands at nearly 20 per cent. less than in 1908–9, which I claim is due very largely to the 3s 9d. on spirits put on by that Budget.
  But last year there was a change. The heat of the summer will no doubt partly explain it in the case of beer, but I do not think it win explain it in the case of spirits altogether. It may have had something to do with it, but I think it is due to something more permanent than that. There was an increase of 4 per cent. in the consumption of spirits. We budgetted last year for a decrease in beer, but instead of that the receipt from Beer Duty exceeded that of the previous year by £565,000, and the only explanation I can give of it is this: Although during the years 1906 and 1907 we were enjoying great prosperity in this country, the working classes did not get the full benefit of it, because the necessaries of life went up, and therefore they had no margin available for alcohol. I think it is to their credit that they did not start by devoting a certain sum of money for liquor, but began by saying they must obtain necessaries. They said, "We must set aside this money for the increased cost of living, and if there is anything to spare we can spend it on alcoholic liquors, and upon luxuries and indulgence." Therefore the increased cost of living must have affected the money spent on intoxicating liquors, even in a time of prosperity. Last year, for the first time, as I have pointed out, we began to have the benefit of the enormous investments in railway developments in Canada, the Argentine, and elsewhere, and the cost of necessaries began to come down. I think that must have had an effect on the expenditure on intoxicating liquors. This year I have estimated that there will be an increase of 2 per cent in the consumption of beer, and 1.5 per cent. in spirits.
  Mr. AUSTEN CHAMBERLAIN: I understand from the last observation of the right hon. Gentleman that he has estimated for an increase in the consumption of both beer and spirits. How is it that he expects less revenue?
  Mr. LLOYD GEORGE: I estimate for a 2 per cent increase in Beer and a 1.5 per cent increase in Spirits. But against this must be set a deduction in each case on account of the coal strike and also, further deductions in respect of excess stocks in the case of spirits and on account of the hot summer of 1911 in the case of beer. On the whole, the balance is against the Exchequer. That is why I estimate that there will be a loss on Excise as compared with the actual receipts last year.
  1074
  Now I come to the Death Duties. These I estimate will be £25,450,000, which is £58,000 up on last year; Stamps I estimate at £9,400,000, which is £54,000 down on last year; Land Tax I estimate to be £700,000, which is £50,000 down on last year, but there were arrears included in last year's revenue; House Duty I estimate to be £2,000,000 which is £130,000 down on last year. That is because there were arrears included in last year's revenue from House Duty. I now come to Income Tax, and I should like to say one word upon that tax, because there is a remarkable development in this respect. Last year we had over £2,500,000 of arrears from the preceding year in our receipts of Income Tax for the year, so that the actual receipts of Income Tax did not represent the real normal Income Tax revenue for that year. We might therefore naturally expect that the Income Tax would be considerably down this year, but there is one circumstance which has intervened to prevent anything like a disastrous drop. The Income Tax, as the Committee know very well, is estimated on the average of the preceding three years' income of every person under a particular schedule. Last year we estimated Income Tax upon the basis of the average of the income derived by people in 1908, 1909, and 1910. This year 1908 drops out and 1911 comes in. The year 1911 was an exceptionally profitable one. The Inland Revenue have secured returns from representative traders in each particular industry, and upon the basis of these, actual returns they have come to the conclusion that the profits for last year were abnormal, and that they increased at a rate almost unprecedented in this country. By taking out the year which preceded the Budget of 1908–9 and substituting for it the third year after the experience of the Budget of 1909–10, the average has been raised so considerably as to go beyond the normal. Therefore this year I expect from the Income Tax—including Super-tax, which is standing for £3,500,000 instead of £3,000,000, as it was last year—a total of £44,100,000. That is a decrease of £704,000 on the actual receipts of last year. The Land Value Duties I expect to produce £545,000. The total tax revenue will be £153,795,000, being a decrease of £1,245,000.
  Mr. AUSTEN CHAMBERLAIN: Can the right hon. Gentleman give the Committee the figures of the Mineral Rights Duty separately from the other Land Duties?
  Mr. LLOYD GEORGE: I will get the figures by the time I reply and give the right hon. Gentleman the information in the course of the evening. I cannot give the figures at the present moment. The Post Office revenue is considerably up, because this year it includes a full year's revenue of the National Telephone service. This year I expect a revenue for postal, telegraph, and telephone services of £29,175,000. That is an increase of £3,475,000 upon last year. On Crown lands I estimate the revenue at £530,000, and the receipts from the Suez Canal shares and sundry loans are estimated at £1,289,000, being an increase of £8,000. Miscellaneous receipts are estimated at £2,400,000, being a decrease of £139,000. The total non-tax revenue is therefore estimated at £33,394,000. That gives a total revenue of £187,189,000. The total estimated expenditure is £186,885,000. I therefore estimate a surplus of £304,000 at the end of the year. That leaves no margin for reducing taxation, but it is encouraging for the Committee to know that in spite of the increased expenditure owing to insurance, and in spite of the fact that we are short by £500,000 which was properly attributable last year to the Admiralty, there is no need for imposing any fresh taxation.
  I have only one or two more sentences I wish to address to the Committee. Lord Lansdowne, in moving the rejection of the Budget in 1909 in the House of Lords, said that he objected to these taxes because they were unproductive, and he added:—
  "We make no secret of the fact that, in our view, this Budget is a confession that you have virtually exhausted the possibilities of a financial system based upon free imports."
  Lord Curzon, in a very characteristic passage, said:—
  "You are setting a veritable old man of the sea on the shoulders of the respectable and reputable classes of the community."
  I need hardly quote the well-known words of Lord Rosebery, that it was "the end of all things." Now we have had three years of it, and the country is more prosperous than ever. The right hon. Gentleman the Member for East Worcestershire (Mr. Austen Chamberlain) is looking forward to the day when he will be standing at this table introducing a highly controversial Budget, and I am sure his supporters are looking forward to it with even more eagerness. For him will be the toil, the trouble, the worry and the anxiety, and for them will be the joy of battle. If,
  1076
  after three years' experience of that Budget, assuming that it ever comes into being, he is able to stand at this Table and to say, "This Budget, which was challenged so fiercely by the Opposition, produced a revenue of £12,000,000 the first year, £18,000,000 the second year, and £23,000,000 the third year, and from £24,000,000 to £25,000,000 the fourth year. I have raised that revenue without adding a single penny to the cost of the necessaries of life. I have done it without interfering with any trade or industry in the country. When I introduced that Budget I found trade at a low ebb, passing through a period of deep depression, and unemployment at its highest. Since then trade has gone up by leaps and bounds, and unemployment has decreased, and our present trade is the largest this country has ever seen." If he can say that, at the end of three years, then he will be entitled to congratulate himself upon having, at any rate, falsified the criticisms of his projects and realised the highest anticipations of his best friends. That is the story of the Budget of 1909.

  TEA.
  I beg to move, "That the Customs Duty charged on Tea until the first day of July, nineteen hundred and twelve, shall be charged as from that date until the first day of July, nineteen hundred and thirteen, that is to say:—
  "Tea, the pound Fivepence."
  Mr. AUSTEN CHAMBERLAIN: The Chancellor of the Exchequer, not content with the task which is usually sufficient for a man of introducing and defending his own Budget, has been good enough, in his concluding observations, to make a speech for me, uttered at some future time, if ever again I have the honour to hold the office which he holds. I hope that, if ever I do make that speech, it will be better grounded than the speech of the right hon. Gentleman. I confess that, to listen to the right hon. Gentleman as he speaks to-day, one would believe that now in this year, for the first time, his Budget of 1909 was really at work, and that now therefore the country was enjoying a prosperity which it has never enjoyed before. I think that the right hon. Gentleman has made exactly the same remark in every preceding year, because within a week after the Budget was introduced he called upon the House to bear witness to its

  1077
  beneficent effect upon the price of Consols. Somehow no one had informed him that the Government broker had just been buying Consols, and Consols are not mentioned to-day except among the many commodities which we may hope to see cheaper under the present efficient administration. After all, that is not the serious side of the right hon. Gentleman's statement, and I should not on this occasion be right in taking the time of the Committee in going into that matter. By far the most important features of this statement were the forecasts of the year on which we have just entered, and the proposal which he has made to the House in regard to the Old Sinking Fund. Before I come to either of these matters I wish to run through some minor details in regard to some of which I have some comments to make, while in regard to others I wish to ask for further information. I think it would be of great interest to the Committee and to the country at largo if the Chancellor of the Exchequer would break up the figures of Customs and Excise and give us on a printed Paper, which might be prepared during the Recess, or presented soon after we reassemble, a statement of the yield of the various taxes under Customs and Excise over a period of five or six years, or any period he likes.
  Mr. LLOYD GEORGE: What period would you like?
  Mr. AUSTEN CHAMBERLAIN: Five or six years would be sufficient for my purposes, but if for any reason, on examining the figures, the Chancellor of the Exchequer thought that to take that particular period would be inaccurate, I should be satisfied to take eight or ten years, or anything that would make a fair comparison. But, as he is well aware, it has been the custom very commonly for Chancellors of the Exchequer in the past to go into detailed figures in regard to these different articles of consumption, and they are all of importance in forming an opinion, both as to the habits of the country, as to the capacity of our taxes, and in preparing Estimates for the ensuing year. On the figures which he has given, I am bold enough to say at once that he has put Excise for the coming year too low. I admit that the growth of Excise, unaccompanied by any similar growth in Customs during the past year, is very extraordinary and takes me by surprise. I admit that there is an explanation to be adduced in
  1078
  the case of sugar. I do not think that partial explanations, such as shortage of crop in these articles, or a less production of tea, really account for the great discrepancy between the relative movement of the Customs and Excise. I wonder whether both the right hon. Gentleman, and perhaps I myself to an even greater extent, have not been wrong in regard to the normal stocks of spirits and perhaps Excise generally held by the dealers. I myself held very strongly, and I think that the Chancellor of the Exchequer held, though there would be some repletion of stocks after the disturbance of the Budget of 1909 was over, that they would not go back to anything like their former level. I wonder whether they have not increased beyond his expectations, and mine?
  Mr. LLOYD GEORGE: They are down considerably, even now, this year.
  Mr. AUSTEN CHAMBERLAIN: The stocks in the hands of dealers. I admit that the extent of the new duty, indicating apparently an increased consumption, takes me by surprise, and I wish that the Chancellor of the Exchequer could give us a further explanation of it. It is, after all, a very speculative matter, no doubt, but I find it difficult to believe that the explanation which the Chancellor of the Exchequer offers by any means explains the whole of that growth. He says that the working men last year had, for the first time in many years, begun to enjoy an increased spending power, but is that really so? Was it due so much previously to a contraction in the spending power of the working man as to the different choice of what he should spend his earnings on? A marked feature was the way in which the money that he used to spend on alcoholic drinks, and so on was spent in other forms of enjoyment: in travel, excursions, taking a holiday with his family, and so on. I do not believe that that process has been checked. I think that it has gone on continuously during last year, certainly during the summer season of the year, and that it is only now being affected in the Easter holidays by the industrial strike. But, on the other hand, I cannot believe that the general budgets of the working classes, for the necessities of life, are, as the Chancellor of the Exchequer's statement would lead us to suppose, lower than what they were in 1904, 1905, and 1906. 1904–5, I think, was the year when I first called attention to this movement, which has

  1079
  been a permanent movement, whereas previously it had been thought to be only a temporary movement. Trade was not at all bad in 1905; but, taking that year and the three years following, I do not think it is true to say that the margin of the working classes for expenditure on luxuries has been increased, as compared with any of those years, in the year which has just ended, by reason of a drop in the prices of the necessaries of existence. Whatever the explanation is, I think the Chancellor of the Exchequer's explanation really will not bear examination.
  I would like to ask also for further details as to Post Office services. Whether he chooses to give them in making his replies this evening or circulate them as a printed Paper they will come out, I suppose; but it is of some importance to us that we should have the expenditure as well as receipts broken up among the different Departments of the Postal service, so that when considering the Post Office Vote, when very large demands for new expenditure are apt to be made on the Government, we may know where we are making money or where we are losing money, and whether we are continuing to secure from the great telephone business which we have just taken over profits comparable with those which they produced under private management. I attach great importance to that. I think that it is right when we embark so much of the State's capital in a great service of that kind we should obtain from the State a contribution in aid of taxes and of these services. I am wholly opposed to the idea of making these services barely self-supporting and not exacting from the Post Office a revenue in relief of that which we expect to get from what is usually called direct taxation or taxation on commodities. For those purposes I shall be glad if the Chancellor of the Exchequer will give us further information about the prospects of the current year, assuming that they are not altogether overclouded by further industrial disturbances. I think that the Chancellor of the Exchequer is right in making a sanguine forecast. For my part I am inclined to be more sanguine than he. I speak with less responsibility. I speak with less information, and perhaps it is very rash of me, when there is no necessity for me to prophesy at all, to venture into the realm of what is necessarily speculation, but I do think that in his estimate he has rather under-estimated
  1080
  the revenue which may be expected to be received from this source than over-estimated it. I am assuming the basis for calculation which he himself has taken that the present industrial dispute is rapidly drawing to a close. I do not feel it is desirable for the moment to enter into a discussion of that matter, but assuming that which the Chancellor of the Exchequer has chosen after consideration to adopt as the basis of his calculations, and assuming that the industrial position is not again disturbed on a large scale, then I think, speaking generally, that the Chancellor of the Exchequer's Estimates are low rather than high. I now turn to the contrast which the Chancellor of the Exchequer drew between the present position and the position three years ago. Then he said he was faced with the biggest deficit on record; now he had the greatest realised surplus, and he was able to provide for a greatly increased and ever-growing expenditure without any new taxation. His statement that he had got the largest realised surplus on record was largely cheered by hon. Gentlemen on his own side. I do not think the Chancellor of the Exchequer has quite the same satisfaction about it himself. It is partly due to mistaken Estimates for which he is responsible; it is partly due to mistaken Estimates for which his colleagues are responsible.
  The FIRST LORD of the ADMIRALTY (Mr. Churchill)was understood to dissent.
  Mr. AUSTEN CHAMBERLAIN: I do not understand the First Lord of the Admiralty, who hastens to contradict. Does he choose himself to disclaim responsibility for the Estimates in his Department?
  Mr. CHURCHILLwas understood to say: The circumstances connected with the excess in the Estimates could not be foreseen.
  Mr. AUSTEN CHAMBERLAIN: Were they mistaken Estimates; were the Estimates correct or were they not? They were not. That is the only statement I am making. There is a certain amount of satisfaction, a great deal of satisfaction to be got when your Estimates of revenue are exceeded because of an unforeseen and unforeseeable increase of prosperity in the country, but there is no satisfaction to be taken from the fact that you have raised money for a particular purpose in order to obtain particular services in return, and

  1081
  then, when you have not been able to obtain those services, the money remains in your pocket. That is what has happened in regard to about half this surplus. Owing to circumstances outside the control of the Admiralty—I do not in the least wish to say, I should be very far from saying that there has been a deliberate delay in the programme, in order to make a record for the Chancellor of the Exchequer— such a thought never crossed my mind, of course, but owing to circumstances which were not foreseen, and which were in themselves regrettable, we have not got for the Navy what we intended to have, what was placed before us as the minimum which we ought to have. Because we have not got it the money is not spent, the surplus is realised, but the liability remains for future years. When it comes to the rest of the Chancellor of the Exchequer's congratulations I think there is something to be abated from them when you examine what they are and out of what they arise. Did anybody ever pretend that he was not going to get a great deal of money from the taxes which he proposed in 1909–10?
  Mr. LLOYD GEORGE: Oh, yes.
  Mr. AUSTEN CHAMBERLAIN: I think not. To some of the most remunerative of the taxes then imposed for the first time no objection in principle was raised on this side of the House, and, indeed, the remarkable thing about the Budget of 1909–10, after three years' experience of it, is that the taxes about which the battle waged fiercest, for which the Chancellor of the Exchequer contended most strongly, to which he attached the greatest importance, which really were the children of his own particular love—from those taxes we have derived revenue in subsequent years utterly negligible on a balance sheet so huge as ours, and which have caused an expenditure far exceeding the revenue in amount. Surely nowadays the Chancellor of the Exchequer will no longer pretend that these taxes are or were ever meant to be, in their present form, and as approved by the House of Commons, a great fiscal machine. No such claim is made for them now.
  Mr. LLOYD GEORGE: Yes, certainly.
  Mr. AUSTEN CHAMBERLAIN: On the contrary.
  Mr. LLOYD GEORGE: The right hon. Gentleman may take his own view. I
  1082
  still claim that the Increment Duty will produce a very, very considerable amount.
  Mr. AUSTEN CHAMBERLAIN: Hope springs eternal in the Chancellor of the Exchequer's breast. All we can say is that the right hon. Gentleman has estimated the revenue derived from this duty and the other Land Taxes as several times on a constantly decreasing scale, and that it has never come up to any of his Estimates. I think I am justified in saying that the real merit of the taxation in the eyes of the Chancellor of the Exchequer, as in the eyes of his most earnest supporters below the Gangway, is the possibilities that lie behind it. After all, as the Chancellor of the Exchequer said to-day, so little did he think of the tax that he gladly made a present of half of it to the local authorities. With delightful ingenuity, he, who has bragged of the relief he has given to the local authorities, has said, "Was it likely that I should expect to get much from that when I really gave away half of it to the local authorities. Do you think that I am the kind of man to give away half a tax if it has any money in it? Those of us who know the Chancellor of the Exchequer will readily respond with the negative answer which he expected from us. That is not the value of the tax. Its value lies in the valuation which was introduced as the necessary basis of the tax, and which is now becoming the justification of the Budget. Is it worth while to spend millions in getting a small revenue, because at the cost of these millions and on the excuse of these taxes you get a really trustworthy survey of the land values of the country on which you can in future base a reform of your local taxation, and at the same time from which you can draw boundless resources for the Treasury? Let me say, in the first place, that if the valuation were perfect and if you on that valuation raised fresh taxes in relief of the rates, you would not have dealt with or touched the great inequality of our present rating system. The great inequality of our present rating system is the unequal treatment of realty and personalty, and the more you put on to your new valuation in relief of local rates the more you are taxing realty, or at least you are only shifting the burden from one form of realty to another form; but you are not doing what has been the object and idea acknowledged by every reformer of local taxation, that of bringing in personalty to shire the burdens which now fall with undue weight upon realty.

  1083
  In this valuation, I think I am correct in saying a fanciful valuation, you are valuing something which in nine cases out of ten never comes into the market, and which never can come into the market. Your tax is levied on no definite basis of fact, but on a balance of speculative opinion as to probabilities and possibilities—on what some arbitrator may conclude as being the most, reasonable means between the unreasonable speculations of expert witnesses employed on either side. Is that a hopeful basis for raising large Bums of money? We have urged upon the Chancellor again and again that the basis which he chose for his taxation was not a suitable basis for a workable system; and I think that everything that has happened in the fixing of these values has tended to confirm and justify the opinion that we expressed. The matter becomes of increased importance when the Chancellor of the Exchequer, following the hon. Member for Newcastle-under-Lyme (Mr. Wedgwood), and the hon. Member for Blackburn (Mr. Snowden), and other pioneers of these forms of taxation, points to these as his great resource against future needs, and it becomes urgent to verify the accuracy of the valuations which are being made— to test their accuracy and to see how the thing is being done. Last year the Chancellor of the Exchequer—I think it was in the month of December, on the Third Reading, at all events, it was very late in the Session—agreed that we ought to have an inquiry into the character of the valuations that have been made at an early date, but he did not think the time had come then, and he thought that such an inquiry might produce results very unpalatable to us. I do not inquire whether the results are going to be unpalatable to individuals or not; I do not inquire whether they are going, as a whole, to prove the case of one party or not; but I do say that when such importance is given to the valuation by the Chancellor of the Exchequer, and when on it depends the amount of taxation payable by countless people throughout the country, it is of great importance that we should know whether the valuation is one that ought to command our respect, whether it has been satisfactorily carried out, and whether in fact the conditions of the law which regulate the way in which it is carried out, are such as can be fulfilled satisfactorily in practice.
  I would invite the Chancellor of the Exchequer now, and without further delay,
  1084
  to appoint this Commission of Inquiry. I call it a Commission of Inquiry, but I do not want to bind myself or the Chancellor to the exact terms I use in describing it. I do not want a Committee of this House, which is not the tribunal to judge of the matter. I want people with sufficient knowledge, or sufficient general experience, to judge clearly and fairly on the evidence that is produced before them— a tribunal that will command respect, that will speak with authority, that will pronounce an unbiassed verdict, and give all of us that light by which we can walk in future. As to the exact form of inquiry, we may very well leave that to the Chancellor of the Exchequer, if he will give us the inquiry itself in a practical, judicial and unbiassed spirit. I come now to what is the real outstanding feature of the Chancellor of the Exchequer's Budget. His proposal, as I understand it, is that the whole surplus which, according to the ordinary law of the land, should have gone to the redemption of the Debt, is to be held in suspense in the Exchequer balances to meet the demands upon him in the course of the year, and if there be any balance over, after the abnormal and exceptional demands in the course of the year, it is to be appropriated as the House should see fit a year hence. I heard that statement with great regret. To begin with, I think that the basis which the Chancellor of the Exchequer built upon was wholly insufficient to maintain such a super-structure. The Chancellor says that this surplus is partly created by the failure of the Admiralty to spend the money which it was expected to spend. Yes, but press that to its fullest extent and all that the Chancellor can claim on that account would be half his surplus and no more, as that which he might properly divert from the redemption of debt, owing to the under-expenditure on the Navy. He says that the Admiralty under-spent by something like £3,000,000. [HON. MEMBERS: "A million and a half."] I am putting it too high. The Admiralty under-spent a million and a half, of which they will spend in this year only about half, or £600,000 exactly. He does not want the money to find that £600,000, he is going to find that out of taxes, he is holding six millions and a half, and his justification is a million and a half which was not spent last year, and of which £600,000 is going to be spent this year. The argument is wholly insufficient to support the action which he bases upon it.
  Mr. LLOYD GEORGE: It was certainly not my most serious reason. I referred to the contingency which the First Lord of the Admiralty made as clear as it should be made clear.
  Mr. AUSTEN CHAMBERLAIN: I am glad the right hon. Gentleman has reminded me of that matter, but I must deal with the question in sections. As far as the under-expenditure last year was concerned, only £600,000 of that is going to be met this year. It is an entirely novel principle to hold over any part of your realised surplus to meet non-expenditure in a previous year by the Departments concerned. It is destructive of the whole basis of your finance. There never will be an Old Sinking Fund again if that becomes the settled practice of this House. Again and again Departments have begged to have this latitude allowed to them. I venture to say, speaking not without a rather diversified experience both in spending Departments and at the Treasury, that if you are going to allow the Departments to keep their unexpended balances to spend in the next year in addition to the sums that would be normally voted for that year, you will find your expenditure growing more and more than ever in spite of you. It is the greatest check against over-estimating, and it is one of the few checks you really have in the Departments like the Admiralty and War Offices that if they over-estimate they shall not have the benefit. If you are going to teach them that if they only over-estimate enough and cause a heavy enough surplus you will let them have that money, then you are going to strike a great blow at accurate estimating and proper control over the expenditure of the country.
  I come to the second question. The right hon. Gentleman said that he is holding this over not merely to provide against the under-expenditure of last year, but also for the contingencies foreshadowed by the First Lord of the Admiralty. I am the last man to complain either of the provision which the First Lord foreshadowed or of the determination of the Government, and the Chancellor of the Exchequer that if that provision be required it shall be forthcoming, and as much shall be forthcoming as is needed. But I cannot reconcile the statement which the First Lord of the Admiralty made with the provision which the Chancellor of the Exchequer is making. The sum of £6,000,000 seems to me something altogether beyond any sum that could be con-
  1086
  ceivably required on the Estimates of this year, in addition to those which are already before the House on the basis laid down by the First Lord himself. That is the second item which justified the Chancellor of the Exchequer, in his own estimation, in holding back this sum. If he might plead with any show of reason that it justified him in holding back part of it, it does not justify him in holding back the whole of it. Although he may say, if it is not all wanted a year hence it shall still go to the Old Sinking Fund, I distrust these bills on futurity. Once money has been intercepted the Chancellor of the Exchequer, or other people for him, will be ready enough to find other purposes to which the money may go if it is not required for the Navy, without its being allowed to be spent in paying our debts, a task which is never pleasant to any of us, and never much loved by this House in particular.
  I venture to say that the moment the Chancellor has chosen for diverting this money from the Sinking Fund is a singularly unfortunate moment. The Chancellor of the Exchequer has had difficult years to face. Nobody doubts that, but the deficit was largely the Government's own creation. It was partly a deficit which no one could have prevented, but undoubtedly there was a deficit which they might have prevented and which, in stead of preventing, they did everything to increase. At the very moment that the Government introduced their old age pensions they took off half the Sugar Duty. When you are proposing £9,000,000 additional expenditure and when you admit you have not revenue to meet it, is that the moment to take off your duty? That is reckless, spendthrift finance. It is not a fiscal policy of any school; it is pure vote-catching on the part of the Government. We admit that the present Chancellor of the Exchequer had at once to fill a gap in taxation which his predecessor had made. He had to pay for his predecessor's fancies as well as his own, and he had a very difficult financial task. I do not think he will say that in the various raids which he has made on the Sinking Fund that he has had any very severe criticism from this side of the House. I think he has perhaps had less criticism than he ought to have had. I am not at all certain, if I could put myself back to where I was when he took £3,000,000 away from the fixed Debt charge, that I would repeat the statement that I then made that I was not surprised and that I thought it not an immoderate

  1087
  thing to do. My hon. Friend behind me (Sir F. Banbury) has the peculiar happiness of being alone in his virtue and wisdom.
  I recognised at that time the difficulties of the Chancellor's position, and I assumed that when he got through those difficulties he would try and restore some part of the provision which he had taken away from the National Debt, and that, at any rate, he would not have raided it further. Now he is making it a stated practice, and when he has got the opportunity with a great realised surplus to make a great effect in the reduction of debt, and when he has the opportunity to produce a marked effect on the national credit and the price of Consols, he has thrown that opportunity to the winds. The Chancellor of the Exchequer talks a great deal about the amount of debt that is really due. He must remember that today it stands higher than it did before the war. On 31st March, 1899, it was £628,000,000, and the figures last published, those of last year, disclosed that it was £685,000,000. There has been some reduction during the current year, which has not yet appeared in the new Returns, but the debt stands higher than at the time of the war. Not only that, but the price of Consols stand infinitely lower. I am not going at this moment into a subject which we have frequently debated without coming any closer together on it, namely, the cause of the reduction in the price of Consols or the extent to which the Government are answerable for that, but I do say that the low price of Consols is extraordinarily favourable to their redemption, because for every million devoted to the purpose you extinguish so much more debt than if the price were higher. I say, also, that the low price makes it peculiarly obligatory on the Government to use all the endeavours in its power to raise the credit of the country. The Chancellor of the Exchequer is doing nothing of the kind; he is utterly regardless about the credit, of the country, as far as I can see. I deplore and I blame the choice which the Chancellor of the Exchequer has made of the way to treat the realised surplus of this year. It will have a bad effect on the market, a market already sufficiently depressed, where the only big buyer in these days is the Government itself. The price of Consols has a depressing effect on the other British Government securities and on the borrowing power of the Government.
  1088
  6.0 P.M.
  When the Chancellor of the Exchequer speaks with a solemnity with which he did to-day about the possibilities of the future, a solemnity and responsibility which, I think, formed at least as happy a contrast with his speeches of three years ago as the revenue of to-day does with the revenue of that time, when he speaks with such seriousness and responsibility about the prospects of the future, I beg him to remember that one of the elements of our strength is our reserves for use in such emergencies, and that he is the particular guardian of those reserves. I beg him even now at this last hour to show some sense of his responsibility in that respect, and to reconsider the proposal which he has laid before the Committee to take away the whole of the realised surplus from its proper and legal application to the redemption of debt. The Chancellor of the Exchequer makes no changes in taxation on the estimates of expenditure and revenue which he has laid before us. He sees his way almost exactly to balance expenditure and revenue. A Budget which otherwise has no features of special interest, and I do not know that the Budget speech had many, is rendered singular, and I think singular for evil, by this proposal of the Chancellor. For my part, I shall certainly resist this appeal, although I did not resist his earlier appeals.
  Mr. LOUGH: I should have been very glad if the Budget statement had been of a nature enabling me to say something encouraging and complimentary to the right hon. Gentleman, but I must confess that we have very little either to criticise or to praise. It is a simple statement, satisfactory from many points of view, of the national accounts, but one which in some respects will cause disappointment. The chief honour of a Chancellor of the Exchequer is in taking off taxes and in reducing burdens. However much you may boast about the success of the taxes that you put on, the nation will never be so grateful to the man who puts on taxes as to one who takes them off. I have been a good deal puzzled—and my state of mind has not been cleared at all by the speech of the right hon. Member for East Worcestershire (Mr. Austen Chamberlain)—by the reasons given for absorbing the whole of the surplus. The right hon. Gentleman opposite dealt with those reasons, but he did not make the matter any clearer. The first reason given by the Chancellor of the Exchequer was the £1,600,000 short

  1089
  expenditure on the Navy. What does my right hon. Friend mean by alluding to that in this connection? He says that he is adding the surplus to the Exchequer Balances because of that short expenditure. Does that mean that the £1,600,000 is to be expended this year, and that the money is to be taken from the Exchequer Balances? If not, it has no meaning. But surely it does not mean that, because we have had Estimates presented to us, and to a certain extent passed, in regard to naval expenditure, embodying the fresh £600,000, which is the only portion of that short expenditure which is to be incurred this year. Having regard to that fact, this short expenditure on the Navy should not have been mentioned at all, as it does not affect the matter, and the Chancellor of the Exchequer does not propose to spend a single shilling of this particular money in making good that short expenditure, if there was any. Personally, I do not wish him to spend it; but I will allude to that point in a moment.
  The Budget statement was really not a fresh statement at all. We had not much comment on the figures of the year. We had rather a retrospect of the three years, and the old story of the Budget of 1909 was retold once more. My right hon. Friend can easily carry that course of argument a little too far. He spoke of the splendid trade we have had, the great prosperity of last year, the growing trade of 1909–10 as compared with that of 1908. He spoke of it as if it had been caused by the Budget of 1909. He went almost too far. We cannot have had the splendid trade and the great national progress simply be-cause heavy taxes were laid on. All the distance to which the argument can be pushed is that, owing to other causes, such as the great recuperative force of the nation, we were able to carry on our trade in spite of the heavy taxation. That is as far as the argument can be carried. It is rather a pity that we should have had the Chancellor of the Exchequer at once asking the people to bear this extra burden of £20,000,000 or £22,000,000, and then telling them that it has increased their wages, improved trade, and increased the prosperity of the nation. I think it is rather a questionable argument if it is pushed to that extent. However, some of my hon. Friends say that the Chancellor of the Exchequer did not go that far. I am willing to accept their statement, but there is a danger of pushing the matter too far.
  Mr. J. WARD: The Chancellor of the Exchequer never suggested such a tiling.
  Mr. LOUGH: With regard to the Budget of 1909, there was one aspect to which the Chancellor of the Exchequer referred at some length. He spoke of having had a very large deficit to deal with in 1909. A full half of that deficit was created by the Government itself. A vast part of the increased taxation went in new expenditure on the Navy. That is really the subject about which I rose to speak.
  Mr. J. SAMUEL: The other side do not cheer that.
  Mr. LOUGH: It is their policy to make expenditure on the Navy, but it was our Chancellor of the Exchequer who did it. That is what grieves me about it. There never was a Chancellor of the Exchequer who, as far as his past record went, was as much pledged not to increase expenditure on armaments as my right hon. Friend, and yet he has increased the expenditure more than any other Chancellor of the Exchequer in this country has ever done. My hon. Friend says that the hon. Members opposite do not cheer that statement. Of course not, and for good reasons. It is not the policy of the Liberal party: it is the policy of the Tory party. A large portion of these heavy burdens has been incurred by my right hon. Friends, because, in regard to expenditure on the Navy, they made themselves the instruments, not of the party which put them into power, but of the party which sits opposite. My right hon. Friend alluded also to the slight decrease in Navy expenditure, and said he was disappointed about it. He had good reason to be disappointed. The decrease is only £303,000, while the increase in three years is £13,000,000. That is most deplorable, and it is a matter to which we are justified in calling attention, because of the ominous remarks made by my right hon. Friend. He spoke even more confidently, and more definitely than the First Lord of the Admiralty about possible increased expenditure on the Navy this year. He stated that he was keeping the money for that, and then he spoke of the prospect of a great increase next year. I protest against these remarks at this early stage. I see no necessity for them. If we were to ask why this expenditure has to be made, my right hon. Friend would say that it is not because of any disturbance in the world's peace, but because of panics that are being created, perhaps in this

  1091
  country, perhaps in foreign countries. But that is a point on which my right hon. Friend himself is not free from blame, and I believe that many of his colleagues contribute their part to making the very difficulties which he has to meet at so much pain and cost to the nation. I believe that the speech of my right hon. Friend to the bankers last July did a great deal to create a panic. I believe that the speech of the First Lord of the Admiralty at Glasgow recently, which was conceived in a very different tone from his speech in this House, did something to create a panic. If we go back three years, as the Chancellor of the Exchequer has done, what was the reason for the great increase in 1909? I have said it before, and I repeat, that it was because of the panic statements made from the Treasury Bench with regard to the Navies that would be built. Three years have passed, and those fleets have mostly proved to be phantom ships; not half the ships on which those Estimates were based were built. But although the ships were not built, the Estimates remained, and we are told that we shall have more and more expenditure for these reasons. I consider it most deplorable.
  The worst aspect of the matter is that it illustrates the fact that the nation has become powerless in this matter. Here is a Government supported by a combination of parties—the Irish party, the Labour party, and the Liberal party. I venture to say that the only party of those three in which any substantial support is found for this policy of increased expenditure on armaments is the Liberal party, and probably not more than 20 per cent. of that party are at the back of this expenditure. Yet we are told in the Budget speech—it is its chief feature—that the expenditure may be heavier this year and heavier still next year. Perhaps this is not the time to discuss the question at any length. I deplore very much that my right hon. Friend should have said so much about it. It is these innuendoes, and the solemn statements from the bench opposite, that they quite approve and know the serious nature of the position, that cause the trouble. All the nations of the world have their ears open. That is what makes the difficulty with which we are struggling. I think we might have been spared it on the present occasion. If we conducted these matters more soberly, and said less about these panics and alarms, and about what other
  1092
  nations are doing, we would be able on an occasion like this to use the vast resources which the prosperity of the country has put at our disposal to reduce taxation. I am sorry that on this occasion it was not possible to do anything of that kind. However, we must congratulate ourselves that there is no increase of taxation. The large sums devoted to the purposes of the Insurance Act— from which great benefit has accrued, and I believe will accrue, to the country—are found in the Budget without any increased taxation. So that, if we have not much to compliment ourselves upon, there is not much to be very sorry about either.
  On the whole I think everybody ought to be pleased that the Chancellor of the Exchequer was able to take such a rosy view of the future in regard to trade. I think the Estimates are again too low. We are probably working for a big surplus next year. That sort of thing may be carried too far. I could not understand the process by which, although a big increase in consumption both of spirits and of beer is estimated for, there is an anticipated decrease in the revenue from those sources. The Estimates are possibly too conservative all round. But that is a good fault. It will perhaps give us a large surplus next year which we may be able to use even more wisely than the surplus is being used this year. I think there is room for the criticism of the right hon. Member for East Worcestershire. I know that if a Conservative Chancellor of the Exchequer had made away with a vast surplus like the surplus of this year, without applying a penny of it to the reduction of debt or any other particularly useful purpose, and if we had been sitting on the other side, we would have had a few words to say about it. But it is not for us to utter those criticisms. Taking the whole statement, apart from the dark threat of increased naval expenditure, which I hope will not be realised, it is one on which the country can congratulate itself, and I think we ought to be pleased that the Chancellor of the Exchequer was able to make it to-day.
  Mr. C. T. MILLS: I think that everybody who takes an interest in the stability of our national credit must have been somewhat appalled to hear of the action which the Chancellor of the Exchequer proposes to take with regard to the surplus of over 6½ millions which he so greatly prided himself on having obtained this year. The right hon. Gentleman told us

  1093
  that he was going to put this surplus to a Suspense Account, in order to provide for certain possible contingencies, such as increases in naval expenditure and the incalculable effects of the mining strike. I do not feel competent to criticise the justice of the calculation that the Chancellor of the Exchequer has made, but I would say, as to keeping this money in order to provide against the strike, that it may be quite possible, if we foretold the result of this strike, that it may be such a dislocation of trade and such a dislocation of the rates of exchange between this country and other countries as to cause something in the nature of a financial panic. If that, unfortunately, comes to pass, surely it would be very much better to strengthen the Consol market and our reserves by putting this great sum of money to the reduction of debt. If we feel it incumbent upon ourselves to make some reserve that reserve seems to me should be made by a reduction of expenditure rather than by reducing the amount of money which we are going to put to debt.
  With regard to the extra expenditure that may possibly be required for the Navy, I would say that if this money is wanted it would certainly be more cheaply raised by the issue of Exchequer Bonds, or any short-dated issues of that sort, than by adopting the very extravagant method which the Chancellor of the Exchequer has foreshadowed. He is getting Consols at a very low price. This is an opportunity which ought not to be missed of applying this very large surplus to the reduction of debt. The Chancellor of the Exchequer read to the Committee a very interesting letter of Sir William Harcourt, which he took to be some justification of the method of his action with regard to this surplus. Sir William Harcourt said that he thought it would be sufficient if the Government maintained the New Sinking Fund and the terminable annuities. But he wrote that letter in 1896! At that time the amount voted for the service of the Debt was £25,000,000, as against £24,500,000 now. He had to find £6,400,000 to meet terminable annuities, whereas the present Chancellor of the Exchequer has only got to meet a little over £3,000,000. Therefore the provision that the Unionist Government of the day required to make that reduction of debt was infinitely larger than the provision that the present Chancellor of the Exchequer is proposing to make. During the past few months a great deal has been written and said by very competent authorities of all shades of political opinions
  1094
  about the depreciation in Consols. I think it is such a serious matter, especially in face of the statement which the Chancellor made about the reduction of debt, that we are justified in drawing the attention of the Government to it once again. The Government, I know, during the past year, by making Consols transferable by deed in the ordinary way, instead of making the public sign books at the bank, have done something to show that they realise that the present weakness of the Consol market and the low price of stock does constitute a matter of very severe import.
  I do not wish to criticise the measure which the Chancellor, or the Government, have adopted. I do not desire to speak as to its advantages or its obvious disadvantages. But I think everybody will admit that it is only a palliative. It is not now going to the real root of the matter, and attacking the real causes of the present depression of our premier security. What is the attitude of the Chancellor of the Exchequer on this subject? He deplores the falling Consols, but he is perfectly satisfied that this fall is due to causes which are peculiar to Consols and Government securities, and is due to causes for which the Government of the day has no responsibility whatever; further, that this depression shows no weakening in our national credit. That is a most dangerous position to take up, as it completely ignores and shows inability to grasp really the serious nature of the problem before us. It is obvious that the present price of Consols must be a very great national, danger, must weaken our power of defence in any crisis, whether military or commercial. The vital question, as I shall try to show this evening, is that this depression of Consols cannot be taken as a mere isolated phenomenon, but it is a sign of the general unsatisfactory tendency of our national credit.
  I am not one of those people—they exist, I believe, mostly in the imagination of the Chancellor of the Exchequer—who believe and try to prove that this country is bankrupt, and that our national credit is shattered. I am proud to think that our credit, in spite of the Chancellor of the Exchequer, is still the strongest in the world. I am proud to think that the people of London are the bankers of the world, and that half the commercial transactions of the civilised world are based upon British credit. A great position like this does bring with it very great responsibility. We

  1095
  must remember that the maintenance of our credit is an absolute necessity to the material prosperity of the inhabitants of this great Empire. When we consider that all our trade rivals are jealous of our financial superiority, and that we have built this enormous structure of credit on a comparatively insignificant foundation of gold, I think we are justified in urging the Government to do all they possibly can to take every measure which they possibly can devise, to see that this credit of ours is maintained and preserved in the future as it has been in the past. What I want to show is, that although British credit is still the strongest in the world during the last few years it has undoubtedly tended to lose the pre-eminence which it once had. That is to say British credit, measured by the price of Consols, which are generally taken to be the barometer of our credit, has tended to depreciate to a greater extent than that of leading foreign nations.
  Let us compare the prices of Consols—I know the comparison has been made before, and I apologise to the Committee for making it again—with the price of the premier securities of other first-class Powers. I only take the first-class Powers in this connection, because it is, of course, desirable, as far as possible, to compare like with like. The comparison of our securities with the securities of small countries such as Switzerland would very much help my argument. Yet clearly the comparative smallness of that debt and the consequent difference in the market would vitiate any comparison. Between 1906 and 1911, taking the highest price in each year, we find that Prussian Three per Cents, have dropped 3¾ points, that Prussian Three-and-a-Half per Cents, dropped 5¼ points, that German Imperial Three per Cents. dropped 4 points, and that French Three per Cent. Rentes dropped 2 points. During this period British Consols had dropped 9 points. That shows that the fall in Consols during the period under review has been from one and a half to nearly five times as great as that in the similar securities of other countries. Objection may be made that all these securities which I have been comparing bear a different rate of interest, and that Consols pay by far the lowest rate of interest. As during the past few years people generally have tended to demand a higher rate of interest for their money it is obvious, it is urged, that the fall of Consols would be
  1096
  greater than in the securities I have referred to. I quite admit the justice of that argument. I think that a far fairer comparison can be made on the basis of the yield per cent., again taking the highest figures of the years under review. In 1906 Consols paid £2 14s. 9d. per cent. In 1911 Consols paid £3 0s. 9d. per cent., or an increase in the yield of 6s. per cent. During the same period German Imperial Three per Cents, showed an increased yield of 3s. 2d., Prussian Three per Cents, of 3s. 1d., Prussian Three-and-a-Half per Cents, of 3s. 10d., and French Three per Cent. Rentes of only 1s. 2d. This therefore shows that the increment yield of Consols has been on the same basis from one and a half to nearly five times as great as the increased yield of similar securities in other countries. Both methods of comparison must lead us to the same conclusion, namely, that our credit is not so superior to the credit of our trading rivals as it was some years ago.
  Let me put it in another way. In 1906 people were content to invest money in Consols, getting only £2 14s. 6d., considering that the better security made it a better investment than, say, French Rentes, which paid £3 0s. 4d. The ratio between the credit of these two countries has changed to such an extent that now the investor requires a yield of £3 0s. 9d. to tempt him to invest in Consols, while a yield of £3 1s. 6d. is sufficient to induce him to invest in French Rentes. In 1906 the investor was content to receive 5s. 7d. less on Consols than on French Rentes, because he thought the security was so much better. The conclusion is that the security of the two nations is about the same. I do not think that a panic conclusion. I do not think the Chancellor of the Exchequer would call it an unpatriotic attempt to depreciate British credit. I am sure that nobody deplores the fact more than I do, but I think it must be obvious that our credit is tending to lose that preeminence which is essential to us if we are going to maintain the prosperity of the people of this country and of the Empire.
  If we turn to an examination of, say, the debenture stocks of our great railways —I do not intend to weary the House with figures now—we find it is the same story: a gradual depreciation in their price. There is one point of interest which I would like to draw the attention of the House to.

  1097
  Perhaps the best test, that we can apply to the stability and well-being of the national credit is to see whether the investor is equally ready to invest his money in his own country or whether in increasing numbers the people prefer to invest their money abroad. The Chancellor of the Exchequer said this afternoon, I think, that "capitalists have never shown greater activity in investment." I quite agree. Unfortunately this activity has not been confined to the United Kingdom. It has largely taken place in other and foreign countries. We find that between 1905 and 1910 the incomes from abroad increased by £20,000,000, represented, roughly, capital invested abroad of about £500,000,000. The Prime Minister has a theory that it is a sign of the prosperity of a country that it should have a large amount of surplus wealth available for foreign investment; wealth which it does not require to invest in home industries. I quite agree with that.
  What he and his supporters have taken for granted is that this large increase of income from capital invested abroad represents an increase in the surplus capital of this country, and that therefore it is a sign of the increasing prosperity of this country. I imagine if I can show that this increase of capital invested abroad is not in proportion to the increase of wealth of this country—that is to say, that it is not an increase in our surplus wealth— I am sure that hon. Members will be quite ready to agree with me that the Prime Minister's theory does not apply in that case; and that so far from it being a sign of prosperity it is a sign that the British investor has become afraid of investing his money in Home Securities. Perhaps I shall do well to make that point. In 1905 identified incomes from British Government Securities, from businesses, occupations, and professions in this country amounted to £481,000,000. The incomes from abroad amounted to £73,000,000. If we assume that in 1905 this theory of the Prime Minister was correct and that this £73,000,000 did represent income from surplus capital which was not wanted at home, we must then come to see how this theory fits with the year 1910, for between those years this £73,000,000 had increased to £93,000,000, or 26.2 per cent. Obviously, if that £93,000,000 represented income from surplus capital, the incomes of British investors from businesses, occupations, professions, etc., in this country must have increased by a more or less similar rate. We find on the
  1098
  contrary, whereas incomes from abroad during that period increased by 26.2 per cent., incomes at home only increase by 6.8 per cent. The hon. Gentleman the Member for Stoke may deride these figures, but I venture to say—
  Mr. J. WARD: What is the actual increase apart from percentages?
  Mr. MILLS: I think I have already given the Committee the actual increase, the increase in incomes from abroad rose from £73,000,000 to £91,000,000.
  Mr. J. WARD: And the incomes at home?
  Mr. MILLS: I am afraid I have not got the actual figures of that increase. I think this shows that even if the capital invested abroad were surplus capital it is certainly obvious that the large increase of capital invested abroad up to 1910 has not been kept pace with by the increase from incomes invested in this country. I think that shows that our national prosperity has not increased, but that the investor has become shy of investing his money in this country and has invested it abroad. It may be interesting to note that in the period between 1894 and 1899, when the Unionist Government were responsible for the finances of the country, this process was almost entirely reversed, and income increased by 21 per cent. for investments at home, while income from capital investment abroad increased by only 11 per cent. I maintain, on the face of these figures and the testimony of business men all over the country, it is impossible to say that our national credit stands as high to-day as it did five years ago. I do not think we shall make this fact any better by shutting our eyes to it, and I think what we ought to do is to see that the Government adopts some method of improving our finances.
  Mr. PRINGLE: Will the hon. Gentleman tell us what is the figure for 1898 instead of 1899. 1899 was the first year of the war.
  Mr. MILLS: I have not got that figure. I think the Government ought to take some steps to try and meet this state of affairs. We may inquire what has the Government, who are responsible, done to improve this situation? My right hon. Friend the Leader of the Opposition made a strong attack at the Albert Hall some months ago upon the financial policy of the Chancellor of the Exchequer, and the

  1099
  Chancellor of the Exchequer soon after summoned a meeting of his own supporters in the city one Saturday afternoon, and tried to make an elaborate answer to my right hon. Friend's attack. His reply amounted simply to a tu quoque. He said if the policy of the Government was bad the policy of their predecessors was a great deal worse. I do not think that is true, but I do not intend to argue the point. But even if it is true our credit will not be preserved by the Chancellor of the Exchequer trying to score debating points against his opponent. Has the Chancellor of the Exchequer done anything during his term of office to raise the price of Consols and strengthen our financial credit? It seems to me his actions have all tended in a completely different direction. Since he took office he reduced the sum set aside for the reduction of debt by £3,500,000. He took £2,500,000 from the Sinking Fund in 1909–10, and in 1910–11 he raided the Old Sinking Fund to the extent of £3,000,000, and now in his present Budget he is proposing to take away from the reduction of debt the whole of the £6,000,000 surplus which ought to apply to the Old Sinking Fund. This policy is bad enough, but it would not be so bad if joined to a moderate system of taxation. We find that from 1905 to 1911 the revenue has increased by 19 per cent., and at the same time the Income Tax has increased by 41 per cent. and the Death Duties by 45 per cent. May I remind the Committee that these Death Duties are a direct tax upon capital, and are paid largely by sales from Consols. I do not think anybody can call this a policy of strengthening Consols or our national credit. With such a system of debt reduction and such a scheme of taxation joined with the policy of reckless extravagance, is it any wonder that our credit is not so well thought of both at home and abroad as it used to be? The Chancellor of the Exchequer seems to have no financial policy which can have an effect in improving Consols or our credit. Speaking in the city he said:—
  "Consols have fallen. True! But all Government securities throughout the Continent of Europe have fallen. and it is only our amateurs in finance who would ever dream of attributing that to Budgets. It is a matter for looking into. It is a matter for grave consideration."
  I venture to disagree with the Chancellor of the Exchequer. I have shown that Consols have fallen in this country to a greater extent than similar securities in other countries, and I maintain that
  1100
  Budgets, in so far as they represent the financial policy of the Government, do have a very great effect upon Consols, and through them upon our national credit. The Chancellor of the Exchequer attempted this afternoon to take great credit to himself for the prosperity and strength to our resources which the Budget of 1909–10 brought. One could take instances if necessary to show the effect Budgets can have upon the price of Consols. The present Prime Minister, when Chancellor of the Exchequer, undoubtedly did not offer so much refreshing fruit to the people of this country as his successor, but I do not think anybody would deny that he did make adequate preparation for the reduction of debt, and did pursue, on the whole, a wise financial policy. What was the result? The result was that for the first time for many years during the present Prime Minister's term of office as Chancellor of the Exchequer Consols actually appreciated in value; somebody may say that was in a time of cheap money. No doubt it was, but since we have had the present Chancellor of the Exchequer, there have been periods of cheap money, but the price of Consols continues steadily to fall, and other investments also. In the last Budget of the Prime Minister as Chancellor, in 1908, he said:—
  "I do not hesitate to say, I am entitled to say, that the time has come in the various interests we have to safeguard and promote and in connection with finance and the reduction we shall have made in March next, to justify a review of the situation."
  He was talking of the £28,000,000 he had set aside annually for the reduction of debt. The present Chancellor of the Exchequer was quick to act upon that hint. He reviewed the situation to some purpose, and reduced the £28,000,000 to £24,500,000, and the result of that review has been a steady depreciation in the price of Consols. It seems to me a vital question to ask what steps the Chancellor of the Exchequer and the Government have taken to stop this fall m Consols. Most people are ready to admit it is a danger. The Chancellor of the Exchequer, when speaking in the City, said:—
  "There were a hundred thousand different theories for keeping up the price of those securities, They may be right, but very nearly all of them have been open to the same charge that they are only methods of tinkering with the matter. They are trying to increase the price of Consols without attempting to go to the real root cause."
  It seems to me that the remedy is quite easy, though it may be rather difficult for the Chancellor of the Exchequer to undertake. He is always in the position of a chairman of a company at a shareholders'

  1101
  meeting refusing to grant increased dividends to the shareholders until the debts of the company are paid off. It seems to me the Chancellor of the Exchequer should immediately, and I regret he has not done it in this Budget, increased the sum allotted to the service of the Debt from £24,500,000 to £25,000,000, and ultimately to £28,000,000, as the present Prime Minister did, and I would also say he ought to be extremely careful that all surplus revenue should be applied every year to the Old Sinking Fund. These two suggestions amount to this, that the Chancellor of the Exchequer should give up his financial policy entirely and should revert to the more serviceable policy of his predecessors.
  There is another minor suggestion that I venture respectfully to make to the Government for dealing with this problem, and that is, that they should apply as much as possible of the sum they have for redemption of debt to the Funded Debt as opposed to the Unfunded Debt. I am also aware that as the old Funded Debt is our first line of defence, it is good finance and sound policy that we should pay that debt as soon as possible, but I think the present relative positions of the Funded and Unfunded Debt would justify the Chancellor of the Exchequer in departing somewhat from this rule, at all events for a short time. On the 31st March, 1911, the Unfunded Debt stood at £40,000,000, whereas the Funded Debt stood at £610,000,000. I am only giving the figures up to the 31st March. Of course, we all know that that figure of £40,000,000 is now largely reduced, because the Government have been redeeming "Treasuries" during the last few months, and I think I am right in saying that that figure would be reduced now by about £7,400,000. At all events there is a large discrepancy between £40,000,000 and £610,000,000. Between the years 1905 and 1911 I think £23,000,000 of Funded Debt was paid off, whereas only £25,000,000 of Unfunded Debt has been paid off.
  I have tried to show that the depreciation of Consols is a serious matter, far more serious to us than any other nation in the world. Seeing the unique financial position occupied by the City of London, and seeing that our position as a nation largely depends upon the maintenance of our credit, I have ventured to make one or two suggestions to the Chancellor of the Exchequer as to how that credit and the price of Consols should be maintained. I
  1102
  do not deny my suggestions are obvious, and I do not for a moment claim that they are original, but I am perfectly convinced that it is only by reverting to some such plan as I have outlined and converting our financial policy from one of reckless expenditure and taxation into one of prudent regard for the payment of debt that we shall be able to put our finances in the position of standing any strain put upon them and keeping our British credit up to the unfeigned admiration of the world.
  Mr. PARKER: I would like to say in regard to what the lion. Member opposite has said, that in my opinion the fall in the price of Consols and Government Stock is largely due to the fact that we are spending such an enormous amount of money on things that can bring us in no return at all. Probably the investor who has money to invest is not prepared to put it into our securities when such an extraordinary amount is being spent on those services which can never bring in any adequate return. I listened to the speech of the Chancellor of the Exchequer with somewhat mixed feelings. There were parts of the right hon. Gentleman's statement which were pleasurable, or should be to all of us in this House. The fact that we had got a surplus of £6,500,000 or over, the fact that it was not necessary to increase taxation or impose new taxation, these things in themselves are very satisfactory. There were other points in his statement which were by no means satisfactory. Some of us who sit on these benches think the time has come when some of the existing taxes, which fall so heavily on the class to which I belong, should be removed altogether from our scheme of taxation. We say that the proportion of taxation which the working classes of this country are called upon to pay under the existing scheme of taxation is altogether in excess of the sum they should be called upon to pay, taking into account the small portion of the nation's income which they receive for their labour.
  The Chancellor of the Exchequer told us that this had been a year of large profits, and he went on to suggest that if we took the old idea that the workers come in for half of those profits, they would represent a sum of £40,000,000. I do not suppose he knows how much the workers have got of that particular amount, but putting it by the side of another statement which the right hon. Gentleman made it does not look as if

  1103
  they got a very large proportion of those profits, because he said that out of 400,000 deaths in this country, 7,000 of those who had left estates had left three-fourths of the total wealth of the 400,000. Therefore I submit that, judging by the amount of wealthy estates becoming subject to taxation under the Estate Duty, the proportion which the workers are getting of this increased wealth is by no means what it ought to be. With respect to the new taxes, as the Chancellor of the Exchequer calls his Budget taxes of 1909, I agree with the conclusion of the Opposition, though from a very different point of view. Apart from the Increment Tax, it is true that the Land Taxes have not brought in a very large amount of money. There is no disputing that fact, and the amount is less than some of us anticipated when we walked into the Lobby to support those taxes. We did not expect a large amount from particular taxes levied, as they were bound to be levied, in this particular form.
  We did not regard that as the greatest thing of this Budget, and we do not do so to-day. We believe that the valuation of the land was the greatest thing we obtained out of that Budget, and we believe some Chancellors of the Exchequer, perhaps the present one, may some day have sufficient courage to put a single tax on all land values, to fall equally on all the land of the country, and then he will receive a larger amount than he is receiving to-day. The Increment Tax cannot bring in a large amount of money yet. I think the Chancellor of the Exchequer was a good deal too generous to the Opposition of that day, and he gave away too much, and many of us voted against the right hon. Gentleman's concessions in regard to the Land Taxes. The fact that he allowed an increase of 10 per cent. before any Increment Tax arises is a concession which ought never to have been made. Some of us would go further and say, not only ought we to have 20 per cent. of that increment in the value of land in and about our large towns and cities, but we desire to have the whole 100 per cent., and we are not afraid of saying so, because it belongs to the people, it was created by the people, and to the people it should go. By putting a definite tax on all land, whether agricultural or sporting land, even if the right hon. Gentleman considers it necessary, after imposing that tax, to give back something to relieve agriculture, if he placed the tax equally over
  1104
  all the land he would not need all that elaborate arrangement under the Budget for collecting his tax, and we should see the real value of a system of land taxation. Therefore I look forward to a taxation of land values which will bring us in a good deal more than what we obtain out of the present Budget.
  There are some direct taxes which do not fall upon the working classes, to which. I personally take a considerable objection. You may say, "Well, you voted for the Budget with them in," and that is quite true, but I claim that apart from the taxes on alcoholic liquors, where the object is not only to produce revenue, but where it is imposed in the interests of the health of the people, and the same applies to a certain extent in the case of tobacco; apart from those taxes, I am opposed to all other forms of indirect taxation, and I believe in taxation being levied directly upon the people. The working classes of this country to-day pay more than their fair share of taxation in proportion to the amount of income they receive, and the taxation of the working classes of this, country is three times as much as that imposed upon the rich in proportion to their income. The amount may not appear three times as large, but if you happen to be in the position of being an Income Tax payer you will know what I mean, and I know which position I prefer to occupy. I prefer to be in the position of an Income Tax payer to that of a man earning £1 per week, paying taxes upon sugar and tea and the necessities of life. I know the proportion of my income which is taxed to-day is less than the proportion taxed when I was working as an unskilled labourer before coming into this House.
  Any system of taxation, whether it is the system of the Chancellor of the Exchequer which for revenue purposes imposes taxes on articles of consumption, which are necessaries of life, or whether it be the system of hon. Gentlemen opposite, who wish to tax everything that we eat, drink, and wear, all those systems, from my point of view, are to the disadvantage of the working classes, while a system of direct taxation is certainly to their advantage. Some of us were looking for a reduction in our taxes. I think the Sugar Tax might very well have gone in this particular Budget, because it is a tax not only upon the breakfast table but upon many industries. It is a tax upon an industry which in my own town employs from 1,000 to 1,500 people, and any tax upon what

  1105
  may be regarded as a raw material must be deleterious to industries. For these reasons I should like to have seen the Sugar Tax abolished, because I regard it as a direct tax upon industry. I re-echo the words spoken by the hon. Member for one of the Divisions of Islington with regard to the amount of money provided for the upkeep of the Navy for the forthcoming year. Each day we come into this House we listen to the prayers of the Chaplain at that table, that the blessing of God may rest upon all our efforts each day, and to-day we have asked the blessing of God to rest upon our efforts in building battleships and making provision for the Navy at a cost of some £44,000,000 a year. I confess I cannot reconcile the two things. I cannot understand the worship of the Prince of Peace and the whispering of prayers in His name, and in the very same Session pass a Budget which is to provide £44,000,000, the object of which, if it is ever to be used for the purpose intended, is to blow the souls of our fellow creatures into eternity. [An HON. MEMBER: "To defend our homes."]
  7.0 P.M.
  I think it is entirely wrong to spend such a large sum for this particular purpose, but I do not suppose anything that I shall say is likely to alter the opinion of this House. I know perfectly well the Chancellor of the Exchequer will always be supported from the benches opposite when he is proposing large additions to the Navy, and I also know that every working man, woman and child, who is working in these islands, will have to provide during the coming year something like 30s. for the purpose of providing the necessary money for the Navy. Working men will have to find one week's earnings out of the fifty-two to provide money for the Navy, because that is the only way to provide it, for as John Ruskin said, there are only three ways of providing money, that is working for it, begging it, or stealing it. I submit the workers of this country are called upon to devote one week's wages out of fifty-two towards providing the money for the Navy, in fact it is nearly equal to one week for every living person, and if you take it at 5s. per family it amounts to four weeks' revenue. You may tell me that it is necessary to spend all this money to protect your hearths and homes, but my home needs no defence against the Germans, because no Continental Power is desirous of taking anything I have. It is the vested interests
  1106
  with which I have nothing in common, and with which the class I am connected with have nothing in common, that these great navies are built up to protect. It is because I believe they are wrong I shall vote against such Votes on every occasion I have the opportunity, and when I can vote clearly upon that question and upon that question alone. I am glad it is true to say to-day we have had a prosperous year. I am glad we can look forward to good trade for the coming year, and I trust the capitalists will take note of the last words in the speech of the Chancellor of tie Exchequer. He said the future depends upon whether capital is prepared to share its lot with labour. There are two ways of sharing. You can share £100 by giving another person £2 and keeping £98 for yourself, or you can share by treating labour fairly and freely. Much labour unrest as we have had during the past year, that labour unrest will still go on unless those exploiting labour are prepared to see that labour gets its fair share of the increasing prosperity of the nation. If those responsible for our great industries see that is carried out, the Chancellor of the Exchequer may rest assured that there will be no agitation either on the part of hon. Members who sit below the Gangway or anyone else. If the capitalists treat labour fairly and give it a fair share of the increasing prosperity of the nation, the Chancellor of the Exchequer will realise his hopes, and he may look forward to as happy a year as he has prophesied.
  Mr. S. ROBERTS: The great majority of this House and of the country do not share the sentiments which the hon. Member who has just sat down has expressed with regard to the Navy. We hold that the Navy is simply for defensive purposes and not for aggression. That has been laid down over and over again, and, however much we may regret the expenditure, it is absolutely necessary for our national existence. Of course, the hon. Member is entitled to his own opinion, but I venture to say that opinion is against the opinion of the vast majority of our countrymen. The Chancellor of the Exchequer had a comparatively easy task this afternoon. His Budget, with a prosperous year, has rolled him in money at a great rate, the result being that he has an estimated revenue for the next year of £187,189,000, which is more than the revenue of last year based on the same taxation. I only hope the Estimates of the

  1107
  right hon. Gentleman are not too rosy. He gave us a very rosy picture of what he considered will be the prosperity of the country during the next twelve months, but, owing to this deplorable coal strike, it is impossible for anyone to say what are the prospects of trade during the present year. The nation is held up at the present moment. Every class and every industry are feeling this terrible strike, and we do not know at the present moment whether we are going to get out of it immediately or not. I sincerely hope it may be so, but at the present time the decision seems to be in doubt. Even when the coal trade does get started again it is impossible to tell how long it will be before the other industries are able to recover their former prosperity.
  It is quite evident the Chancellor of the Exchequer had no taxes he could remit with a surplus of only £804,000, taking the estimate of expenditure and revenue for the next twelve months. We do not realise, as one year passes and another comes, the rate at which we are increasing our expenditure in all departments. I make out that our national expenditure during the last five years has increased by £35,000,000, and we do not know where the expenditure is going to cease. The feature of the Budget is no doubt the proposed unusual disposal of the realised surplus of £6,500,000. According to law, that surplus ought to go to the Old Sinking Fund to pay off debt, but unfortunately Chancellors of the Exchequer—I do not say the right hon. Gentleman is the only offender—do raid this fund from, time to time. I say that when the fixed charge has been reduced from £28,000,000 to £24,500,000 it is not the time to raid the Old Sinking Fund. We were told by the right hon. Gentleman he thought it was necessary to keep this fund in hand in a Suspense Account—that is what it comes to—to provide against the contingencies which the First Lord of the Admiralty, in his able speech the other day, feared might arrive. I quite agree that those contingencies, if they do happen —and we all hope they will not—will have to be met, but, in my opinion, the proper way to meet them is by a Supplementary Estimate and not by taking this money into a Suspense Account, to be withdrawn, I take it, at the option of the Chancellor of the Exchequer. I should very much like him, in his reply, to state on what authority he would take that money from the Suspense Account in case
  1108
  he needs it. Would he bring it before this House? He certainly ought not to take it without the leave of the House. We should like an answer from the right hon. Gentleman, saying whether we shall have an opportunity of debating that point should unfortunately the necessity arise.
  I put down item by item the figures, as the right hon. Gentleman went through them, and on the same taxation they amount altogether to an estimated revenue for the next year of about £187,000,000. The items are practically about the same as last year. Some of them are increases and some of them decreases. I am afraid, however, all these items will more or less be affected by the present deplorable strike. The Chancellor of the Exchequer only dealt with the Excise. He said articles, such as tea and tobacco will be affected, but I maintain all these items will more or less be affected, unless the trade of the country should fortunately survive this deplorable blow which it has sustained. The Dead Weight Debt on April 1st last year amounted to £685,000,000, about the same as it was twenty years ago. Notwithstanding that payments have been made, it increased so much owing to the Boer war that the Dead Weight Debt is practically the same as it was twenty years ago, and it is £57,000,000 more than it was at the time of the Boer war. When we have a state of things of that kind, surely it is not the time we ought to take money which should go to the Old Sinking Fund. The New Sinking Fund which was reduced two years ago to £24,500,000 was fixed by Sir Stafford North-cote in 1875 at £28,000,000 a year. The reason he gave at that time was that the, amounts which had been devoted to the payment of debt previous to the year 1860 had never been less than £28,000,000, and he thought that was the least sum which ought to be paid each year. The Committee must remember that the whole of the fixed Charge does not go to the payment of debt. It is only the balance after the interest has been paid. This year, for instance, the amount which the Chancellor of the Exchequer estimates will be repayment of capital is £7,167,000, but the inside Fixed Debt Charge, interest and management, is the large sum of £17,532,000, so that, after all, the amount which we are paying off is very little indeed.
  Mention has been made of Consols. The thing which would bring up the price of

  1109
  Consols more than anything would be to increase the amount purchased every year by way of the Sinking Fund. Nothing would do it more, and, if the Chancellor of the Exchequer could see his way to go a step further, and to say that after a fixed period of years Consols should be repayable at par, the effect on the market would be enormous. I do not know why Consols should be dealt with in a way different from other loans. Local authorities and corporations borrow money, and this House insists on that money being repaid after a certain period of years. Some of those periods are as short as thirty years. The Chancellor of the Exchequer borrows money, and there is no condition as to when it shall be repaid. Consols are simply an annuity going on for an indefinite time. Certainly, if we could have some arrangement by which after a period they could be repaid at par, a very great gain would be effected. I must say one word upon a tax which has not been mentioned this afternoon. I suppose it has not been mentioned, because the Committee has almost given up hope of reduction. I speak of the Income Tax. An Income Tax at 1s. 2d. in the £ in a time of peace, with no apparent prospect of any reduction, is, I maintain, a danger to the State. It is a war rate. It was a rate of 1s. 2d. during the Crimean war in 1854, and during the Boer war in 1902. During the last seventy or eighty years the rate has, on very few occasions, been more than 1s. 2d. It was Is. 4d. in the year 1855, and 1s. 3d. in 1902–3, and it was raised, as the Committee know, by my right hon. Friend the Member for East Worcestershire, when he was Chancellor of the Exchequer, at the time of the Boer war. He regretted doing so. I think he will remember his Budget statement in 1904, when he was raising the Income Tax. He said:—
  "I say for myself that, in my opinion, it is the Income Tax payer who will have first claim to relief, and I hope the sacrifice I am now asking of him will not endure for long."
  It was a tax put on as a temporary war tax, and the right hon. Gentleman gave the pledge, as Chancellor of the Exchequer, that the Income Tax payer should have the first claim to relief when the Treasury was able to give it. But this Income Tax has gone on and on, and now, I am afraid, those who pay it have got into this state of mind that they do not see any prospect of having it cut down. We know what is the opinion of the Prime Minister in regard to Income Tax.
  1110
  When he was Chancellor of the Exchequer he said:—
  "I do not hesitate to associate myself with the declarations of more than one of my predecessors that an Income Tax at a uniform rate of 1s. in the £. in time of peace, is impossible to justify and difficult to defend. It is a burden on trade which, in the long run affects not only profits but wages."
  We all know the opinion of the late Mr. Gladstone, that great financier, who described this tax as—
  "a demoralising and dangerous one, vexatious to trade and industries, but at the same time an engine of gigantic power to be used for national emergency."
  We have two great resources of national reserve. What are they? First, there is the Income Tax, which, in order that it may be a reserve, must be kept at a low rate. If you keep a uniformly high Income Tax you cannot get a reserve income to fall back upon in case you wait it. Therefore you must keep it low. But you must keep your fixed charges for the Sinking Fund high. These are the two great national reserves, and unless you do these two things there will be no reserve. I am glad to see the Chancellor of the Exchequer has returned to his place. I should like to repeat that I listened to his Estimates for the coming year with interest, but with anxiety. I am afraid that he has estimated too rosily. I fear, when this strike is over, it will be found that his Estimates, in view of the terrible national calamity we are suffering under, are too rosy. Of course, it is impossible for the right hon. Gentleman to estimate what the financial result to the country will be of the present deplorable condition of things. We all hope that his prophecies may prove true, and that the trade both of this country and of the world, may be so strong that it will survive the blow dealt it. But if it does not survive the blow the Estimates of the right hon. Gentleman will not be realised, and we may have a Budget of a very different character twelve months hence. But I hope the Chancellor of the Exchequer next year, if he is in office, will be able to bring forward a financial statement equally satisfactory.
  Mr. CHIOZZA MONEY: The hon. Member who has just sat down has exhibited a great deal of alarm with regard to the progress of the Income Tax, and he used an expression, which I have often heard before, that the Income Tax is a reserve which should not be trenched upon in time of peace. As a matter of fact, I should like to ask the hon. Gentleman, if he agrees with the expenditure which the House has decided upon, and which the

  1111
  party with which he is associated has at every point endeavoured to increase, upon whose shoulders he would place the burden of this expenditure?
  Mr. S. ROBERTS: It is not my office to offer suggestions of that kind. That is a matter for the Chancellor of the Exchequer.
  Mr. CHIOZZA MONEY: The hon. Member declares that the Income Tax is too great a burden to place upon certain shoulders. If that be the case, upon whose shoulders is it to be placed? The money must be got from somewhere. It can only be got out of the aggregate income of the country, and if the hon. Gentleman complains that my right hon. Friend has selected certain persons who cannot bear the burden he certainly ought to tell us upon whose shoulders he would place it. Destructive criticism is not of much use in a matter of this kind. For instance, on an unearned increment of £5,000 can it be said that a tax of 1s. 2d. in the £ is too great a burden for the owner of that income to bear? What is true about the finances of every country? You have to get public income out of private income, and you have to get the public income out of the aggregate income of the country. You have to make up your mind in what proportion you can adjust it, with the least amount of inconvenience, amongst the various classes in the country. My right hon. Friend, as I think, has very wisely adjusted the burden so that it falls conveniently upon shoulders able to bear it. But the hon. Member opposite has not told us what methods he would substitute for the methods of the Chancellor of the Exchequer.
  I turn to his remarks upon Consols. We have had a very interesting speech from the hon. Member for Uxbridge (Mr. Mills) upon the same subject. But, while he dealt with some of the causes which have undoubtedly affected the price of Consols, he has not reminded the Committee that there is one very great cause for which his party was certainly responsible, and that is the widening of the scope of Trustee Investments. I have discussed this matter with many people. I have no desire to express dogmatic opinions of my own, but I do suggest to the House that, the period when the change was made was a very unfortunate time, as events proved, for the credit of Consols, and for this reason—the world was then approaching a period in which new countries were going to undergo a
  1112
  very rapid and accelerated degree of development—new countries, fortunately for the British Empire, among the most fertile and the best naturally-found countries in the world. They were approaching a period when they would be desirous of obtaining capital, and it was at that period we threw open Trustee Investments to the stocks of these new countries. At the same time we also threw upon the markets a very large amount of gilt-edged stocks of our own here; therefore it had a double effect upon the price of Consols. It may be said that the amount of the calls upon these stocks by trustees desirous to invest in any year would not be such as to seriously affect the price, but if anybody studies the subject of prices they will know that the effect upon them of an additional call, or of an additional supply to meet a definite call is out of all proportion to the amount of that addition. In the case of Trustee Securities, although it might seem on the face of it that the amount of call was not large enough to produce such an effect, as a matter of fact the effect has been out of all proportion to the amount of call, in the same way as it is with other commodities.
  Mr. MILLS: My point is that the effect in regard to Trustee Investments has worn off by now.
  Mr. CHIOZZA MONEY: No, it is a continuing call. It is an increasing call. This is a very serious subject. I do not want to be dogmatic or to attribute too much to any particular cause. But I do regard this as one of our chief difficulties, and it is for this House to decide whether it should allow this cause to continue. While we have duties to our Colonies we have also duties to ourselves. With regard to the remarks made as to the amount of foreign investments, I must say I do not altogether share the optimistic views of the Prime Minister. I behave both in regard to capital and to men, the head and front of an Empire such as we are, it is our duty to offer to supply a certain surplus to our oversea Dominions. It is good both for them and for ourselves. When we are dealing with emigration of men or of capital I represent to the Committee it is obviously a matter of degree, and I suggest the time has arrived when we ought seriously to consider whether Colonial investments have not reached a point dangerous to the country in this sense. At the present time British North America, Africa, and Australasia each have about £400,000,000 of British

  1113
  capital, and that amount cannot pass for investment in those new countries without taking with it men who might be employed here. If we turn to the emigration figures what do we find? We find that last year the number of emigrants reached 260,000, a total never reached before, and when we turn to the figures of the present year—I may point out that the figures for last year were unprecedented —they are cast into the shade by the latest figures. In February the total was larger than ever before, and it looks as if we were going to emigrate in the course of this year 300,000 of the best of our stock at the time when we are, so to speak, jingling our money in our pockets. I would venture to remind the House and the Chancellor of the Exchequer, that our future depends on present happenings with regard to our population, and if this emigration continues, while our birth rate falls, we shall not get any increment yield out of our Land Duties.
  I would like to remind the Committee what has happened in regard to wages during the last ten years. Here, may I say, that there is no need for a recondite explanation why it is that a fall in the consumption of alcohol occurred until last year, and why it is that in last year the consumption again rose. Not only did the consumption of alcohol rise last year, but there was also a rise in the Savings Bank deposits. The working classes had not only made money to spend upon drink, but they had more money to save, and they saved it. These facts correspond to a very interesting series of facts. What are those facts? They are these: Since 1900, in spite of the increased trade and the increased volume of investments, real wages have fallen. That is to say, that money wages were practically stationary in those ten years. The Board of Trade takes an index number based upon the rates of wages in the building trade, the engineering trade, agriculture, mining, and textiles, and takes the index number of 100 for the year 1900. We find that in 1910, ten years later, it was still 100, and that in the meantime it had fallen as low as 97 and risen as high as 102, so that in those ten years wages were almost stationary. In the same period we find that the retail cost of food in London, according to the consumption of a working-class family, rose by 10 per cent., so that while the cost of food went up 10 per cent. in those ten years money wages were practically
  1114
  stationary. The consequence was that the working classes had less to spend. It is true that in those years the rich were growing richer and the poor poorer. That is a statistical fact which cannot be denied. What were the increased profits in those ten years? In the ten years the gross assessments for Income Tax rose from about £800,000,000 to over £1,000,000,000.
  We need not be surprised if in that period the consumption of alcohol fell off. Last year, fortunately for the country as well as for the working classes, wages took an upward turn. We had a large number of labour troubles, and we had a considerable increase in wages, and consequently we had additions to the Post Office Savings Bank deposits, to the consumption of goods, and, amongst other things, we had an increased consumption of alcohol. Those who are inclined to cast stones at the working classes because there was an increased consumption of alcohol should remember that there was also the largest increase in Post Office deposits since 1897. I think we can find a parallel to that series of facts in the trade Returns. If they are examined we find there was a much larger increase in exports than in imports, and, although imports did increase, they did not increase so much as exports. When we remember that prices were going up, we see that imports were much more stationary than they should have been during that period, pointing really to a stationary character of consumption, which is not very agreeable. A great deal has been said with regard to the method adopted by my right hon. Friend the Chancellor of the Exchequer in dealing with the surplus of the past financial year. It is true that the course is unusual, but so are the circumstances. Indeed, the circumstances are very unusual. It was pointed out by the last speaker that we cannot be quite certain— few of us would like to prophesy—as to the course of trade and revenue in the next year. My right hon. Friend has made certain Estimates. I hope they may be fulfilled, but, at any rate, no one can speak with confidence. We do not know what is to be the end of the present trouble, or what may be the effects upon the trade of the country of dearer coal for two, four, or six months. These circumstances are exceptional.
  My right hon. Friend, in proposing to carry this sum to a sort of special reserve, is doing a thing which could only be

  1115
  regarded as common sense. My right hon. Friend does not propose to play ducks and drakes with the money behind the backs of the House of Commons. I assume if any of that sum is required, whether it be for special circumstances in connection with the labour troubles or whether it be for the Navy, Supplementary Estimates will have to be presented to the House. If my right hon. Friend takes the course I suppose he would take, of coming to the House with Supplementary Estimates, it entirely disproves the arguments used by the last speaker. There is only one other remark with which I desire to trouble the Committee. It is that we have had illustrated during the last two years a theory I ventured to put before the House on a former occasion, namely, that if a country arranges its taxation with due regard to the ability of the citizens to bear taxation, then this will happen, that if that country, as is our country, is a progressive country, the national dividend of which is increasing year by year, then this fairly arranged taxation will yield an increasing revenue from year to year. That is what has happened as the consequence of the Budget of my right hon. Friend. We have seen him meet a deficit, we have seen unusual circumstances arise, and in spite of those unusual circumstances we have seen that the taxation has easily borne the burdens placed upon it. If we could get rid of some of the follies which are still attached to it, I am one of those who confidently believe that an annual Budget discussion will almost become unnecessary. Let me explain what I mean.
  The national dividend, taxed according to the ability to bear it of each citizen, would yield an increasing revenue. It is for the country to decide what amount out of this ought to be spent upon the various services, and the real crux of argument would not then be the method of raising taxation, but would rather be what amount of money Parliament should decide ought to be spent on the various services. We should then get rid of the old wrangles and those unhappy divisions of those interested in tea, or sugar, or other commodities, wondering whether a tax was going to be put on this, or taken off the other. We should no longer have taxes used that would bear especially upon any particular industry, and we should raise our revenue according to the means of each citizen. That we can do by getting rid of Budget discussions as they have
  1116
  been understood in the past. The discussion would then settle upon this: what ought the country to spend upon certain necessaries, what can the country afford, and what ought it to afford, and these might be proper discussions, and might even be fuller than they are now. Having got rid of the question of what is the proper expenditure in relation to the national dividend, if our system of taxation is fair, it is merely a matter of adding a percentage to or deducting a percentage from Estimates already made. It is towards that desirable end that we are certainly moving, and I think every other country will move. Let it be remembered that we-are not the only country that levies a, graduated Income Tax, or that levies Death Duties, or contemplates levying them. In the German States a graduated Income Tax is not only used for national purposes, but for local purposes also, and while the last speaker thought the wealthy people of this country were hardly done by, if he will compare the taxation paid by a merchant in London, added to the local rates, with the taxation paid by a similar merchant in Berlin, added to his local income tax, he will find that it is the merchant in Berlin who has to bear the heavier burden. Not only is his national income tax levied according to his ability to pay but his local income tax is similarly levied.
  As to Death Duties, either Germany will have to make recourse to Death Duties, or she will have to give up those visions she cherishes so confidently. Therefore, those-who think that because our expenditure has increased in late years we shall sink in the scale of nations, have their eyes too much fixed upon their own country. While it is true that public expenditure has increased in this country, it has also increased in other countries. Although I have not in my mind the exact proportions, I am sure it will be found upon examination that these other countries have increased their expenditure at least as-rapidly as we have. We have seen no evidence that they are suffering from it. On the contrary we have seen that the world as a whole, and not only our own country, has never made such progress. That is one of the most remarkable phenomena in modern history. There is every sign of its continuation. That very acceleration of progress has been a concomitant of increased public expenditure. I do not welcome every item in that public expenditure. Everybody deplores expenditure on armaments, but in every country, including our

  1117
  own, the expenditure has not been confined to expenditure on armaments. In every country there has been a great and growing expenditure upon social progress. For instance, in Germany, I believe, it is estimated that in the course of a year or two the expenditure on social insurance will reach something like £60,000,000 a year. I believe that Germany has largely benefited by this expenditure. I do not therefore regret the increase in our public expenditure as something which makes for the degradation of the country. Rather I choose to regard it, and I ask the Committee to regard it, as an investment that will bring back in time to come not merely larger profits, and better wages for labourers, but a nation strengthened in each of its parts.
  Mr. WHELER: I do not propose to follow the hon. Gentleman who has just spoken, but I wish to join in the protest made from this side of the Committee in regard to the way in which the surplus of £6,000,000 has been dealt with by the Chancellor of the Exchequer. I, in common with many, think that if the money had been put into the Old Sinking Fund it would have done a great deal to create that feeling of confidence in financial circles which does not exist to-day. I think we ought to have the support of a part of the Labour party, because I believe that recently, owing to the lamentable strike, they have had to realise a certain amount of their invested funds, and it must have been a disappointment to them to find out that on the funds which they invested years ago, and which produced a higher rate then than they do now, they have had to suffer a substantial loss. I should like to ask the Chancellor of the Exchequer a question. He mentioned in the course of his speech that one-fifth of the valuations were now completed. I should be glad if, when he comes to reply, he will tell us whether he means by that that this one-fifth of the whole valuations are completed in the sense that the Government have sent in their valuations, that they have been agreed to by those to whom they have been sent; or whether he means that provisional valuations have been sent in, and that the matter has not been definitely settled, because in many cases undoubtedly a considerable time will elapse before the provisional valuations are settled, and it seems hardly correct to say that one-fifth of the valuations are complete except in
  1118
  the sense I put forward. I have risen to ask the Chancellor's attention to one special subject in which I have been rather interested, and that is the Excise Duties on home-grown tobacco. A certain section of Members of the House are very anxious to be enabled to grow tobacco in England —coarse sorts of tobacco for purely agricultural purposes—with the object of extracting nicotine, the wash that we get from nicotine being so valuable. I brought the subject to the attention of the right hon. Gentleman (Mr. Hobhouse) and the right hon. Gentleman (Mr. Mck nnon Wood). Neither of those Gentlemen is now Secretary to the Treasury, so I have to come again to the right hon. Gentleman and ask him to reconsider this question. I asked him last December whether the Government chemist would assist those who are trying to produce this denaturent. I mention the matter so that the right hon. Gentleman might ask the Government chemist if he thinks fit to deal with the matter, and to do something in the Finance Bill to give us what we want. It is not a question of any loss of revenue to him, but it is a question which, if it can be arranged, will undoubtedly supply what is largely wanted by many agriculturists—namely, a very high-class scientific wash. The only outstanding difficulty is that the Government chemist has not yet been able to give time to consider the question and to give a reply to those who are working with him at Wye College and elsewhere as to the exact value of the denaturent we propose. Though it may not seem a big question, it is a very vital point that we should be able to have the benefit of home-grown tobacco, and we are only too keen to show the right hon. Gentleman that we only want it for agricultural purposes. If the production of nicotine is a monopoly in the hands of a very few the price will be practically prohibitive for those who want to buy it for the purpose I have indicated, and if he can see his way to enable us to grow it here he will have conferred a great benefit on the agricultural community.
  Mr. AUSTEN CHAMBERLAIN: I ask leave to confirm with the Chancellor of the Exchequer, in your presence, Sir, and subject to your consent, the arrangement which was made with the Prime Minister across the Table earlier in the day. It is of course, customary that we should have a second day for the general discussion, and it is convenient for the Government that

  1119
  we should take that on a separate Resolution. Perhaps the Chancellor of the Exchequer would tell us what Resolutions he wants to take to-night and on what Resolutions he proposes that we should have the second day's general discussion which the Prime Minister promised us, and when the Chancellor of the Exchequer has given us that information perhaps we might hear that it meets with your approval, and, in accordance with the practice for many years, that you would permit the general discussion to be reopened upon another Resolution than the one now before the Committee.
  Mr. LLOYD GEORGE: It is customary to have a general Debate upon the whole of the Budget proposals upon some one Resolution and to range beyond the mere subject matter of the Resolution over the whole proposals of the Budget. I understand there have been some negotiations proceeding as to the Resolutions which are to be taken to-night, and the Resolution to be postponed for the purpose of a general discussion. The suggestion was that the first three Resolutions should be taken, and that the general Debate should be on the fourth Resolution, which is the amendment of the law.
  Mr. AUSTEN CHAMBERLAIN: I think it would be reasonable to ask that we should keep the Old Sinking Fund Resolution as the one for further discussion. I do not think there is ever any discussion on the one for amending the law at large, for the Chancellor always explains that if the Committee objects to that he will withdraw it, and the only result would be to deprive hon. Members of any opportunity of moving Amendments. The Sinking Fund Resolution has a marked importance of its own, and I think the House would like to have it for the general discussion, and would also like to have an opportunity of discussing it on its own merits.
  Mr. LLOYD GEORGE: I think that is very reasonable, and it is desirable that that should be the subject matter of the Debate. I therefore suggest that we should take the first two Resolutions and the last, and that the third should be postponed.
  Mr. AUSTEN CHAMBERLAIN: May we have your consent, Sir, to that arrangement?
  The CHAIRMAN (Mr. Whitley): Yes, certainly.
  Mr. J. WARD: The right hon. Gentleman (Mr. Lough) suggested during the earlier part of the discussion that the Chancellor in his Budget statement had made the claim that the Budget of 1909 was the cause of our present good trade. I did not understand, and I repudiated the suggestion at the time, that the Chancellor had made any claim of that description. I understood his position to be that during the great Budget Debates in 1909 the Opposition were continually declaring that if the Budget ever became law trade would decay and commerce would practically evaporate, and, in the words of Lord Rosebery, that it would really mean the end of everything. I understood that the speech to-day was merely an illustration that none of these prophecies had come true, and, as a matter of fact, that the Budget had not injured trade; and any Budget that really carried out the object of fitting the burden to the back would probably assist trade rather than prevent it from developing. The right hon. Gentleman also criticised the Chancellor for that, when he was in opposition he was always in favour of retrenchment as far as the fighting forces of the country were concerned; and he pointed the finger of reproach at him as if he were himself responsible for the extra expense, amounting, I think, to some £12,000,000 or £13,000,000 a year, that has resulted from circumstances over which I suggest the Chancellor has no control. I can scarcely understand the position of some hon. Members who oppose expenditure on the Navy. I could understand the position of a man who was against war altogether, and who said that, under no circumstances, should men fight, and who voted against every preparation for war. I can understand that as being a logical position, trusting, as he suggests, to the ethics which rule nations for defending one's interests and preventing one having injustice done to him; but that peculiar phase of economy that is represented by the right hon. Gentleman I cannot understand for the life of me.
  8.0 P.M.
  He began by suggesting that the Navy is absolutely necessary. If the Navy is necessary. what is it necessary for? I suppose it is necessary really to defend the country, and it is a moral certainty that if you spend a brass farthing on the Navy that is not absolutely effective for the purpose for which the Navy is

  1121
  intended, namely, to defend the country against any possible attack by its enemies; all you spend on the Navy is so much waste, and is worse than if you had never spent anything at all. Therefore I should certainly like some of my Friends on this side of the House to give me an illustration of what kind of Navy it is that they require. I notice that nearly all these Gentlemen begin by professing to admit that a Navy is necessary, and once that is admitted it seems to me that the whole case is gone. I do not know that if hon. Gentlemen opposite ever come on this side and come forward with great scare programmes, I shall support them, but certainly, if it is anything within reason, such as is suggested now, or even extraordinary expenditure, it would meet with my approval if the state of affairs looked as if it were necessary. Whichever side I am on, it is a moral certainty that I shall always support those who are responsible for the efficiency of this branch of the fighting service. My hon. Friend (Mr. Parker), one of the best Friends I have in the House, said that, so far as he was concerned, he had no interests in this country to protect. I dare say he is as wealthy as I am, and I have the salary which the Chancellor gives me, and I have very little more. I should think that as long as I was a member of a great country like this life was not worth living while there was a prospect of an invader putting his foot on the soil of the country; therefore I cannot understand the position taken up by some hon. Members. I have delivered speeches, I dare say, regarding the Army which seemed to contradict what I am saying now, but that is an entirely different thing altogether. I look upon the Army as more for maintaining order in our own territory, I fear a great Army because I fear that if the Jingoes ever get into power they might use it for the purpose of aggression in other people's territory. But I have no fear of the Navy being used for that purpose at all. It is necessary for an island kingdom like ours, and the criticisms passed upon it to-night are criticisms which I cannot understand. Once you agree to spend 2d. for an old tub for the Navy you have given the whole case away, because it is useless to supply it unless it is useful for the purpose intended. I should like our Friends to tell us what their position is in this matter. They criticise our position, but they never state their own. Therefore, if there are any hon. Members
  1122
  who are going to criticise the provision made for the Navy in the Budget, I hope they will show us what they would put in its place if they were in the position of the Chancellor of the Exchequer.
  There was one point which I could not quite follow in the speeches of the hon. Member for Uxbridge (Mr. Mills) and the hon. Member opposite (Mr. Wheler). The Chancellor of the Exchequer is, I understand, putting aside the surplus. I should have liked to see the surplus used in many ways. For example, we might have commenced the benefits of the Insurance Bill as from 15th July. I think that would have been favourably received by the class to which I belong, although perhaps not by the class to which hon. Members opposite belong. I cannot understand why the hon. Members objected to the surplus being put aside for special contingencies. I do not suppose it will be touched without discussion in this House unless some serious emergency should arise, in which case I dare say the Government would run the risk of using it. I would do so if I were in the Executive if I thought the national interests were involved. I cannot understand why the hon. Members suggest that it should be used for blstering up in some way the finances of the country—to support Consol holders. I much prefer it to be used for purposes which we know definitely rather than for purposes of bond holders or anybody else. I think the Chancellor of the Exchequer has done the right thing in relation to this matter. One cannot see much sunshine ahead in relation to the business for which this money is to be specially devoted. It is possible that instead of the economists having their way, a considerable increase of expenditure will be necessary before we get through this financial year.
  The hon. Member for the Ecclesall Division of Sheffield (Mr. S. Roberts) stated it was deplorable that the Income Tax should stand at the present time at 1s. 2d. in the £. He said that was on a war footing. I do not understand this talk about reserves, and this, that, and the other. I daresay it is all right if one deals with high finance, but if I hand over the surplus to the Chancellor of the Exchequer for Governmental purposes or spend it on a trip to the Continent, it seems to me that so far as the reserves of the nation are concerned, it would not matter in the slightest degree. As a matter of fact if the surplus is devoted to putting finance in a proper condition and the defences of the country on a sound footing, I should think these

  1123
  are the best purposes it could be devoted to. As to the Income Tax, the hon. Member said that we were promised that there should be some relief, if even a reduction to 1s. If I understood the Budget of 1909 aright, earned incomes up to £3,000 had the tax reduced one-fourth, 9d. being charged instead of 1s., so that those with incomes earned in professions by doctors, architects, and others, got a certain amount of relief from the present Government which is so abused for having increased the Income Tax in time of peace. It should never be forgotten that that abatement was allowed. Then as regards the Super-tax which is imposed on incomes of £5,000 and over, if you mean that it should be reduced, let us understand your position. I am not going to shed crocodile tears over gentlemen who are called upon to pay 1s. 8d. in the £ on incomes over £5,000. Those who have means should be called upon to pay in proportion to their means. Considering how much indirect taxation working men pay for the upkeep of the Government of the country, surely people who are wealthy should not grumble at the amount they have to pay, especially in view of the greater advantage they get from the Government and from the stability of the State as compared with working men. I do not think that is the line of argument to proceed upon. As to the Navy, I would ask hon. Gentlemen not to criticise the proposals of the experts who are continuously to the best of their ability putting the defences of the country in a sound condition, unless they admit first of all that defences of any kind are unnecessary. If they are necessary, let them tell us what their views are on the subject. It is easy to criticise or complain of what other people do. The question is—what would you put in the place of what is proposed?
  Mr. BIGLAND: I would like to refer to what the hon. Member for East North-ants (Mr. Chiozza Money) said with regard to wages paid. The Chancellor of the Exchequer in his statement said he estimated the increase in wages was roughly £14,000,000. The hon. Member for Leicester (Mr. Ramsay Macdonald) in a debate earlier in the Session distinctly made the statement that the actual cash paid to all the members of trade unions now registered, showed a decrease as compared with ten years ago of £57,000. The Member for East North-ants rather confirmed that. I wish
  1124
  to point out that there is a considerable divergence of opinion there. It may be that the Chancellor of the Exchequer was right, because over and above the wages paid to the members of trade unions, there is an enormous amount of wages paid to others. In that way, I admit, that up to the present time, or up to the time of the commencement of the strike, there was a great volume of wages paid to unskilled workers. In that way the contradiction of what the hon. Member for Leicester said by what the Chancellor of the Exchequer said to-night, may be more or less apparent. I am rather glad that the subject of the adjourned Debate will be on the question as to how the £6,500,000 surplus should be expended. I am rather pleased it has been deferred for twelve months for this reason. To my mind the weak point of our finance in this country is that we have failed to do what every insurance company, every banker, and every large manufacturer does, and that is, to gradually build up a reserve fund. I would suggest to the Chancellor of the Exchequer that here is an opportunity when we might make a beginning from the national point of view in building up a reserve fund. He has at present £6,500,000 over and above expenditure. When one looks at the financial position of other nations, such as France, the United States and Russia, we see that gradually they have accumulated reserves in gold of enormous amounts. That, from the national point of view, means stability of credit, and it means safety, I had almost said, in times of national emergency. I do not hesitate to say that the fact that there was £300,000,000 in gold in Prance acted as an enormous lever in the prevention of hostilities last summer.
  We as a nation—the largest nation in our commercial relations of any nation in the world—must build up a reserve fund in some form or other. There are several ways nationally that we might think of building up a reserve fund. I would suggest that it is possible we might even make it on a wider basis than a national fund. I would like the idea considered carefully whether it could not be an Empire Reserve Fund—not merely a reserve fund built up out of moneys voted by this Parliament, but out of moneys voted by the Parliaments of all our sister States. Considering the enormous amount of money called for, year after year, for the Navy and the Army, if we could devise some well thought out scheme for starting such a

  1125
  reserve fund in times of peace with such a surplus as we have had this year, it might be possible to go on adding to that reserve fund, and we should be in a much stronger position. Another reason why I am so anxious that some Empire Reserve Fund should be built up is this: As I sat here night after night listening to the Debates on the Estimates for the Army and the Navy I was deeply impressed by the fact that the wages now paid to our soldiers and sailors are utterly inadequate. I did not feel that it was possible for any Member of the House to rise and propose an increase of pay, but I think an increase could possibly be given if we had a reserve fund built up—the capital to remain intact, and the interest on the Fund to be used for additional payments to our soldiers and sailors. I think that is an idea that would appeal to the people not only of this country but in all parts of the Empire. We know that vast fortunes have been made and will be made in this Empire, and that many men have built up these fortunes through the protection and safety under which they conducted their business, and that they will be willing to give during their lifetime, or to bequeath at their death, very considerable sums to an Empire Defence Fund, if such a thing existed, with the knowledge that the interest on that money would be devoted to improving the conditions and pay of the soldiers and sailors of this country who in the past have been the means of defence of this Empire.
  On this ground I am pleased to note that this discussion will be continued to another evening. I do not know that it would be well to make a suggestion as to how that great Empire Defence Fund might be started. It might be well if His Majesty himself would become the President of it, and take it out of the hands of this Parliament to some extent, and invite the Premiers of all our self-governing and sister States to unite with him in suggestions as to how that fund might be formed. First call of all could be made upon the voluntary effort of the citizens of the Empire, and, having once begun in that way, then application could be made through the Premiers of our sister States and through our Chancellor of the Exchequer so as to build up a really immense Empire Defence Fund. I am so sanguine as to believe that inside ten years you would build up a fund of £300,000,000, and with the interest on that we could wipe out the disgraceful reflection on this country caused by the wretchedly small pay of our soldiers and sailors, and it would stand there as a
  1126
  possibility that an Executive might feel the need of in an emergency. It would stand there to establish the credit and stability of every trade in the Empire. If he felt that there was such a reserve fund standing to the credit of the Empire he would have a greater consciousness than ever that he could go forward with whatever enterprises he thought well, and in the end to that extent his position would become stronger than before. I know that a suggestion such as that His Majesty might take part in such an Empire movement is one which perhaps ought to be made with great reticence, but I do not forget that when he came back from one distant portion of the Empire he used these words: "Wake up, England!" and I have felt over and over again that the weakness of the fiscal position of this country is the fact that we have never had from the Chancellor of the Exchequer any suggestion as to building up a permanent reserve fund. I should be only too pleased if some such action could be taken, and when we meet again to discuss the further portion of this Budget, I trust that that idea may be further discussed.
  Sir JOHN JARDINE: During the course of this Debate several matters of considerable interest have presented themselves. It is a very comfortable thing to have a great big surplus like this following the wise fiscal system that has been adopted and as a continuous result of several years thereof. I think that the Chancellor of the Exchequer is to be congratulated on his prophecies and his performance, on his caution and his boldness. In dealing with the surplus, especially a big surplus like this, there is a natural desire on the part of many interests to get some fiscal gain. If I would urge one point which has been several times before the Chancellor of the Exchequer, it is that the recommendations that have been made as regards the calculations of the real incomes of insurance companies should receive careful attention at a time when money is so plentiful in the Exchequer as now. As many hon. Members know quite well what I refer to, I need not labour that point any further. On the question that was mooted as to whether some part of this £6,000,000 should be used to bolster up Consols, I agree with the hon. Member for Stoke, that no part thereof should be so used, because if once we begin to do so, the owners of gilt-edged securities and Colonial bonds of all sorts, especially those bearing 3 per cent. and 3½ per cent., will

  1127
  insist that those securities having gone down through no fault of their own, ought to be brought up by the action of the State. As the hon. Member for Stoke said, this money is being reserved for— the term used was—contingencies. The very word contingencies implies that certain events may or may not occur. All sides of the House will hope that nothing in the European situation will arise to require us to expend that money hastily. As regards the Navy, might I say that the annual expenditure has year by year increased largely. I, for one, would like to economise there. As has often been said, military and naval expenditure is really a question of our foreign policy. We have heard in this House of Lord Haldane's visit to Germany and we hope that that may prove fruitful so that this contingency may not occur. For over a century our relations with France, and during the thirty-three years that I was in the service of the Government of India our relations with Russia, were supposed to be inimical, but other events occurred and changes took place on the part of both countries and in our sentiments to them, and we are now on the most excellent terms with Russia and with France. Both those old bogeys have gone, and therefore by judicious foreign policy we may avoid this contingency that has loomed so seriously before us. With regard to Income Tax I have always been very jealous of keeping such figures on the fiscal paper in time of peace as 1s. 6d. and 1s. 2d.
  We might have difficulty even with an overflowing and increasing commerce if the contingency of war were suddenly to occur. While, however, many unthankful taxpayers have had their Income Tax reduced from 1s. to 9d.—a matter which is not generally acknowledged as it ought to be—still, I think, the other figures are rather high, and are only to be tolerated as a burden on the capital of this country after what has been pointed out by the Chancellor of the Exchequer in his fine speech, namely, that commerce has been going up during the last few years with leaps and bounds. I do not doubt that very much of that prosperity is the result, as the right hon. Gentleman said, of the exportation of British capital to such countries as Canada, the Argentine Republic, the Indian Empire, and the Malay States, where often sums of money have gone in establishing indiarubber plantations; and, as economists from the time
  1128
  of Mill have pointed out, money sent out in that way blesses both the capitalists, who send it, the people who live on the wages, and the people of this country to whom the returns come back to be spent here in the shape of larger income. The development of commerce in this particular direction, how far it affects the flow of capital to those other regions, and the return got from it is evidenced very much by the number and the amount of the securities; and I do not doubt that is one of the reasons for the greatly increasing income of this country, and has enabled the taxpayers to stand what I think is a high form of taxation. While we rejoice at such prosperity all around us, with our system of Free Trade on which it depends —and we must preserve intact from the Opposition that great fortress of our commerce, that essential condition for the comfort of the people, as shown in the cheapness of those very necessities of life which come from those distant countries that I have named—while we rejoice in these things, it would be no doubt unwise of me to make any strong attack on these figures which I deprecate; but in course of time I should be extremely pleased if, with due allowance for the indirect taxpayers of a reduction, especially of the tax upon sugar, which forms one of the materials of so many industries in the United Kingdom, we could reduce the Income Tax for the benefit of the other class. Then, I think, we would have still greater reason to bless the Chancellor of the Exchequer and his new and different fiscal system.
  Colonel WILLIAMS: Of all the Budget speeches to which I have listened for the last few years, I think that-of to-night gives us the least information, while containing a great deal of prophecy. I want to call particular attention to the Chancellor of the Exchequer's mode of dealing with the under-expenditure of last year. It is quite true that it was partly beyond the control of the spending departments, and I believe it is to be dealt with in future years. So far as the Chancellor of the Exchequer provides for that expenditure under the Sinking Fund there is no great objection to it. But he has held back the whole of the Sinking Fund for the year apparently for one purpose, and one purpose only, a perfectly legitimate one, namely, to supply the needs of the Navy which might occur in consequence of the under-expenditure of last year, and also to provide for the possible necessity of the extra expenditure to which reference was made

  1129
  by the First Lord of the Admiralty. But the Chancellor of the Exchequer was not quite distinct enough, not so distinct as some of us would like, in saying that the money is going to be ear-marked for the needs of the Navy. If it were possible for the six and a half millions to be used for other purposes than the Navy it would be extremely bad finance; it would give the Chancellor of the Exchequer the opportunity of setting right mistakes in his estimating, and he can hardly make a greater mistake than he did last year when he said that he had a surplus of six and a half millions. The practice of holding back the Sinking Fund for any need that might occur would help the Chancellor of the Exchequer in bad estimating. I hope the Chancellor of the Exchequer in his reply will be able to make quite clear that the six and a half millions is to be earmarked for the purpose of the Navy, and not to be diverted to other needs which may come up during the year.
  The FINANCIAL SECRETARY to the TREASURY (Mr. Masterman): I rise to answer one or two questions put during the Debate by hon. Gentlemen opposite. I was asked, first of all, as to the Estimate for the Land Tax for the present year. The total is £545,000, divided as follows:— Increment Tax, £30,000; Undeveloped Land Tax, £100,000; Reversion Duty, £125,000; and Mineral Rights Duty, £290,000; making the total I have given. I was asked by the right hon. Member for East Worcestershire (Mr. Austen Chamberlain) as to the division of the aggregate money of the three Post Office services. The aggregate amount is £29,175,000 estimated revenue. Of that, £20,275,000 is to come from the postal and packet services, £3,000,000 from the telegraph, and £5,900,000 from the telephone. I was asked as to the inquiry into the general system of valuation. At present there has been completed, as the Chancellor of the Exchequer stated, something like one-fifth of the whole valuation. My right hon. Friend asked me to say that he adheres to every statement he made last December as to the desirability of some sort of inquiry, and the only question is as to the time and method of the inquiry. He suggests whether it would not be better to leave the matter until rather more appeals have been decided and more valuants fixed, in order to see whether the particular methods advanced by the right hon. Gentleman opposite can be adopted. That is a matter for consideration, and perhaps
  1130
  some further attention may be given to it in the course of the Debate upon the Finance Bill.
  A question was put as to the apparent discrepancy in connection with Excise. My right hon. Friend announced that he had Budgetted for an automatic increase for the first time for many years in beer and spirits, and at the same time he had Budgetted for a decrease in the revenue of about £680,000. These figures are not incompatible as a matter of fact, and I think my explanation will be quite clear. We have for the first time Budgetted for an automatic increase of 1½ per cent. increase in spirits, and 2 per cent. in beer. Against that we have to set off reductions from both sources of estimated revenue because of the coal strike. We consider it a substantial reduction, though the hon. Member for Sheffield thought it insufficient. In the case of Spirit Duty, also, £300,000 is due to excessive stock. A further factor to be considered is in the case of beer. We have to put the consumption of last year as against the consumption of this year, and we have he recognise that last year there was an abnormal consumption owing to the prolonged hot weather which we cannot expect this year. I think that is reckoned at something like £300,000; therefore, although we have allowed for an automatic increase in beer and spirits, we have to make deductions because of the strike, and because of the abnormal hot summer last year, which more than balance the estimated automatic increase, and the result is that the Estimate is less by £680,000. The last point I was asked about was as to the disposal of what the hon. Member for Sheffield called the Suspense Find— that is, the Exchequer Balance to which this six and a half millions will be paid. I can assure him, in the name of my right hon. Friend, that none of that money can be touched without the authority of Parliament or will be touched without the authority of Parliament. I think I have answered all the questions that have been definitely put.
  Mr. WHELER: Can the hon. Gentleman make any reference to the subject of the duty on tobacco?
  Mr. MASTERMAN: I am afraid I cannot give any assurance now, but perhaps the hon. Gentleman would put a question or raise the matter on a subsequent stage.
  Question put, and agreed to.

  INCOME TAX.
  Motion made, and Question proposed, "That Income Tax shall be charged for the year beginning the sixth day of April, nineteen hundred and twelve, at the rate of one shilling and twopence in the pound, and that the same Super-tax be charged for that year as was charged for the year beginning the sixth day of April, nineteen hundred and eleven."—[Mr. Masterman.]
  Mr. POLLOCK: I desire to ask the hon. Gentleman whether he has considered a question which has often been raised in this House, and which has been discussed and favourably considered by a predecessor of the hon. Gentleman in office. The question to which I refer is whether any allowance can be made on the Income Tax charged in respect of wasting assets. I do not wish to detain the House now on this subject as this is not a suitable opportunity, but I am anxious to know if the hon. Gentleman has taken the question into consideration. His penultimate predecessor was disposed to consider this matter favourably. He indicated that he thought we had made out a case in respect of wasting assets which were entirely exhausted by the work which produced the profit on which the income was levied. Take, for instance, the case of nitrate companies which have registered addresses over here, and in which the capital is laid out for the purpose of getting a certain quantity of nitrates, which is easily ascertained, and in respect of which the source from which the profit is made is exhausted in a very few and quite ascertainable number of years. It is not fair to the hon. Gentleman to ask now for any definite reply, but I call his attention to the matter chiefly for the reason that the present Chancellor of the Duchy thought we had made out a case. I am only asking for very limited relief. I am not asking for relief in the case of all wasting assets, as they are commonly called; I am not asking for relief in the case of leases nor of ordinary coal mines; I simply ask for relief in the case of gravel or nitrate beds. The present system prevents the companies being registered here and there has been a good deal of loss in consequence of the system on which we levy the Income Tax on those wasting assets. I enter a protest against the present system in order that it may be more fully discussed when we have the opportunity of discussing the Income Tax or on the occasion when the Bill is introduced,
  1132
  when I will endeavour by means of a new Clause, if it is not in it already, to bring the matter to the attention of the Treasury. In the meantime I ask the Financial Secretary to look into it, and I hope he may give it that favourable consideration which the present Chancellor of the Duchy extended to it. I raise the question not for the purpose of trying to get rid of Income Tax, but for the purpose of saving a source of income to this country which is being driven out of it in connection with these wasting assets.
  Question put, and agreed to.

  AMENDMENT OF LAW.
  Resolved, "That it is expedient to amend the law relating to National Debt, Customs, and Inland Revenue (including Excise)."—[Mr. Masterman.]
  Resolutions to be reported to-morrow; Committee to sit again to-morrow.

  PUBLIC PETITIONS.
  Ordered, "That a Select Committee be appointed, to whom shall be referred all Petitions presented to the House, with the exception of such as relate to Private Bills; and that such Committee do classify and prepare abstracts of the same, in such form and manner as shall appear to them best suited to convey to the House all requisite information respecting their contents, and do report the same from time to time to the House; and that the Reports of the Committee do set forth, in respect of each Petition, the number of signatures which are accompanied by addresses, and which are written on sheets headed in every case by the prayer of the Petition, provided that on every separate sheet after the first the prayer may be reproduced in print or by other mechanical process; that such Committee have power to direct the printing in extenso of such Petitions, or of such parts of Petitions, as shall appear to require it; and that such Committee have power to report their opinion and observations thereupon to the House."
  Ordered, "That the Committee do consist of Mr. Agar-Robartes, Lord Charles Beresford, Sir William Bull, Mr. Burt, Mr. Charles Craig, Mr. Hackett, Mr. R. L. Harmsworth, Mr. Hughes, Mr. Lees Smith, Mr. Lloyd, Mr. Marshall, Sir Reginald Pole-Carew, Mr. Reddy, and Mr. Stanier."
  Ordered, "That Three be the quorum." —[Mr. Gulland.]
  ADJOURNMENT.—Motion made and Question proposed, "That this House do now adjourn."—[Mr. Gulland.]
  Mr. KING: I rather regret this. I have been shut out from my Motion. This is not the first time that this has happened to an unfortunate private Member. I have been shut out once before this Session by the action of the Government, and in a previous Session when I had been fortunate enough to draw first place, I was again shut out. Therefore, the chances of the ballot for the private Members as far as I can see are three draws and no result. I do not intend to let this occasion pass without some sort of protest. The Government might very well have taken two Orders to-day instead of to-morrow, and have let us off for our holiday a little earlier. They might also have suggested that some part of the discussion on the Adjournment which is to occupy so much of our time to-morrow should be taken today. It is too late now to make arrangements for dinner or any other diversion of that kind, so that I do not really see what is the object of this Motion for Adjournment. I appeal to the hon. Member in charge of the Government business whether he cannot withdraw the Motion.
  Mr. GULLAND: I personally regret that the hon. Member has not had an opportunity of moving his Motion. At the same time I would remind the House that a fortnight ago, before the ballot was drawn, the Prime Minister announced that this day would be devoted to the Budget, and gave full warning that whoever was successful in the ballot could not expect his Motion to come on. No one knows better than the hon. Member that that was said, so that he has really no case against the Government for having taken this evening. It was quite impossible to forecast how the Debate would run; therefore the Government found it necessary to take the evening and to suspend the Eleven o'clock Rule. The discussion might have gone on to all hours. It is one of those occasions that it is impossible to forecast, and the hon. Member cannot blame the Government for what is purely an accident.
  Sir W. BYLES: I take it that this is what is technically known as a deal. I do not complain of it on that account, but I assume that deals are only made—
  Mr. GULLAND: I can assure the hon. Member that there is no deal at all.
  Sir W. BYLES: I did not think the Debate could have dried up quite so soon unless there had been a deal of some sort. The first night of the Budget is of such importance that many Members would naturally wish to speak. I do not desire to speak myself, but there are Members on this side with whom I have much in agreement who have some criticisms to offer upon the Chancellor of the Exchequer's proposals, but who have been shut out by the arrangement that the Government have made. I only make that observation. I do not wish in the least to stop the progress of this Motion.
  Mr. AUSTEN CHAMBERLAIN: The hon. Member persists in speaking of what has occurred as an "arrangement." It was not an arrangement between the two Front Benches. As a matter of fact, it took me entirely by surprise, so that I unfortunately missed the speech of the Secretary to the Treasury in which he replied to the questions I had put. The hon. Member regrets this arrangement because it has shut out various friends of his from uttering criticisms upon the Chancellor of the Exchequer. I have the deepest sympathy with him. That little spark of independence will be cherished by us, and we would do nothing to extinguish it. But anxious as the hon. Gentleman's friends were to criticise some of the proposals of the Chancellor of the Exchequer, they were even more anxious to get their dinner. Accordingly, none of them were in the House to continue the Debate, which has died because nobody wished to carry it on. If any Members desired to speak, they have only themselves to blame for the early conclusion of the Debate. It certainly cannot be laid to the charge either of the Government or of this bench. Those who have had occasion to watch Budget first nights know that it is by no means an unprecedented circumstance. It is often convenient for Members to reserve their considered criticisms of the Budget statement until they have had time to read the Chancellor's speech, and think about it. Personally, as one who has had to figure on these occasions immediately after the Chancellor of the Exchequer has spoken, I can only express my envy of those more happily situated Members who can defer their observations until they have had a little time to consider the statement
  Question put, and agreed to.
  Adjourned accordingly, at Eight minutes before Nine o'clock, until to-morrow (Wednesday) at noon.

  Road Board (Grants to County Councils, Ireland).
  Road Board (Grants to County Councils, Ireland).
  Civil Service (First Division Clerks).
  Civil Service (First Division Clerks).
  Development Commissioners (Procedure).
  Development Commissioners (Procedure).
  Land Purchase (Ireland).
  Land Purchase (Ireland).
  Inferior Manures.
  Inferior Manures.
  Cutting down Trees (Ireland).
  Cutting down Trees (Ireland).
  Coal Inspection.
  Coal Inspection.
  Expenses of Witnesses (Ireland).
  Expenses of Witnesses (Ireland).
  Magistrate Removed.
  Magistrate Removed.
  Local Taxation Grants.
  Local Taxation Grants.
  Publicans as Magistrates.
  Publicans as Magistrates.
  Extra Police (Elton).
  Extra Police (Elton).
  Old Age Pensions.
  Old Age Pensions.
  Hendon Parish Church (Grave of Sir T. Stamford Raffles).
  Hendon Parish Church (Grave of Sir T. Stamford Raffles).
  Northern Nigeria (Executions).
  Northern Nigeria (Executions).
  Bursars and Pupil Teachers (England).
  Bursars and Pupil Teachers (England).
  Metropolitan Police Courts (Ushers).
  Metropolitan Police Courts (Ushers).
  Strike of Carmen (Police Duty).
  Strike of Carmen (Police Duty).
  Tithe Rent-Charge (Wales).
  Tithe Rent-Charge (Wales).
  Small Holdings.
  Small Holdings.
  Census of Production.
  Census of Production.
  Births and Deaths (Great Britain).
  Births and Deaths (Great Britain).
  Wandsworth Board of Guardians (Male Officers).
  Wandsworth Board of Guardians (Male Officers).
  Housing Acts.
  Housing Acts.
  Durham Miners' Strike and Provident Funds.
  Durham Miners' Strike and Provident Funds.
  British and Irish Emigration.
  British and Irish Emigration.
  Emigration from Scottish Ports.
  Emigration from Scottish Ports.
  Territorial Force (Post Office Servants).
  Territorial Force (Post Office Servants).
  Telephone Service.
  Telephone Service.
  Scottish and Irish Bank Notes.
  Scottish and Irish Bank Notes.
  Ballydine Cross (County Tipperary Postal Facilities.
  Ballydine Cross (County Tipperary Postal Facilities.
  Shrewsbury Post Office.
  Shrewsbury Post Office.
  Pacific Cable.
  Pacific Cable.
  Rural Auxiliary Postmen, Dundrum, County Tipperary.
  Rural Auxiliary Postmen, Dundrum, County Tipperary.
  Scottish Teachers (Superannuation).
  Scottish Teachers (Superannuation).